Case study: Client with complex income structure completes on London purchase

05 Jun 2020

Investec Mortgage Intermediaries Team

A HNW client with a complex income structure purchases Prime Central London property

High net worth individuals (HNWI) often have complex income, originating from multiple sources, including buy-to-let portfolios, bonuses and sometimes in foreign currency. So when it comes to purchasing property, it can be challenging to prove affordability.
 

The client

We recently worked with a broker to support a client who was looking to buy a new primary residence in Prime Central London, requiring a loan of £5.5million at 75% loan to value (LTV).
 

The challenge

Like many HNWIs, their income was highly complex – comprising myriad elements, including deferred income, rental from overseas property, as well as taking some in US Dollars. As a result, the client required a bespoke consideration, which at Investec Private Bank we have plenty of experience in.
 

The solution

We work very closely with Investec’s credit team every day. As a result, we’re able to take a holistic view of the client's and their business’ income and asset profile, recognising they would come into liquidity throughout the mortgage term. As such, we were able to structure the mortgage in a way that allowed for monthly interest only payments and annual capital reductions as liquidity events occurred over five years, followed by full amortisation, ensuring both the client and our credit team were satisfied.
'Many HNWIs might look like they may struggle to service their debt through a traditional lens, but when you take a step back and consider their holistic success both personally and financially, affordability is there. It just takes a more in-depth understanding of clients and their requirements than they may be used to. We were happy to provide the client with a solution that enabled the client to complete the purchase of their new home.
 

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