A London-based consultant recently approached me looking for a bridging loan remortgage for a bridge he had taken out against his residential home. My client’s home was a stunning £1.5million new build property in South West London, where he was looking to reside with his young family.
After hearing of Enness’ unique market offering of succeeding where other property financers fail, my client got in touch to see whether I could secure him a loan following his previous struggle to source a lender. This difficulty to find a broker who could help him arose from him going over budget on the build of his home, meaning that the loan amount required on the property increased significantly. As this was a residential loan, my client’s application resultantly became unaffordable to the lenders he approached.
There are very few lenders in the market that can consider income multiple stretches where the client is not considered high net worth, with net assets exceeding £3million. Unfortunately for my client, these were the kind of lenders with whom he had been in conversation with. One opportunity arose where he believed he had secured terms, however he was only left disappointed when, due to his age, the mortgage term could only be 20 years. The lender in question would have required capital and interest to reach 5.5x income, which they deemed unaffordable over a 20-year term.
Due to my good relationship with a building society I have worked with many times, I was able to negotiate a loan for my client whereby the lender was happy to consider an income stretch by means of an interest only loan and go just over 5.5x income stretch to clear the bridging finance completely.
My client had indicated that a small portion of the grounds attached to his property could be sold to reduce the loan to value (LTV), resultantly making the building society happy to take a holistic approach to his application as the client’s intentions would be to reduce the loan in the future.
After a long time of being rebutted by lender after lender, my client was extremely happy to accept a 5-year discounted term at 3.25%, with 2 years of early repayment charges.