Interest Only Mortgage for Retired Couple’s ‘Forever Home’
The Clients: A retired couple with a small buy to let portfolio. Their only other form of income was their private pensions.
The Property: The clients wanted to purchase their ‘forever home’; a four-bedroom detached house with a garden that they could enjoy throughout the remainder of their retirement. It was situated in a commuter belt town in the North of England and ideally located to manage their buy to let properties.
The Finance: The clients were ‘upsizing’ and needed a mortgage to purchase their dream property.
The Challenge: As both clients were already in their 70s, their age on application restricted the number of lenders available. The couple had also specified that they wanted an interest-only mortgage so that they could keep monthly repayments to a minimum. For this option, lenders would require a credible repayment vehicle in place to demonstrate that they’d be able to repay the capital. The combination of these challenges significantly restricted our initial choice of lenders.
The Solution: Having researched the borrower criteria’s and suitable products of the available lenders, we were able to approach a lender we believed would accept our clients. By showing them that the couple had enough equity in their buy to let portfolio to repay the mortgage capital at the end of the term, the lender was happy to offer them a mortgage. Our clients were delighted to purchase their forever home and fully settle into their retirement. Here are the details: