My client had recently divorced and was looking to remortgage her house in Cambridge, valued at £2 million. Although she was not seeking a substantial mortgage (she was only borrowing £125,000), however she wanted to repay the loan over a long term as she needed to keep her outgoings as low as possible.
Mortgages for divorcees are often fairly complex as the estate has been carved up – usually in a very specific way. In this instance, it was particularly complicated as the divorce was settled in a Swiss Court and my client’s income solely derived from maintenance. Her income also went directly into an offshore account.
One of the main problems when it comes to mortgages for divorcees is that most lenders will only consider maintenance as income if there is another type of income in the background to support the loan. This is a widespread problem concerning mortgages for divorcees but if you speak to the right banks there are ways to manage it.
In this instance the loan was probably too small for a private bank and did not fit the high street due to the type and origins of the income. I decided to look at building societies.
One of the main challenges I was likely to meet would be having the Swiss court order to be recognised by a UK lender and to see some evidence. I also had to make sure the mortgage term was limited to the duration of the maintenance payments.
I ultimately secured the risk averse, repayment mortgage on the terms my client required at a rate of2.09%.