12 Property Portfolio in Negative Equity
During the boom of the market, a client of ours had left his full-time employment to become a buy to let landlord, building a portfolio of 12 units. As property values began to crash in 2008, he was left with a negative equity portfolio and variable cash flows. With outstanding mortgage debt of £1.3 million and values of only £900,000, the writing was on the wall – as soon as interest rates began to rise, he would have been forced to sell, and the various lenders would have chased him for the shortfall.
During a free 1 hour independent buy-to-let health check, it became apparent that he had no real strategy to deal with the situation. After being referred to Rescue My Properties, we had to negotiate hard with the various lenders to sell the portfolio below the outstanding mortgage balance, ensuring a write off of the shortfall. With the portfolio now taken care of, seeing that he needed urgent employment to replace the income, we managed to help by placing him in one of our client’s businesses as a Senior IT Manager, more than doubling his annual income, which is now £45,000.