The high street lenders tend to only deal with pretty straight forward scenarios. So, you will need to fit their standard credit score requirements, meet their standard income multiples and, in the main, simply be easy to deal with. However, we all know that not everyone fits this ‘ideal client’ picture.
Complex scenarios are on the increase. We had one recently where the clients had built a number of properties but could not sell them for the desired price, siting Brexit as a major factor in this. Having financed the build with development funding, this can be quite expensive if you run over the agreed timescales. In addition, this company was running at a loss for this project, as all the building costs had been put through the accounts without the counterbalance of the properties selling to recoup funds. Therefore, this was not a case many lenders would look at! However, we found a lender who was willing to assist due to the fact that the clients had previously completed many projects like this, had a number of shareholders and, as they were converting the properties in to Buy to Lets, this would be a long-term venture. All in all, the clients interest rate changed from over 10% on the development finance, to less than 5% on the buy to let rates. They also managed to recoup their funds and rent out the properties.
These are just some of the benefits of using an independent mortgage brokerage and especially if they are ‘whole of market’ and have the ability to deal with any lender and are not restricted to a small panel of lenders.
Other examples include applicants with no credit: too much credit: a desire to pay up front or add additional security in the form of another property thus increasing their ability to borrow more.
AToM has a vast number of lenders on its Complex Prime panel already looking at these types of difficult scenarios. These lenders may not be household names, but you’ll probably find they are extremely helpful and will look at most scenarios, manually, with no credit scoring and have an appetite to lend! Most importantly, their interest rates are mostly very competitive too!