Multi-Unit Finance Explained
In the context of multi-unit finance, the focus is on properties that may
contain more than one dwelling or unit but are financed under a single loan or
financing arrangement. This can be especially important for Landlords
looking to scale their portfolios or finance larger developments.
A Multi-unit typically means a block of flats on one freehold title. It can be
simpler, easier and more cost-effective to get one mortgage as opposed to
getting several different mortgages on the same property. Blocks of flats
range anywhere between 2 flats anywhere up to 100+ flats or more on a single
Freehold TitleHow Multi-Unit Finance Works?
Loan Structure:
When applying for multi-unit finance, the borrower typically presents the
property as a whole (with multiple units) and applies for a loan based on the
total value and income potential of the property.
Property Valuation:
A professional Redbook Valuation is normally required, where the lender will
assess the potential rental income from each unit and the overall condition of
the property.
Cash Flow Consideration:
Since multi-unit properties can produce multiple streams of rental income,
lenders often consider the property’s overall cash flow as part of the
assessment process.