I recently secured a million pound mortgage for a client in his mid-sixties after the buyer of his property pulled out at the last minute, leaving him in a quandary.
My client in this instance was a former athlete. He was looking to sell his property in Hampstead in order to buy a £2m property nearby, which he was looking to move into with his partner. He was planning to fund the new purchase with the equity from his old house.
Just as they were about to exchange, however, a link in the chain broke and the prospective buyer pulled out. My client urgently needed funds in order to complete on the purchase; he otherwise risked losing the property. At this point, he came to us. He was looking for a loan of just under £1m secured against the new property.
Because he needed the funds so quickly, he was initially considering taking out a bridging loan. I felt, however, that we would be able to do better for him. Given that he was trying to save for his retirement, a bridge would have been an unnecessary expense in this case.
Before coming to us, he had been turned down by several high street lenders on account of his age. Happily, mid-sixties is fairly young for our clients; we have access to several lenders who are prepared to lend well into retirement.
Time was of the essence as he needed to complete within a month.
Even though his contract with a major sporting body was due to end in four years, I was able to find a lender willing to lend 6 times his income – well above the usual multiples.
An interest only mortgage would allow him to keep monthly payments to a minimum, and also give him a few years to sell his old property, meaning he wouldn’t have to drop the price in an effort to shift it quickly. This sale would then be used as the repayment vehicle.