£775,000+ mortgage for doctor using dad's foreign income to boost affordability
A doctor raised an interest-only mortgage of just over £775,000 using his dad's income to purchase a property close to his work.
Trinity's broker found a large high street lender happy to accept the client's fathers income even though he worked for a multinational firm overseas and was paid in US dollars.
As most of the lenders provide up to five times salary income multiples, the additional income was needed to bridge the difference between the son's salary and the loan size required.
The applicant's father was a high net worth individual working in finance, but due to his age the term was limited, and the monthly repayments would have been extremely high on a full capital repayment basis.
The broker obtained £775,000+ mortgage at an extremely low rate to purchase the £1 million property using a mixture of sterling and foreign income.
The lender also used the father's previous bonus as a future projection as an interest-only repayment vehicle.
Case details
Value: £1,000,000
Mortgage: £780,000
Rate: 1.39% fixed until 31/05/2020
Reversion rate: The lender’s standard variable rate – currently 3.94%
The overall cost for comparison is 3.41% APRC representative.
Lender’s arrangement fee: £999
Mortgage term: 10 years
Repayment type: Interest only
Loan-to-value: 80%
Early repayment charge: Until 31/05/2020
Overpayments: Up to 10% per annum.
Representative example: A mortgage of £1,035,000 payable over 10 years, initially on a 1.39% fixed rate until 31 May 2020 and then on a variable rate of 3.94% for the remaining 8 years, would require 25 monthly repayments of £900.08 followed by 95 monthly repayments of £2,551.31. The total amount repayable would be £1,042,350.92 made up of the loan amount, plus interest (£264,876.92) and fees of £999. The overall cost for comparison is 3.41% APRC representative.
The actual rate available will depend on your circumstances. Please ask for a personalised mortgage illustration.
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