Many Enness Private Office clients are keen to take out a mortgage on a second home due to the nature of their work. We deal with many City-based workers who want a base in London as well as a family home outside of the city. I was recently able to assist a client who was looking to finance a second home purchase in London. My client was a Managing Director at a London-based firm, but his current residential property was in East Sussex, meaning he faced an extensive daily commute.
My client particularly wanted to work with a broker who had extensive experience of working with large banking bonuses. Fortunately, Enness Private Office has a wealth of experience in securing property finance for clients with bonus-based incomes. Like many of my clients, this client was extremely busy, and desired the sort of bespoke, efficient service that Enness Private Office is well known for providing.
As mentioned, my client’s income structure posed a problem. He received a large bonus, over double his base salary. Banks do not look favourably on this as it is a riskier type of income and is less sustainable over the term of the mortgage.
Furthermore, my client was keen to minimise his monthly payments, so he also wanted a split between repaying on an interest only and capital and repayment basis, which can be difficult to achieve.
I contacted a lender who takes a practical approach when assessing income, affordability and repayment strategy. I arranged the loan amounts to fit within this lender’s criteria for interest only, as well as obtaining a very competitive rate.
His East Sussex home was worth £3million, and the London property he wanted to purchase was worth £1.5million. We capital raised against his main home to provide a cash deposit for the onward purchase and repay his current mortgage; the final loan amount was £2million.
The final product was a rate of 1.7% fixed for 5-years, over an 18-year term; my client was extremely pleased with this as it was a lower rate than he had been paying on his East Sussex property. He was delighted to be able to take out a mortgage on a second home in London as such a favourable rate.