Fleet Mortgages will now consider applications where individuals want to transfer their properties into a special purpose vehicle limited company.
It will treat the limited company as if it is purchasing the property and will be considered as long as it:
- Falls within standard criteria
- The existing owners of the property are directors and shareholders of the limited company.
- Solicitors will be obligated to ensure that the lender’s interests are protected appropriately in respect of, but not limited to, any insolvency provisions.
- Solicitors must ensure that stamp duty land tax is paid on the value of the property, as reported by the lender’s valuer.
Fleets’ entire limited company range is available to customers wishing to carry out this type of transaction.
Chief executive Bob Young says: “This move to accept applications from borrowers transferring their properties to limited companies is the latest in a series of criteria changes that we have been making during 2016 and there will be further amendments and updates announced in the coming weeks.
“The impending changes to tax relief on mortgage interest payments for individuals, due to be phased in from next year, mean that more and more landlords are looking at corporate vehicles such as limited companies to both house their existing portfolio and to purchase new properties within.
“Our move in this area will hopefully smooth the financing path for those seeking to transfer existing properties into a company structure. We believe that this combined with our highly competitive products, will prove to be a popular amendment to our criteria.”