welcome Tristan. I hope they were helpful, even if not a full endorsement that what you want to do is going to work. Better to know now though than later when you have committed yourself eh?
It can be both Jay Jay, depending on which type of bridging loan you use - a Purchase Bridge lends up to 75% of the purchase price but a Market Value Bridge lends up to 75% of the market value. Check out this video where I explain the 5 types of bridging in more detail th-cam.com/video/5j6G3RIbbfI/w-d-xo.html
This is a fantastic video. I am looking to buy a house that has a workshop out the rear of it with its own entrance. The catch I stated I have rented the workshop for 16 and own the business as a sole trader in it. I am looking to buy the house with a btl mortgage and can get the 25% deposit through equity in my house. I have a great friend that has looked after all my finances and mortgages for many years who is trying to get a btl but I assume the workshop is going to be a problem if its there then?
Glad you think so. Correct, as soon as any BTL lenders valuer spots the workshop is on the same title as the house, you will get an automatic decline of your application because it is outside BTL lenders criteria. Your friend should know this and it will waste his, yours and everyone else's time trying. He needs to be approaching commercial lenders, not BTL ones.
@KevinWrightProperty not good at all then as he previously told me that he does not do commercial mortgages. Can you recommend anyone in Northern Ireland that I could talk to about my plans ?
@@AutoFreak10 - thats a shame. We broker commercial mortgages on the mainland but not really in NI, sorry. If you are on Facebook, look for property groups in NI and ask in there
Great video bro! If the home and commercial property are separate, but on the same lot. can they sell the commercial property to my business for a percentage of the total cost of the property? and I buy the home, with a conventional or a VA loan if it’s owner occupied. Just trying to think out of the box over here.
Some of your terminology suggests that you are not from the UK or talking about a UK property? Any answer I give will be solely related to UK property and no other jurisdiction. Mixed use properties are invariably a shop and a flat above, both rented out, not your home. if you mean can the seller split the title and sell the commercial part to your Ltd Co and you buy the flat above on a main residence mortgage. Yes that is possible if you really want to live above a shop? You will most likely need to pay the sellers additional legal costs for splitting the titles.
The answer is yes I do and I have been educating investors on how to be much smarter with property finance since 2013. I run several courses and mentorships, both online and venue based. Probably the best starting point for you would be my Property Finance Masterclass, this is a live stream 1-day event that you can attend without leaving home. I run it on the 1st Saturday of the month, most months, from 10am to 3pm. There is a Masterclass running on Saturday 5th December and you can book your place for £24.91 + vat at this link - www.rycmasterclass.co.uk It would be great to see you there.
Hello Kevin, id like to buy a 3 bedroom apartment that currently has a restaurant on the ground floor, we would live in the apartment and run the downstairs as a bar in free time, whilst still remaining in full time employment elsewhere, is this possible, on commercial mortgages they are asking for business plans but not taking into account us affording the mortgage based on other earnings
possible perhaps Laurence but not easy. Commercial mortgage lenders like to deal with business people, not someone who treats business as a hobby, which from your post, appears to be your approach. Bars have an abnormally high failure rate, so lenders dont like them per se. Asking for a business plan is to be expected, they are business loans, not hobby loans.
Q1. Is there a 'standarized' list of the tenant grades for the diff type of businesses? Q2. If so, do U have a link? Q3. If I buy a MU and it's already tenanted, how is the lease transferred? Q4. Is there Stamp Duty on a transferred lease? TIA
1. there is nothing standardised about any aspect of commercial mortgages because of the endless variations 2. none exist, see above 3. you renew the lease 4. SDLT is paid on purchases, not leases
Hi Kevin, brilliant content here! Thanks in advanced. I have a question in regards how to find a lender for am empty freehold shop if you're just a residential owner with no previous landlord experience.. I am interested into purchasing an empty shop to potentially convert into flats (live in one of them and sell the other two) after applying to class MA in August, so this would be, offering a lease option for the asking price until planning permission has been approved. If it's been denied, then walk away of the deal, if hopefully it's granted, is it possible to apply for: 1) Residential Mortgage and simply live in one of them and sell the other two flats 2) Apply for a BTL lender and let the flats. 3) Use a bridging loan to sell the flats. I'd really appreciate your opinion on this. Thanks!
Thanks for your comments Juan. The only type of lender that will consider your project - buy empty shop, covert to multiple flats - are bridging lenders. If you intend to live in one of the flats that complicates it further, as it is then an FCA Regulated loan and that severely restricts the number of bridgers who you can use because most bridgers choose avoid lending where a main residence is involved. Prior to being granted permission for the bridging loan we will have to prove that you have the ability to get a main res mortgage for the flat you intend to live in sufficient to repay the bridging loan in full, once the other flats sales are taken into consideration. Should you decide to keep the flats and rent them then yes A BTL lender can be found. If you want to drill down further with this, my email address can be found in the About tab
Let me first say that I am not a pensions expert and my comment is based upon many years experience in property finance. You should always verfiy anything I write with someone qualified to advise you on pensions. Broadly speaking, any property that it is possble to live in for a prolonged basis cannot be bought with pension funds. By that definition, being able to live in the flat above a shop/office etc. when both parts are on the same title would invalidate it as being able to be bought through a pension fund.
@KevinWrightProperty thanks for the quick reply. I found a case study after asking the question. It seems appointing a solicitor to create a freehold on the residential flat and then a lease hold on the shop at the point of sale is the way its done. The pension then purchases the lease hold flat and I'd have to buy the freehold/ flat as a standard BTL. The seller then recieves a single payment from the solicitor.
@@looper_force - you have incorrectly interpreted whatever you found. It seems appointing a solicitor to create a freehold on the residential flat and then a lease hold on the shop at the point of sale .....You cannot appoint a solicitor to do this when you don't own the property The pension then purchases the lease hold flat .......you mean the shop, not the flat, surely? I'd have to buy the freehold/ flat as a standard BTL ...... no standard BTL mortgage lender lends on freehold flats. Only specialist lender would lend on this arrangements and you are going to pay a premium rate for that. You would need to work out if all the involved costs is worth the bother, compared to just buying a pure commercial property with none of that hassle.
@@KevinWrightProperty Hi, on your first point; I did wonder myself about the solicitor doing this when I don't own the property, I was assuming both seller and buyer would agree to this and solicitors on both sides would sort the legal stuff.......on your second point, yes my mistake, shop not flat....,.on your third point, I'm not an expert in this field like you so not saying you are incorrect , maybe I am misunderstanding your point, we have 2 freehold flats and have had these for years, gone through several mortgage products/lenders on them and never required any specialised lenders, they are a pair though (ground and first floor) and we do own the freehold to, maybe this makes a difference (we split them ourselves years ago from a single dwelling)......FYI - link to the case study I found www.xpsselfinvestedpensions.com/media/snwfpxdg/sipp-case-study-mixed-use-property.pdf
That is a common thing Will but no mortgage lender is going to give you money to do that. They lend on properties already converted but those still to be converted. To fund the purchase of that type of deal you would need to buy it cash. If you don't have that much case, then you use bridging finance to fund the purchase, and possibly the conversion too. Once converted you can then get a mortgage to repay the bridger, or pull your cash out. Standard BTL lenders wont lend on multiple self contained units on a single title so you would need to use commercial type lenders or split the titles, which could be the more awkward of the two options.
@@MrCae001 as I am based in the UK, I have little knowledge of what terminology is used in the US. My videos are based on what applies in the UK, not countries outside of the UK - but that would explain your unfamiliarity with the term if you are US based. Likewise the US has property terms that are not used in the UK or we use different words to describe the same thing US - real estate/UK - property US - foreclosure/UK - repossession To use but two examples. Although the US term of 'flip' has been adopted in the UK for buying and quickly selling a property on. Thanks for your engagement.
Thanks for the answers on the live stream earlier.
welcome Tristan. I hope they were helpful, even if not a full endorsement that what you want to do is going to work. Better to know now though than later when you have committed yourself eh?
Do bridging loans give you 75% of purchase price or market value? Eg if i get a property 25% under market value will they pay full purchase price?
It can be both Jay Jay, depending on which type of bridging loan you use - a Purchase Bridge lends up to 75% of the purchase price but a Market Value Bridge lends up to 75% of the market value. Check out this video where I explain the 5 types of bridging in more detail
th-cam.com/video/5j6G3RIbbfI/w-d-xo.html
This is a fantastic video. I am looking to buy a house that has a workshop out the rear of it with its own entrance. The catch I stated I have rented the workshop for 16 and own the business as a sole trader in it. I am looking to buy the house with a btl mortgage and can get the 25% deposit through equity in my house. I have a great friend that has looked after all my finances and mortgages for many years who is trying to get a btl but I assume the workshop is going to be a problem if its there then?
Glad you think so. Correct, as soon as any BTL lenders valuer spots the workshop is on the same title as the house, you will get an automatic decline of your application because it is outside BTL lenders criteria. Your friend should know this and it will waste his, yours and everyone else's time trying. He needs to be approaching commercial lenders, not BTL ones.
@KevinWrightProperty not good at all then as he previously told me that he does not do commercial mortgages. Can you recommend anyone in Northern Ireland that I could talk to about my plans ?
@@AutoFreak10 - thats a shame. We broker commercial mortgages on the mainland but not really in NI, sorry. If you are on Facebook, look for property groups in NI and ask in there
Many thank you Kevin.
always welcome Sam
Great video bro! If the home and commercial property are separate, but on the same lot. can they sell the commercial property to my business for a percentage of the total cost of the property? and I buy the home, with a conventional or a VA loan if it’s owner occupied. Just trying to think out of the box over here.
Some of your terminology suggests that you are not from the UK or talking about a UK property? Any answer I give will be solely related to UK property and no other jurisdiction.
Mixed use properties are invariably a shop and a flat above, both rented out, not your home. if you mean can the seller split the title and sell the commercial part to your Ltd Co and you buy the flat above on a main residence mortgage. Yes that is possible if you really want to live above a shop? You will most likely need to pay the sellers additional legal costs for splitting the titles.
Kevin - do you run “classes “ on property finance? I would be really interested if you do
The answer is yes I do and I have been educating investors on how to be much smarter with property finance since 2013. I run several courses and mentorships, both online and venue based.
Probably the best starting point for you would be my Property Finance Masterclass, this is a live stream 1-day event that you can attend without leaving home. I run it on the 1st Saturday of the month, most months, from 10am to 3pm. There is a Masterclass running on Saturday 5th December and you can book your place for £24.91 + vat at this link -
www.rycmasterclass.co.uk
It would be great to see you there.
Hello Kevin, id like to buy a 3 bedroom apartment that currently has a restaurant on the ground floor, we would live in the apartment and run the downstairs as a bar in free time, whilst still remaining in full time employment elsewhere, is this possible, on commercial mortgages they are asking for business plans but not taking into account us affording the mortgage based on other earnings
possible perhaps Laurence but not easy. Commercial mortgage lenders like to deal with business people, not someone who treats business as a hobby, which from your post, appears to be your approach. Bars have an abnormally high failure rate, so lenders dont like them per se. Asking for a business plan is to be expected, they are business loans, not hobby loans.
Q1. Is there a 'standarized' list of the tenant grades for the diff type of businesses?
Q2. If so, do U have a link?
Q3. If I buy a MU and it's already tenanted, how is the lease transferred?
Q4. Is there Stamp Duty on a transferred lease?
TIA
1. there is nothing standardised about any aspect of commercial mortgages because of the endless variations
2. none exist, see above
3. you renew the lease
4. SDLT is paid on purchases, not leases
@@KevinWrightProperty Thanks.
@@ruairigogan6697 welcome
Good tip Kevin
glad you liked it
Hi Kevin, brilliant content here! Thanks in advanced. I have a question in regards how to find a lender for am empty freehold shop if you're just a residential owner with no previous landlord experience.. I am interested into purchasing an empty shop to potentially convert into flats (live in one of them and sell the other two) after applying to class MA in August, so this would be, offering a lease option for the asking price until planning permission has been approved. If it's been denied, then walk away of the deal, if hopefully it's granted, is it possible to apply for: 1) Residential Mortgage and simply live in one of them and sell the other two flats 2) Apply for a BTL lender and let the flats. 3) Use a bridging loan to sell the flats. I'd really appreciate your opinion on this. Thanks!
Thanks for your comments Juan.
The only type of lender that will consider your project - buy empty shop, covert to multiple flats - are bridging lenders. If you intend to live in one of the flats that complicates it further, as it is then an FCA Regulated loan and that severely restricts the number of bridgers who you can use because most bridgers choose avoid lending where a main residence is involved. Prior to being granted permission for the bridging loan we will have to prove that you have the ability to get a main res mortgage for the flat you intend to live in sufficient to repay the bridging loan in full, once the other flats sales are taken into consideration.
Should you decide to keep the flats and rent them then yes A BTL lender can be found. If you want to drill down further with this, my email address can be found in the About tab
@@KevinWrightProperty thanks Kevin. I'll get in touch with you via email :)
@@juanfcgb -great, i will watch out for it
Hi Kevn, do you know if you can you buy a mixed use property through a pension fund or does it need to be purely commercial?
Let me first say that I am not a pensions expert and my comment is based upon many years experience in property finance. You should always verfiy anything I write with someone qualified to advise you on pensions. Broadly speaking, any property that it is possble to live in for a prolonged basis cannot be bought with pension funds. By that definition, being able to live in the flat above a shop/office etc. when both parts are on the same title would invalidate it as being able to be bought through a pension fund.
@KevinWrightProperty thanks for the quick reply. I found a case study after asking the question. It seems appointing a solicitor to create a freehold on the residential flat and then a lease hold on the shop at the point of sale is the way its done. The pension then purchases the lease hold flat and I'd have to buy the freehold/ flat as a standard BTL. The seller then recieves a single payment from the solicitor.
@@looper_force - you have incorrectly interpreted whatever you found.
It seems appointing a solicitor to create a freehold on the residential flat and then a lease hold on the shop at the point of sale
.....You cannot appoint a solicitor to do this when you don't own the property
The pension then purchases the lease hold flat
.......you mean the shop, not the flat, surely?
I'd have to buy the freehold/ flat as a standard BTL
...... no standard BTL mortgage lender lends on freehold flats. Only specialist lender would lend on this arrangements and you are going to pay a premium rate for that.
You would need to work out if all the involved costs is worth the bother, compared to just buying a pure commercial property with none of that hassle.
@@KevinWrightProperty Hi, on your first point; I did wonder myself about the solicitor doing this when I don't own the property, I was assuming both seller and buyer would agree to this and solicitors on both sides would sort the legal stuff.......on your second point, yes my mistake, shop not flat....,.on your third point, I'm not an expert in this field like you so not saying you are incorrect , maybe I am misunderstanding your point, we have 2 freehold flats and have had these for years, gone through several mortgage products/lenders on them and never required any specialised lenders, they are a pair though (ground and first floor) and we do own the freehold to, maybe this makes a difference (we split them ourselves years ago from a single dwelling)......FYI - link to the case study I found www.xpsselfinvestedpensions.com/media/snwfpxdg/sipp-case-study-mixed-use-property.pdf
What about if I want to convert the ground floor office to resi, first floor is already a flat?
That is a common thing Will but no mortgage lender is going to give you money to do that. They lend on properties already converted but those still to be converted. To fund the purchase of that type of deal you would need to buy it cash. If you don't have that much case, then you use bridging finance to fund the purchase, and possibly the conversion too. Once converted you can then get a mortgage to repay the bridger, or pull your cash out. Standard BTL lenders wont lend on multiple self contained units on a single title so you would need to use commercial type lenders or split the titles, which could be the more awkward of the two options.
@@KevinWrightProperty thank you so much! That's really good and clear. I understand now. Much appreciated!
Thanks
welcome Sam
A bite to what lender? I can't figure out what he is saying...
give me the time point in the video you are referring to and I will try to help you understand
@@KevinWrightProperty wow thanks so much for the immediate response. You are comparing them to commercial lenders... what kind of lender is that?
@@MrCae001 no problem - buy to let lender I would guess, without watching the whole video through
@@KevinWrightProperty that it is. However, this term is not used in the US market, I don't think
@@MrCae001 as I am based in the UK, I have little knowledge of what terminology is used in the US. My videos are based on what applies in the UK, not countries outside of the UK - but that would explain your unfamiliarity with the term if you are US based. Likewise the US has property terms that are not used in the UK or we use different words to describe the same thing
US - real estate/UK - property
US - foreclosure/UK - repossession
To use but two examples. Although the US term of 'flip' has been adopted in the UK for buying and quickly selling a property on.
Thanks for your engagement.