Our client, a Hong Kong national, approached us for finance to purchase a UK new-build buy-to-let property. His initial intention was to complete the purchase through a Special Purpose Vehicle (SPV) limited company, a common structure for UK investment property.
Core Challenge
While the mortgage itself appeared straightforward, the proposed SPV structure required a specialist lender due to the client's overseas status. This meant:
Higher interest rates and arrangement fees than mainstream lending
A significantly higher overall cost of borrowing
A structure that had not been assessed against the client's wider circumstances, including tax implications
Purchasing in the client's personal name could offer a more cost-effective route, but this was a tax consideration rather than a mortgage one, and required independent advice before any lender approach could be made.
Our Approach
Rather than proceeding on assumption, we recommended the client seek independent advice from a qualified tax adviser to confirm the most appropriate ownership structure before committing to either route.
Following a detailed review of the client's circumstances, the tax adviser concluded that purchasing in his personal name was the more appropriate structure. This significantly widened the lending options available, moving the case from a narrow pool of specialist SPV lenders to a much broader range of mainstream lenders offering more competitive pricing.
Throughout the transaction, we worked closely with the client's solicitor and tax adviser to keep everyone aligned as the structure was confirmed and the purchase progressed.
The Solution
With the ownership structure confirmed, we secured finance through a mainstream lender at considerably better rates than the original SPV route would have allowed.
Outcome
Borrowing costs reduced by more than £10,000 over the initial mortgage term
Funding structure that genuinely reflected the client's overall circumstances
Purchase completed with confidence that the ownership structure had been independently verified
Key Takeaway
Effective mortgage advice extends beyond finding the lowest headline rate. For overseas investors and complex transactions, the greatest value often comes from understanding the wider picture and coordinating specialist advice, at the right stage, from tax advisers and solicitors alongside the mortgage itself.