£1.8 Million Property in Kent for Couple with Complex Income Structure

• Clients: Married couple and teachers with four UK buy-to-let properties
• Property: Residential home in Kent valued at approximately £1.8 million
• Challenge: Required 80% LTV while the husband had income from two different sources and a tight exchange deadline
• Finance: 80% LTV mortgage with 100% of the husband’s income considered

I recently assisted a married couple who were looking to purchase a new family home in Kent. I had previously helped them raise a deposit against one of their buy-to-let properties, so I was already familiar with their wider financial circumstances and property portfolio.

The couple owned four buy-to-let properties and were currently renting. They wanted to purchase a residential property of their own, valued at approximately £1.8 million, and needed an 80% loan to value (LTV) mortgage to complete the purchase.

Both clients worked as teachers, but the husband’s income was more complicated than a standard employed profile, as it came from two separate sources. Finding a lender prepared to consider 100% of his income was therefore important, particularly given the relatively high LTV they required.

There were, however, some positive factors within the application. The couple had no dependants or unsecured debts, which helped strengthen their overall affordability position and made the application more attractive to lenders that were comfortable assessing their income structure.

Timing was another important consideration. The clients needed to exchange contracts on their onward purchase before the end of the tax year, so there was a relatively tight window in which to secure suitable mortgage terms. I worked closely with the lender and was able to obtain terms within two weeks, allowing the clients to keep their purchase on track.

However, the couple did not actually want to complete the mortgage until later in the year. Rather than allowing this to derail the transaction, I negotiated a delayed completion structure and secured a mortgage offer that remained valid for six months, giving the clients the flexibility they needed around their moving plans.

I was ultimately able to secure the required 80% LTV mortgage while also persuading the lender to take 100% of the husband’s income into account for affordability purposes. The mortgage was fixed for two years at 1.54% at the time.

The result gave the clients the high LTV they required, while the extended mortgage offer period provided valuable flexibility around the timing of their move. It also demonstrates how a detailed understanding of a client’s wider financial circumstances can be important when arranging finance for a more complex income profile.

For borrowers with multiple income sources or a more unusual financial structure, specialist large mortgage expertise can help identify lenders that are prepared to assess the application on its individual merits.

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. Higher-LTV borrowing can increase the level of debt relative to the value of the property, while changes in income or personal circumstances may affect affordability.