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Residential Remortgage & Holiday Let Purchase – Case Study

The Client:
Our client was a UK citizen who already owns one Holiday Let property as well as his own residential property and was about to complete on another Holiday Let property. The client works as a Train Driver on a good income, with both basic plus overtime pay.

The client had Bridging Finance in place against his own residential property and used the funds to buy his first Holiday Let months earlier. He was wishing to now pay off the more expensive Bridging Finance (“exit the bridge”) with a remortgage on his residential home as well as secure a new Holiday Let mortgage for the new purchase.

Contact us today to speak with a specialist Holiday Let Broker to discuss how we can assist you

The Scenario:
The client had sufficient equity in his residential property to remortgage and release sufficient equity for the deposit of the new Holiday Let property. However, before contacting us, the client had been trying for several months with other Brokers to secure the funding but had been unsuccessful. He has a high debt to income ratio and this was most likely the reason he had been struggling as he needed the equity from his residential to act as the deposit for the new Holiday Let.

The Solution:
Being a whole-of-market Broker, we have the knowledge to know that some Lenders internal credit scoring systems allow an application to be considered even where a client is highly “geared” – i.e. high debt to income ratio. So long as the credit score passes and the client have maintained their credit agreements to a satisfactory level, certain Lenders will still consider an application. In this particular instance, we were able to use a High Street Lender who accepted the client’s residential remortgage.

For the Holiday Let purchase, since the client already owned one and has a good income, we were able to secure him the best deal on the market for this, which fitted the Lender’s criteria perfectly. It was also beneficial that the client already has the onward purchase resolved as that can often hold up residential remortgages, as lenders’ wish to know the specific details etc.

Discover our Holiday Let Mortgage Broker services.

Summary:
When trying to remortgage a clients’own residential home, it can be often be difficult when the client owns multiple properties and has a high debt to income ratio. However, options do exist, especially if all existing credit agreements have been well maintained.

Key things to consider for Residential Remortgages when raising funds to buy another property:

  • Debt to income ratio.
  • Good payment history.
  • If you don’t have an onward purchase, most residential lenders will want to see one or at least know the details.
  • If you already own a Holiday Let, and earn over £30k, you are in a good position with Lenders to be able to purchase another Holiday let.
  • Just because you have had setbacks or issues, doesn’t mean it’s not possible – you just need to work with an experienced Broker.

If you have any questions about Holiday Let Mortgages, or would like a Free Quotation then please call us now on 03303 112 646 today. Alternatively please fill in our online enquiry form now and one of our Holiday Let Mortgage Advisors will call you back.

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Expat Residential Mortgage – Case Study

The Client:

Our client is an Expat working as a Sales Director and living in Hong Kong until recently when he moved to Japan. The client works for a UK based multi-national company and earns good income with most of his overseas expenses also being paid by the company.

The Scenario:

The Client was seeking an Expat Residential Mortgage to enable him to purchase a property for him and his family to live in upon their upcoming return to the UK. The client had a handsome 40% deposit.

Contact us today to discuss Expat Mortgages and how we can assist you.

The Solution:

Being a whole-of-market Broker, we could easily offer standard Expat mortgage rates and terms to this client as we have access to all of the Expat Mortgage Lenders, including the specialist lenders.

However, through our specialist Expat knowledge and experience along with the clients’ strong credit profile and large deposit, we were actually able to offer

him standard UK Resident (non expat) mortgage rates, even though they were still living in Japan. This was an excellent outcome for the client as the rate secured was an overall 1.1% cheaper than the cheapest Expat market rate that the client was eligible for.

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Summary:

When looking for a “Buy to Live” property it is important to remember that a family member will have to occupy the property when the mortgage holder is abroad, as the property cannot be left vacant since this would invalidate the buildings insurance.

Key things to consider for Expat Mortgages:

  • Certain currencies will not be accepted by Lenders- usually if the currencies is considered volatile.
  • Expat Mortgage Interest Rates are usually higher than standard (UK Resident) mortgage rates.
  • Lenders’ Arrangement Fees are usually a percentage of the loan rather than a  flat / fixed fee.
  • The client/s will need an active bank account and credit footprint in the UK.
  • Loan to Values are typically lower.

If you have any questions about Expat Mortgages, or would like a Free Quotation then please call us now on 03303 112 646 today. Alternatively please fill in our online enquiry form now and one of our Expat Mortgage Brokers will call you back.

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Regulated Bridge – Case Study

The Client:

A client was looking to purchase a property via auction which came with a strict completion deadline. As the client was a foreign national, sourcing a lender able to lend could have been a difficult process.

The Scenario:

As specialists in bridging as well as foreign national mortgages, we were able to find a lender who would consider the case within 24 hours. The value of the property was £200,000 with the client providing a deposit of £80,000.

Contact us today to discuss Bridging Loans and how we can assist you.

The Solution:

The first thing we did was to source a viable exit strategy for the client to ensure they would be able to clear-off the bridging loan – also known as “exit the bridge”. After referring the case to several suitable lenders, we provided the client with two competitive remortgage options. This provided the client with the peace of mind they required to meet the affordability criteria to be able to pay off the bridging loan and also meeting the main requirement for the bridging lender.

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We then requested all packaging requirements in advance from the client to ensure that the lender was able to review the case as quickly as possible so that we could ensure the legal work could be carried out without any delays.

After meeting the completion deadline, we were than able to focus on the re-mortgaging of the property so the client could recoup the interest costs of the bridging loan, as well as having the security of knowing they have a long-term mortgage on the property. 

Summary:

For more details on Bridging Loans, please refer to our dedicated website:
https://www.uk-bridgingfinance.co.uk/

If you have any questions about Bridging Loans &/or want to receive a free quotation, please call 03303 112 646 today. You can also fill in this short online form to get started. Our team of Bridging Loan Experts will get back to you straight away.

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Expat Remortgage Interest Only Adverse Credit – Case Study

The Client:

Our client lives in Canada and has a residential property in the UK that she has been letting out since she left the country in 2016. As a UK-born resident, the client moved to Singapore initially and then on to Canada to live. The property is currently on shared ownership with the client wishing to purchase the property up to 75% and remove the shared ownership aspect entirely.

The client has good income and an established job, however she does have some adverse credit including missed mortgage payments. One missed mortgage payment was just over a year ago, and the other two within the last three years.

Contact us today to discuss Expat Mortgages and how we can assist you.

The Scenario:

Initially the client wanted an Expat capital and interest mortgage, however once we established the clients’ full circumstances there were multiple factors to consider. Points for considerations included, the fact there is the adverse credit, no other property is owned and the client used to live in the subject property. We also had to be mindful of the fact that the majority of lenders that would be considered more ‘specialist’ in the Expat sphere do not offer capital and interest. There are also some lenders that simply do not allow a remortgage away from shared ownership.

The Solution:

A five year fixed mortgage was always going to be the only option in regard to rental affordability. However, once we’d checked the case with the mainstream Lenders due to the issues identified above when all put together, the case unfortunately didn’t fit with any of them.

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However, we found a Specialist Lender that was comfortable with what was regarded as “consumer lending” by many, and they had criteria on missed mortgage payments, but only within the last year. Additionally, the Specialist Expat Lender was fine with the shared ownership aspect, and they also offered capital and interest mortgages.

With the benefit of our specialist advice the client was able to make an informed decision. The client was keen on capital and interest as previously mentioned. However, it left the client very close to coverage required due to the rental amount received – also, as they were paying management fees it didn’t fit with the Lender overall on this basis. We therefore suggested the client opt for an Expat Interest only mortgage – reason being that while the Lender put forward doesn’t allow intermittent overpayments, they do allow the client to pay it all off within the 5 year fixed without any Early Redemption Charges (ERCs).

In this scenario, as long as the client keeps their credit clean, in a couple of years, they will probably be able to remortgage to a better lender, change it to Capital and Interest mortgage and actually pay less and there won’t be any exorbitant early redemption charges. The client was delighted by this solution as it ultimately ticked all her boxes.

Key Factors to consider for Expat Mortgages UK:

  • Not all Expat Lenders offer capital and interest.
  • Adverse credit makes Expat Mortgage Lending Specialist and also limited.
  • A lot of these Expat Lenders consider if you’ve ever lived in the UK and have any other properties in the UK.
  • Remortgaging away from shared ownership isn’t widely available.

To know more and speak to one of our Expat Mortgage Brokers for a FREE Quotation and Advice, call us now on 03303 112 646. You can also fill in this short online form to get started. Our team of Expat Mortgage Brokers will get back to you straight away.

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Unsecured Business Loan Case Study

The Client:

A client had a requirement for some business finance. The money was to be used for Working Capital and for Business Expansion. They wanted to raise between £10,000 – £15,000 and needed the funds urgently.

The Scenario:

Unsecured Business Loans still tend to be a niche product and remains a higher risk product for the Lenders. As a result, it is a limited market and clients do not have as many options available to them as a standard secured lending product like a mortgage.

Contact us today to discuss Business Loans and how we can assist you.

After the pandemic, most Lenders have been extremely cautious and want to ensure that they are supporting business whilst still lending money responsibly. This also means that the liquidity in this market is less as compared to pre-pandemic levels.

This is where we come in as a Specialist Commercial Finance Broker. We understand our Lending Partner requirements and ensure that we meet our clients’ requirements to them. As an example, a business may be looking for a Business Loan for equipment or for a machinery purchase. A standard / traditional Business Loan may be too expensive for the business, but we would look at offering them an asset finance facility in this instance. This gives the customer the equipment they need and essentially the Lender the security they require.

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The Solution:

As a result, with this client, we identified that the client had a high turnover business. For businesses such as off-licences, corner shops, newsagents etc, the turnover tends to be high. Therefore, we were able to arrange a £12,500 turnover-based loan which was to be repaid in a mid – short term period.

This was good for the client as they wouldn’t have to be drawn out into long winded finance and using the power of their turnover, they will be able to repay the loan in 5 months. The client was also delighted as they received the funds in 24 hours of their initial enquiry to us. Our role was key in being able to work to the clients’ requirements and pace. There are multiple other options we would have been able to explore with business in a different position.

Summary:

Both Secured and Unsecured Business Loans are accessible to businesses of all shapes and sizes – working with a Business Loan Broker like ourselves we will search the whole market for you to find the best Lender and Rates for your particular business. Additionally, we shall present the loan application to the Lenders in the format and language they wish to see, which in doing so, will significantly improve your chances of being approved for a Business Loan.

For full details on the types of Business Loans available please visit our Business Loans page.

To know more and speak to one of our Business Finance Brokers for a FREE Quotation and Advice, call us now on 03303 112 646. You can also fill in this short online form to get started. Our team of Business Finance Brokers will get back to you straight away.

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First Time Buyer – Self-employed Partner with No Accounts

The Client:

We were recently successful in helping a client buy their first home, who had recently become a Partner within a GP practice.

The Scenario:

Typically, when you become a Partner of a GP practice you a treated as “self-employed”. A Partner will take a share in the profits (and losses) of the practice. Compared to a salaried (employed) GP who is employed on a contract, on a basic salary by the practice.

Contact us today to discuss Contractor Mortgages and how we can assist you.

This can pose an issue when looking to take out a mortgage as typically lenders will need at least 2 years history in that role, being self-employed. To a Lender anything less can be deemed risky. Due to the nature of being self-employed, income will typically fluctuate. As a result, Lenders risk appetite is high as they need to be sure that the business can prove a sustainable track record of earnings by way of 2 years accounts.

Therefore, on the face of it our client wouldn’t be able to get a mortgage having only just joined the practice and not having the standard track record lenders demand.

The Solution:

However, this wasn’t the case for our client. This is where our expertise came into play, being a Specialist Self-Employed Mortgage Broker we were able to source a market leading deal with a well-known High Street Lender.

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All the Lender required instead of the typical 2 years accounts, was a letter from either the head partner OR Practice Accountant detailing the level of projected drawings the client was expected to receive for the year. In addition they also required to see the detailed Practice Accounts to back up the letter.

To make things even better, we were able to obtain a ratio of 5.5 x income and also up to 90% loan to value, which represented an excellent deal for the client who was delighted with this outcome.

Summary:

Being self-employed for less than 2 years doesn’t necessarily mean that you are unable to get a mortgage. Working with a Specialist Mortgage Broker that fully understands the market and what options are available to self-employed persons such as Partners, GPs & Contractors etc; is the best way of not only ensuring you can successfully secure a mortgage, but equally that you can achieve the highest loan to value and income multiples.

To know more and speak to one of our Contractor Mortgage Expertscall us now on 03303 112 646. You can also fill in this short online form to get started. Our team of Contractor Mortgage Experts will get back to you straight away.

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Secured Business Loan Case Study

The Client:

The client is a payroll services business seeking £250,000 – £350,000 of working capital to facilitate ongoing growth of their business. The client wanted to be able to have a facility that would allow them to grow the business over a 3 year period to invest in marketing, new staff and upgrading their office to accommodate the increased demand for their business. The client had no business assets so to speak, however they did have assets in the background that could be used as security to strengthen the case.

Contact us today to discuss Business Loans and how we can assist you.

The Solution:

As the client was looking for a large loan, it was important to ascertain what assets were available to be used as security and also understand what the turnover level was for the client. The client’s business had shown positive growth over the last 3 years, evidencing a high level of turnover and sufficient amount of net profit which was favourable for the Lenders.

The client had enough equity in two properties in the background to place an equitable charge over both of them.

We were able to secure the customer 2 finance offers:

a) Either an unsecured loan option of £150,000 initially, or

b) £217,000 if using the two properties in the background as security.

Although the business could support a higher loan amount, since the business had just one sole Director, the preferred Lender caps their loan sizes due to their only being one Personal Guarantee.

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Whilst the initial loan was not as high as initially hoped, however the selected Lender provides flexibility – i.e. so long as the client maintains regular repayments over a 3-6 month period, then the Lender can offer further “top-up loans” to allow the loan to grow alongside the business. These funds will allow the company to grow as per their 3 year plan and subsequently, with the option of the top-up loan, provide a suitable longer term facility to support the business as it expands.

In terms of timescales, from the initial submission of the application to the lender, it took just 9 working days for the funds to be released to the client, who was delighted with the excellent terms we secured for their business.

Key Points to Consider:

As a general rule, if the client has assets or is a Homeowner, financial providers can often lend between 15% – 25% of the business turnover.

Please keep in mind that these are only broad guidelines. Each case is looked at individually and treated on its own merits.

Summary:

For full details on the types of Business Loans available please visit our Business Loans page. To know more and speak to one of our Business Finance Brokers for a FREE Quotation and Advice, call us now on 03303 112 646. You can also fill in this short online form to get started. Our team of Business Finance Brokers will get back to you straight away.

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Adverse Credit Remortgage Case Study

The Client:

Our client wanted to remortgage their primary residence, which was currently mortgage-free. They needed to raise money to buy a new vehicle and also to send their daughter to university.

The Scenario:

The client had already approached several other brokers, all of whom were unable to assist him. The client had recently missed several mortgage and unsecured loan payments in the previous 12 months therefore he had what is referred to “Adverse” (bad) Credit.

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Generally most lenders will outright decline a mortgage application if there have been any missed mortgage payments in the last 12 months. The client could have waited until the payments were more than a year old, but they wanted the money right away.

The Solution:

We started with a well-known High Street Lender because they didn’t have any specific criteria for missed mortgage payments and considered it based on credit score. Unfortunately, the case was rejected due to not meeting the minimum credit score required. The client’s credit report was unaffected because the lender just performed a ‘soft check,’ which leaves no trace.

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The next best option was to contact a Lender that specialises in providing mortgages to clients who had previously experienced credit problems. The Lender approved the mortgage application because the arrears had been paid in whole and the client could show that no payments had been missed in the previous six months. This loan was available with a loan-to-value ratio of up to 85%.

Summary: Adverse credit doesn’t instantly dismiss the ability to being able to get a new mortgage. Specialist Lenders exist in the market for circumstances when this happens and they are willing and keen to work with clients all the time. However, access to these Lenders is invariably restricted to clients introduced firstly via Brokers and secondly, typically only “whole-of-market” Brokers work with the Specialist Lenders such as these.

To find out more and speak to one of our highly experienced and CeMAP qualified Mortgage Advisors, call us now on 03303 112 646. You can also fill in this short online form to get started. Our team of Residential & Buy to Let Mortgage Advisors will get back to you straight away.

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Holiday Let Case Study

The Client:

The client was looking to refinance a former Residential property that has been used as a second home.

The Scenario:

The value of the property was £600,000, but with the AST rental figure only being £1,400 per month, they wanted to explore ways of earning a higher income from the property.

Due to its coastal location, the property was confirmed to be ideal for use as a Holiday Let, so the client wanted to remortgage onto a specialist Holiday Let mortgage.

Contact us today to discuss Holiday Let Mortgages and how we can assist you.

Some lenders, although offering holiday / short term let products, still assess the maximum loan affordability off the AST rental figures, which was limiting the loan to approximately £400,000 on a 5 Year fixed rate. However the client wanted to raise 75% LTV to enable them to invest in more property, whilst only fixing their rate for 2 Years.

The Solution:

The remortgage was subsequently placed with a specialist lender who was able to use Holiday Let rental figures to establish affordability, which were much higher than the AST rental income figures.

The client had to go away and obtain a valuation from a local/regional holiday let expert who would need to confirm the average weekly rental in the low, mid and high seasons. The lender would then take an average of these over a 30 week period to use as the annual income. The figure resulted in £1,200 weekly average which over 30 weeks came to £36,000 annually as opposed to the AST rental figure of £16,800 per Year.

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The higher Yearly income figure allowed the client to secure a 2 Year fixed rate mortgage at 75% LTV with an interest rate of 3.29%, whilst raising an additional £50,000 out of the property to go towards their next investment.  

Summary:

Being a whole-of-market Broker, we work with ALL Lenders including the Specialists. For more details on Holiday Let Mortgages, please refer to our dedicated website:
https://holidayletmortgageuk.com/

If you have any questions about Holiday Let Finance &/or wish to speak with one of our Specialist Holiday Let Mortgage Advisors for a Free quotation, please call 03303 112 646 today or complete the short enquiry form.

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Unsecured Business Loan – Case Study

The Client

A successful second-hand vehicle dealership who was seeking £100,000 of working capital to facilitate ongoing growth of his business. In particular, the client wanted to purchase higher value stock which would generate greater profit margins. The client had no business assets that could be used to secure against the loan and was a non-homeowner, so no personal assets to be used either – this therefore makes the loan being sought unsecured.

Contact us today to discuss Business Loans and how we can assist you.

The Solution

As the client had no substantial assets that could be lent against, it was very important to understand what the annual turnover for company was, as this would determine what the client could potentially borrow. The client’s business was successfully generating a good turnover and net profits which we growing year on year, which lenders like to see.

We were able to acquire the customer a very competitive unsecured business loan for the full requested loan amount of £100,000, purely based on the company’s turnover. This will allow the company to grow, purchase the necessary stock and ultimately make the business more profitable.

The whole deal took less than 7 days from initial enquiry to funds being released to the client, who was delighted with the terms secured for their business.

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Key Points to consider

As a general rule, if the client has assets or is a homeowner, financial providers can often lend between 15% – 25% of the business turnover. However, in this case, since neither asset is available to use as security, the maximum unsecured loan available is normally 10% of the company’s turnover.

Please keep in mind that these are only broad guidelines. Each case is looked at individually and treated on its own merits.

Summary

For full details on the types of Business Loans available please visit our Business Loans page.

To know more and speak to one of our Business Finance Brokers for a FREE Quotation and Advice, call us now on 03303 112 646. You can also fill in this short online form to get started. Our team of Business Finance Brokers will get back to you straight away.