Client was purchasing her first home with her partner from a shared ownership builder.
She was pressured in to using the builder’s recommended mortgage advisor who turned out to not be as knowledgeable as they were led to believe.
Due to her partner’s credit rating, her application was rejected by several mortgage lenders, and she thought that she might lose her dream house but, she was in luck when she decided to contact Oportfolio to see what our advisors could do for her.
Our client and her partner found an ideal property through a large house builder on a shared ownership basis and was looking forward to the prospect of owning her first real home. However, despite the excitement they both felt, they were also extremely nervous as she had been told plenty of conflicting information about the best way of getting a mortgage by the builder, her friends, and her own internet research.
Without really knowing where to start, our client was strongly encouraged to speak to the builder’s recommended mortgage broker who briefly advised her on mortgages but didn’t really take the time to get to know her situation and answer her questions. The advisor submitted a mortgage in principle for her and her partner however, due to her partner’s poor credit history the case failed, and the advisor could not find another lender that would be willing to lend to the pair.
Understandably she was very frustrated and upset by this and the advisor then encouraged her to put the property and mortgage in her sole name to stand a chance of passing the credit search. But the advisor was inexperienced, and they were unable to find a mortgage lender willing to consider the loan size needed based on one salary alone and it looked like her dreams of owning a property with her partner were over.
How did we help?
One of our client’s friends recommended Oportfolio to her after hearing about the nightmare journey she had already been on. Our advisor Jade spoke to the client and took time to understand what the situation was, where the issues lay and what we could do to help.
Jade managed to calm her down as she was getting very stressed about the prospect of losing the house and we made everything clear with her, something that the other advisor had not done. Using our understanding and experience with both new build homes and shared ownership properties, we found a mainstream lender who was willing to lend our client the money she needed to buy the property on her own.
And as a bonus, the lender, and the product we managed to source for her was the most competitive mortgage interest rate available too. The monthly mortgage payment, shared ownership rent, and insurance also all falls within her monthly target budget so she will never feel out of pocket or like she is stretching beyond her means.
So far, we have a successful mortgage in principle for the loan size required, we provided this to the developer (as previously the developer’s broker told them to ignore her as an applicant as it wasn’t possible). Once we got involved, we confirmed the agreed MIP and affordability to the builder and completed their housing association/shared ownership affordability assessment and made it work for the client. She is no longer stressed, and we are looking after her and her application well.
She wishes she had never bothered with the other broker and gone to an expert like Oportfolio from day one.
What was the rate?
We have advised and applied for a capital repayment mortgage at a rate of 1.72% fixed for 2 years until 31/03/2024, and after the fixed period, they would revert to the bank’s 3.74% standard variable rate. At which point we would contact her to make her aware and look at some options to get her back on to a low fixed rate again.
The overall cost for comparison is 3.6% APRC. The arrangement fee is £999 which was added to the loan, and early repayment charges have been applied. The mortgage term is 40 years.