Picture the scene: After the Christmas decorations have been packed away and the January sales blow-out is nothing more than a distant memory – we all experience a financial “hangover” in February as we set about to recover our finances when suddenly, out of the blue, a nice tax bill comes through the post.
Many of us have been in this position and unsurprisingly, most of your clients have too. Did you know though, that more often than not, a second charge loan can provide many of your clients with the finances needed to pay off that bill and could be more appropriate than a remortgage?
This is for many reasons including:
A number of lenders are happy with “tax bill” as a loan purpose – rates starting from 4.85%.
Self assessment is fine – SA302’s are acceptable.
If recent accounts are not adequate then lenders will look at projections.
Bank statements are considered to support weaker affordability cases.
Limited company directors – payslips only. Accounts not required.
Company owner not drawing salary or dividends – can treat repayment of director’s loan as income
If you have a scenario you would like to discuss, then please call us on 01902 585052.
2 out of 3 borrowers get a lower rate than our representative example of a regulated secured loan below:
Mortgages and Remortgages
£80,000 over 240 months at an APRC OF 4.3% and a discounted variable annual interest rate for two years of 2.12% at £408.99 per month followed by 36 payments of £475.59 and 180 payments of £509.44. The total charge for credit is £39,873 which includes a £995 broker / processing fee and £125 application fee. Total repayable £119,873.
Secured / Second Charge Loans
£63,000 over 228 months at an APRC OF 6.1% and an annual interest rate of 5.39% (Fixed for five years – variable thereafter) would be £463.09 per month, total charge for credit is £42,584.52 which includes a £2,690 broker / processing fee. Total repayable £105,584.52.
£4,000 over 36 months at an APR OF 49.9% (fixed) and an annual interest rate of 49.9% would be £216.21, total charge for credit is £3,783.56. Total repayable £7,783.56.
THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR HOME
REPAYING YOUR DEBTS OVER A LONGER PERIOD CAN REDUCE YOUR PAYMENTS BUT COULD INCREASE THE TOTAL INTEREST YOU PAY. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR ANY OTHER DEBT SECURED ON IT.
If you have been introduced to Promise Money by a third party / affiliate, Promise may pay them a share of any fees or commission it earns. Written terms available on request. Loans are subject to affordability status and available to UK residents aged 18 or over. Promise Money is a trading style of Promise Solutions Ltd. Promise Solutions is a broker offering products which represent the whole of the specialist second mortgage market and is authorised and regulated by the Financial Conduct Authority – Number 681423.
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