Overcoming Client’s Complex Employment Status For Their New Mortgage

Our client, a UK national and working professional, approached LDN Private Client’s looking to purchase a new main residence after selling their previous property and moving into rented accommodation. Having just started a family, they were ready to make the move from Central London to Sussex, seeking a large family home that would provide the space and environment they needed for their growing family. The client required a substantial mortgage to fund their purchase, as they had identified a property that would serve as their ideal family home, with their goal being to secure financing that would allow them to complete this important life transition smoothly and efficiently.

The primary challenge arose from a significant change in the client’s employment status. Although they had worked for their firm for several years as a self-employed LLP partner, recent case law had prompted their employer to transition them back to PAYE employment. This created a complex situation for mortgage applications, as lenders would need to treat their income differently under the new employment structure. The lack of a track record under the new PAYE arrangement meant that traditional lending criteria couldn’t be easily applied, presenting a significant hurdle since most lenders require evidence of stable income history when assessing mortgage applications, particularly for substantial borrowing amounts.

To address this unique situation, we leveraged our extensive network of lender relationships, particularly focusing on institutions with more flexible underwriting approaches. We utilised our contact within a major high street lender’s large loan team to present the client’s case in the most favourable light. The key was providing comprehensive documentation that demonstrated the client’s income stability and future earning potential. We prepared detailed explanations of the employment transition, highlighting the client’s long-standing relationship with their employer and the involuntary nature of the change. By presenting this information strategically and working closely with the lender’s underwriting team, we built confidence in the client’s ongoing income reliability.

The solution?

We successfully secured a market-leading fixed rate with a major high street lender, arranging exactly what the client needed: 75% loan-to-value financing on an interest-only basis. This structure provided the flexibility the client required while maximising their borrowing capacity. The interest-only arrangement was particularly beneficial, allowing the client to manage their monthly outgoings effectively during this transition period. The competitive rate ensured they weren’t penalised for their unique circumstances, and the 75% LTV meant they could proceed with their chosen property without needing to compromise on their requirements.

The client was extremely pleased with the outcome, especially considering that alternative lenders were only offering around 50% less borrowing capacity. This solution enabled them to complete their move to Sussex successfully and purchase the family home they had envisioned rather than having to settle for a smaller property or delay their plans.

The successful arrangement demonstrated that with the right approach and lender relationships, even complex employment transitions can be navigated successfully.