Gareth Briggs, Head of UK Residential Mortgages at specialist capital advisory firm Arc & Co., has secured a £1.34m buy-to-let refinance facility for a London property owner who relocated to Dubai.
The process was particularly challenging due to the business being viewed as a Dubai start-up from a lending perspective.
The four-month completion timeline reflected various hurdles, including a significant down-valuation from £2.5m to £2m. Adding to the complexity, a portion of the land was scheduled for sale later in the year, requiring careful structuring of the titles and security. The charge was specifically arranged to cover only the house and existing garden, ensuring a smooth future sale process.
A key challenge was meeting income coverage requirements, as the London property's rental income alone was insufficient. The solution, proposed and navigated by Arc & Co., involved incorporating the borrower's Dubai business income, despite it being in its early stages and currently supported by external investors.
The loan represents a 67% LTV against the property's final valuation of £2m, structured as a 2-year fixed rate at 6.64% over a 20-year term.
Gareth commented:
"This deal required a specialist approach due to its unique circumstances. The chosen lender was the only one comfortable utilising the Dubai business income, despite it being a new venture.
“By carefully structuring the security and navigating the ICR requirements, we've delivered a solution that supports both the client's current needs and future plans for the property."