The client, who is a Senior Business Manager in the construction industry, is a 65 year old British national who relocated to Norway over 40 years ago. Although based in Norway, he spends a lot of time working overseas, making his pay and tax arrangements complex.
After inheriting a cottage in Cornwall, the client spent £290,000 extending and fully renovating the property. This was financed from a combination of savings, a bridging loan from Norway (secured on the UK property) and over £80,000 from credit cards and unsecured loans.
Now the renovations are complete, the property is to be rented out during the summer months on a holiday let basis, and the client will vacation there with his family in the winter. The client wished to raise sufficient funds against the property to repay the Norwegian loan and all of his unsecured borrowing, totalling £240,000.
We were able to find a lender who was comfortable with the client’s age, complex overseas income, lack of UK mortgage history, and requirement for £80,000 of debt consolidation. In addition, the lender was happy to agree to the client renting out the property on a short term basis during the summer, and also staying there with his family whilst back in the UK during the winter months.
As the projected rental income was not sufficient to support the loan, they assessed the mortgage purely on the client’s earned and pension incomes. In addition, the lender offered the loan over a 10 year term, taking the lending up to the client’s 75th birthday, and on interest only to keep the payments affordable.
|Loan amount:||£240,000 (57% LTV on property value of £421,000)|
|Rate:||Lifetime discount of 1% of standard variable rate (currently 5.49%), current pay rate 4.49%|
|APR:||Overall cost for comparison 4.6% APR representative variable|
|Loan purpose:||Holiday Let Remortgage|
|Lender’s arrangement fee:||1% of loan amount|
|*Early repayment charges:||3% of the remaining balance for the first 2 years|
Overall cost for comparison 4.6% APR representative variable based on a lifetime discounted rate of 4.49% over 10 years at 4.59%, the lender’s arrangement fees of 1% of £240,000 (£2,400). The actual rate available will depend on your circumstances. Ask for a personalised illustration.
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 product 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 independent mortgage advice.
Largemortgageloans.com is a trading name of Largemortgageloans.com Limited, which is authorised and regulated by the Financial Conduct Authority. A typical fee of 1.17% of the mortgage amount is payable. Of this, 20% is payable on application and the balance of 80% on completion. For example on a mortgage application of £100,000 the fee would be £1,170 in total. Of this, £234 (20%) would be payable on application (this fee is non-refundable) and the balance of £936 (80%) on completion.
The Financial Conduct Authority does not regulate some aspects of commercial mortgages, secured loans and bridging finance.
Your home or property may be repossessed if you do not keep up repayments on your mortgage