Managing one mortgage expiry date is relatively straightforward. Managing several across a growing rental portfolio requires a system.
A landlord may have mortgages with different lenders, product end dates, early repayment charges and loan-to-value positions. Some properties may be owned personally, while others sit within a limited company. One property may be ready to refinance, another may require refurbishment and a third could have rental or valuation issues that restrict the available options.
Without a clear finance calendar, important decisions can become last-minute emergencies. The landlord may move onto a lender’s reversion rate, accept an unsuitable product transfer or discover too late that a valuation, lease, tenancy or document problem must be resolved.
A portfolio finance calendar brings those dates and decisions together.
What should the calendar contain?
The calendar should record more than the day each mortgage product ends.
For every mortgaged property, include:
- Property address
- Ownership name or limited company
- Current lender
- Mortgage account reference
- Outstanding balance
- Repayment method
- Current interest rate and monthly payment
- Product expiry date
- Early repayment charge period
- Remaining mortgage term
- Current rent
- Estimated property value
- Approximate loan-to-value
- Intended action at expiry
- Date the review should begin
It is also useful to record insurance renewal dates, tenancy changes, licence renewals and planned refurbishment work where these could affect the timing of a remortgage.
A spreadsheet may be sufficient for a smaller portfolio. Larger landlords may prefer portfolio-management software, but the principle remains the same: the information must be accurate, accessible and reviewed regularly.
Begin the review up to six months before expiry
Landlords should not wait for a lender’s renewal letter before considering the options.
Starting the review up to six months before the existing product ends creates time to:
- Confirm the outstanding mortgage balance
- Check the early repayment charge
- Review the current lender’s product-transfer options
- Compare remortgage products across the wider market
- Obtain an indication of the property’s value
- Confirm the current and achievable rent
- Assemble the necessary documents
- Address property or credit issues
- Consider whether additional borrowing is required
A new mortgage should not normally complete while an avoidable early repayment charge remains, but the research and preparation can begin well in advance.
Mortgage offers and product-transfer reservations can have expiry dates of their own. The timing must therefore be planned carefully rather than assuming that the earliest application will always produce the best outcome.
Review the valuation and rental position
The landlord’s estimate of a property’s value may differ from the lender’s valuation.
This matters because the valuation determines the loan-to-value calculation and can affect the products available. A lower-than-expected figure could prevent the landlord reaching a preferred pricing band or restrict the amount of equity that can be released.
The calendar should prompt the landlord to review recent comparable sales and identify any significant improvements completed since the previous valuation.
The rent must also be considered. Buy-to-let lenders generally assess whether the expected rent supports the mortgage under their rental coverage calculation. A property may contain substantial equity but still fail to support the requested loan if the rent is too low.
If a tenancy is due for renewal close to the mortgage expiry date, the landlord should consider the timing carefully. Any rent review must be lawful, reasonable and commercially justified rather than introduced solely to satisfy a lender’s calculation.
Remember that the lender may assess the portfolio
For a portfolio landlord, refinancing one property may involve more than examining that property alone.
The lender could request information covering the complete portfolio, including:
- Property values
- Mortgage balances
- Monthly rents
- Mortgage payments
- Ownership structures
- Loan-to-value figures
- Rental coverage
- Experience and future plans
- Personal or company income
- Cash flow and financial resilience
An underperforming or highly geared property elsewhere in the portfolio could influence the application.
Keeping the portfolio schedule current throughout the year is considerably easier than reconstructing it shortly before every mortgage expiry.
Coordinate fees and cash reserves
Several mortgages ending within a short period can create a concentration of costs.
Depending on the route selected, the landlord may face arrangement fees, valuation charges, legal costs, broker fees and early repayment charges. A new lender may also require work to be completed before accepting the property.
The finance calendar should therefore be connected to a cash-flow forecast.
Landlords should consider whether they have sufficient reserves to cover:
- Mortgage and professional fees
- Temporary increases in monthly payments
- Voids and arrears
- Essential repairs
- Licensing or compliance work
- A valuation below expectations
- A required reduction in the mortgage balance
A portfolio that appears profitable annually can still experience cash-flow pressure if several large costs fall in the same month.
Connect mortgage dates with future purchases
The calendar should include intended purchases as well as existing mortgages.
A landlord planning to buy another property may expect to release equity from one of the current portfolio properties. If that remortgage is delayed, the purchase deposit may not be available when required.
Equally, completing a new purchase shortly before refinancing another property could change the landlord’s borrowing, cash reserves and portfolio figures. The order in which transactions occur can affect the available options.
Before committing to a purchase, establish:
- Which property will provide the deposit.
- When that money is likely to become available.
- Whether the existing rent supports the proposed equity release.
- What fees and taxes must also be funded.
- How the new borrowing affects the portfolio’s overall cash flow.
The mortgage conversation should begin before the viewing, not after the offer has been accepted.
Should mortgage expiry dates be spread out?
There can be advantages to avoiding too many mortgage products ending simultaneously. Staggered expiry dates may spread fees, administration and exposure to changing rates across different periods.
However, deliberately selecting a shorter or more expensive product purely to create a neater calendar may not be worthwhile. Each mortgage should still be chosen according to the property, borrowing requirement and landlord’s wider plan.
The objective is not to make every expiry date different. It is to understand when decisions will be required and ensure the portfolio can absorb them.
Review the calendar every month
A finance calendar only works if it remains current.
Set a monthly reminder to update balances, rents, estimated values, planned purchases and approaching product expiries. Highlight mortgages requiring action within the next six months and record who is responsible for obtaining documents, quotations or professional advice.
NetRent Mortgage Solutions can help landlords review upcoming expiry dates, compare product-transfer and remortgage routes and consider how each decision fits the wider portfolio strategy.
To begin planning your next mortgage review, contact NetRent:
Telephone: 01352 721300
Email: mortgages@netrent.co.uk
NetRent does not provide legal advice. This article represents our general understanding of the landlord mortgage market and is provided for information only.
Mortgage products, rates, fees, valuations, affordability calculations and lender criteria can change. Appropriate mortgage, financial, legal and tax advice should be obtained before proceeding.