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Remortgage of family home on interest only terms after divorce

Remortgage of family home on interest only terms after divorce

A barrister approached us looking to remortgage his home after recently getting divorced from his now ex-wife.

Instead of splitting the equity in the house, the couple had agreed that the husband could have the house and he would remortgage it in his sole name, and pay the agreed settlement to his ex-wife using money in his savings.

The client had originally approached his existing lender directly for a remortgage on interest-only terms but had been declined due to earning insufficient income on his own to pass their affordability criteria.

The client is a high net worth individual and, worried that he would be unable to obtain a mortgage by going directly to another lender, he approached us for help.

We took the case to an intermediary-only lender, which allows borrowing up to 5.5 times income (unlike the 4.5 x maximum set by the client’s original lender).

We spoke with the underwriting team and provided evidence of the client’s income and assets. To support the case we were also able to provide evidence that the client’s student loan and car loan had recently been fully repaid.

The following favourable terms were offered saving the client £904 pcm in mortgage payments:

Property Details

Property value: £800,000

Loan amount: £660,000

LTV: 82%

Rate: 1.38% 2 Year Fixed

Term: 30 years interest only

Mortgage payment: £2,296pcm

Previous monthly payment: £3,200pcm

Lender arrangement fee: £1,995

Consultant mortgage adviser: Ashley Jones, 01732 471694 or 07853829939

Please note. There are no longer any residential mortgage lenders which will allow applicants to borrow up to 5.5 times their salary. However, we do still have access to lenders, which will go above the standard 4.5 times. 

NB: ANY PROPERTY USED AS SECURITY, WHICH MAY INCLUDE YOUR HOME, MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE

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Mortgages for Business Ltd is registered
in England and Wales No. 2502713.

Registered office:
17 Kings Hill Avenue,
Kings Hill, West Malling,
ME19 4UA.

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Mortgages for Business Ltd is authorised and regulated by the Finance Conduct Authority (No. 313537) to transact regulated mortgages. We are a credit broker, not a lender. We work with the whole of market in sourcing a lender for you; we may receive a commission from the lender, and this amount varies between lenders. The FCA does not regulate some investment mortgage contracts. Mortgages for Business Ltd is a founding member of the National Association of Commercial Finance Brokers, the body that promotes best practice within the commercial finance industry. Telephone calls may be monitored or recorded for training purposes.

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