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Stuart Phillips

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  1. Like
    Stuart Phillips reacted to ArjunB in Commercial property investment   
    Hi all,

    With the rise of licensing & building requirements, tenancy checks & deposit regulations, commercial property investment looks ever more appealing. Commercial property investment and ownership is seen far more like a business, rather than being a ‘greedy landlord’. 
     
    It’s fairly well-known that UK commercial property doesn’t appreciate in the same way that residential property does & that mortgage rates are far higher, with lending having stricter covenants too. Does anyone have any resources to think about this more? Any recommendations on where to find good deals for <=£500k or any other tips from seasoned commercial investors?
     
    Would like to delve into this a bit further. 
     
    Thanks!
    Arj
  2. Like
    Stuart Phillips got a reaction from michael_bm in Monzo or Starling business bank account for property business?   
    I've heard a few people say they needed a DIP in order to get a Starling account.
    Perhaps just get a broker to forward something, it might be enoughto satisfy them. Alternatively find a decent client facing lender and do a DIP online. NatWest should be easy to do.
    I'd rate Starling much higher than Monzo. Starling is run by someone who used to be pretty senior in the BoE, and is doing pretty well. Monzo seem to be struggling to make a profit and id be cautious about their long term future. I use Starling for my business acccounts and Monzo for personal though. Monzo wouldnt give me a business account because its financial services, so i dont know what their application process is like.
  3. Haha
    Stuart Phillips reacted to EvolutionBlogger in Ltd companies and anonymity   
    If you have a limited company, there are filings that are uploaded to the HMRC website. If someone is willing to spend the time, then they will learn some information about your business. 

    Have you considered buying property via your pension? It's possible to buy property inside a SSAS pension, I wrote an article about it here. As your pension is a trust, there's no disclosures on the HMRC website. 

     
  4. Like
    Stuart Phillips got a reaction from tuk in Ltd companies and anonymity   
    No idea. But I can tell you none of the figures for Aalto Mortgages ltd are true.
    I've no debts, cash is about right, and as a services business, I've no assets to speak of save a couple of laptops.
    I think it's a scam frankly.
  5. Like
    Stuart Phillips got a reaction from tuk in Ltd companies and anonymity   
    Unless you are a large limited company you dont publish anything that would confirm your net worth, however you will show which lenders have a charge over the company. Even then there are no figures published.
    You can use a virtual company, or as @EvolutionBlogger says, use your accountants address. Both are perfectly acceptable.
  6. Like
    Stuart Phillips got a reaction from jonscott in BTL Mortgage rates tracker   
    Theres a lot of talk at the moment about rate rises, which seem fairly inevitable in the longer term. Many of my clients are wondering when the right time to push the button on refinancing would be, if 2 year deals are unwise at the moment, and generally want to understand whats happening in the market. I thought it might be a good time to actually start tracking these on a consistent basis, and giving people the opportunity to follow this information themselves. Feel free to follow this post for weekly updates.
    It seems like a relatively straightforward thing to do, but there are so many deals out there, so many ways to break these deals up (2/5 yrs, fixed/variable, personal/company, etc) and so many ways to actually measure rates, that in order to make it sustainable i have had to make some concessions.
    What i decided is that i will show a weekly summary of the lenders lowest rate available and the average of all their rates at 75% LTV,  but across all initial terms and mortgage types. Ive assumed a property value of £150k. For each of these you will be able to see the change on previous week and the change since the start on the 1st November
    You will be able to access the link below, which i will update each week, which allows you to filter specific lenders, select company, personal or both and filter for different initial periods. The online version is read only. Let me know if this is helpful, or if you have an suggestions, i will do as much as my limited Excel knowledge allows!
    BTL Rates Master.xlsm
  7. Like
    Stuart Phillips reacted to dove in GetGround experiences   
    I am not sure but think there could be a real issue with the one property one company approach for investors that are looking to expand their portfolios.
    For a company to make sense, it is likely that the investor is planning to roll up profits for reinvestment, otherwise the investor will most likely get taxed twice (corporation tax and dividends), undermining any case for incorporation.  But here, the investor will need to extract profits if they are looking to expand and buy more properties.  Thus once they have exhausted their dividend allowances, they will then get taxed at their marginal rate.
    I would suggest careful financial modelling or appropriate advice prior to going down this route.
     
     
  8. Like
    Stuart Phillips got a reaction from Chris_M in BTL Properties...   
    I get the same on broker forums and conferences. Theres always someone who does 100 mortgage a month (and still finds time to post online or attend conferences!) or charge £3000 broker fees without pushback because they "know how to present the value of the proposition" or othersuch LinkedIn nonsense.
    The answer? Ignore it all. People are in business for different reasons, prepared to risk or sacrifice different things and mostly they are simply lying, to put it politely. People doing well dont generally need to tell people about it...
    I have clients who make as much from 3 London properties than some with a dozen townhouses in the North East, the former seem far more relaxed! Many dont have the cash to buy in London so you just have to work with what you have. To me success is the value you add rather than what you end up with, and no, the irony of that Linkedin nonesense statement isnt lost on me!
  9. Like
    Stuart Phillips got a reaction from janny42 in BTL Properties...   
    I get the same on broker forums and conferences. Theres always someone who does 100 mortgage a month (and still finds time to post online or attend conferences!) or charge £3000 broker fees without pushback because they "know how to present the value of the proposition" or othersuch LinkedIn nonsense.
    The answer? Ignore it all. People are in business for different reasons, prepared to risk or sacrifice different things and mostly they are simply lying, to put it politely. People doing well dont generally need to tell people about it...
    I have clients who make as much from 3 London properties than some with a dozen townhouses in the North East, the former seem far more relaxed! Many dont have the cash to buy in London so you just have to work with what you have. To me success is the value you add rather than what you end up with, and no, the irony of that Linkedin nonesense statement isnt lost on me!
  10. Like
    Stuart Phillips got a reaction from Giles S in How to become a mortgage advisor.   
    I think anyone taking on a trainee is going to build in some protection for themselves anyway and it would really depend on the offers available.
    I started with a large estate agent, now the largest since the two merged, and they are very corporate, very sales driven and was expected to play some nasty games to win business, which is why i left quickly. Some of the robo advisors like Habito, Mojo, Lodon and Country might be a good bet because their tech is excellent and you'll need that to make it managable and they have deep pockets and are hiring aggresively. Maybe then look at a smaller broker on a self emplyed basis where you share the commissions and see if it makes sense to go alone. Personally i love running my own businesses, but its not for everyone, theres little security.
    I think the bigger consideration is how you would build a business down the road. Advertising and lead generation is extremely expensive, theres simply no way i'd make a solid profit if i were buying in all my leads or paying thousands a month for CPC ads. Organic marketing is crutial (answering questions in forums! cough cough) but takes a long time to build. I think if i were to start again i'd allow about 2 years of consistent marketing activity on social media, forums, websites, youtube/tiktok whatever and blogs to get to the point where i was bringing in the 30 - 40 new leads a month i'd need. I'd need a big pot of money to cover those costs, my admin and my marketing support (as thats a full ime job)
    From there you have renewals and referalls where your conversion rate becomes far better. Brand new clients i convert at 3:1 on average, referals and repeat business is close to 1:1 and so in terms of time and efficiency thats where its at. Its taken me 10 years to get to the point where new business essentially manages itself.
    Add to this the fact that mortgage brokers are going to be a thing of the past. Technology is such that its only a matter of time before AI based systems can deliver better outcomes for clients than brokers can, and the technology that joins the dots is nearly there to make the actual admin a thing of the past. I believe that niche brokers will remain, but a large part of the vanilla market will dissapear to purely online systems much like car insurance for instance.
    If you want to go DA i'd look at SimplyBiz for their support in getting the application through the FCA, thats a hell of a process, costs £3-4k to apply and then takes 6-12 months to get authorisation. The costs of a DA are pretty high too. There are some good networks out there, but thats a whole other thread i think and Cherry is the place for that.
    Good luck! Its a thankless job.
     
  11. Like
    Stuart Phillips got a reaction from Giles S in How to become a mortgage advisor.   
    Try cherry forums. There's usually DA firms hiring who would consider you if you're done the job before.
    I only worked for an estate agent for a few years before I went self employed, and then a few years later went DA. I also only work 9-5 with the odd exception. The vast majority of clients can spare half an hour during the day to discuss their mortgage and technology does a lot of the heavy lifting these days. The days of driving to clients and sitting in their house for a few hours is long gone.
  12. Like
    Stuart Phillips got a reaction from Jeremy C in BTL Mortgage rates tracker   
    New charts are very telling:


     
    Expect average rates to keep trending upwards. If you are sat on a variable rate, either residential or BTL now would be the time to secure a low 5 year fixed rate as the rates we have seen will not be coming back...
    Also interesting to see the lowest 5 year fixed personal rates exceeding the lowest rate 2 year company rates. Keeping LTV's under 60% makes a real difference to financing costs.
  13. Like
    Stuart Phillips reacted to MarkyUK in Broker fee after lender withdrew offer.   
    What’s there to debate? I’ve since been informed that some brokers are paid on completion. It comes down to the initial terms of deal I suppose…. I wouldn’t have felt comfortable not paying anyway, I was more interested in what the norm is.
    Anyway to cut to the chase I did pay and he very kindly agreed to do the next find at no cost.
     
     
  14. Like
    Stuart Phillips got a reaction from horne-properties in Is this a good time to build a portfolio   
    Its not because the brokers cant be doing with the hassle, in fact the opposite, it would be a huge opportunity because of the volume of mortgages processed and probably some good kick back on any lawyer referal. The issue is that the HMRC challenged this loophole, and whilst they lost in the case of Ramsey, their situation was different to most investors. The catch is:
    HMRC has historically challenged whether incorporation relief applies to rental business transfers. However, a 2013 case (Ramsay v HMRC [2013] UKUT 226), which HMRC lost, has helped to establish tests which, according to HMRC, a landlord would need to pass so that incorporation relief could be claimed:
    The management of the properties must amount to a ‘business’. This is considered to mean that the owners must typically spend at least 20 hours per week actively managing the property portfolio and, usually, have no other occupation or significant income. The property business should be run to make a profit with normal commercial practices in place, for example a tenant management system and business bank account. Claiming incorporation relief is only possible when the entire business (portfolio of properties) is incorporated. It isn’t possible to transfer individual properties to a company and claim incorporation relief.
    So, selling (Its a transaction between seperate entities) a property to a limited company only avoids CGT if its your primary job and you can demonstrate that you put 20 hrs a week into it. How are you going to prove that? If you have a job, it wont work, if you use an agency to manage a property, it wont work, the list goes on. I have explored this for dozens of clients, with dozens of accountants and lawyers all confirming the same. Unless your entire business is managing your portfolio effectively full time and you can demonstrate it, this will be an expensive, slow process with little guarantee of success.
    Thats why brokers dont recommend it.
  15. Like
    Stuart Phillips got a reaction from MAXTUC in 4 Bed student property - HMO mortgage or BTL?   
    This is always a complex question because as far as any local authority is concerned this is a HMO. However, as you say, student usually sign a 11-12 month agreement and do so all on one agreement. If one student leaves the rest carry the can or find a replacement. This is very different to having 6 bedrooms occupied by strangers on licenses.
    Therefore many lenders allow up to 4/5 students on one AST to be considered on their standard products and policy and dont class these as HMO mortgages. For example:
    Coventry - Properties subject to an Additional HMO licence are acceptable subject to a maximum of four tenants on one relevant tenancy agreement. TMW - The Mortgage Works consider the following types of property as a HMO: A property occupied by five or more people A property with five to seven lettable rooms in an area commensurate with multi letting BM Solutions - The maximum number of occupants is 5. They must all be party to the agreement. It is the landlords responsibility to ensure that all legislation is complied with including (but not restricted to) legislation relating to Tenancy Deposit schemes and HMOs (Houses in Multiple Occupation). Properties subject to Local Authority Homes in Multiple Occupation (HMO) licensing may be acceptable, subject to the valuer’s assessment of suitability based on our requirements. Where it gets more complex is where there are things like locks on doors or anything that alludes to this being operated like a standard HMO. Fire doors and blankets etc are fine, but locks, sinks in bathrooms, mail pigeon holes etc may cause the valuer to class this as a HMO and not as a student let, so be mindful. Each lender is a bit different on this so its worth checking with them exactly where they draw that line.
  16. Like
    Stuart Phillips got a reaction from kirsty_c in What’s a reasonable bridging loan rate at the moment?   
    @Simon Allen at Searchlight, @kirsty_c at Real Finance both know their stuff and you are welcome to drop me a PM of course.
  17. Like
    Stuart Phillips got a reaction from ld2x07 in What’s a reasonable bridging loan rate at the moment?   
    @Simon Allen at Searchlight, @kirsty_c at Real Finance both know their stuff and you are welcome to drop me a PM of course.
  18. Like
    Stuart Phillips got a reaction from ld2x07 in What’s a reasonable bridging loan rate at the moment?   
    Bridging is the wild west, its not nearly as reliable a market as BTL mortgages. You'll find rates move upwards as they discover more about the deal, or that the cheapest rates are with lenders that process these things as slow as they would a limited company mortgage.
    That said, those rates and costs dont seem bad for a light refurb bridge. Their broker fee of £2k is very steep. Dont forget they get paid about 0.8% - 1% of the loan in commission anyway, and get another commission (and broker fee) when they flip you to a new mortgage deal.
    Bear in mind also you will need to bridge for at least 6 months if you want to leverage the new value of £120k with a new lender.
    For clients who havent used bridging before i often recommend a light refurb mortgage, where the lender does both the bridge and the final mortgage essentially as one with the following pro's and cons:
    Pro:
    No second application, You get before and after val based on the schedule of works before you commit You can move to the mortgage within the 6 months based on the market/improved value Cons:
    The bridge wont be quick The final mortgage wont be as competitive as you might get elsewhere They might be more conservative on final values than a seperate remortgage  
  19. Like
    Stuart Phillips got a reaction from liz_la in Commercial property - what's the catch?   
    Assuming you need finance, that's the catch.
    It's expensive, slow and lenders are very picky about the business and you likely need a 40% deposit. Those costs will affect your net yeild and make normal BTL seen more appealing!
  20. Like
    Stuart Phillips got a reaction from liz_la in First-time Buyer…help!   
    Thats a very small mortgage and so even with three adults on one income it should still be feasable.
    You just need to speak to a broker and work through the numbers.
    The basic process is to get on a call and present all the info, they run some checks and make a recommendaion and then will apply for the mortgage on your behalf. That usually menas presenting payslips and bank statements, doing a valuation on the property and then they produce an offer letter, which a solicitor uses to draw down the funds and complete the sale for you. You'll also need to instruct a solicitor at the beginning.
    A few things to note. Firstly brokers get paid based on the loan size and im afraid that at £25k that means they earn about £100 on this mortgage plus broker fee. Dont be surprised if a few dont respond on this because, being very honest, i wouldnt trade all the work and compliance that goes into this (the work and risk is the same regardless of the size of the loan) for £100 + £299 broker fee, unless it was already a client of mine. I just wouldnt make anything from it after i pay out all the costs involved!
    Secondly, if you are buying from your landlord, there are a couple of lenders who will allow any discount they pass onto you to be used towards the deposit. So for example if its market value miht be £215k, but they are happy to sell to you at £200k then that £15 straight away goes towards the deposit. Unfortunately the minimum loan with most lenders is £25k!
  21. Like
    Stuart Phillips got a reaction from stepet in Interest rate, and interest only mortgages??.   
    You wont be able to find this information, they are apples and pears.
    Lenders produce rates depending on risks and appetite etc, but within that you can choose interest only or repayment. You might be able to draw some information from the number of interest only loans available as i believe the Bank of England produces that data monthly, but you wont be able to see what rates people take on IO vs Repayment and i dont think there would be anything meaningful there. Lenders certainly dont offer different rates based on that choice.
  22. Haha
    Stuart Phillips got a reaction from kirsty_c in Fee Free Mortgage Brokers   
    Obviously im the best mortgage broker in the land
  23. Like
    Stuart Phillips got a reaction from willv in Commercial property - what's the catch?   
    @kirsty_c at Real Finance is worth speaking to on that front.
  24. Like
    Stuart Phillips got a reaction from MAXTUC in Down valuation on personal home remortgage..   
    Crack on.
    The lender estimate is just that, an estimate. You'll only know the try value when someone agrees to buy it from you.
    It's not recorded anywhere outside the lender, it won't be on land registry, so any future buyer will never see this figure.
  25. Like
    Stuart Phillips got a reaction from stepet in INTEREST RATES arrrrgh!   
    Don't forget that mortgage fixed rates are not tied to the Bank of England base rate. It's complex economics, but also factors supply and demand as much as the actual costs of lending.
    Lenders will resist rate rises as much as they can, and there's a dearth of housing stock currently, so competition will remain high for some time.
    I'm tracking BTL rates in another thread, so that should give you some insight. I'd risk a potential cost, over locking in a definite cost now. I think rises will come, but not as soon as you fear.
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