When is a deposit not a deposit

Had a client approach me last week looking for a BTL mortgage. Nothing odd in that you may think! What the client wanted to do was have title to a property transferred into his name from one of his relatives. Again nothing odd right! When asked about the deposit he said that there was equity in the house and that in essence the equity was the deposit

Oh dear!

Alarm bells started ringing at this point.

What he and many others are unlikely to know is that the field of lenders who will agree a BTL on a concessionary purchase is very slim - possibly 3 that I know of. Not entirely sure of the reasoning behind this but not a lot of lenders will touch this kind of lending.

In the end we could not proceed as the three lenders were looking for the borrower to be earning a minimum of £25K. So please be aware that it may be tricky to start your property empire by transferring old Aunt Ethel's flat into your name!

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