MFB secured a great rate on a homebuyer mortgage for our client, a second-time buyer on an individual income purchase.
The Client
A second-time buyer who, having recently secured a new well-paid job, was looking to purchase their dream home.
The Property
A four-bedroom semi-detached house located only a short distance from a popular city centre in the Midlands.
The Finance
Having moved back in with their parents after selling their first home, our client had a substantial deposit to put towards the purchase. However, they still needed a 70% LTV mortgage to secure their dream property.
The Challenge
The primary challenge with this case was that despite a large deposit, our client still wanted to borrow a significant amount in relation to their annual income. Typically, lenders will offer borrowing up to 4.5x a client’s income.
This wariness around affordability multiples primarily stems from the issues that contributed to the 2008 financial crash and a lot of regulation is now in place to prevent homebuyer mortgage applicants from borrowing more than they can comfortably afford. However, our client was hoping to secure around 5.5x their annual income in order to secure their forever home.
The Solution
Our experience with specialist lenders in the residential market meant we knew which could be open to considering larger income multiples, providing there was sufficient evidence the client could afford it, and their income was likely to increase over the coming years.
Given our client’s occupation, we put together a case highlighting their strong financial position and future increased earning potential. Alongside the large deposit from the sale of our client’s first home, the lender was happy to continue and offered the loan size required to complete the purchase.
Property Details
Property market value: £680,000
Loan amount: £500,000
LTV: 77%
Rate: 4.36% five-year fixed
Term: 30 years, capital and interest repayment
Mortgage payment: £2502.05 per calendar month
Lender arrangement fee: £1,995
Looking to source a homebuyer mortgage?
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