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Multi-Unit Blocks of Flats – Lender’s Different Criteria

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Multi-Unit Blocks of Flats – Lender’s different Criteria

A Muti-unit block of flats (MUBF ) is 2 or more flats on 1 freehold title. We have arranged mortgages for MUBFs from 2 to 20 units all on 1 freehold title and in theory there is no maximum as to how many units you can have on the freehold title.

The keys points are
  • Each unit is self contained with it’s own access and utility connections (Heating, Water)
  • There are no shared facilities – Each unit has it’s own kitchen and bathroom
  • There is one freehold title and the flats do not have their own leasehold created.

MUBF can be very popular with landlords and investors because from a management perspective they save time and cost ,managing multiple units all in one place rather than miles apart.

The traditional BTL lenders do not lend on these properties because their underwriters are not trained to understand them and their valuers do not have the experience or professional indemnity insurance to value them.

The good news is that the huge range of specialist and commercial lenders that we have on our panel at Advocate Finance can provide mortgages on these MUBF properties, obtaining high loan to values at competitive interest rates.

Seek specialist advice

Your typical mortgage adviser may finance a MUBF once in  a blue moon so they don’t understand how to assess the property, which questions to ask, and how to correctly match the landlord/investor’s requirements with the best solution in the market.

How we can help you

MUBFs are complex properties and we have arranged mortgages and loans on hundreds on them over the years. We understand the different lenders criteria. Not that you need to understand it ,as we can explain this fully on an enquiry to us, but below are a few of the factors that we need to consider to match the best solution for you.

  • Minimum size of each unit
  • Average value of each unit – Some lenders have a minimum average value even though the unit is being financed as a whole block
  • Investment values and break up values for the block
  • Location and overall purchase price
  • MUBFs that may have some leaseholds created but are the majority freehold
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