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Growing your property portfolio


Is this possible:

  • Buy 5 houses (50-60k price range) on BTL mortgages with 25% deposits, do small refurbs out of own cash with aim to rent them out within 3 months max.
  • In 6 months’ time, refinance to pull some cash out of the deal (most will still have money in them)
  • Use the rental profits + cash from the refinancing to buy more rental properties
  • Repeat, building up a portfolio.

Question is, does this work?  Can I use BTL mortgages for this or do I have to use bridging finance? Can I refinance BTL mortgages in this price range?  Will there be limits to what I will be able to pull out of the re-mortgage bit.  (This is all assuming I take zero out of the company)


Your intention is sound, but your strategy to achieve it is a bit off beam.  I know something about this, because I have been teaching investors how to achieve exactly this outcome, and a lot more, since 2013.  Here is how to refine it to make it more achievable.

  • Using BTL mortgages when you intend to redeem within months doesn’t work, because no mortgage lender knowingly gives you a mortgage when your intent is to redeem it within months. You can only get the initial BTL mortgage by deceiving the lender as to your intent and this is not a smart thing to do. Bridging finance is the correct product to use, they expect you to redeem within months.
  • Pretty much every property training course teaches investors to go for the same type of property - £50-£150k price bracket needing a cosmetic refurb. You will find it difficult to
    1. Buy at a decent price due to too much competition from other investors.
    2. Get a big enough uplift in value to get your cash back out.
  • A better strategy is to focus on properties with a problem i.e. currently unmortgageable, but where you know that you can fix the problem (I teach 16 different type of these - how to find, fix, fund and refinance). No mortgage dependent buyer can look at these, so your competition to buy is cut at a stroke. You can negotiate to buy them cheaper, but your outrageous offer may be initially rejected until the seller gets sufficiently motivated to accept it - you have to play the long game on these.
  • If you are using a limited company to buy, then you need to be aiming for a done up value of at least £75k, this is where most Ltd Co lenders sit as a minimum property value.
  • Some bridging lenders will lend against the asking price, not the purchase price. This is really important to understand if you want to scale in the way you suggest as it means when you buy unmortgeagable properties below the asking price, you don't need to put 25% deposit on each one. You can put, 15%, 10%, even 5% down if you buy it far enough below market value.

If you want to know more - ask me for help.


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