Summary
First Time Buyer in UK purchasing for £1.3m wanting 90% LTV and low repayments.
Client seeking lender who will recognise significant bonus income for mortgage affordability purposes.
Solution found via private bank with arrangement for interest only mortgage for five years which then reverts to a capital repayment mortgage for 20 years.
Our client
Our client was a First Time Buyer in the UK looking to purchase a property for £1.3m.
What was needed?
The client ideally wanted to obtain a 90% loan to value mortgage of £1.17m as the client held cash overseas and wanted to minimise the amount of money he brought into the UK for tax reasons.
What was the challenge?
The client was employed, but much of his income was made up of sizeable bonuses, so the challenge was to find a bank that would lend at the highest possible loan to value and recognise all or most of his bonus for affordability purposes. In addition, the client wanted to keep the monthly repayment costs as low as possible.
How we provided the solution
After researching the mortgage market for the client’s particular circumstances, Nick Plappert Executive Director, found a private bank that would lend the amount required, as most of the High Street banks will not lend to 90% LTV at this level of borrowing.
Nick was able to arrange the required level of borrowing and as the client also wanted to keep the monthly costs as low as possible, he was able to arrange with the private bank to structure the loan as interest only for the first five years with set annual payments, to bring the loan to value down to 75% in five years after which it would revert to capital repayment.
This meant the client had very affordable monthly payments, with set annual payments that he can make in-line with the timing of when he receives his bonuses.
The client was delighted as the mortgage arrangements suited his situation perfectly and he was able to purchase the UK property he wanted.
What was the rate?
The rate was 3.09% fixed for two years with a Lender fee of 1%.