Friday, 29 July 2016

Should you buy-to-let through a Limited Company?

We work closely with a number of lenders who specialise in lending to limited companies to purchase buy-to-let (BTL) properties, but as with any investment strategy, there are pros and cons to taking this approach and every case is different.

“The number of buy-to-let (BTL) mortgage applications completed by limited companies in the first half of 2016 rose to 30 per cent of all BTL completions, according to the Limited Company Buy to Let Index; up from 18 per cent in the same period in 2015”
Limited company Buy to Let Index
So what do you need to know?
There are four key financial advantages to using a limited company you can consider:
Firstly, there is a higher tax relief following the announcement that from 2017 to 2020 the amount of BTL relief individual landlords can claim back will be cut by 15 per cent.
Also, following the dividend tax credit, which introduced a new tax-free allowance of £5,000, you can potentially receive tax free dividend income from the property.
For a limited company, there is also zero income tax on the retained profit. You will still have to pay corporation tax, but this is lower, giving you better cash flow to grow a portfolio.
Lastly, if you need a cash advance, you have the option to release funds from the company using a director’s loan when acting as a limited company.
To add to this, the announcement from the Government following Brexit, that it plans to lower corporation tax to 15 per cent, may also sway residential property investors to go down the corporate route.
On the flip side, there are costs associated with being a limited company that you need to consider before deciding which is the best option for you.
The general costs of running a limited company can creep up to more than you think, so these need to be forecasted. These include filing accounts at Companies House, corporate taxes, and accountancy and auditing fees.
Furthermore, borrowing through a limited company means missing out on the Capital Gains Tax (CGT) allowance when you come to sell, and with the allowance currently at over £11,000, it’s an important factor to consider.
Bristol & Exeter Mortgages Online cannot offer you specific advice regarding your individual tax arrangements. We always recommend that you take professional advice from a qualified accountant. * However, once you know the best option for you to take we will find the best, most competitive and appropriate Buy to Let mortgage to meet your specific needs.
For further information about Buy to Let please visit our BTL page.
Please contact us on 0117 325 1511 or  to arrange a free consultation with one of our experienced, expert Mortgage Advisers.
* We have a number of expert accountants that we can recommend if you do not have your own.
The Financial Conduct Authority does not regulate some aspects of buy to let mortgages.
Your property may be repossessed if you do not keep up repayments on your mortgage

Monday, 25 July 2016

5- star Google Reviews

Back in March we asked our clients if they would be kind enough to give us a review on Google.  We are absolutely delighted to say that we now have 51 5-star reviews!
On our new websites you can see all of our reviews, just click here

Thank you to everyone so far here is our latest one.

My wife and I found our dream home and went to Paul for help and guidance in purchasing the right deal for us, this was provided with abundance and with true professionalism.
We are very satisfied with Paul and the team and would recommend his/their services to anyone who wants an easy ride to getting their mortgage approved and ready to proceed.

Well done Paul and many thanks for all the hard work and effort you put in to ensure that our experience was incident and stress fee.
Neil & Clare

Friday, 22 July 2016

Why do I need an Agreement in Principle?
Few lenders offer actual mortgages if you've no property in place - they offer a “Mortgage in Principle” (MIP) or an “Agreement in Principle” (AIP). This provisionally lets you know how much you can borrow, subject to finding a suitable property in a specified time.

An Agreement or Mortgage in Principle is an important step in applying for a mortgage. It gives an indication of whether a lender could lend you the amount you need to borrow. Lenders use a soft credit check to do this, which has no impact on your credit file. The process is relatively speedy and requires some personal information, including details of your income and financial commitments, this information is used in the strictest confidence.

Getting an Agreement/Mortgage in Principle does not mean you are committing to apply to that lender for a mortgage. However, once you have one, you'll be ready to discuss all the options we can offer.

Let us arrange for an Agreement in Principle for You. We do not charge for this service.

For more information about specific types of mortgages click on the appropriate link