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Refinancing Your Property to Access Cash for Further Investments

Are you looking to further expand your property portfolio but are restricted due to limited excess cash or funds? Well, you may have been aware that you can refinance your primary property mortgage but were you also aware that you can refinance the mortgage on your investment properties. Being able to release cash from your investment property may be necessary for several different reasons but growing your property portfolio is an option many successful investors look to try and achieve over time.

How to Use the Cash?

The value of your investment property may have increased since you purchased or refinanced last, so why not make the equity in your property work for you? As a general guide, you can look to finance up to 75% of the property value.

The outlook of refinancing is that there is truly no limit to what you can use the spare cash for. If you want to use the funds to pay for a wedding, pay off debt or pay for your child’s education these are all possible options of refinancing however when you see the benefits of increasing your property portfolio and the monthly income it’s hard to not want to use these investments as a catalyst to improving your wealth and asset list.

You may decide to use this cash to purchase another investment property which in turn will create more passive rental income each month and add to your personal wealth. A working example is shown below to breakdown the investment opportunity:

Another popular choice clients will refinance their investment opportunity is to free up some spare cash to invest into that property itself in order to increase the monthly rental income that can be achieved. Upgrading your buy to let properties will help to secure a higher rental yield as tenants will be more likely to pay a higher price for a renovated property. Common repair works can include an extension to increase living space or add an additional bedroom subsequently resulting in higher rent and increasing the property value both of which will be beneficial to the investor. General repairs such as roofing, doors, leaks etc will all help to increase your returns on the monthly rent, and these can be paid for using the extra cash from refinancing an investment property.

Where do we start and what is the process?

Firstly, speak to International Property Finance Group. The value of your current property/portfolio is an important starting point as we need to understand the amount of equity you have in your asset pool.

Once we know this, we would also like to know the amount of rental that is achieved on your current properties. Many lenders use the rental achieved to calculate the lending amount.

IPFG consultant will require you to complete a fact find, the more information you give the better the advice regarding the lenders available and who is giving you the best rate.

You can either speak to the consultant over a team’s video call or if email works better for you, then we can gather your information this way. Once received we will research the market (IPFG are directly authorised by the FCA which means that they are not tied to a panel of lenders) and confirm the best products to suit your onward needs.

Once you fully understand all aspects of the new product, the team at IPFG will process the mortgage application to completion – which will include providing documents, instructing a solicitor and maybe checking your tax position with a tax expert. I would also suggest that you check your life cover for future inheritance tax.

The Team at IPFG have a process chart if you need a breakdown but the process usually takes approx. 8 weeks from start to finish. IPFG have over 45 years experience of UK mortgage advice and their ultimate goal is to provide clients with the best advice and recommendations whilst making the financial process as seamless as it possibly can be. 

*IPFG services are licensed to assist you in UK and Germany markets for mortgage services

If you would like more information or advice regarding services at IPFG and equity release, please get in contact.


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