£2.5 million part-and-part mortgage for company director buying a £3 million home
Trinity Financial arranged a £2.55 million mortgage for a director at a large finance company buying a £3 million home. The client put down a £450,000 deposit and borrowed at 85% loan-to-value (LTV). We arranged £2.25 million on interest-only and the remaining £300,000 on capital repayment.
The challenge
Our client had worked with Trinity Financial for years and came back to us when they found their next home. They wanted to keep their deposit to 15% and put as much of the borrowing as possible on interest-only. There was no particular rush to complete, so we had time to focus on finding a lender that could accommodate both requirements.
How we structured the mortgage
We found a lender willing to lend 85% of the purchase price, with 75% of the property value on interest-only and a further 10% on capital repayment. This is known as a part-and-part mortgage.
| How the purchase was funded | Amount | Share of purchase price |
|---|---|---|
| Deposit | £450,000 | 15% |
| Interest-only borrowing | £2,250,000 | 75% |
| Capital repayment borrowing | £300,000 | 10% |
| Total mortgage | £2,550,000 | 85% |
The monthly payments on the £300,000 repayment portion reduce the balance over time. On the £2.25 million interest-only portion, the monthly payments cover interest. The client planned to use future bonuses to reduce that balance. They were considering either paying the bonuses directly into the mortgage or investing some of the money before putting it towards the loan. Bonuses can vary, investments can fall in value and any interest-only balance still outstanding at the end of the term must be repaid.
Why the client chose a tracker mortgage
Both portions were arranged on a tracker. The client saw value in the possibility of lower payments if the lender’s base rate fell. They also accepted that payments would rise if it increased. Early repayment charges were part of the deal, so their timing mattered when planning how to use future bonus payments.
Looking for a large part-and-part mortgage?
If you’re buying a high-value home with a 15% deposit or want to use bonus income as part of your mortgage repayment plan, speak to Trinity Financial. We can compare lenders’ criteria and explain how much of your mortgage could be arranged on an interest-only basis.
Call Trinity Financial on 020 7016 0790 to secure a fixed or tracker rate mortgage, book a consultation, or use our appointment calendar
The information contained within was correct at the time of publication but is subject to change. It is for general information purposes and is not advice.
Your mortgage is secured on your property. Your property may be repossessed if you do not keep up repayments on your mortgage.
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