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Many landlords aren’t aware of multi-property mortgages, giving brokers the chance to introduce this useful product, says Matt McCullough, head of sales and development at Aldermore
Multi-property mortgages are a smart way for many landlords to cut costs and manage their portfolios more efficiently. But not all buy to let borrowers know about them, and not all lenders offer these innovative products.
This gives brokers the opportunity to introduce a practical mortgage solution that can make a real difference to your clients.
With changes like the Renters’ Rights Bill and energy-efficiency requirements on the horizon, Aldermore’s multi-property mortgage can help landlords reduce their outgoings and leverage their portfolio to fund any necessary improvements.
All of which gives brokers a valuable talking point in client conversations.
A multi-property mortgage allows landlords to combine multiple buy to let properties into a single mortgage account.
Instead of managing separate applications, end dates and payments for each property, everything is consolidated under one mortgage and with Aldermore, landlords can include up to 30 properties on one account.
Affordability is assessed across the whole portfolio, which offers important benefits for landlords, particularly those with lots of properties or who are looking to expand.
Leverage the whole portfolio: instead of judging each property in isolation, affordability is measured across the portfolio. Stronger properties with higher yields or more equity can support weaker ones. This brings two key advantages: landlords can often access more competitive rates based on their combined loan-to-value, and not every property has to meet the minimum interest cover ratio, as long as the overall portfolio works.
Save on mortgage fees: your client pays one product fee rather than up to 30, which can massively reduce their upfront costs. Aldermore’s multi-property mortgage comes with free valuations, free legals on remortgages and just one charge for a personal guarantee and ILA (independent legal advice) on limited company lending (covering up to 30 properties). For returning borrowers who have taken ILA in the last 12 months, we’ll look to waive this fee on new applications moving forward (subject to criteria).
Less admin: one application process and set of packaging requirements, one underwrite and affordability stress test, one mortgage account, direct debit and annual statement not only cuts admin from the off, it makes remortgaging easier with just one review date.
Access to finance: landlords can raise capital against the combined portfolio, helping them fund deposits for new purchases or invest in improvements. Borrowing is available up to a maximum combined loan size of £10m up to a 65% combined loan-to-value ratio (or £5m up to 75% LTV).
Support for limited company transfer: multi-property mortgages are great for moving properties into a limited company structure, as all completion dates can be aligned and fees reduced.
Of course, multi-property mortgages aren’t right for all landlords.
All the property purchases have to complete on the same day, which can be difficult. They also need to be the same transaction type (for example, all remortgages or all purchases), and they can’t be cross-border, some in England and others in Scotland.
It can be a bit more complex to release a property from an account, if the landlord wants to sell up, for example, but it’s possible. We just need to make sure the affordability stacks up on the remaining portfolio, and we have a few options to make this work. But you should explain this to your clients, especially if exiting the market or selling some properties is on the horizon for them.
The process for brokers and landlords is straightforward.
If you have a landlord with more than one buy to let mortgage due to renew around the same time, they could be eligible. Aldermore allows landlords to use multi-property when applying for just two properties or up to a maximum of 30 all in one go.
Your first step is to call us for a chat. We’ll invite you to send us the client’s property schedule so we can see the bigger picture, including when other mortgages are renewing, and work out what we can offer them.
One common scenario is when all mortgages are due to renew around the same time. In this case, the landlord might let some roll onto SVR for a short time until the last deal is ready to renew. This means they can all be refinanced together with no ERCs to pay. In some cases, they might even choose to pay ERCs if moving to a lower rate is cheaper overall.
On purchase business, it’s harder to line up completion dates for this type of mortgage, but it can happen if your client is buying in bulk from another landlord or developer.
Multi-property mortgages are also popular when moving properties into a limited company structure. In these cases, landlords are effectively selling the properties to themselves, so they can make sure all completions happen on the same day.
As always, you’ll need to do the sums for your client, but we’re here to help you work out the best option and tailor the deal to their needs. We’ll also guide you through the process, which requires just one application and a single set of documents and checks.
We will then assess affordability across the whole portfolio, not property by property. Completion happens on the same day with all properties, and of course, there will be just one renewal date in the future.
With profitability under pressure and new rules on the horizon, landlords need smarter ways to manage their portfolios.
Multi-property mortgages can both unlock borrowing power and reduce costs. By positioning them as a portfolio management tool, not just a one-off saving, you can help your landlord clients make a well-informed long-term decision.
Aldermore’s multi-property mortgages give brokers a chance to demonstrate added value, and we’re here to support you at every stage of the process.
Visit our dedicated multi-property mortgages website page to learn more about how these products help landlords or contact your BDM to discuss a case.