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This Week’s Dilemma

I am a broker and I’ve done my time in the industry so I don’t like to admit this but I’m confused about how to use fast-track. My client wants to borrow 300,000 with an LTV of 75%. The client’s income is 100,000 of which 45,000 is basic income with the rest being commissions and bonuses. I want to know if I can put this through as a fast-track case.

Alan Cleary, managing director of edeus, says:

You can’t put this through as a fast-track deal – it’s wholly inappropriate. Although the 75% LTV isn’t too far off a mainstream lender’s criteria, your client will need a low LTV to qualify for a fast-track mortgage but it will probably have to be less than 75%. Your client’s income is insufficient to meet mainstream lenders’ policies on income.

Typically, borrowers will have to have a high credit score as well as a big deposit for lenders to decide not to request proof of income. Even if this client wants a low LTV you cannot put a deal through when income is insufficient. Any lender will see that the income is made up partly from commission or bonuses which can only account for 50% of a client’s total income.

But having said that, this is not the first time I’ve heard of someone trying to fit the wrong sort of borrower up with a fast-track mortgage. Fast-track products are, to paraphrase the great Sir Winston, a riddle wrapped up in a mystery hidden inside an enigma. This is a problem we as an industry need to address.

The short answer to this question is that your client needs a self-cert mortgage, and it’s not as if self-cert is a bad option either. We offer a full range of self-cert products available up to 90% LTV as standard so your client’s deposit is well within the boundaries. And given that we offer a maximum loan of 2m, your client’s 300,000 request is comfortably within our policy.

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