The clients were South African nationals seeking to purchase a property in London for £2.6m. They wished to borrow £1.95m to assist with the purchase. With an employed income of £100K pa, this was going to be a significant challenge, however, the applicants did have access to a significant offshore trust fund.
We were able to secure a facility with a private bank that effectively monetized the assets in the trust in conjunction with the applicants’ earnings in the UK. This resulted in the clients being approved for the desired facility on very favorable terms.
The clients approached Specialist Mortgages as they faced several issues. Most lenders in the UK will only base their lend on the strength of the clients’ income, this was clearly not going to be sufficient to support a mortgage of £1.95m.
“By obtaining a detailed picture of how their asset base was developed in South Africa, in combination with reassurances from the trustees handling their offshore fund, we were able to build a compelling case for a leading UK bank.”
Whilst the clients had the capacity to fund the purchase outright, this would have involved depleting the trust fund to a significant extent, and this was a scenario they wanted to avoid as their investments had been performing well.
Our role as the broker was to find a lender that could meet the clients’ requirements on the best possible terms. We approached several private banks with whom we have existing relationships to determine the options.
By obtaining a detailed picture of how their asset base was developed in South Africa, combined with reassurances from the trustees handling their offshore fund, we were able to build a compelling case for a leading UK bank.
The clients were able to secure a facility of £1.95m to complete on their desired property. Additionally, the terms secured were highly favourable with a 2-year tracker available at 1.59% or a fixed-rate at closer to 2%. Lender arrangement fees were also quite modest at 0.5% of the loan amount.
This enabled the clients to achieve their objectives in a highly cost-effective manner without affecting the assets that had been established within their offshore trust fund.
