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Case profile
The client, a director and majority shareholder of an offshore private equity firm, owned a property in London that was to be rented out (he had previously lived in the UK). The firm had not been trading long so proof of income was difficult and the income was offshore. The client’s mortgage was on a very good tracker rate but the rate was ending shortly which meant that he would be reverting to a relatively expensive standard variable rate.
Although the client couldn’t show much income from his company he did have other offshore assets, which were a mix of properties and Exchange-Traded Funds (ETF’s). He received rental income from the properties so could demonstrate his income and wealth.
Solution
As the client’s income and assets were based offshore it was particularly difficult to find a suitable solution for him. We needed to find a bank that would recognise his offshore property income and assets, as well be comfortable with the income from the offshore private equity firm. The property was in a prime West End location, the loan to value was low and the rental income was strong therefore we were able to find a Private Bank willing to offer better terms than the client’s existing lender would offer.
The Private Bank wanted the client to bank with them in the UK and also requested he place cash with them for additional security.
Deal highlights
| Loan amount: | £2 million (44% LTV on overall property valuation of £4.5 million) |
| Rate: | Bank of England Bank Rate plus 2.75% (current payment rate 3.25%) |
| APR: | Overall cost for comparison 3.9% APR representative variable |
| Term: | 5 years |
| Type: | Interest Only |
| Loan purpose: | Buy to Let Remortgage |
| Arrangement fee: | 1% of loan amount |
| Early repayment charges: | 1% of the loan amount in the first year only |
Notes
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 The rate quoted may become out of date at short notice and may not be available at the point at which customers enquire about it.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 3.9% APR representative variable based on 5 years at 3.25%, lender’s arrangement fees of 1% x £2 million (£20,000), 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.
