What was the situation?
Towards the end of stamp duty holiday in 2021, we found many clients were pressed to complete in cash to avoid missing out on the benefit. One particular client, a foreign national, purchased a multi-million pound holiday home in cash just in time.
With £2,000,000 of equity sitting in the property, the client was keen to raise up to £1,000,000 and replace their initial cash outlay so they could reinvest the capital into the financial markets. Further to this, time was against us as they wanted this to happen quickly to take advantage of various investment opportunities.
What was the issue?
Firstly, due to my client’s profession, their income was predominately bonus based.
Secondly, they had already begun an application with another broker and had been quoted rates of 4% with an additional 2% lender fee. The lender had also told them it would likely take up to four months to complete.
What was the process?
After reviewing the clients financial and personal situation from scratch, I was able to better understand what they were looking for and what wider global assets and liabilities there were to support their application.
Armed with this knowledge, the private client team and I concluded that a high street bank should allow this case on an appeal basis if a professional explained the complex income and expenditure more clearly. The benefit of this would be a minimal lender fee, significant rate reduction and importantly, a shorter time to completion.
To begin with, the client was hesitant as they had already approached this bank directly and been rejected. However, I explained about our internal relationships with the lender, and our hope for a quick resolution. Given the potential reduction in interest and fees on offer, the client was happy to proceed. We appealed their initial application and asked for a review, explaining the misunderstood income and expenditure.
What was the solution?
Once the application was reviewed, I was able to raise more funds than the clients initially thought possible, whilst being on a substantially better product paying 1.5% per annum; equal to over £37,500 less interest per annum. Further to this, the initial fee was £30,000 lower!
The result was obtained within a few weeks rather than months, which allowed the funds to be released in ample time to redistribute across the financial markets as per the client’s plan.
The client was delighted and surprised at this successful outcome. They were shocked at what we as brokers were able to accomplish given that they had had no luck directly and banked with the lender in their home territory.
Lending solutions with LDN Finance
Are you looking to purchase a high value holiday home but have a complex income structure?
At LDN Finance, our specialist team has extensive experience in securing short-term finance solutions suited to your circumstances – no matter the complexity. Working closely with our trusted network of private banks and specialist lenders, we’re sure to secure a bespoke arrangement for your project at competitive, market-leading rates.
Get in touch with us to organise an initial consultation.