Offset mortgage for first-time buyer using trust fund income to buy £1.4 million property
Trinity Financial recently arranged a £500,000 mortgage for a first-time buyer purchasing a £1.4 million property.
Our client received income via a trust fund in addition to his salary and he also asked for an offset mortgage.
Did he have a complex situation?
The trust fund income was around £35,000 per annum, and he needed to use it to raise a sufficiently large mortgage. He required a five-times salary income multiple, and he had £100,000 in savings, which he was planned to offset against the mortgage.
Quite a few lenders do not accept investment or trust fund income for mortgage affordability, and even fewer lenders offer offset mortgages.
How did we help?
Trinity's mortgage adviser approached a broker-only lender with a reputation for common-sense lending, which offers a range of offset mortgages. The lender quickly agreed to use the trust fund income and offer a five-times salary mortgage, subject to the required supporting documents being uploaded to the building society's broker portal.
This lender offered some of the most competitively priced offset mortgages and was one of our only real options. Our client attempted to get an offset mortgage directly from a different lender but could not get it approved.
Was the rate particularly good?
Trinity's broker arranged a two-year offset fixed rate priced at just over 4.5% with a £995 arrangement fee. Like many borrowers taking a shorter-term fix, they hope to swap to a cheaper deal if rates come down.
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The information contained within was correct at the time of publication but is subject to change.
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