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Our client, a self-employed entrepreneur with financial interests in a range of companies, needed to arrange a million pound remortgage quickly. His bank had decided to reduce its residential loan book as part of its deleveraging programme and asked our client to repay his £1.45 million mortgage in full within weeks.
Our client’s income was erratic – as is typical with many entrepreneurs – with losses in 2009 and 2010 and profits in 2011 and this pattern meant that the high street banks would not consider the case. Nor did our client have investable (also known as liquid) assets that he could move to a new lender as part of the deal; this factor discouraged a number of private banks.
The client’s particular financial affairs, especially his self-employed status and his multiple sources of income, meant that we needed to present the case correctly to the right private bank. Using our experience of the 44 private banks and lenders that we deal with, we quickly found a bank with whom the client had a commercial connection, leading to a reference from the commercial lending arm of the bank to the residential lending arm. The bank was willing to lend the money, on the proviso that the client deposited 12 months’ interest up front as additional security before completion. The bank was also willing to add this amount to the total loan.
|Loan amount:||£1.508 million (£1.45 million plus £58,000 interest to be held as a deposit) (52% LTV on overall property valuation of £2.9 million)|
|Rate:||Bank Rate plus 3.25%¹ variable tracker rate (payment rate of 3.75%)|
|APR:||Overall cost for comparison 4.4% APR representative variable|
|Lender’s arrangement fee:||1% of loan amount|
|Early repayment charges:||None|
Your home may be repossessed if you do not keep up repayments on your mortgage.
This case study is for information and illustration purposes only. It is not an offer, or suggestion of an offer. Each mortgage case is assessed on an individual basis and there is no guarantee that the solution described here can be repeated in the future.
Please note that this specific deal may not be available to – or suitable for – all customers, dependent on their individual circumstances. The rate quoted may become out of date at short notice and may not be available at the point at which customers enquire about it. This document may not contain all the information needed for customers to make a decision and they should seek advice.
Overall cost for comparison 4.4% APR representative variable based on 5 years at 3.75%, with lender’s arrangement fees of 1% x £1.508 million (£15,080) and legal and valuation fees of £10,000. The actual rate available will depend on your circumstances. Ask for a personalised illustration.
Largemortgageloans.com is a trading name of Largemortgageloans.com Ltd. A fee of up to 1% of the mortgage amount is payable, of this 25% is payable on application and the remainder on completion, e.g. on a mortgage of £100,000 the fee would be £1,000 of which £250 would be payable on application. The precise amount will depend on your circumstances.