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Trinity Financial recently arranged a remortgage for an engineering contractor switching rates and borrowing additional funds.

He wanted a part interest-only mortgage to keep the monthly repayments low and secure a leading five-year fixed rate.

As he had come to the end of his current deal, he thought it was a good time to switch to a more completely priced rate and borrow an additional £150,000 to purchase a buy-to-let property.

He had one full year’s experience working as a contractor and was previously employed in the engineering sector. He was three months into his second 12-month contract.

Solution

Trinity’s broker contacted a high street lender with an excellent policy for contractors combined with excellent five-year fixed rates.

The bank was happy with his track record of working in the engineering sector and that he had nine months left in his job.

As the client met the minimum qualification income for interest-only, it accepted part interest and part capital repayment mortgages. He had £450,000 on interest-only and £150,000 on capital repayment.

The bank provided one of the most impressively priced five-year fixed rates and was happy to release funds to purchase an investment property.

The mortgage offer was produced in a week.

Case details

Property type: Detached house

Value: £1,000,000

Mortgage: £600,000

Rate: 1.90% until 31 July 2024

Reversion rate: The bank’s standard variable rate, currently 4.24%.

The overall cost for comparison is 3.62% APRC representative.

Lender’s arrangement fee: £1,499

Mortgage term: 25-years

Repayment type: Part interest-only

Loan-to-value: 60%

Early repayment charge: Apply for the full five years.

Overpayments: 10% per annum allowed

Representative example: A mortgage of £600,000 payable over 25 years, initially on a 1.90% fixed rate until 31 July 2024 and then on a variable rate of 4.24% for the remaining 20 years, would require 24 monthly repayments of £1,341 followed by 240 monthly repayments of £2,365.91. The total amount repayable would be £1,099,827.40 made up of the loan amount plus interest £498,278.40 and £1,499 arrangement fee. The overall cost for comparison is 3.62% APRC representative.

The actual rate available will depend on your circumstances. Please ask for a personalised mortgage illustration.

Call Trinity Financial on 020 7016 0790 to secure a contractor or additional funds mortgage

 

 

 

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