The case was tricky as our client is a day rate contractor with a five-year history in contracting but only two months remaining on his existing contract. We required a lender that would accept a fixed-term contract that was about to expire on the basis that the applicant had experience and history behind him so would be able to secure a new contract once his current one expired.
Numerous lenders were sourced but this deal required specific criteria and took a lot of research to identify a suitable lender. Key requirements: – A lender comfortable using the client’s fixed-term contract when assessing affordability.
A lender comfortable with only two months remaining on the client’s existing contract.
Borrowing at 73 per cent LTV on a property worth £570,000.
Ability to add the lender’s arrangement fee to the mortgage.
After sourcing the mortgage market, we identified a lender who would agree to our client buying at 73 per cent LTV, basing affordability on his fixed-term contract.
The application process: To support the mortgage application, the client supplied us with evidence of his fixed-term contract and income, as well as proof of identity. We were delighted to inform our client that the lender had issued a formal mortgage offer for the full amount requested.
Property value: £570,000
Loan amount: £419,999
Rate: 1.43 per cent fixed for two years
Lender product fee: £999 added to the loan
Monthly payment: £1,563.37