The client is a successful developer who runs each development through separate Special Purpose Vehicle limited companies. Because of this, the companies showed a mixture of losses followed by high profit in differing years.
The client was hoping to buy a new home and despite having a large deposit was struggling to secure a mortgage directly with conventional lenders because his income streams were difficult to understand – he draws only a modest salary plus dividends from the SPVs. Also, the client wanted interest-only terms which few residential mortgage lenders will consider.
We approached a specialist bank whose underwriting team is trained to understand complex income structures and allows interest-only terms on a case-by-case basis.
An offer was promptly issued and the application proceeded without a hitch.
Interest-only terms were offered because the client could demonstrate access to sufficient funds, via his other properties, to repay the debt.
Here are the details of the deal.
Property value: £2,600,000
Loan amount: £1,400,000
Product: 2.09% tracker for 2 years
Term: 8 years interest only
Mortgage repayments: £2,438 pcm
Lender arrangement fee: £999 added to loan amount
Consultant: Jeni Browne
Consultant tel: 01732 471647