Large loan residential purchase

What was the situation?

Our clients had been posted in the US for three years with their existing firms and had now since returned to England for six months before getting in contact. They were intending to sell their main residence at £1.3 million and purchase another at £2.5 million.

What was the issue?

Midway through the transaction to sell their current residence, their buyer pulled out meaning the mortgage figures we applied for on their new residence no longer worked. Based on the timescale to complete required by their vendor, they didn’t have enough time to put their own home back on the market and try to find another buyer. Our clients also wanted to be in their new home for their kids starting school in September 2019 so wanted a swift and certain completion themselves.

What was the process?

After completing a thorough review of all assets, we established they did not have enough cash to keep their existing property and fund the purchase of the new property with the mortgage applied for. We then looked at ways of raising enough money for them to keep their existing property and still purchase the new residence.

What was the solution?

We applied for a buy to let mortgage on their current property, enabling them to capital raise money for a deposit on the new property purchase and to cover stamp duty. We then applied for a larger mortgage with a new lender on the current residential to cover the extra money needed for the second property purchase. As the clients were now borrowing a lot more than previously intended, they wanted to have some of the new residential borrowing on an interest only basis to reduce their monthly payments.

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