- Client: US resident working between the US and UK
- Property: Victorian terrace in Richmond Green valued at £4M
- Mortgage amount: £2.2M
- LTV: 55%
- Interest rate: 1.46% fixed for five years
Arranging a large mortgage for a London property can become more complex when a borrower is resident overseas and receives a significant proportion of their remuneration through bonus income. Enness was approached by an existing client looking to purchase a Victorian terrace property overlooking Richmond Green in south west London.
The property was valued at approximately £4M, with the client looking to secure mortgage funding of £2.2M. This represented a 55% loan to value (LTV), providing a substantial level of equity in the property.
The client was a US resident and worked for a leading US telecommunications company, splitting their time between the US and the UK. Their remuneration consisted of a strong basic salary alongside a significant annual bonus.
While the client’s overall income was sufficient to support the proposed borrowing, the bonus element presented an additional consideration. Lenders can apply different approaches when assessing variable remuneration, with some limiting the amount of bonus income they will include in affordability calculations or requiring evidence of a consistent bonus history.
This was particularly relevant given the size of the mortgage required. The client needed a lender that was comfortable considering their international circumstances and able to take an appropriate view of their remuneration structure.
Enness reviewed the client’s circumstances and approached lenders with experience of large mortgages and international borrowers. The application was presented with a focus on the client’s overall income position, employment and established bonus history.
Following negotiations, Enness secured mortgage funding of £2.2M against the £4M Richmond property, representing 55% LTV. The mortgage was arranged at a rate of 1.46% fixed for five years at the time.
The resulting structure allowed the client to proceed with the purchase of the London property while securing a fixed rate for the initial five-year period. The transaction demonstrates how large mortgage finance can be structured for international borrowers where remuneration includes a significant variable component.
For borrowers who are resident overseas or divide their time between jurisdictions, specialist mortgage expertise can help identify lenders able to consider international income and complex remuneration structures, subject to individual circumstances, affordability and lender criteria.
Disclaimer:
This case study is for illustrative purposes only and does not constitute financial, legal, tax or investment advice. Finance is subject to status, underwriting, affordability, valuation, property suitability, due diligence and lender criteria. Terms, rates, LTVs, fees and availability may vary depending on individual circumstances.
Risk Warning:
Property securing finance may be repossessed if repayments are not maintained. Property values can fall as well as rise. Borrowers with income derived partly from variable remuneration should consider the potential impact of changes in bonus income on affordability and their ability to maintain mortgage repayments.
Information contained in our case studies is for market and illustrative purposes only. In some cases, these may be made up of multiple cases and are for illustrative purposes only.
Some case studies are made up of enquiries that have come into the business, not all business completes, and the posting of a case study does not represent a completed piece of business.
Property values can fall as well as rise, and you may not get back the amount originally invested. Property investments can be illiquid and may take time to sell. Where borrowing is used, your property may be repossessed if you do not keep up repayments on a mortgage or other loan secured against it.
