The client's father was moving abroad permanently, and so had suggested selling his house to his son on a concessionary purchase basis.
They'd agreed a market rate of £290,000, and Dad was happy to gift his son 10% equity to use as the deposit. He was also going to give his son another £46,000 on completion from the sale proceeds.
The problem was the client, a fixed-term contractor with a large day rate income, had a very large number of debts including car finance, credit cards, and personal loans.
This was making it extremely diffucult to place the case with a lender, as the sheer volume of credit commitments meant it was being declined on credit scoring at DIP stage.
One niche building society lender, who specialise in complex circumstances like this, told us they would consider the case. However their criteria stated that where all the deposit was gifted equity, the max LTV was 80%.
Fortunately, Dad agreed to gift the full 20% as equity, with the post-sale donation reduced by £29000 to £17000.
The total debt and volume of credit agreements was still a concern. After advising the client, it was agreed his chances of success would improve if he could reduce all the numerous smaller debts before applying, which he was able to do.
With just a couple of larger personal loans and a car finance agreement remaining, the lender agreed the mortgage and the client was able to complete the purchase from his father shortly afterwards in early 2025.
Case Study 3
Case Study 8
