This case study highlights how we were able to help our clients buy their next property.
Our clients' challenge
Our clients were purchasing a new home together. The mortgaged flat they lived in was owned by one of the clients, their partner was a first time buyer. Their intention was to retain this property as a rental investment, and to buy a new residence at c.£700k, for which they’d require a mortgage of 85% lending. The complexity of the case was in finding a lender that would be prepared to exclude the existing mortgage payment as a commitment (on the premise that it would be rented out and ‘self-financing’), also that both client’s incomes are heavily commission based. For many lenders, only 50% of variable income will be used in affordability calculations, irrespective of consistent track record of earnings.
Alexander Hall's solution
We sourced a lender that was prepared to use 100% of average commission earnings from the last 6 months, helping us to achieve the level of lending required by our clients. They were also able to deem the background property as self-financing as the rental achieved will be greater than the current mortgage payment, verified by comparables and a rental valuation letter. Having initially thought we’d need to use quite a specialist lender, with a more costly interest rate, our clients were delighted to hear that we managed to agree the case with a high street lender offering a market leading rate.
Click here to see the current best moving home deals.
