IT contractor capital raise for new residential home

THE SCENARIO

It’s always nice to receive a personal referral from an existing client and recently I was passed a case in just this way.

My clients were a professional couple looking to convert their current residential property into a buy to let (BTL) to raise capital to put towards the purchase of their new residential home. This is known as a ‘let to buy’.

My client’s current residential property was in London and their new property was a new build home in a quieter area just outside of the City. Their current residence was worth £530,000 and the new residential property was valued at around £350,000. The couple were looking for a 90% loan to value (LTV) for their new residential property.

There were some issues which needed to be overcome. Firstly, their current residential property had been remortgaged only three months previously, and had a remaining lease of 84 years. He was also a contractor, and though contractual work may be regular, some lenders are still cautious because there is no guarantee of the fixed income one gets when they are employed. Furthermore, my client had been a victim of identity fraud in the past, so his credit profile was not as good as it could have been.

I approached two lenders with whom I had worked with before for each of my client’s mortgage requirements. For their new residential purchase, I used a lender who specialises in manual underwriting, meaning I was able to present the case on its merits.

The lender was willing to overlook the fraudulent activity my client had been subjected to and was able to use his day-rate pay as a contractor to achieve the full 90% LTV required amount. This was an excellent result as lenders usually only lend up to 75% on new build properties.

For the existing property, I was also able to source a lender who would remortgage within six months of their previous mortgage thus achieving the capital raise up to 75% LTV, a very favorable LTV considering the property’s short-lease.

Other brokerages simply do not have the access Enness has to such a vast network of lenders.  We pride ourselves on the relationships we’ve nurtured over the past 10 years and, as such, can secure the best rates on the market.

The couple were absolutely delighted and are very much looking forward to moving into their new home outside of the capital.

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