Need a large remortgage? We have the banking contacts to provide a tailored solution where other lenders may not be able to help. To discuss this or any other large or complex mortgage case, please contact us on 020 7519 4984 or email us.
Our clients had bought a new main residence for £2.3million which they wanted to renovate. They planned to install new bathrooms, underfloor heating, a new kitchen and build an extension on the first floor. With this exciting project in mind they had successfully applied for planning permission, but still required funding.
In order to fund the renovation they wanted a remortgage against the property for up to £700,000, while using £200,000 in savings to fund the balance of the works. They ideally required a low variable rate product with no Early Repayment Charges, as they intended to repay the loan within 2 years through bonus and dividend payments.
However, when they approached high street lenders to arrange the remortgage they were turned down. The property was not deemed to be habitable, as the interiors had been entirely stripped and had neither a functioning bathroom, nor a functioning kitchen.
They, instead, received quotes for development finance products with pay rates ranging between 4% – 6% with a 1% arrangement fee and a 2 year tie-in. These were too expensive and they did not want to be tied in on a high pay rate for that period of time.
Through our excellent range of contacts with private banks, we were able to find a lender who would offer the clients a remortgage instead of development finance. We put together a case on behalf of the clients explaining how their future bonuses and dividends could be used as a repayment vehicle.
We approached a lender who offered them a £700,000 interest only mortgage at a favourable rate with no Early Repayment Charges. The clients were delighted with the offer and were happy to proceed, allowing them to get underway with the renovations to their new home.
Rate: A variable rate, currently 2.75% for the first 24 months.
Reverts to the bank’s standard variable rate, currently 4.50%, for the remaining term of the mortgage.
Overall cost for comparison 4.4% APR representative variable based on 15 years at 2.75%. Lender’s arrangement fee is 1.25% of the loan amount. The actual rate available will depend on your circumstances. Ask for a personalised illustration.