This week's case study highlights how Alexander Hall helped a client secure the level of lending they required during the Covid-19 lockdown.
Our clients' challenge
Our client is purchasing a new residence at £1.15m. They had spoken to a number of advisers and banks prior to speaking with Alexander Hall, finding that they had two major issues. Firstly, they had a 5% deposit which was some way short of what most lenders require at this purchase price. Secondly, the majority of the client’s income was derived from performance bonuses. With the onset of the Covid19 pandemic, lenders have generally taken a far more cautious view in how these can be considered when calculating what they’re prepared to lend. Subsequently, the client was some way short of the lending that they would require to proceed.
Alexander Hall's solution
We found a lender that would take a view on the bonuses and use them in the lending calculation. This was due to the extensive track record that the client could demonstrate along with the unique nature of their professional expertise. The lender agreed that the mortgage could be set up on an interest only basis, with annual lump-sum repayments mandated, to ensure that the borrowing level (LTV) reduced significantly over the first 5 years of the loan. This was perfect for the client given the nature of their annual bonus income. Our client was understandably delighted with the outcome having presumed they would have to delay a purchase for some time to save up an increased deposit.
