Are limited company mortgages 'just for the rich and famous'?

Skipton International looks to spread the word on an increasingly popular product with many potential benefits

Are limited company mortgages 'just for the rich and famous'?

This article was created in partnership with Skipton International

With mortgage rates falling, as lenders become more confident and more competitive in a calmer market, Skipton International is seizing the opportunity to showcase one of its more niche products.

Founded in 2009, the award-winning bank provides a range of attractive Sterling and US Dollar savings products for private and corporate savers, is a leading mortgage lender in Guernsey and Jersey, and also offers mortgages on UK buy-to-let property for expats and residents overseas. But heading into 2024, it’s aiming to raise the profile of its limited company mortgage, also known as a special purpose vehicle mortgage, that allows borrowers to purchase a buy-to-let property through a limited company, set up for the sole purpose of property investment.

“It’s a new way of looking at holding your UK mortgage in a way clients may never have thought about doing before,” said Lorraine McLean (pictured), mortgage sales manager at Skipton International.

The product was soft-launched about 18 months ago, just before September 2022, when - for want of a better term - the wheels fell off the market.

Over the past 12 months, there’s been a growing awareness of just how many mortgages are being held within limited companies as they become an increasingly popular way for people to arrange their finances.

“It’s a great product but it’s not one that everyone knows about, or that people would necessarily think about, and that’s an unnecessary barrier to business,” McLean shared, noting that shining a light on this offering ties in well with Skipton International’s paramount mission of helping as many people as possible get into new homes.

“Some assume it’s too expensive and only for the rich and famous, but it’s available to everybody. People should consider it as an option and see if it’s suitable for their needs.”

Skipton International’s limited company lending is available to customers around the world, but their holding company must be registered in England, Wales, or the Channel Islands. A big advantage is that they can be residents of those jurisdictions as well, McLean noted, whereas previously it was only available for those living offshore.

“We know there are a lot of people holding them that are actually residing in the UK, so we’re highlighting this point,” McLean explained. “It’s a product we never offered before and it’s not widely available across the market. We’re very niche on this.”

Addressing common concerns, McLean pointed out that registering a limited company is quick - she’s seen people set them up within days - and relatively low-cost - though she urges everyone to verify price independently, for a company filing fee of around £12. Once established, the limited company’s registration is permanently held at Companies House, regardless of the life of the mortgage.

Limited company mortgages also offer many potential benefits that touch on tax advantages, greater anonymity that keeps dealings private, and more business-focused, cleaner transactions. But McLean recommends people always do their due diligence and seek legal advice from relevant professionals as to the benefits limited company lending may provide.

“Though it might not be the best route for everybody, it’s a great option to consider,” she summed up. “More people are viewing it as a different and potentially very attractive vehicle for holding mortgages.”

For more information, visit the website or reach out to the Skipton International team directly at (+0044) 01534 509501.