A self-employed client with a background in film production approached Enness Global to arrange finance for the purchase of a second residential property in London. The client had built an established production company, with ownership shared between family members, but the nature of the business meant that income varied considerably between projects and could fluctuate from year to year.
The clients required approximately £650,000 of additional residential borrowing. Their combined taxable income was relatively modest compared with the overall value of their business interests, as the clients generally retained capital within the company rather than drawing substantial personal income.
The company had also recently received a significant payment relating to a completed project. However, extracting those funds personally would have created additional tax considerations, meaning the capital could not simply be treated as regular personal income for the purposes of the mortgage application. The clients therefore required a lender capable of assessing their broader financial position rather than relying solely on their latest taxable income.
The fluctuating nature of the production business created a further challenge. The previous financial year had been comparatively weaker, while the underlying business remained established and capable of generating significant income when projects completed. Enness therefore needed to present the client’s wider financial position and the cyclical nature of the business clearly to a lender.
Enness Global approached a private bank with experience in assessing complex self-employed and high-net-worth borrowers. The lender was prepared to consider the profitability and underlying strength of the business alongside the clients’ personal financial position, rather than relying exclusively on the most recent income figures.
The clients also had a planned sale of another property, which provided a potential future source of repayment. Taking the overall circumstances into account, the lender agreed to structure the borrowing over a five-year term with the facility designed to provide flexibility around the timing of payments, subject to lender criteria.
This structure allowed the clients to proceed with their planned second-property purchase without requiring them to extract a significant amount of capital from the production company as personal income. It also provided a repayment strategy linked to their wider property position and future liquidity.
The case demonstrates how private banking can provide greater flexibility for self-employed borrowers whose taxable income does not necessarily reflect the strength of their underlying business interests. By considering the wider balance sheet, business structure and available exit strategy, Enness was able to identify a lending solution suited to the clients’ circumstances.
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, 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. Property values can fall as well as rise.
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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.
