I was approached by a banker buying a new London home at £2.85 million and who was looking to borrow 70 per cent (£1.995 million) and needed help sourcing a lender to grant a 2.85 million pound mortgage with bonus income factored in.
He had already been agreed for a mortgage through his own private bank at a fixed rate of 2.99 per cent but was keen to see whether there were any more competitive deals in the marketplace.
With the deposit coming from the sale of the client’s main residence, the main issue I faced was agreeing a loan for a client who received a significant part of their income in bonuses. In addition, some of their bonus income had been deferred from previous years.
The client was therefore beginning to receive large sums now which we needed a lender to take into account.
Based on the client’s track record of basic income and bonuses, I was able to agree a £1.995 million loan at a rate of 2.53 per cent, fixed for two years. The bank agreed the mortgage on an interest only basis and the client aims to amortise the loan to around 60 per cent in the next few years. Much of this capital repayment will come from his deferred bonuses.
In addition, the lender was prepared to agree the mortgage on a stand-alone basis with no requirement for the client to move any of his assets to the bank.
My relationship with a range of private banks meant I could secure far better terms for my client than he had been offered by his own bank. Indeed, the rate I was able to secure saved him over £18,000 in interest payments over the first two years of his new mortgage.