Expert Knowledge & Professional Service

£1.5 million mortgage for clients with 20% deposit moving out of London

Key features:     

• £1.5 million mortgage secured with 20% deposit  
• Large property with land  
• 1.95% two-year fix  

Our clients     

Our clients asked for help to secure a larger mortgage on a property in Surrey after they sold their home in London. The main income earner was a compliance director working at a bank receiving a bonus. 

Why was it difficult?  

Even though they were borrowing around 4.5 times their joint salary, they required a £1 million+ mortgage with a relativity high loan-to-value at a time when many of the banks and building societies had restricted lending. They also needed the lender to accept bonus income. 

How did we help?   

Trinity's broker found a large bank offering particularly cheap two-year fixes, and after submitting the application the mortgage was offered within two weeks. 

What was the rate?     

The mortgage was a 1.95% rate fixed until 31/10/2022, and after the fixed period it reverted to the banks 3.59% standard variable rate. The overall cost for comparison is 3.4% APRC. The arrangement fee was £999 and early repayment charges applied. The mortgage had a 25-year term.    

Call Trinity Financial on 020 7016 0790 to secure a mortgage or book a consultation

Trinity Financial quoted in FT Weekend's front page story

Trinity Financial's team were excited to be quoted in the FT Weekend's lead story covering the recent mortgage rates rises.

Trinity's Aaron Strutt told James Pickford of the Financial Times the mortgage lenders have been extremely busy and they do not want to top the best buy tables. 

Click here to view the full story £

£800,000 mortgage using 5.5 times salary multiple for couple earning over £100,000

Key features:      

• £800,000 mortgage arranged enabling clients to purchase £1.35 million property 
• 5.5 times salary for a couple earning over £100,000   
• 1.59% five-year fix and 40-year term 

Our clients      

Our clients asked for help to secure a more generous income multiple to purchase a £1.35 million purchase. They were accountants working for large companies in London, and their joint income was over £100,000 a year. They also had a large deposit generated from the sale of their property.

Why was it difficult?   

Many of the lenders have temporarily withdrawn their income stretch mortgages recently, so there is a reduced choice of banks and building societies. Our clients also asked for the longest mortgage term possible to reduce their monthly costs.  

How did we help?    

Trinity's broker secured the requested £800,000 mortgage for our clients through a leading bank offering great five-year fixed rates. The term was spread over 40-years, and the mortgage offer was produced within two weeks. 

What was the rate?      

A 1.59% rate fixed until 02/01/2026, and after the fixed period it reverted to the banks 3.35% standard variable rate. The overall cost for comparison is 2.9% APRC. The arrangement fee was £999, and early repayment charges applied. The mortgage had a 40-year term and there was a free basic property valuation.     

Call Trinity Financial on 020 7016 0790 to secure a mortgage or book a consultation 

Five times joint income multiple used to secure £500,000 mortgage

Key features:      

• £500,000 mortgage arranged to help purchase £915,000 property 
• Five times salary income multiple    
• 1.43% five-year fix and 30-year term 

Our clients      

Our clients asked for help to secure a five times joint income mortgage to purchase a flat in London. They were both employed engineers buying their first home, and the deposit was being gifted. One of them was an EU national, and they wanted a longer-term fix. 

Why was it difficult?   

Many of the lenders have stopped offering five times salary mortgages, and some have tightened their gifted deposit rules. Some of the banks and building societies have also increased their longer-term fixed rates.

How did we help?    

Trinity's broker secured a five times joint income mortgage with a lender offering low five-year fixes to borrowers with larger deposits. The bank was happy with the gifted deposit and provided a mortgage offer within 10 working days. Our broker had a Skype call with the clients to verify their identification and answer any questions. 

What was the rate?      

A 1.43% rate fixed until 31/12/2025, and after the fixed period it reverted to the banks 3.59% standard variable rate. The overall cost for comparison is 2.9% APRC. The arrangement fee was £1,499, and early repayment charges applied. The mortgage had a 30-year term.     

Call Trinity Financial on 020 7016 0790 to secure a mortgage or book a consultation 

What is the difference between a buy-to-let and let-to-buy mortgage?

Let-to-buy mortgages are regularly used by homeowners who have lived in their property for a few years and want to move. 

These borrowers have equity in their property because house prices have increased in their area and they have repaid some of the mortgage. They like the idea of releasing some of the cash to put towards the deposit on a new home and letting their property to take advantage of future house price rises and the high rental income.

Buy-to-let mortgages are used for investment property purchases and normally consist of one transaction. Properties are typically let on an assured shorthold tenancy agreement and landlords are not allowed to live in the house or flat.

How do you secure a let-to-buy mortgage?

If you have at least 30% - 40% equity in your current home, it should be possible to remortgage it onto a buy-to-let while releasing funds for you to put towards the deposit of a new main residence.

The lenders will want to how much the property will rent for to determine the maximum loan size although some banks and building societies will also use your salary to boost the loan size.

Providing you have a deposit of at least 10%, and you earn enough money to meet the lender's affordability criteria, you then secure a residential mortgage for your new main residence and potentially access a lower rate because you have a bigger deposit. 

What are the rates?

Many of the lenders offering let-to-buy mortgages do not have specific let-to-buy rates so borrowers can access the lowest buy-to-let and residential deals. The rate will depend on the size of their deposit, the amount of rent the property generates and their overall financial situation.

The cheapest residential mortgage is available below 1.3% and the lowest buy-to-let rates are priced below 1.50% if you have a 40% deposit. The rates are not a huge amount more expensive if you have a 30% deposit for the buy-to-let or a 25% deposit for the residential transaction.

Comment

Aaron Strutt, product director at Trinity Financial, says: "Many borrowers like the idea of keeping their existing home and letting it out often for capital growth but also the rent. It is not always possible to arrange let-to-buy mortgages through one lender so arranging two mortgages at once can be tricky if you do not know which lenders to approach."

Call Trinity Financial on 020 7016 0790 to secure a let-to-buy mortgage or book a consultation

Halifax providing 10% deposit mortgages again

Halifax is the latest lender to announce it is returning to the 10% deposit mortgage market after previously pulling its low deposit rates when the coronavirus crisis hit in March. 

Halifax's new two-year fix undercuts many of the other lenders offering 10% deposit rates. Its two-year fix is 3.54%, and the five-year fix is 3.59%. Both products have £999 arrangement fees, and the maximum loan size is higher than many other providers at £500,000. Early repayment charges apply throughout the fixed period. 

The new products are only available to first-time buyers, and mortgages must be taken on a repayment basis. New build properties will not be accepted, and there will be an enhanced credit score requirement so borrowers will need a clear credit history to qualify.

There is a maximum 4.49x loan to income cap applied as part of the bank's affordability assessment, and any financial commitments will be deducted as ongoing in the affordability calculation even when declared as ‘to be repaid’.

Aaron Strutt, product director at Trinity Financial, says: "Over the last week more of the lenders have started providing 10% deposit mortgages again, but the cheapest deals are well over 3%. 

"Virgin Money has been offering low deposit mortgages to borrowers willing to take seven or ten-year fixes, although the bank is about to launch a five-year fix."

If you are looking to take a low deposit mortgage, it is worth taking a short term fix, especially if you are taking a larger loan."

Call Trinity Financial on 020 7016 0790 to secure a 10% deposit mortgage or book a consultation 

Santander offering five-times salary income multiple and 1.14% two-year fix for mortgages up to £1.5 million

Santander for Intermediaries is offering some of the most generous income multiples and the cheapest mortgage rates across the market. 

Santander's lowest rate is 1.14% and it is available to borrowers remortgaging to the bank, the price rises marginally to 1.18% if you are purchasing a property. Both rates are fixed until 2 April 2023 and once the deals expire they revert to the lender’s 3.35% standard variable rate. The overall cost for comparison is 2.9% on the remortgage deal and 3% APRC on the purchase rate.  

There is a £1,499 arrangement fee for both products, and applicants will need a 40% deposit to qualify. The maximum loan size is £1.5 million and if you are remortgaging Santander will pay for property valuation and legal fees or provide £250 cashback if you opt for your own solicitor. 

Aaron Strutt, product director at Trinity Financial, says: “Over the last few weeks the lenders have improved their rates so borrowers with the largest deposits can secure two-year deals at just over 1%. The leading five-year fixes are available from 1.35%.

"Santander has one of the best interest-only policies, and it provides part interest and part capital repayment mortgages to help borrowers reduce their costs. The bank also offers five-times income to those earning between £45,000 and £99,000 and 5.5 times salary to those earning over £100,000. To qualify for the more generous income multiples, applicants will need to have a 25% deposit."

Santander is currently taking an average of 22 days to produce a residential mortgage offer although other lenders are offering similar rates with faster processing times.

Call Trinity Financial on 020 7016 0790 to secure a fixed-rate mortgage or book a consultation

HSBC, NatWest and Barclays return to the 10% deposit mortgage market

Many of the lenders that initially pulled out of the 10% deposit mortgage market have returned over the last few weeks. 

Barclays, Coventry for Intermediaries, Halifax, HSBC for Intermediaries and NatWest, are the latest lenders to provide low deposit rates again after initially withdrawing when the coronavirus pandemic hit. 

If you are planning to purchase a property and you have a 10% deposit the mortgage rates are not as cheap as they used to be, but they are getting better. Many of the lender's low deposit mortgages have a maximum loan size of £500,000 and they are still mainly available to first-time buyers.

Aaron Strutt, product director at Trinity Financial, says: "While some lenders have been offering first-time buyer low deposit mortgages for a few months, it has taken the likes of Halifax and NatWest longer to return."

Call Trinity Financial on 020 7016 0790 to secure a first-time buyer mortgage or book a consultation