Our client, a day-rate contractor working in the IT sector, wanted to remortgage his main residence and at the same time raise additional funds to purchase an investment property. He wanted the remortgage to be on an interest-only basis to keep costs low. So, that he could afford the investment property as well.
Remortgage
We needed a lender who was prepared to lend £395,000 against a property value of £660,000 on an interest-only basis. Client was interested in a base-rate tracker with no ERCs (early repayment charges) so he could keep his options open and give him maximum flexibility in a volatile market. He wanted to avoid locking into a fixed rate while rates are high.
Use the advice of a contractor remortgage broker – AWS Mortgage advisors are fully familiar with the terms of the contractors and know what remortgages the lenders are offering to them. Moreover, AWS Mortgage advisors are also aware of the pros and cons of each remortgage. Therefore can make a comprehensive comparison of existing remortgages in the market.
Key requirements: –
- A lender who would lend the full amount required to remortgage the client’s main property and raise funds for the buy-to-let property.
- The lender happy to lend on an interest-only basis.
- A lender willing to add the arrangement fee to the loan.
So, after sourcing the mortgage market, we identified a lender who would agree to lend the full amount required at a competitive rate.
The application process: To support the mortgage application, the client provided details of his income and evidence of his identity. We were delighted to inform him that a lender had issued a formal offer for the full amount requested.
- Property value: £600,000
- Loan amount: £350,000
- LTV: 60%
- Rate: 3% (0.75% above base rate) for two years
- Lender product fee: £999 added to the loan
- Monthly payment: £875
