One of my recent cases came to us via one of our partners. In this case, the client was referred to Enness by a lawyer who thought we were best placed to find him a quick solution to a complicated problem. He was a returning ex pat looking to secure a mortgage back in the UK, but using his bonus income.
My client was young and single, and had been living and working at a large investment bank in Geneva, Switzerland for the past three years. Work was now bringing him back to the UK, and he was looking for a loan of £1.4m with which to buy a property to move into in Wimbledon.
One of the main things lenders look at is the client’s track record in the UK. In this case, all of his recent income history was in Switzerland, and of course none of it was in sterling.
To make things even more complicated, much of his income came in bonus form. Many lenders consider this an irregular form of income and will not take it into account when conducting their affordability checks. Just to muddy the waters a little further, the Wimbledon property was a new build and therefore perceived to be higher risk.
The challenge was to find a lender willing to take a view on his non UK, bonus-based income. When I started exploring my client’s options, I found that the majority of banks had a rigidly enforced cap of £1.15m for this type of loan, and refused to lend the full £1.4m needed to finalise the purchase.
The private bank I had in mind for this type of loan has a notional maximum loan of £1m. It therefore took some skilful negotiation to persuade the lender to increase their upper limit for my client.
Thanks to a long-standing relationship with the lender, I was able to eschew conventional channels and speak to the underwriter directly. They were happy to take his bonus income into account and agreed the £1.4m loan he needed, at a 2-year fixed rate of 3.09%. Given that ex pat mortgages usually come in at well over 4%, this was a fantastic result.
Best of all, I managed to secure half the mortgage on an interest only rate, meaning that his monthly payments would be lower from the outset.
The client has since recommended us to his friends and family, including his brother, a property developer, with whom we will be working. Enness is also in the process of arranging life insurance for him, as the logical next step in the mortgage process.