That banks are lending enough is evidenced in gross lending contraction, that they simply ‘aren’t lending’ is factually incorrect.
We encounter all kinds of strange paths to homeownership with our clients and thought it might be worth showing a recent example which probably never would have made it through without a broker, branch banking typically run a mile from this type of case or don’t spot the angle.
In this instance we had a permanent worker with a child and no savings. This instantly has a few negatives, having children reduces your borrowing capacity and not having savings diminishes any hope left.
With this case in particular though, there were other aspects that swayed it. The client lived with a relative who was selling a property and moving in with a sibling, some of the profits were going to go towards helping our client make a purchase.
A gift alone normally won’t help you get a loan, you have to prove repayment capacity, some lenders will let the whole deposit come from a gift but you still have to demonstrate ability to repay once the loan draws down.
The house that is for sale had improvements to it, the source of the funding for this was our client so we had to make an argument that the savings amassed to create this and the expenditure of it represented evidence of such capacity.
The actual process was tricky, we had to get evidence of the work, match up the withdrawals to the receipts for same and put it all together into a package proving this situation to be true, then add this to the nominal rent being paid to demonstrate the ‘whole case’.
We are satisfied that only a broker would have the financial incentive to do the work a case like this involves and that being able to see the angles which would justify the application are not something you’d encounter in a bank branch (we have reasons beyond what we can include in this post for that).
Brokers being on the side of their clients rather than on the side of the financial institution is something people sometimes overlook, this case was a great example of how it pays to have a professional go to bat for you.