At Online Mortgage Advisor, we hear from a lot of property landlords who want to increase their portfolio but still make it profitable for them. I answer a question below from Michael who has credit issues and wants to use a Special Purpose Vehicle (SPV) to purchase a 2nd property. <hr /> <h4>Question</h4> <i><span style="font-weight: 400;">Hi Pete,</span></i> <i><span style="font-weight: 400;">I’ve been a buy-to-let landlord for several years but own just one property. I’m hoping to expand that to two properties in the near future and was considering setting up a </span></i><a href="https://www.onlinemortgageadvisor.co.uk/buy-to-let-mortgages/spv-mortgages/"><i><span style="font-weight: 400;">special purpose vehicle (SPV)</span></i></a><i><span style="font-weight: 400;"> to purchase the second house so I can take advantage of the tax benefits.</span></i> <i><span style="font-weight: 400;">The only problem is that I have bad credit. I have a discharged county court judgement (CCJ) on my credit report and I’m worried that will stop me from qualifying for a SPV mortgage. Is that likely to be the case?</span></i> <i><span style="font-weight: 400;">Many thanks,</span></i> <i><span style="font-weight: 400;">Michael, York</span></i> <h4>Answer</h4> <span style="font-weight: 400;">Hi Michael,</span> <span style="font-weight: 400;">Good to hear from you. I’d be delighted to help you out and I’ve got good news for you: it’s certainly possible to buy an investment property through an SPV if you have bad credit.</span> <span style="font-weight: 400;">You might have heard that SPV mortgages, in general, are more difficult to come by than the regular kind, and while that’s true, they are usually offered by specialist lenders. Broadly speaking, specialist mortgage lenders can be more flexible with complex cases, and that includes customers with bad credit.</span> <span style="font-weight: 400;">The fact that your CCJ has been discharged will certainly work in your favour, as these lenders prefer customers with older credit issues that have been settled. With this in mind, it could well be possible to find a lender that specialises in both SPV agreements and borrowers with historic credit issues, and your chances of acceptance will likely be higher if you’re able to put down extra deposit to offset the risk.</span> <span style="font-weight: 400;">The best way to find a mortgage provider who will lend under these niche circumstances is to apply through an independent mortgage broker who knows the market. They will search the entire market and match you with the lender who has the right expertise and is best positioned to offer favourable rates based on your needs and circumstances.</span> <span style="font-weight: 400;">I hope that helps,</span> <span style="font-weight: 400;">Pete</span> <hr /> You can see other questions I have answered about SPV mortgages below: <ul> <li><a href="https://www.onlinemortgageadvisor.co.uk/buy-to-let-mortgages/spv-mortgages/should-i-use-an-spv-to-expand-my-buy-to-let-portfolio/">SPV to expand a buy-to-let portfolio</a></li> <li><a href="https://www.onlinemortgageadvisor.co.uk/buy-to-let-mortgages/spv-mortgages/can-i-get-an-spv-mortgage-if-im-a-first-time-landlord/">Using a SPV as a first time landlord</a></li> <li><a href="https://www.onlinemortgageadvisor.co.uk/buy-to-let-mortgages/spv-mortgages/can-i-get-a-semi-commercial-mortgage-through-an-spv/">Semi commercial mortgage using an SPV</a></li> </ul>
