Daphne and Joe are both self-employed and found themselves in a tricky position as they approached the end of their mortgage term with another lender. Unfortunately, they were unable to secure a product transfer with their existing lender and needed to explore remortgage options. They were looking to borrow £1 million, with no additional capital raising, but their case was complex.

The couple had a small, historic default on their credit file, and their existing mortgage was structured on a part interest-only, part repayment basis. On top of this, both Daphne and Joe’s incomes had fluctuated significantly since the pandemic, which created challenges when approaching some lenders, particularly in terms of which income figures could be considered.

At Foundation, we were able to take a sensible view of the case and accept the latest year’s income for both applicants, even though it remained lower than the figures they had when originally taking on their current debt. This flexibility was crucial in making the numbers work.

For customers like Daphne and Joe, our £4£ Remortgage option proved to be the ideal solution. This product has no set loan-to-income cap and instead bases affordability on the individual circumstances of the borrower. It also allows no maximum loan to income cap, making it possible to transfer their £1 million loan on a part-and-part basis because it was deemed affordable.

Thanks to the competitive rate we had available, the broker was also able to increase the portion of the mortgage on repayment without increasing their monthly mortgage payment. This provided Daphne and Joe with not only a practical solution for today, but also helped to put them in a stronger financial position when their new five-year deal comes to an end.

If you’ve got a similar case, we’d love to talk it through. Give your Foundation regional area manager a call today, we’re always happy to help.