The Mortgage Lender (TML) has processed a complex, self-employed residential mortgage application in 10 working days.
The clients, who were a couple trading as limited company directors, sought a mortgage for a new build property. The case presented itself as more complex as it progressed, due to a change in company structure part way through the application. The broker, EHF Mortgages, took the case to TML which accepted the updated shareholding midway through the underwriting process and was able to reflect this in its mortgage offer.
To help maximise the client’s borrowing capability, TML assessed the self-employed couple’s affordability on net profits before tax. This gave the borrower an increased capacity to borrow a higher loan amount. TML also used the applicant’s latest year’s trading figures rather than an average from the last two to three years, which would have included any impacts from the Covid-19 pandemic. This, alongside TML’s ability to account for the client’s shareholding value increasing, allowed the client to borrow an even greater amount for their property.
For TML to also progress the application, the new build itself needed a warranty certificate that would be accepted by the lender. However, it transpired that the warranty was not one typically accepted by TML, so the lender obtained special dispensation for the warranty to be accepted.
Meanwhile, TML’s residential rates reduced between the mortgage offer being made and completion, and the lender liaised with the broker to honour a lower rate for the borrowers, saving them thousands of pounds over their fixed term mortgage deal.
TML was able to provide an 80% LTV for the property, helping the client achieve their homeownership goals.
David Eaves (pictured), head of sales at The Mortgage Lender, said: “This case is a prime example of how we go above and beyond to support our brokers and end customers. A number of complex factors were at play here, and our team ensured we provided clear underwriting, speedy responses, and a flexible approach throughout in order to accommodate the client’s borrowing needs.
“Justin Moy from EHF Mortgages, Andrew Heath, one of our BDMs and Leanne Robertson, one of our mortgage underwriters, worked efficiently together to ensure the application was processed within 10 working days, half the average time an application usually takes, meaning the client could meet their homeownership goals.”
Justin Moy, managing director at EHF Mortgages, added: “The challenge was that the client was drawing 100% of the profits, but only owned 50% of the business – a family member owned the rest of the shares. Once we understood the situation and had agreed a potential way forward with the TML underwriters, we recommended that the client spoke to the family to take full ownership of the company. TML was then able to facilitate the mortgage and their affordability allowed the use of just the last years’ company profit.
“The client had already exchanged on the purchase some months ago, without a suitable mortgage in place, so not only was the challenge to lend the funds, but at the speed needed to keep the new build developer onside, as much as the rest of the chain.”
