The client: As with many people moving home in this tough financial climate, our client wanted to find the cheapest mortgage possible. She required 85 per cent loan-to-value (LTV), which usually means a higher mortgage rate than if she was borrowing say, 60 per cent, as lenders regard the former as being riskier. Subsequently, she needed at least some of the mortgage on an interest-only basis to keep costs down.

Working in IT, part of our client’s salary is in the form of bonuses on top of her basic salary, which further complicated matters.

This required a lot of research to find a lender who could meet the client’s criteria, while offering a competitive rate.

Key requirements: –
  • A lender prepared to offer a competitive rate at 85 per cent LTV on a part interest-only basis.
  • A lender willing to take bonuses into account as well as basic salary when calculating how much the client could borrow.
  • A lender prepared to add the arrangement fee to the loan.
After sourcing the mortgage market, we identified a lender who agreed to lend the full amount required at a ‘best buy’ rate.

The application process: To support the mortgage application, the client provided evidence of her income and identity. We were delighted to inform her that a lender had issued a formal offer for the full amount requested on a part interest-only basis.
  • Property value: £825,000
  • Loan amount: £700,000
  • LTV: 85%
  • Term: 25 years
  • Rate: 4.55% fixed for two years
  • Lender product fee: £899 added to the loan
  • Monthly payment: £3,163