Creative refinancing to restructure portfolio debt was the solution our client needed when faced with tightening lender tests that made a strong, well-run portfolio fail on paper. Our client, a highly experienced landlord, wanted to cut borrowing costs across a ten-property portfolio (around £20m value with £11m of debt). The sticking point was the flagship Prime London asset (about £10m): great property, solid tenant, yet the rent didn’t pass the lender’s test at today’s stress rates.
Most buy-to-let lenders check two things:
On the £10m property, the answer was “not quite”.
Rather than forcing the rent to do all the work, we used the client’s wider finances to support the asset that missed the test.
A ring-fenced cash deposit: a pot of money held with the lender to “top up” payments if needed.
Some lenders are set up for this, some aren’t, so we didn’t try to make one lender do everything.
We split the portfolio by what each lender does best.
The flagship property went to a private bank that looks at the whole picture—liquidity, other income, tolerance for voids—and can accept a cash interest-servicing deposit to bridge the rent gap.
The rest went to a specialist portfolio lender on straightforward, interest-only terms. This route was fast with tidy processing; there was no need for private-bank flexibility on those units.
This approach reduced risk as there was no single lender over the entire portfolio, saved time as the simpler loans completed while the private-bank line was finalised, and kept options open (easier to sell or refinance parts later).
Top slicing is where a lender uses your reliable surplus income—in addition to the rental income—to assess whether a loan is affordable. If rent plus excess income meets the lender’s stress-test requirements, the borrowing can be approved even when rent alone falls short.
Not all lenders offer top slicing, but for clients with strong, well-documented income, it can be a powerful tool to unlock higher borrowing, refinance challenging properties, and improve overall portfolio flexibility.
Sometimes top slicing isn’t the right fit—especially with company-owned properties or “asset-rich, income-light” clients. In those cases, a lender may accept cash on deposit to support payments.
How to calculate the deposit sum:
It’s clean, auditable evidence that the mortgage can be paid—even if rent is light or there are voids.
We divided and conquered. The high-value asset went to the private bank, backed by the interest-servicing deposit. The other properties moved to the portfolio lender on an interest-only basis, protecting cash flow.
On valuation, Prime assets can be sensitive. We shortlisted valuers with local depth, staged the big instruction, and raised a little more on some lower-value units which created a practical buffer against a down-valuation on the high value property.
If this scenario resonates with you or you’re seeking personalised mortgage advice for another situation, please get in touch — we’d be happy to see how we can help.
Call our team today on 0800 980 8777 or email info@privatefinance.co.uk.
Disclaimer:
The information presented in our case studies is intended for illustrative and marketing purposes only. Some case studies may be based on multiple enquiries or hypothetical scenarios to demonstrate typical processes or outcomes. Not all case studies represent completed business transactions, and the inclusion of a case study does not imply that the business was successfully concluded.
