Acquisition Calculator
Overview
If you're going to buy one of your prospects, you'll be spending some money - and most likely taking out a mortgage as well.
Property Prospector allows you to calculate different costs and fees for your purchase, and the numbers you provide will be used to help cacluate future yield and return.
Some numbers are estimated based on market rates, but you can change these as needed.
Getting Started
Financial calculations are per-plan, per-property.
Start by opening the prospect from your Shortlist, and select the Plan tab.
The Plans Overview shows each financial plan you stored for a prospect.
Click Details to open the plan you want to adjust, or Add Plan to create a new plan.
Investment Plan
The first part of the form is for your initial investment - buying the property.
- Price - the final price you expect to pay for the property.
- Second home - if you do not intend to live in the property, it is considered a second home. This incurs an additional stamp duty surcharges depending on the value of the property. You may also pay different rates for council tax. If you will be a live-in landlord, the property will be your primary residence, and these rates will not (usually) apply.
- Non-resident - if you are not resident in the UK there are additional fees and taxes to pay.
- Expenses - Add any expenses associated with the purchase here. Do not include repair or refurbishment costs.
- Finance type - cash, mortgage, or bridge. If you are paying cash up front, there is nothing else to fill out in this category. Otherwise, additional fields are on the right.
Mortgage Calculation
If you selected Mortgage for the finance type, you'll be prompted to add some information about the mortgage. Estimated fees are auto filled by PaTMa, but you can customise these to the rates your lender has offered.
- Mortgage rate - the interest rate on the mortgage.
- Mortgage fixed fee - any fixed fees required by the lender.
- Mortgage percentage fee - The lenders' costs or additional fee.
- Max LTV - the maximum loan to value permitted (ie: how much loan you can take out againsst the value of the property)
- Rental cover - for buy to let properties, the loan will be restricted based on the rent income.
- Stress rate - the interest rate used to calculate rental cover.
- Roll up mortgage fees - include the fees in the total mortgage.
Bridge Calculation
Bridging loans are short term loans contingent on a quick repayment - often made when the sale of a currently owned property will fully cover the purchase of a new one.
- Bridge rate - the interest per month on the loan.
- Bridge facility fee - percentage fee taken by the lender.
- Bridge exit fee - a final additional fee paid on repayment of the loan.
- Bridge fixed fee - any fixed costs associated with the loan that are not related to repayment.
- Max LTV - the maximum loan to value permitted (ie: how much loan you can take out againsst the value of the property).
Other Fields
The plan can also include refurbishment costs, refinancing, and expected revenue.
These are all added on the same page, and discussed in more detail elsewhere:
Saving the Plan
Regardless of what changes you make, the calculations will update as you work.
To store the plan and any changes made, click Save Plan.