Lenders offering sub-sale and reassignment of sale contract mortgages
Trinity has access to a leading bank offering sub-sale or reassignment of sale contract mortgages at impressively low rates.
The lender states that sub-sales and reassignment of sale contracts occur when a new-build property is contracted for a sale to a third party that has yet to be completed.
Aaron Strutt, product manager at Trinity Financial, says: “Most of the mortgage lenders have stopped offering sub-sale and reassignment of sale contracts.
“To qualify for one of these mortgages, the applicant has to be open and honest about the buying process. The bank specifically states that the property valuer they instruct must be aware of the nature of the transaction.”
The bank restricts the loan-to-value, and it must be below 70% of the lower of the purchase price or valuation. It is also important that the total mortgage lending is less than the contracted sale price being paid by the third party.
The deposit funds must be evidenced as being from the applicant’s own resources and the bank states there cannot be a family or other relationship between any applicant and the vendor or third party.
Other acceptance policies
Trinity has access to another bank offering clients assignable contacts but not sub-sales. It caps the maximum loan-to-value is 70% on a flat of 75% on a house.
In its lending policy, the bank says the sale needs to complete directly between the developer and the client with the original planned purchaser simply having been paid to walk away. It will not allow any subsequent assignments.
Another large lender states it has a policy for sub-sales and it will lend on the lower of the purchase price or property valuation.
It says: “Our policy for sub-sales is to lend on the lower of the purchase price or property valuation in the original transaction until a minimum of six months from completion and as such. The third party must be noted at the Land Registry as the registered owner for a sub-sale to proceed.”
For help to secure a sub-sale or reassignment of sale contract mortgage, call Trinity on 020 7016 0790.
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