THE QUESTION

I’m looking to refinance a property as soon as possible to release cash tied up.

Similar properties on the same street sell for £95k and I purchased mine at £75k and spent about £5-6k on the refurbishment (painting throughout, new carpets, new kitchen units, new electrical wiring, new toilet and basin).

However, I’ve just heard no one took the requested before photos so I’ve got no photographic proof of what it looked like pre-refurb (and I can’t show off the refurb either!)

Will this present a problem if I try to re-value the property to a higher amount?

THE ANSWER

It helps to understand the mindset of the surveyor who will be visiting your property and that will be very much to value any recently bought property at the purchase price paid, unless given compelling reasons not to.

Such as:

• Planning permission gained
• Structural alterations that increase the footprint i.e. an extension
• A cosmetic internal refurb

The degree...

THE QUESTION

Any tips on getting the highest valuation for a property you want to mortgage?

THE ANSWER

It helps to know that any surveyor's mindset when asked to value a property purchased a few months previously will be to value it at the purchase price paid, unless given compelling reasons not to.

When they arrive at the property they will be focused on the purchase price paid; your success in getting the highest valuation will be determined by how much you are able to shift their focus.  Here is what I teach on my workshop on this subject.

• You need a works schedule, but that in itself is not enough; it needs to be as detailed as you can possibly make it, think of what a Quantity Surveyor would produce. It also needs to be uncosted.
• You need to provide before and during photos.  The surveyor has to be given visual evidence of the scale of the work you have undertaken.
• You have to 'dress' the property. If it is already tenanted it will have that lived in look, but if it...

THE QUESTION
I own outright two properties, which are rented out; both are worth £85K and both yield 9.5%. I've owned them for four months they have been let for two months. I have no proof of income as I've just started doing this full time. Can I get a BTL mortgage for these properties at a competitive rate anywhere, or do I need to wait six months and go through TMW?

THE ANSWER
The wider issue here is that you can buy properties for cash, with all the advantages that brings, but you don’t want to then wait six months plus before you can repeat the process. If mortgage lenders (the ones that give you the best rates) require you to own the properties for six months before you can apply for a mortgage, you are missing out on potentially lucrative deals because your cash is trapped in these properties.

As you have bought two properties worth £85K each you already know that being a cash buyer allows you to close deals fast, to negotiate harder, to buy unmortgageable...

THE QUESTION

What happens if you don't complete on time when buying at auction?

THE ANSWER

When you bid for a property and your bid is accepted you have made a commitment to purchase; to all intents and purposes the property has been sold to you and you will have to pay a 10% deposit at the point of sale.  If you fail to complete by deadline date, the vendors solicitor will give you a Notice to Complete; usually a further 10 days in which to complete the purchase. That is effectively your last warning, your yellow card.

You can be charged a daily rate of interest from the deadline day onwards, so the clock is now ticking and having a direct impact on your bank account!

At the expiry of that notice period the vendor can withdraw from the sale and retain your 10% deposit as you failed to perform. That is your red card.

The vendor retains the right to claim further costs from you, for instance, if they subsequently sell it for a lower price that you contracted to pay.

Most...

When we are JVing, what paperwork/agreements do we need to produce/sign? Others have mentioned being a sophisticated investor or an individual of high net worth. How does that translate into any agreement? Do we simply have to state we are one or the other? And what are the definitions of each?  I think I need the new JV PS 13.3.

PS13/3 is the FCA placing restrictions on the marketing of unregulated investments to members of the public.  Basically it's to control people who they consider unable to be able to work out a good deal from a bad deal

This pretty much covers any investment where the investor stands to gain (or lose) money depending how the investment performs, but is not regulated by the FCA or sold through an FCA regulated financial adviser.

It certainly covers any property deal from selling off plan Caribbean hotel rooms (remember them) to a two-up two-down refurb.

Loans on a specified rate of interest, regardless of whether the project makes or loses money,...

Question

I have 3 ex-council flats in concrete blocks with no mortgage on them. I have tried to get a mortgage but cannot find a lender who will lend on them. I want to use the money locked in the flats to buy more property, can you teach me how bridging finance works and if that would be applicable to these flats?

Answer

Perhaps it might help if I gave you a few simple facts about bridging finance:

• • it is short term finance taken over a matter of months
  • it is used to buy properties at one price then to sell or refinance at a higher value, sometimes referred to as forced appreciation
  • the increase in value over a short time period is usually achieved by either buying below market value, refurbing to create a higher value, or sometimes a combination of both
  • it is asset based lending whereas, by contrast, mortgages are income based lending
  • it is quicker to arrange than mortgages, allowing you to negotiate to buy properties much more quickly, rather like the speed at which a...