Clients book new money-saving remortgage rate up to 6 months ahead of the current deal ending in anticipation of a rate rise.
The clients were a professional couple, whose existing mortgage was coming to an end in May 2022. They were recommended to speak to Rose Capital Partners on the advice of another client. These clients had secured a mortgage deal ahead of schedule which ended up saving them a lot of money, so they referred their friends to us in the hopes that we could do the same for them as a London-based mortgage broker.
What was needed
The couple had no need for any extra borrowing but were unaware that you can book a new rate on your current mortgage up to 6 months ahead of your current deal ending. The clients were also unaware that as the lead earner had changed jobs in the last 2 years, there would be a greater level of scrutiny applied to his bonus, which was required in order for the lender to agree to the loan.
What was the challenge?
The main challenge was getting the clients motivated enough to get the paperwork we needed, so far in advance of their product ending. However, as November rolled around and there was the widely publicised expectation that the Bank of England would raise interest rates that month, the motivation kicked in as lenders started raising the rates on their products in anticipation of the rate rise. We managed to get the application submitted on the day the lender pulled that particular product, meaning we secured the market-leading rate available to the client, which subsequently became unobtainable as no lender has offered a rate as low since.
During the underwriting process, we were able to put the lenders at ease with the bonus income, change in employment, etc., all with no time pressure as the product had been secured (which means any subsequent changes will not affect our clients as the rate was booked). Also, as legal work takes a lot longer than usual at present, this means this aspect of the remortgage can also rumble along with no risk of the clients missing the end date in order to ensure a smooth transition from the current lender to the new one.
How we provided the solution
After speaking with the clients and assessing their remortgage needs, Richard Campo, Managing Director, outlined the challenges above in a way that the clients understood while making the process its self as easy as possible. Once the lender and product were identified, Richard sent a few reminders of the impending changes and chased the clients harder once he was told the lender would be pulling the product. Had he not communicated so well, the clients would have ended up paying considerably more on their mortgage than they needed to with a higher remortgage rate. Highlighting why it is just so important to have a mortgage broker in your corner that has your interests at heart, not the lenders.
What was the rate
The interest rate was 1.19%, fixed for 5 years (which was 75% of the property value).