Brothers Buy House Together Case Study

by | Monday 10th Jan 2022 | Mortgage Case Studies

Two Brothers

Key features:

First time buyers struggling with separate residential mortgages. Clients are Brothers and decided to try and purchase a property together to live in

Wanted to buy a new build home so explored the option of buying through the help to buy scheme

Our client:

They were brothers who were both looking to purchase their first residential properties. After doing some of their own research they realised that unfortunately they would both struggle to purchase a property on their own so decided that they would look at buying together.

All seemed to be going smoothly however several factors that they didn’t consider came in to play.

How did we help?

The clients decided that as well as using a standard residential mortgage, they wanted to buy a new build property using the government’s help to buy scheme. This scheme provides a 40% loan from the government towards purchasing a new build property which often either decreases the amount of mortgage that you need or allows you to purchase a larger property. To use the help to buy scheme, you must be a first-time buyer and you must meet certain affordability criteria like the mortgage lenders.

Our advisor sat down and spoke with the clients to get a better understanding of their situation and soon found out that there were several obstacles that the clients had not been made aware of before and that Oportfolio would need to help them navigate.

They didn’t know that they needed to do the help to buy application as well as the mortgage application, so we helped them with this and directed them on how to do this (their solicitor and the developers hadn’t even mentioned this to them).

Both clients didn’t know that the affordability for mortgages is also assessed differently when getting the HTB loan so our advisor went through this with them to make sure they were clear on what was acceptable.

Finally, one of the clients received a bonus but only had one year’s history and the other had recently stated a new job. After carful and in-depth research, we were able to proceed with only one payslip rather than needing 3-6 months payslips (that are sometimes requested by lenders).

We managed to secure the clients a mortgage offer and help to buy offer in a record time, beating both client and builders’ expectations.

What was the rate?

A 1.26% rate was fixed until 31/12/2026, and after the fixed period, it reverted to the bank’s 3.59% standard variable rate.

The overall cost for comparison is 2.9% APRC. The arrangement fee was £999, and early repayment charges were applied. The mortgage term was 32 years, and they had a 5% deposit plus a 40% help to buy loan.

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