Whilst Covid was doing its worst, for some inexplicable reason the mortgage market became more interesting. In fact, new players and Private Banks came to the fore with innovative offerings, the result being that we have been taking more enquiries into helping people raise money for house purchases than ever before. None have been straightforward, but most have been achieved.
A common problem is helping children get a foot on the property ladder as their earnings are invariably too low to meet the high multiples required by current property prices, thereby requiring much higher deposits. However, many lenders will now monetise a parents’ investments with us even where no income is taken.
Mr A has £1.75 million invested with us. He was going to have to cash in £250,000 of investments to help out his son. Although not drawing any income from his portfolio, the lender assumed that a 5% income could be drawn thereby creating an additional income of £87,500 for affordability purposes. The lender recognises this “income” the same as a guaranteed income. As such Mr A did not have to realise £250,000 which remained invested. Given the strength of the portfolio the lender agreed a mortgage at a rate of 1.37%.
The extraordinary position we find ourselves in in terms of the lowest interest rates ever means that only modest returns from the markets makes borrowing more sense than cashing in investments.
There are many more examples that we can help with including lending for tied properties, Grade 1 listed, joint application but sole proprietor, bridging loans and combining multiple properties to achieve higher loan to value lending.
We work with a team of highly qualified external mortgage specialists who grasp our clients’ needs and have an extraordinary understanding of the opportunities in the market to make many opportunities possible.
30th April 2021