Scenario:
We were approached by the client following the decline of their previous mortgage application. They were looking for a £1.1 million loan to buy a new property for £1.8 million. The client was a banker with a 2 year annual bonus history.
Challenges:
The previous lender had offered a lower loan amount as they were averaging the last 2 years bonuses and using 50% of this figure. To borrow the loan required, we needed a lender who could work off the most recent bonus figure that was almost three times larger than the previous years.
Solution:
The previous bonus was lower as the client had changed jobs half way through the year and the bonus was on a pro-rata basis. Prior to this bonus, the client had received a similar bonus to the most recent one therefore demonstrating a track record of receiving this level of bonus. This provided the lender with comfort to work off the latest bonus and offered the clients the full loan amount required.
Key features:
Property value: £1.8 million
Loan amount: £1.1 million
LTV: 65%
Repayment type: capital repayment
Product type: 5 year fixed
Interest rate: 0.99%