Our client, a professional working in healthcare, wanted to remortgage his main property, which he had purchased less than six months previously using bridging finance. The plan was for the remortgage to pay off the bridging loan.
We needed a lender who was prepared to lend £500,000 against a property value of £1.3m on an interest-only basis. To make the situation more complicated, the client has multiple income sources, including income from sole trader and net profit income on his limited company business accounts, as well as rental income. We also needed a lender who was happy to use the latest year’s net profit and self-employed income rather than an average over the past two years. The most recent year’s figures were much higher, enabling the client to borrow the amount required.
Key requirements: – • A lender who would lend the full amount required to remortgage the property and pay back the bridging finance. • A lender happy to take a variety of income sources into account when deciding whether to lend to the borrower. • A lender willing to add the arrangement fee to the loan.
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 rental income, along with 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: £1.3m • Loan amount: £500,000 • LTV: 38% • Rate: 2.5% fixed for two years • Lender product fee: £999 added to the loan • Monthly payment: £1,042