A client recently came to me as he wanted to remortgage a flat he owned in North London, worth £450,000. My client required a £300,000 loan and wanted to capital raise to put towards his business expansion.
However, there were a few challenges that came with my client’s personal situation. Firstly, he was from Nigeria and living and working in Lagos. He worked in the medical supplies industry and was self-employed, with the main purpose of the remortgage to capital raise so he could expand his business in Nigeria.
This alone created a problem, as capital raising for business purposes in the UK is extremely difficult and even more so if the funds are to be sent overseas. Not only this, due to my client’s limited ties to the UK, his profile was a problem to almost every lender as he had a little credit history and was, therefore, considered a much greater risk to lend to.
If that wasn’t all, the fact that my client was self-employed created yet more hurdles, as a lender would need to verify his accounts with a certain type of accountant. In order to approve the application for a self-employed client, a lender will always require a proof of accounts. This is the case for self-employed mortgages in general, yet this was even harder due to my client being based overseas, as the accountants would work differently or not with the UK at all.
Equally, my client’s income was not in sterling and consequently did not apply to UK tax rules. This is often a problem for lenders, and with foreign currency mortgages harder to secure since the Mortgage Credit Directive, many lenders have opted out of this space altogether.
Despite this, due to my excellent relationship with numerous private and specialist banks, I was able to use my resources to find a lender willing to accept my client’s case.
I managed to secure a variable rate of 5.3% over a 15-year term, on a capital and interest basis.