The Client:
The clients were a young couple with a child who owned their residential home. The first applicant was in fulltime employment, and the second applicant was employed part time – taking care of the children. They had recently remortgaged their property onto a five-year fixed rate deal.
Scenario:
A property became available as part of the partners fathers deceased estate, there was an Equity loan attached to it along with other charges.
There were 2 parties to the inheritance.
To prevent any early repayment charge with their existing mortgage lender the transfer of the current mortgage and topping up the loan with more borrowing was deemed to be the most cost-effective solution also using the inheritance part of the loan as a discount toward the purchase price.
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The Solution:
The lender had some unusual and limiting criteria regarding the use of equity, so we had to structure the loan in such a way as to meet the client’s needs, the lenders criteria and also ensure that the other beneficiary of the estate received their inheritance.
We were able to raise the additional funds needed to ensure the extensive renovation works could commence immediately on grant of planning for the extension works.
With the additional borrowing and the transfer of the current loan, their payments were well withing budget despite the new property being considerably larger and with room and land for their family to grow.
Had we tried the remortgage or development finance options for the costs and penalties would have been prohibitive and not allow them to buy this property which will once complete be the home they live in for many years.
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