I recently assisted a successful entrepreneur who was looking to purchase a £3 million apartment in Central London. Having already approached several brokerages without finding a suitable solution, the client wanted a lender that could take a broader view of both his income and the level of borrowing required.
The client had founded and grown a successful UK business and was looking to purchase his first main residence in London. His business had performed strongly over several years, but he had consistently reinvested profits back into the company to support its continued growth.
As a result, his personal income did not fully reflect the strength of the underlying business. This created an affordability challenge when seeking a mortgage of the size required.
The client also wanted to keep his deposit as low as possible. He was looking for 90% loan to value (LTV), allowing him to retain more of his available capital within the business rather than committing a larger proportion towards the property purchase.
A high-LTV mortgage of this size required a lender prepared to look beyond a straightforward income assessment and understand the relationship between the client’s personal income and the performance of his business.
OUR SOLUTION
I reviewed the client’s wider financial position and approached lenders experienced in dealing with successful entrepreneurs and complex income structures. The objective was to demonstrate that the lower personal income was a result of deliberate reinvestment into a growing business rather than an indication of weak financial performance.
Using the strength of our lender network, I identified a specialist lender that was prepared to consider the client’s circumstances and the proposed level of borrowing.
The lender ultimately agreed to provide a mortgage at 90% LTV against the £3 million property. This allowed the client to purchase his London home while retaining a greater proportion of his capital for continued investment in his business.
The case highlights how self-employed mortgage applications can require a more detailed assessment when business owners deliberately retain profits within their companies. It also demonstrates the value of specialist lender access when a borrower is seeking a large mortgage combined with a high LTV.
For borrowers considering a high-value property purchase, the appropriate LTV will depend on the lender, property, affordability and wider financial circumstances. Specialist million pound mortgage expertise can be particularly relevant where the required borrowing falls outside standard high-street lending 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, property suitability and lender criteria. Terms, rates, LTVs 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.
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.
