Home remortgage for semi retired landlords in their late sixties

The client: A semi-retired couple in their late sixties looking to remortgage their home. As well as being the directors of their own office supply business, the married couple received rental income from their investment properties.

The property: Since purchasing the property in 2005, the couple completed a full refurbishment of their home, including a large extension which doubled the size of the property.

The 5-bed detached bungalow, located in the suburbs of Oxford, is in a popular residential area and had increased in value by almost £500,000 from its original purchase price.

The finance: To pay off a small loan against one of their BTL properties, the clients wanted to raise additional borrowing against their home. The clients’ existing mortgage had expired and due to their original lender’s age restrictions, they were unable to extend the term with this lender.

The clients wanted to borrow 41% LTV against £675,000 and required a mortgage term of 12 years to take them up to the age of 80. They were also keen to find a competitive retirement interest only product.

The application: Usually borrowing over the age of 70 is difficult, as lenders expect to see a reduction in income as borrowers come into retirement age.

Through assessing the client’s circumstances and considering their rental income, we knew that we would be able to find a suitable and affordable product.

We advised them that it would be in their best interests to take out a 2-year fixed rate mortgage, allowing them flexibility if they wished to downsize in the near future and prevent any extortionate early repayment charges.

We approached a lender that we know takes on clients up to the age of 80, as the clients requested. This lender also offers competitive interest only rates, available exclusively to intermediaries. Happy with the low LTV of the mortgage and the security of other unencumbered BTL property in the background, the lender was happy to accept this case.

From submitting the case to the lender, an offer for this complex case was made within just six weeks. Here are the details of the deal:

Property Details

Property value: £675475,000

Loan amount: £275,980

LTV: 41%

Rate: 1.77% 2-year fixed rate (4.7% APRC)

Term: 12 years

Lender arrangement fee: £999

Mortgage payment: £408 pcm

Consultant mortgage adviser: Ashley Jones, 01732 471694 or 07853829939

21st May 2019