An existing client contacted me recently looking to secure a mortgage against his London property to purchase an overseas property for a family member. Making clear his desire to move quickly, it was important this deal was enacted swiftly, and I negotiated the best deal possible for my client.
Two problems initially arose. My client’s earnings were registered in offshore accounts, meaning lenders would need a degree of convincing with regards proof of income. Furthermore, my client was using his London home, valued at £1.4million, as security against the new mortgage but the ownership structure of his London property was complex to say the least.
The property was owned by a company registered to the Isle of Man, which was in turn owned by a family trust registered in Gibraltar. Adding to this, the settlor of the Gibraltarian trust (a family member) was not the same family member as the occupants of the London property. In terms of British regulation, raising capital against this property, would pose a challenge.
Owing to my client’s complex income, he needed to raise initial capital via a bridging loan secured against his London property. Knowing this was a challenging case, I approached several lenders. Understandably, due to the regulatory complexities many were reluctant but after explaining my client’s situation to a regulated bridging lender whom I have an excellent relationship, I was able to set the wheels in motion.
Raising capital with the bridging loan ensured my client’s situation improved dramatically. Having secured the loan, I approached a private bank to secure the main body of my client’s mortgage, a buy-to-let secured against my client’s London property which would crucially provide an exit for the bridge loan.
In the end, I managed to secure a £785,000 gross loan for my client at a rate of 1.05% over a period of six months.
Without my special relationship with the lenders, my client’s situation may well have been untenable. Needless to say, my client was delighted with the outcome.