An international client approached Enness to secure finance for a first residential property purchase in London. The client was a senior executive at a large marketing company and received a significant proportion of remuneration through bonus income. The client’s borrowing requirements and income structure meant that a specialist mortgage solution was required.
The client was seeking to maximise borrowing while contributing a relatively small deposit. With a deposit of approximately 5%, initial mortgage options available to the client carried relatively high interest rates. The property itself also presented an additional lending consideration due to its unusual characteristics and proximity to commercial and retail premises, which restricted the number of lenders willing to consider it.
The key challenge was to structure the mortgage around the client’s full income profile while identifying a lender comfortable with both the required level of borrowing and the property itself. The client also wanted a structure that could make efficient use of future bonus income and provide flexibility around managing mortgage interest costs.
OUR SOLUTION
Enness identified a specialist lender able to consider the client’s broader income profile, including eligible bonus income, subject to the lender’s affordability criteria. This increased the borrowing capacity available to the client and helped meet the required funding level.
An offset facility was also incorporated into the proposed mortgage structure, allowing eligible savings to be held alongside the mortgage and potentially reducing the amount of interest charged, subject to the lender’s terms and the client’s individual circumstances.
Given the property’s unusual characteristics, Enness also worked to establish whether the proposed security would be acceptable to the lender’s valuation process. The property was considered suitable subject to the lender’s formal valuation, underwriting and standard lending conditions.
The resulting mortgage was structured over a 29-year term with a two-year fixed-rate period and an offset facility. The lender also agreed to waive the valuation fee and product fee, subject to the agreed terms.
From initial application to mortgage offer, the case progressed within eight working days. The speed of the process was particularly important as the seller intended to keep the property on the market until the client had received a formal mortgage offer.
This case demonstrates how specialist mortgage structuring can help borrowers with complex income profiles, high borrowing requirements and properties that may fall outside the standard lending criteria of mainstream providers. By considering the client’s wider financial position and matching the application with an appropriate lender, Enness was able to identify a suitable financing structure within a tight timeframe.
Disclaimer:
This case study is for illustrative purposes only and does not constitute financial, legal, tax or investment advice. Finance is subject to status, affordability, underwriting, valuation, property suitability and lender criteria. Terms, rates and availability may vary depending on individual circumstances.
Risk Warning:
Your property may be repossessed if you do not keep up repayments on your mortgage or other borrowing secured against it.
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.
