When purchasing their dream forever home, we helped our client secure their homebuyer mortgage on a term that exceeded retirement age.
The Client
Our clients were a couple looking to purchase their new dream home in which to enjoy their approaching retirement. They also owned two other residential properties, which they used for private holidays.
The Property
A four-bed, semi-detached house in a stunning seaside town in England.
The Finance
With a substantial deposit of 50%, our clients were hoping to source an interest-only mortgage for their home purchase.
The Challenge
A key challenge with this case was that our clients were looking for a mortgage term to exceed the state retirement age. Most lenders have an upper age limit attached to their products, meaning we had limited options available to us. This challenge was only amplified by the interest-only requirements, which is less common and more difficult to secure in the residential mortgage space since the 2008 financial crash.
However, the biggest challenge was that our client’s employment contract was due to end six weeks from the beginning of the case, with no plans to continue the contract. This was an issue for lenders, as proving that our clients had the necessary income to pay off the loan was more difficult.
The Solution
From our experience with complex residential cases, we knew that putting together a pack of our clients’ supporting documentation for the lender would help speed up the application process. Part of this documentation was an up to date CV from our client that proved they had ample employment opportunities to support paying off the homebuyer mortgage.
It also included our clients’ plan for repaying the capital at the end of the term, which was to sell one of the two properties they had in the background. Having approached a lender we knew offered interest-only mortgages and would consider our clients’ situation, we secured a mortgage offer in just four days.
Property Details
Property market value: £667,500
Loan amount: £337,500
LTV: 50%
Rate: 1.16%, 5 years fixed
Term: 7 years, interest-only
Mortgage payment: £455.49 per calendar month
Lender arrangement fee: £1,995
