Can Limited Company Landlords Use Rent Factoring?
Yes. Limited company landlords and special purpose vehicles can use rent factoring. Factored purchases contracted rent held in the company name and advances £1,000 to £75,000 within 24 hours. The company keeps its properties, its mortgages and its lender arrangements exactly as they are.
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How it works for a company or SPV
Where properties are held by a limited company or SPV, the tenancy agreements and the rental income sit in the company name. Factored purchases a portion of that contracted income and pays the lump sum to the company bank account.
The arrangement is entered into by the company, and the directors sign on the company's behalf following standard identity verification.
- Documents required: signed tenancy agreements, proof of company ownership of the property and director identity verification.
- Funds are paid to the company account within 24 hours of approval.
- Trading companies and dedicated property SPVs are both accepted.
Why incorporated landlords use rent factoring
Many landlords incorporated after Section 24 restricted mortgage interest relief for individuals. Corporate structures bring their own cashflow pressures: corporation tax deadlines, refurbishment programmes across a portfolio and deposits for the next acquisition.
Rent factoring releases capital held up in future rent without new company borrowing, a new charge or a revaluation of the portfolio.
- Fund corporation tax and accountancy deadlines.
- Fund EPC upgrades across a company-held portfolio.
- Fund deposits for the next SPV purchase without selling an asset.
Eligibility for company landlords
- UK limited companies and SPVs holding residential property in England, Wales, Scotland or Northern Ireland.
- Buy-to-let, HMO, student and council-let tenancies accepted.
- Single properties and portfolios of any size.
- Assessment based on rental income and tenancy quality, with a soft search only.
- Approximately 90% of landlord applications are approved.
Rent factoring for a limited company compared with company borrowing
| Factor | Factored rent advance | Company buy-to-let borrowing |
|---|---|---|
| Speed | 24 hours | 4 to 12 weeks |
| Valuation | Not required | Required on each property |
| Security | No charge on company property | Charge over property, often with a debenture |
| Director involvement | Identity verification only | Personal commitments commonly requested |
| Legal fees | None | Payable, often on both sides |
| Effect on existing facilities | Existing mortgages unchanged | May require lender consent or refinance |
When a rent advance may not suit you
- A rent advance is sized on contracted rental income, so it is not the right route for sums far larger than the rent a property produces. Purchases and large developments are usually better served by a mortgage or a bridging facility.
- Because settlement comes out of rent already being collected, landlords who need that full rent for monthly mortgage payments should check the reduced income still covers their outgoings before applying.
- A property with no tenancy in place, or with rent not being paid, will not qualify — the advance is priced against rent that is contracted and flowing.
- Where a landlord wants the cheapest possible cost of capital over several years and can wait weeks for funds, refinancing at a low rate may be less expensive than a short-term advance.
Sources and official guidance
Frequently asked questions
Can an SPV use rent factoring?
Yes. Factored funds special purpose vehicles holding UK residential property, advancing £1,000 to £75,000 against contracted rent in the company name.
Does the company need trading history or filed accounts?
No. Factored assesses the tenancy agreements and rental income, so newly incorporated SPVs with occupied properties can apply.
Is a charge registered against company-held property?
No. Factored registers no charge at HM Land Registry and no debenture over the company, so existing company mortgages remain unchanged.
Which company documents are needed?
Factored needs the signed tenancy agreements, proof that the company owns the property and standard identity verification for the directors.
How is a rent advance treated in company accounts?
The arrangement is a purchase of receivables rather than borrowing. Accounting and tax treatment should be confirmed with the company's accountant.
Related Factored guides
Get a rent advance of £1,000 to £75,000
Factored funds UK landlords within 24 hours, with no legal fees, no valuation and no charge on the property.