Find out how we helped our client capital raise to fund their home improvements
The Client:
At 70 years old, our client wanted to make some improvements to her home. She still worked in higher education with no plans to retire fully in the next few years.
The Property:
A rural four-bedroom detached property in the East Midlands, our client had lived there for many years. It was convenient for reaching her place of work and surrounded by a community she knew well.
The Finance:
Having paid off the mortgage several years ago, our client wanted to release 5% of the equity to make some overdue improvements, including a full kitchen and multiple bathroom renovations.
The Challenge:
The main complexity of this case was our client’s age. Being 70 years old at the point of application, most lenders required her to repay the loan in full by her 75th birthday, which meant the monthly repayments were too high. Furthermore, even though she was still employed past the average retirement age, most lenders would not accept her employed income for the entire loan duration, making affordability challenging.
The Solution:
We knew we’d need a lender to assess this case based on its background context, not just a tick box criteria. Using our knowledge of the complex residential market, we found a lender that would consider the client’s employment to determine how long they could feasibly work for. Therefore, they could assess how old the client could be while still taking an employed salary rather than retirement income.
Initially, the lender was only willing to offer a five-year term; however, due to the unique nature of our client’s work, we were able to negotiate a full nine-year term. Comfortable that our client could still do her job until the age of 80, the lender happily proceeded. Without this successful negotiation, we would have had to approach a specialist later-life lender, which would likely have attracted an interest rate at least 2% higher than the one we managed to secure. Instead, we secured a competitive rate with a high-street lender. Here are the details:
Property Details
Property value: £1,000,000
Loan amount: £55,000
LTV: 6%
Rate: 3.59%, fixed for five years*
Term: 9 years
Mortgage payment: £607.55 per calendar month
Lender arrangement fee: £999
*Rate secured December 2022
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