New £600,000 mortgage and rate switch for doctors living in their old property while new home is refurbished
Trinity Financial recently arranged an existing mortgage customer rate switch and a new home mortgage through another lender. This was to help our clients purchase another family home while keeping their old one.
Their existing fixed rate with their lender was coming to an end, and they had agreed to buy a new property in need of work. They asked our broker to arrange another mortgage so they could buy the new house and live in the old one until it was ready for them.
What did they do for a living? Doctors working as private consultants.
Were they in a rush to complete? Yes, they needed a larger home as their family was bigger. They were purchasing a new family home while maintaining their current property to complete renovations, as they have a small baby.
Why did they need our help? Affordability – keeping monthly payments as low as possible while they maintain two mortgages and pay for the home improvements. They wanted to keep their old property and potentially let it out once they had finished their refurbishment work and moved into the new house.
Did we struggle to find a lender? Affordability was challenging and finding an interest-only option to minimise the monthly repayments with the right amount of equity they had in the new property was tricky. However, the old mortgage was switched to a no early repayment charge product so they could stay in the property and either sell it or remortgage to a buy-to-let lender without paying a large exit fee.
Was the new £600,000 mortgage on interest-only or capital repayment? Part interest and part capital repayment. They also took a slightly longer mortgage term. As so much of the new mortgage was on interest-only, our broker was able to raise the full £600,000, enabling them to have two mortgages based on their joint incomes. If both mortgages had been on full capital repayment, this deal would have been challenging to place because the affordability would not have worked with a lender offering a competitively priced rate.
Was the rate particularly good? Competitive with the rest of the market is at just below 4.5% fixed for five years.
Where did they get your details from? Existing clients.
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The information contained within was correct at the time of publication but is subject to change.
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