5. Full Address of the Deal (not your home address)
7. Please provide 3 like-for-like comparable of the same property type, size, on the same estate/street/locale, and of the same standard. You must provide URLs for these comparables below.
Please be aware by selecting that this deal is for PERSONAL use only, we will allow you to “submit” the deal, even if we deem your answers or your due diligence to be deficient. We will, however, give you warnings as to these deficiencies, but note that a deficient deal cannot be submitted, as is, via Deal Connect or sold without clear warnings to their intended recipients.
Please download your due diligence template which you will need to provide evidence based on the following questions. Failing to provide adequate evidence for your due diligence will result in us being unable to accept your deal for Deal Connect, so it’s worth getting it right as soon as you can!
Download Your Due Diligence Template
You can download an example of a Due Diligence Template below to know what level of detail is expected:
Download Your Due Diligence Example
Please provide a detailed breakdown in the table provided in your Due Diligence Template (Step 3 - “Deal Viability”). This will include:
Money upfront - please list: deposit, rent upfront, refurb costs etc
Monthly Costs - please list: rent, council tax, bills, maintenance costs, wifi etc
Profit per month
Profit per year
Estimated ROI
As your ROI is between 1 - 99%, we do not deem this to be a viable deal and cannot rate it any further. Please check your calculations and start again, or submit a different deal.
Please provide evidence in your Due Diligence Template (e.g. email confirmation or message from a professional who viewed the property)
Please provide evidence in your Due Diligence Template (e.g. photo, video or proof of appointment)
Please provide evidence in your Due Diligence Template (e.g. screenshot from local authority or estate agent)
Please provide evidence in your Due Diligence Template (e.g. screenshot from local authority or letting agent)
Please provide evidence in your Due Diligence Template (e.g. your measurements for each room)
Please provide evidence in your Due Diligence Template (e.g. screenshot it is not an article 4 area)
Please provide evidence in your Due Diligence Template (e.g., a screenshot from the relevant local authority website that Article 4 is coming soon)
Please provide evidence in your Due Diligence Template (e.g. screenshot that you have grandfather rights and a certificate of lawfulness)
Please provide evidence in your Due Diligence Template (e.g. evidence that this is running as an HMO such as tenancy agreements)
Please provide evidence in your Due Diligence Template (e.g. a copy of the licence)
Please provide evidence in your Due Diligence Template (e.g. costs and timescale to obtain permission)
Please provide evidence in your Due Diligence Template (e.g. screenshot of agent’s registration)
Please provide evidence in your Due Diligence Template (e.g. title deeds)
Please provide evidence in your Due Diligence Template (e.g. email from landlord and/or letting agent)
Please provide evidence in your Due Diligence Template (e.g. email from landlord and/or letting agent and a copy of the contract)
Please provide evidence in your Due Diligence Template (e.g. evidence of phonecall or meeting appointment with landlord or agent)
Please provide evidence in your Due Diligence Template of the length of the break-clause and whether it is reciprocal (e.g. email from landlord and/or letting agent and a copy of the contract)
Please provide evidence in your Due Diligence Template of the length of the break-clause and whether it is reciprocal (e.g. evidence of phonecall or meeting appointment with landlord or agent)
Please provide evidence in your Due Diligence Template (e.g. a copy of the commercial lease agreement)
Please provide in your Due Diligence template a copy of the contract you have agreed with the landlord or agent.
Please provide evidence in your Due Diligence Template that the Landlord will not be in breach of his own mortgage or insurance agreements (e.g. the contract)
Please provide evidence in your Due Diligence Template that the Landlord will not be in breach of his own mortgage or insurance agreements (e.g. email from landlord only)
Please provide evidence in your Due Diligence Template (e.g. screenshots of HMO managers’ opinions in writing, Spareroom, Propertymarketintel, etc.)
Please provide evidence in your Due Diligence Template (e.g. HMO Managers estimate of rental value for that specific address)
Please provide evidence in your Due Diligence Template (e.g. screenshot of comparable properties renting at that price)
Please provide evidence in your Due Diligence Template (e.g. screenshot of comparable renting at that price)
Please provide evidence in your Due Diligence Template (e.g.screenshot of wifi testing - fast.com or other website)
Please provide evidence in your Due Diligence Template that the property is compliant with fire safety rules (e.g. a current HMO licence, a fire safety officer inspection report, a fire risk assessment)
Based on your due diligence, we will not be able to rate your deal. Please review and compile more evidence and then use the rate my deal AGAIN. These are the following areas for improvement:
Based on your due diligence, we have identified the following areas for improvement:
Deal viability
Property Viewing – it is always best that you view the property yourself or at the very least send someone to view the property. Relying on written details and photographs is not always enough to detect defects.
Property classification – you need to know the classification of a property in order to know for which purposes the property can be used.
Room sizes – it is important to measure the room sizes yourself, as errors often creep into agents’ measurements.
Article 4 – it is important to know whether or not the property is in an Article 4 area as planning permission is usually required for an HMO in these areas.
HMO Status - it is important to know whether or not the property has previously been run as an HMO as this will increase the chances of it having an HMO licence or acquiring an HMO licence.
HMO Licence – all HMOs require a licence, so if the property doesn’t currently have one, this will have to be applied for and the associated time and cost of doing so will have to be taken into account.
Agent registration – it is important to know whether or not an agent is registered with the PRS or TPO to ensure they’re operating in a way that is compliant and renders them accountable to their governing body.
Landlord identity – it is important to ensure that the landlord is the genuine owner of the property by checking with Land Registry. People have been scammed by “fake landlords” in the past.
Landlord consent – it is important for the landlord to give their consent to the property being used in the intended way and to have that confirmation in writing. Verbal agreements are difficult to prove.
Length of lease agreement – it is important to know the exact length of the lease you’ve negotiated and to have this clearly confirmed in the Lease Agreement.
Break-clause – it is important to negotiate a break clause so that you can get out of the contract if it is not working out. It is preferable to have a one-way break clause in your favour, so you can get out but the landlord can’t. A break-clause should be included in the Lease Agreement.
Lease Agreement – it is vital to use the Samuel Leeds / PIMS agreement if you can because this has been drafted to protect your interests (as far as it can without knowing your exact intentions). However, if an agent or landlord offer you an alternative contract, you should compare this to the Samuel Leeds / PIMS Lease Agreement to ensure their contract protects your interests as much as possible.
Landlord’s contractual obligations – it’s important to obtain the landlord’s confirmation that they will not be in breach of their own mortgage or insurance obligations as this could void any agreement you have with them or anyone else you might sell the deal to.
Demand - it’s important that you provide evidence of demand as this has significant impact on the value of the deal if you are selling it and the viability of the investment if you are taking on the property yourself.
Estimations of rental - the best estimates are from experienced HMO managers, although comparables in very similar areas are also good evidence.
Wifi - fast wifi is very important to most people, particularly for those working from home or running a business from home.
Fire Safety – this is vitally important and can attract criminal sanctions if not complied with.
7. Please Provide three like-for-like comparables of the same house type, size, on the same estate, and of the same standard, showing your estimated GDV. You must provide URLs for theses comparables below.
Please download your due diligence template which you will need to provide evidence based on the following questions. Failing to provide adequate evidence for your due diligence will result in us being unable to accept your deal for rating.
Download Your Due Diligence Template.PDF
Please provide in your Due Diligence Template evidence that the purchase price (inc. all costs) plus the refurb price are equal to less than 75% of the estimated end value (e.g. your calculations)
Please provide in your Due Diligence Template evidence that the purchase price (inc. all costs) plus the refurb price are equal to 75-80% of the estimated end value (e.g. your calculations)
Please provide in your Due Diligence Template evidence that the purchase price (inc. all costs) plus the refurb price is equal to 80-90% of the estimated end value (e.g. your calculations)
As your total costs are more than 90% of the end value, we do not deem this to be a viable deal and cannot rate it any further. Please check your calculations and start again, or submit a different deal.
Please provide evidence in your Due Diligence Template (e.g. email confirmation or message)
Please provide evidence in your Due Diligence Template (e.g. the builders’ quote(s) for renovating the listed building where required)
Please provide evidence in your Due Diligence Template (e.g. report from planning consultant)
Please provide evidence in your Due Diligence Template (e.g. the GDV and the 3 comparables - screenshots and URL links).
Please provide evidence in your Due Diligence Template (e.g. the GDV and 2 comparables - screenshots and URL links)
Please provide evidence in your Due Diligence Template (e.g. the GDV and the 1 comparable screenshot and URL link).
Please provide evidence in your Due Diligence Template (e.g. confirmation from the broker that you will get finance on a property that is of non-standard construction)
Please provide evidence in your Due Diligence Template (e.g. estate agents brochure or Title Deeds)
Please provide in your Due Diligence Template evidence of the extent of the refurbishment and your multiple builders' quote
Please provide in your Due Diligence Template evidence of the extent of the refurbishment and your own detailed builders' quote as you are a builder yourself
Please provide in your Due Diligence Template evidence of the extent of the refurbishment and one single builders' quote
Please provide in your Due Diligence Template evidence of the extent of the refurbishment and your Quote My Refurb report
Please provide in your Due Diligence Template evidence of the extent of the refurbishment and your own quote as you have experience of refurbishments
Please provide evidence in your Due Diligence Template (e.g. copy of head lease)
Please provide evidence in your Due Diligence Template (e.g. email from landlord or letting agent)
Please provide evidence in your Due Diligence Template of comparables showing nightly rates and occupancy rates (e.g. screenshots of 3 comparables from propertymarketintel.com)
Please provide evidence in your Due Diligence Template of comparables showing nightly rates and occupancy rates (e.g. screenshots of 2 comparables from propertymarketintel.com)
Please provide evidence in your Due Diligence Template of comparables showing nightly rates and occupancy rates (e.g. screenshot of 1 comparable from propertymarketintel.com)
N.B. Questions 12-18 are not visible because they do not apply to you
Please provide evidence in your Due Diligence Template (e.g. screenshot from the relevant local authority website that Article 4 is coming soon)
Please provide evidence in your Due Diligence Template (e.g. evidence that this is running as an HMO, such as tenancy agreements).
Please provide evidence in your Due Diligence Template (e.g., a screenshot of the HMO licence and link from the local authority’s Register of HMOs for the property’s address).
Please provide evidence in your Due Diligence Template (e.g. screenshots of the HMO managers opinion in writing, spareroom, propertymarketintel, etc )
Please provide evidence in your Due Diligence Template (e.g. HMO Managers estimate of rental value)
Please provide evidence in your Due Diligence Template (e.g. screenshot of very comparable property renting at that price)
Please provide evidence in your Due Diligence Template (e.g. screenshot of almost comparable renting at that price)
N.B. Questions 19-21 are not visible because they do not apply to you
Please provide evidence in your Due Diligence Template (e.g. estate agent’s estimate of end rental value)
Please provide evidence in your Due Diligence Template (e.g., a screenshot of almost comparable renting at that price)
Please provide evidence in your Due Diligence Template (e.g. email or screenshot of mortgage quote)
Please provide evidence in your Due Diligence Template (e.g. show the two figures separately and the percentage difference between them)
Please provide evidence in your Due Diligence Template (e.g. estate agent’s information or Title Deeds)
Please provide evidence in your Due Diligence Template (e.g. estate agent’s information or other specified source)
Please provide evidence in your Due Diligence Template (e.g. estate agent’s information or Title Deeds and quote to extend the lease)
Please provide evidence in your Due Diligence Template (e.g. estate agent’s information)
Please provide evidence in your Due Diligence Template (e.g. estate agent’s information or tenancy agreement)
Please provide evidence in your Due Diligence Template (e.g. estate agent’s brochure or screenshot)
Please provide evidence in your Due Diligence Template (e.g. estate agent’s brochure or screenshot and quote to upgrade)
Please provide evidence in your Due Diligence Template (e.g. your calculations, which clearly include and show the auction fees)
Please provide evidence in your Due Diligence Template (e.g. solicitor’s letter or email)
Please provide in your Due Diligence Template evidence of an independent surveyor’s report
Based on your due diligence, we will not be able to rate your deal. Please review and compile evidence and then use the rate my deal AGAIN. These are the following areas for improvement:
Listed building – if you want to alter or extend a listed building in a way that affects its character or appearance, you must first apply for Listed Building Consent from your local planning authority. Carrying out unauthorised works to a listed building is a criminal offence and carries a maximum sentence of 2 years in prison and an unlimited fine.
Planning permission – the current definition from the government about when to apply for planning permission is if “you are building something new, or want to make a major change to a building (e.g. an extension) or wish to change the use of your building”. If you’re unsure, always check with your local planning authority.
Permitted Development Rights - these rights are a national grant of planning permission which allow certain building works and changes of use to be carried out without having to make a planning application. Find out from the relevant local planning authority whether these apply to the property in question.
Comparable Properties – it is important to provide at least 3 comparable properties to be certain that the strategy you are adopting for the property is not only viable but profitable. Ensure that the comparable properties are like-for-like.
Standard Construction – it’s important to know whether a property is of standard construction, particularly if you want to borrow against it, because lenders prefer buildings of ‘standard construction’, which is commonly defined as a “property built of brick stone or concrete, with slate or tiled roofing”. Non-standard construction covers a wide range of property types, from listed buildings, prefabricated steel builds, properties with concrete or glass walls, or those with thatched or eco-friendly roofing - and everything in between.
Builders’ quotes – determining the real price of refurbishing a property requires an expert in the field (a builder) and even they differ with their estimates. Best practice is to obtain several quotes to determine the most accurate cost, although it is never an exact science. Guestimates, however, are dangerous and can eat into some, if not all, of your profit margins.
Article 4 – it is important to know whether or not the property is in an Article 4 area as planning permission is usually required if you wish to change the use of the property into Serviced Accommodation or an HMO.
Head Lease – it is important to find out whether or not a property is governed by a Head Lease which prohibits sub-letting. If such a prohibition exists, you will not be able to proceed with any SA or HMO plans or sell the deal with SA/HMO as the strategy for that property.
Due diligence on the comparables
Property classification
Room sizes
HMO status - it is important to know whether or not the property has previously been run as an HMO as this will increase the chances of inheriting an HMO licence or acquiring an HMO licence.
HMO licence – all HMOs require a licence, so if the property doesn’t currently have one, this will have to be applied for and the associated time and cost of doing so will need to be taken into account, for your own calculations, and if you are selling the deal.
Demand – it’s important that you provide evidence of demand as this has significant impact on the value of a deal if you are selling it and on the viability of the investment if you are taking on the property yourself.
Estimations of Rental – the best estimates are from experienced HMO managers or letting agents, although links to very comparable properties can also provide good evidence.
Mortgage Quote – it is imperative to obtain a mortgage quote or at the very least use a mortgage calculator to determine the viability of the acquisition.
Mortgage Stress Test – it is vital to compare the monthly rental income to the monthly mortgage payments to determine the viability of the deal. The aim is for the rental received from tenants to exceed the mortgage payments by at least 25%.
Freehold Property – owning the Freehold means you own a property outright, including the land it’s built on, with no fixed time limit. It’s important to know whether a property is sold Freehold or Leasehold as there are greater legal and cost implications if the property is Leasehold.
Leasehold Property - is owned for a fixed amount of time and then reverts to the landlord (the owner of the Freehold). The longer the lease, the more it is worth. Leases can be extended. You can find out how much it would cost to extend the lease here https://www.lease-advice.org/calculator/
Length of lease
Vacant Possession. It is important to know whether a property is being sold vacant or with a tenant in situ. Tenants have rights and if you are expecting the property to be empty, it is vital to ensure that there is no tenancy agreement related to that property. Alternatively, if the investment is intended to include a tenant in situ, you should ask to see the tenancy agreement.
EPC Rating. It’s important to know the EPC rating as it can affect the value of the property, its potential for attracting lending, as well as informing you about the cost of running the property. It is also a legal requirement to provide an EPC rating, so it is not difficult to find https://www.gov.uk/find-energy-certificate
Crime Rates. Being able to confirm that an area feels safe adds value to the property and will attract a wider variety of investors and buyers.
Auction fees. These can be hidden in the small print and can vary enormously. Make sure you ascertain the entire cost of purchasing a property from auction and include these in your calculations as they can be substantial. Make sure you read the small print or get a solicitor to do it for you.
Legal Pack (auctions). Every auction house produces its own legal pack and some are more straight-forward than others. They are not all the same. Our advice is to instruct a solicitor to ensure the legal pack provides you with all the information you need and hasn’t hidden any red flags which would render the purchase unviable or even completely uneconomic.
Survey (auctions). There are many reasons that properties end up at auction (e.g. deaths and repossessions), but often it’s because the property is so defective that the owners and estate agents can’t shift them (e.g. massive structural problems or subsidence). This is why it is vital to obtain a survey before you buy a property at auction or else you could be buying a property that costs more to fix than it’s actually worth.
Funds (auctions). Buying a property at auction is much faster than normal property transactions and you more or less become immediately liable to pay all the monies – usually 10% immediate deposit and just 28 days to complete (i.e.to pay the remaining 90%). Do not rely on other people to “come up” with the money after you’ve bid on a property and won the bid. You will be personally liable as soon as your bid is accepted. Make sure you have the funds in your account before you bid on a property.
Bridging and refinancing risks (auctions). Be mindful that bridging finance or refinancing usually takes longer to obtain than the 28 days many auction houses require you to complete in. Best practice is to have the money in your account before you make a bid or have a Plan B if the bridging/refinancing doesn’t come through in time.
Auction terms. Make sure you read all the terms very carefully and be aware that you will usually lose your deposit if you fail to complete and you might even be liable to the seller if they are out of pocket due to your inability to complete on time or at all.
Deal Viability
Download Your Due Diligence Template.zip
Please provide evidence in your Due Diligence Template of:
Total money upfront - deposit, rent upfront, refurb costs etc
Total monthly Costs - rent, council tax, bills, maintenance costs, wifi etc
Income per month
As your total costs are BETWEEN 1 - 99%, we do not deem this to be a viable deal and cannot rate it any further. Please check your calculations and start again, or submit a different deal.
Use our Article 4 Checker tool in your portal by following the button below:
Article 4 Checker
Please provide evidence in your Due Diligence Template that you have seen the Head Lease (e.g. copy of the Head Lease)
Please provide evidence in your Due Diligence Template of the length of the clause and whether or not it’s reciprocal (e.g. email from landlord or agent and a copy of the contract)
Please provide evidence in your Due Diligence Template (e.g. a copy of the lease agreement)
Please provide evidence in your Due Diligence Template (e.g. screenshots of 3 comparables)
Please provide evidence in your Due Diligence Template (e.g. screenshots of 2 comparables)
Please provide evidence in your Due Diligence Template (e.g., a screenshot of one comparable)
Please provide evidence in your Due Diligence Template of the cost implications of maintaining or replacing a prepayment meter.
Agent Registration – it is important to know whether or not an agent is registered with the PRS or TPO to ensure they’re operating in a way that is compliant and renders them accountable to their governing body.
Landlord Identity – it is important to ensure that the landlord is the genuine owner of the property by checking with Land Registry. People have been scammed by “fake landlords” in the past.
Landlord Consent – it is important for the landlord to give their consent to the property being used in the intended way and to have that confirmation in writing. Verbal agreements are difficult to prove.
Head Lease – it is important to ensure that the property is not governed by a Head Lease which prohibits sub-letting for serviced accommodation. If such a prohibition exists, you will not be able to proceed with your SA plans or sell the deal with SA as the goal for that property.
Length of Lease – it is important to know the exact length of the lease you’ve negotiated and to have this clearly confirmed in the Lease Agreement.
Comparable properties – it is important to provide at least 3 comparable properties to be certain that the strategy you are adopting for the property in question is not only viable but profitable. Ensure that the comparable properties are like-for-like.
Prepayment meters – the cost of prepayment meters can be considerable in either keeping them or replacing them. If prepayment meters are installed in the property, these costs need to be factored in.
Please provide in your Due Diligence Template evidence that the purchase price (inc. all costs) plus the refurb price equal to 80-90% of the estimated end value (e.g. your calculations)
Please provide evidence in your Due Diligence Template (e.g. email confirmation or message from professional)
Please provide evidence in your Due Diligence Template (e.g. builder’s quote for renovating a listed building where required)
Please provide evidence in your Due Diligence Template (e.g. report from planning consultant).
Please provide evidence in your Due Diligence Template (e.g. report from a planning consultant).
Please provide evidence in your Due Diligence Template (e.g. the 3 comparables - screenshots and URL links).
Please provide evidence in your Due Diligence Template (e.g. 2 comparables - screenshots and URL links)
Please provide evidence in your Due Diligence Template (e.g. 1 comparable screenshot and URL link).
Please provide evidence in your Due Diligence Template (e.g. confirmation from broker that you will get finance on a property of non-standard construction)
Please provide evidence in your Due Diligence Template (e.g. multiple builders’ quotes)
Please provide evidence in your Due Diligence Template (e.g. your detailed quote)
Please provide evidence in your Due Diligence Template (e.g. your builder’s quote)
Please provide evidence in your Due Diligence Template (e.g. Quote My Refurb report or screenshot)
Please provide evidence in your Due Diligence Template (e.g. evidence of your own detailed quote)
N.B. Questions 9-10 are not visible because they do not apply to you
Please provide evidence in your Due Diligence Template of costs of ground rent and service charge (e.g. Estate Agent’s information or other document)
Please provide evidence in your Due Diligence Template (e.g. estate agent’s brochure)
Please provide evidence in your Due Diligence Template (e.g. estate agent’s brochure or tenancy agreement)
Please provide evidence in your Due Diligence Template that you have included the auction fees in your calculations (e.g. your calculations with auction fees)
Please provide evidence in your Due Diligence Template (e.g. independent building survey)
Based on your due diligence, we will not be able to rate your deal. Please review and compile your evidence and then use the rate my deal AGAIN. These are the following areas for improvement:
Deal Viability – ideally, in a Flip, you want to purchase a property for 75% or less of its estimated end value.
Listed Building – if you want to alter or extend a listed building in a way that affects its character or appearance, you must first apply for Listed Building Consent from your local planning authority. Carrying out unauthorised works to a listed building is a criminal offence and carries a maximum sentence of 2 years in prison and an unlimited fine.
Refurbishment Quotes – determining the real price of refurbishing a property requires an expert in the field (a builder) and even they differ with their estimates. Best practice is to obtain several quotes to determine the most accurate cost, although it is never an exact science. Guestimates, however, are dangerous and can eat into some, if not all, of your profit margins.
Freehold Property
Leasehold Property
Leasehold Costs
Safety. Being able to confirm that an area feels safe adds value to the property and will attract a wider variety of investors and buyers.
Auction Fees. These can be hidden in the small print and can vary enormously. Make sure you ascertain the entire cost of purchasing a property from auction and include these in your calculations as they can be substantial. Make sure you read the small print or get a solicitor to do it for you.
Auction Legal Pack. Every auction house produces its own legal pack and some are more straight-forward than others. They are not all the same. Our advice is to instruct a solicitor to ensure the legal pack provides you with all the information you need and hasn’t hidden any red flags which would render the purchase unviable or even completely uneconomic.
Survey For Auction Property. There are many reasons that properties end up at auction (e.g. deaths and repossessions), but often it’s because the property is so defective that the owners and estate agents can’t shift them (e.g. massive structural problems or subsidence). This is why it is vital to obtain a survey before you buy a property at auction or else you could be buying a property that costs more to fix than it’s actually worth.
Auction Funding (auctions). Buying a property at auction is much faster than normal property transactions and you more or less become immediately liable to pay all the monies – usually 10% immediate deposit and just 28 days to complete (i.e.to pay the remaining 90%). Do not rely on other people to “come up” with the money after you’ve bid on a property and won the bid. You will be personally liable as soon as your bid is accepted. Make sure you have the funds in your account before you bid on a property.
Financial Responsibility At Auction. Be mindful that bridging finance or refinancing usually takes longer to obtain than the 28 days many auction houses require you to complete in. The best practice is to have the money in your account before you make a bid or have a Plan B if the bridging/refinancing doesn’t come through in time.
Auction Terms. Make sure you read all the terms very carefully and be aware that you will usually lose your deposit if you fail to complete and you might even be liable to the seller if they are out of pocket due to your inability to complete on time or at all.
Please evidence of differential between purchase price and current value (e.g. Your calculations)
As your total agreed price is 40% higher than the current value, we do not deem this to be a viable deal and cannot rate it any further. Please check your calculations and start again, or submit a different deal.
Please evidence that you have agreed on the purchase price (e.g. email from landlord or estate agent)
Please evidence of the property’s current value (e.g. official valuation, estate agent’s written quote, recent like-for-like comparables)
Please evidence that you have agreed on a Consideration Fee (e.g. email from landlord or estate agent)
Please evidence of the agreed term length (e.g. email from landlord or estate agent)
Please provide, in your Due Diligence Template, evidence of the agreed monthly fee (e.g. email from landlord or estate agent)
Please provide evidence that the Landlord will not be in breach of his own mortgage or insurance agreements (e.g. contract)
Please provide evidence that the Landlord will not be in breach of his own mortgage or insurance agreements (e.g. email from landlord)
Please provide evidence in your Due Diligence Template (e.g. screenshot of 2 comparables)
Please provide evidence in your Due Diligence Template (e.g. screenshot of one comparable)
N.B. Questions 14-22 are not visible because they do not apply to you
Please provide evidence in your Due Diligence Template (e.g., a screenshot from local authority or estate agent)
Please provide evidence in your Due Diligence Template (e.g. evidence that this is running as an HMO)
Please provide evidence in your Due Diligence Template (e.g. screenshot of HMO licence)
Please provide evidence in your Due Diligence Template (e.g. screenshots from HMO manager's opinion in writing, Spareroom, Propertymarketintel, etc )
Please provide evidence in your Due Diligence Template (e.g., a screenshot of comparable property renting at that price)
Please provide evidence in your Due Diligence Template (e.g., a screenshot of comparable renting at that price)
Please provide evidence in your Due Diligence Template (e.g. HMO manager estimate of rental value)
N.B. Question 22 is not visible because it does not apply to you
Evidence all monthly costs including but not limited to:
Evidence of your expected rental income such as:
Please provide evidence in your Due Diligence Template (e.g.Quote My Refurb screenshot or a builder quote if a refurb is needed
Deal Viability – ideally, in a Lease Option, you want the purchase price to be the same as or less than the property’s current value.
Landlord’s Financial Needs – it’s important to know whether or not the landlord requires the money quickly, so that you can better gauge your bargaining power and the value of their offer.
Agreed Purchase Price – you need to have the agreed purchase price in writing, particularly if you are wanting to sell the deal to someone else.
Current Value – it’s important to obtain a professional valuation of the property in order to determine whether or not the Lease Option is a worthwhile strategy for you.
Consideration Fee (Option Fee) – ideally you should pay as little as possible for the Lease Option, although you must pay something to make the contract legally binding. This payment can be as little as £1.
Monthly Fee – ideally, you want to pay as little as possible for the Lease Option each month, although very often you will aim to pay cover the landlord’s mortgage costs. However, if the landlord does not have a mortgage on the property, you may be able to negotiate a nominal monthly payment or no payment at all, other than the upkeep of the property.
Landlord’s Mortgage And Insurance – it’s important to obtain the landlord’s confirmation that they will not be in breach of their own mortgage or insurance obligations as this could void any agreement you have with them or anyone else you might sell the deal to.
Article 4 – it is important to know whether or not the property is in an Article 4 area as planning permission is usually required for an HMO in these areas. Use our Article 4 Checker to do this https://www.samuelleeds.com/online/article-4-search/
Head Lease – it is important to ensure that the property is not governed by a Head Lease which prohibits sub-letting. If such a prohibition exists, you will not be able to proceed with your plans to let the property for BTL, SA or HMO or sell the deal for any of those stated strategies.
Property Classification – it is a legal requirement to know the classification of a property in order to know for which purposes the property can be used (e.g. C3 (single dwelling house), C4 HMO (3-6 unrelated tenants), Sui Generis (7 or more unrelated tenants).
Room Sizes – it is important to measure the room sizes yourself, as errors often creep into agents’ measurements and there are legal requirements for the size of rooms in HMOs – make sure you know what these are.
HMO Status - it is important to know whether or not the property has previously been run as an HMO as this will increase the chances of inheriting an HMO licence or acquiring an HMO licence.
HMO Licence – all HMOs require a licence, so if the property doesn’t currently have one, this will have to be applied for and the associated time and cost of doing so will need to be taken into account, for your own calculations, and if you are selling the deal.
Profit – you need to show that the estimated rental you obtain each month will exceed all your costs.
Refurbishment costs – ideally you’ll be able to let the property without refurbishment but if you can’t, your refurbishment costs should be less than 10% of the value of the property.
Refinancing Property
Please provide evidence in your Due Diligence Template of the ROI:
As your ROI is not at LEAST 20%, we do not deem this to be a viable deal and cannot rate it any further. Please check your calculations and start again, or submit a different deal.
Please provide evidence in your Due Diligence template (e.g. estate agents' quotes, comparables and official valuation)
Please provide evidence in your Due Diligence template (e.g. state the purchase price and provide your calculations).
Please provide evidence in your Due Diligence Template (e.g. estate agent’s estimate of rental value)
Please provide evidence in your Due Diligence Template (e.g. screenshot of a very comparable property renting at that price)
Please provide evidence in your Due Diligence Template (e.g., a screenshot of an almost comparable property renting at that price)
Please provide evidence in your Due Diligence Template (e.g. estate agent’s information or other source)
Please provide evidence in your Due Diligence Template (e.g. estate agent’s information or Title Deeds and quote to extend)
Please provide evidence in your Due Diligence Template (e.g. estate agent’s information or landlord email)
Please provide evidence in your Due Diligence Template (e.g. estate agent’s brochure or screenshot and quote to upgrade EPC rating)
Please provide evidence in your Due Diligence Template (e.g. auction fees in calculations)
Property viewing
Landlord identity
Value of the property
Agreed purchase price
Estimations of rental
Mortgage
Mortgage Stress Test
Freehold property
Leasehold property
Vacant Possession
EPC rating
Crime rates
Auction fees
Legal pack
Survey
Funds
Please provide evidence in your Due Diligence Template (your calculations including the purchase price, the GDV, the GDC and the profit)
As your expected profits are less than 15%, we do not deem this to be a viable deal and cannot rate it any further. Please check your calculations and start again, or submit a different deal.
Please provide evidence in your Due Diligence Template (e.g. planning permission letter, written report from planning consultant, the offer in writing subject to planning)
Please provide evidence in your Due Diligence Template (e.g. email or letter from planning consultant)
Please provide evidence in your Due Diligence Template (e.g. confirmation of the deal)
Please provide evidence in your Due Diligence Template (e.g. a professional valuer’s valuation and/or comparables to calculate the GDV)
Please provide evidence in your Due Diligence Template (e.g.calculations and comparables to calculate the GDV)
Please provide evidence in your Due Diligence Template (e.g.builder’s quote, quantity surveyor’s report and a breakdown of your own calculations)
Please provide evidence in your Due Diligence Template (e.g. a breakdown of your calculations)
Please provide evidence in your Due Diligence Template (e.g. email with vendor or agent)
Please provide evidence in your Due Diligence Template (e.g. ball-park figure )
Based on your due diligence, we will not be able to rate your deal. Please review and compile more evidence first and then use the rate my deal AGAIN. These are the following areas for improvement:
Planning permission
GDV
GDC
Purchase price
Expected profit
Full Address of the Deal (not your home address)
Buy, Refurbish, Refinance / Flip Additional Questions
Buy to Let Additional Questions
Rent to HMO Additional Questions
Rent To Service Accommodation Additional Questions
Lease Option Agreement Additional Questions
Please provide a breakdown of the costs associated with the building / renovation costs along with any evidence.
