Our client, a day-rate IT contractor, wanted to remortgage to raise funds to pay for home improvements. He was also coming to the end of a fixed-rate mortgage so wanted to move onto a similar deal. Rather than paying his lender’s higher standard variable rate.
Remortgage
Because our client is a day-rate contractor, we needed a lender who would take his day rate into account. When calculating how much he could afford to borrow. There was also a potential issue in that he had recently taken a break from work in order to re-train in order to earn a higher daily rate.
Numerous lenders were sourced but this dal required specific criteria and took a lot of research to identify a suitable lender. Most lenders require at least one year’s continuous track record of employment. So our client’s break to re-train caused some issues, and we needed a lender. Who we could discuss the case with in order to explain the situation.
Key requirements: –
A lender comfortable with our client being a professional day-rate contractor, who was prepared to base the client’s income on that day rate, rather than salary and dividends, when calculating how much they could borrow. The lender happy to increase the size of the mortgage to cover the cost of the home improvements. A lender offering a competitive fixed-rate mortgage.
After sourcing the mortgage market, we identified a lender who would agree to our client borrowing the required amount of £622,000.
The application process: To support the mortgage application, the day-rate contractor supplied us with evidence of his fixed-term contract and proof of identity. We were delighted to inform our client that the lender had issued a formal mortgage offer for the full amount requested at a competitive fixed rate.
Property value: £850,000 Loan amount: £595,000 LTV: 70% Rate: 1.89% fixed for two years Lender product fee: £1,495 Monthly payment: £2,346
