SPV mortgages, arranged by special purpose vehicle specialists.

A special purpose vehicle is a limited company with one job: holding rental property. It is registered at Companies House like any other company, but its SIC codes restrict it to property activity, it carries no trading income, and its balance sheet contains nothing except the properties, the mortgages secured on them and the directors' loans that funded the deposits. That deliberate emptiness is the point. When a lender underwrites the company, there is nothing to untangle: the rent is the income, the property is the security, and the directors stand behind the debt with personal guarantees.

In practice the vehicle operates like a small, disciplined business. Rent arrives in the company bank account, the mortgage and insurance and letting costs leave it, and what remains is profit taxed at corporation tax rates. You, the shareholder, decide what happens to that surplus: leave it in the company compounding towards the next deposit, draw down the director's loan you put in tax-free, or extract it as salary or dividends. None of it touches your personal tax return until you choose to take it out, which is the structural difference from owning the same property in your own name.

Because the credit assessment is clean. A trading company that happens to own a flat brings supplier debts, staff costs, seasonal cashflow and the risk that a bad trading year drags the property down with it. A special purpose vehicle brings none of that, so the underwriter can price the case on three things: the rent, the asset and the people guaranteeing the loan. The result shows up in the market's shape. The widest product ranges, the highest loan-to-value tiers and the keenest company pricing all sit behind clean SPV criteria, while mixed-activity companies get routed to a smaller, dearer corner of the panel.

It also means a brand-new vehicle is not a weakness. Lenders do not ask a fresh SPV for trading history or accounts, because there is nothing the accounts would tell them that the structure has not already guaranteed. Most of our panel will lend to a company incorporated days before the application, provided the directors' own positions stack up. What lenders do check is that the vehicle is genuinely special purpose: property-only SIC codes, no unrelated borrowing, no trading activity hiding in the filing history.

Plan around 25% of the purchase price. The bulk of the market caps SPV lending at 75% loan to value, with a handful of lenders stretching to 80% on a pricing premium, and a few preferring lower leverage for first-time landlords or unusual property. The deposit almost always enters the company as a director's loan: you lend the company the money, it is recorded in the accounts, and the company can repay it to you tax-free in later years as rental profits accumulate. That repayment right is one of the quiet advantages of the structure, and it is worth documenting the loan properly from day one.

Other deposit routes work with the right paperwork. An intercompany loan from your trading business is acceptable to a good share of the panel, gifted deposits from close family pass with a gift letter, and equity raised by remortgaging another property, personally or company-held, is routine. What every lender insists on is provenance: a documented trail showing where the money originated, not merely which account it left last. Budget separately for stamp duty land tax with the 5% company surcharge (8% Additional Dwelling Supplement in Scotland), because that comes from cash, not the loan.

More on structuring the loan in the director's loan deposits guide.

The gains are mostly tax-shaped. Mortgage interest is a fully deductible expense inside the company, where Section 24 limits a personally held landlord to a basic-rate credit. Profits face corporation tax at 19 to 25% rather than income tax at up to 45%, and they can be retained and recycled into the next deposit without a personal tax event. Limited liability ring-fences the property business from your other affairs, subject to the personal guarantees, and shares in the vehicle give you succession options, gradual transfers to family, that a personally held title does not.

The costs are real and worth pricing honestly. SPV mortgage rates run modestly above personal-name equivalents, typically 0.20 to 0.40%. The company pays the stamp duty surcharge on every residential purchase with no first-property relief. You will pay an accountant to file annual accounts and a corporation tax return. Extracting profit costs dividend or salary tax on the way out. And moving property you already own into the vehicle is a market-value sale, with capital gains tax and stamp duty land tax both in play unless incorporation relief genuinely applies. For a higher-rate taxpayer holding leveraged property long term, the arithmetic usually favours the vehicle; for a basic-rate taxpayer with little debt, it frequently does not.

Model both routes on your figures · context in the Section 24 guide.

No, and the distinction moves real money. A special purpose vehicle is defined by what it does not do: no trading, no consultancy invoices, no e-commerce side line, nothing on the filing history except property. A company that trades and also owns its premises, or a landlord who runs a building firm through the same entity, is a trading company in lender eyes, and most of the mainstream company buy-to-let ranges simply exclude it. The trading cases that do place go to a shorter list of underwriters who will read full accounts, and they pay for that attention in rate.

The grey areas are where we earn our keep. A dormant company revived for property use can pass as an SPV with some lenders and not others. A vehicle owned by a trading holding company is acceptable to part of the panel, with the parent sometimes asked for a guarantee. An SPV that once filed a single trading invoice may need explaining. None of these kill a case, but each one removes lenders from the list, and knowing which survive before submission is the difference between one application and three. If your company already exists, send us the Companies House number before you do anything else; the filing history usually answers the structural questions in minutes.

The core of the market is the specialist panel that underwrites company buy-to-let as its day job: Paragon, Kent Reliance, Fleet Mortgages, Foundation Home Loans, Landbay, Precise Mortgages. Around them sit the intermediary-only lenders, The Mortgage Works, Leeds Building Society, Coventry Building Society, Metro Bank, whose company ranges are simply unavailable to the public; they quote through brokers or not at all. The challenger names, Aldermore, Shawbrook, Interbay, LendInvest, take the complex end: layered group structures, expat directors, heavy refurbishment, large multi-unit blocks.

Criteria differ more than rates do. One lender insists on a maximum of four directors, another caps the number of properties in the vehicle, a third reads an intercompany deposit loan differently from its neighbour. Whole-of-market access matters less for the rate table and more for knowing, before submission, which underwriter will read your particular structure without friction.

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The remortgage is where the vehicle starts compounding. When the initial fix ends, the company can remortgage to a new lender, capital raise against the equity that rent growth and any price growth have created, and deploy the raised funds as the deposit on the next purchase, all without the money ever passing through your personal tax return. Because the new loan is re-stressed at 125% on the current rent, a property whose rent has risen since purchase will often support a noticeably larger loan at remortgage than it did on day one. Many of our clients run a deliberate cycle: buy, let, season the rent, remortgage, repeat.

Once the vehicle holds four or more mortgaged properties, the directors become portfolio landlords in lender language. Every new application and remortgage then attracts an aggregate review: the whole rental schedule, total gearing and the portfolio's blended cover, not just the subject property. That is not a barrier, strong properties offset weaker ones, but it changes which lenders fit. A remortgage that would be straightforward for a two-property SPV may belong with a dedicated portfolio landlord lender at property five. We track both the product end dates and the portfolio shape so each remortgage lands with the right underwriter.

See limited company remortgages and limited company portfolio mortgages for the dedicated products.