Our client, the daughter and employee of a well known entrepreneur, wished to borrow £325,000 to purchase a property for £600,000 (a loan to value (LTV) ratio of 54%). She had a very low credit score but this was caused by her limited credit history and a minor dispute with a mobile phone company.
She had already spoken to a broker who had referred her to specialist adverse credit lenders who quoted her a rate of 5% with high arrangement fees. Luckily for her, she was referred to us by an existing Private Finance client.
Given our client’s background and the relatively low LTV, we were able to negotiate a 2 year discount offset mortgage at 2.89% variable rate (APR 3.8%* - the overall cost for comparison) with a £999 product fee and no early repayment charges. The bank took a view on the low credit score and credit record because of the overall profile of the client.
By using Private Finance rather than the alternative broker and adverse credit lenders, our client may potentially save thousands of pounds in interest. The Private Finance mortgage consultant also went to her office to complete the application, something the initial broker did not offer to do.
*APR (the overall cost for comparison) calculation based on a 2 year term, interest only mortgage with the lender charging a £999 product fee and legal and valuation fees of £2,000. The actual rate available will depend on your circumstances. Ask for a personalised illustration.