When Lillie first contacted us, she was feeling understandably frustrated and close to giving up.
Her situation was actually very common for many people trying to buy a home from a family member. Lillie wanted to purchase her father’s property through what’s known as a concessionary purchase, where the property is sold below its market value and the difference in value effectively becomes the buyer’s deposit.
In simple terms, the equity in the property was going to provide the deposit rather than Lillie needing to save a traditional cash deposit.
While this type of arrangement can work well for families who want to keep a property within the family, it can sometimes cause problems with mortgage lenders. Many lenders simply don’t accept this type of structure, particularly when the deposit is being provided through gifted equity rather than savings.
Unfortunately, Lillie had already discovered this the hard way.
Before speaking with us, she had approached other lenders and brokers but had been declined. On top of the concessionary purchase structure, there was another complication. Lillie had adverse credit on her file, including a missed payment that had occurred just four months earlier. For many high street lenders, this combination of factors was enough for them to say no.
By the time she reached out to us, she had been told more than once that purchasing the property simply wasn’t possible.
Rather than dismissing the case, we took the time to properly understand Lillie’s situation. Every client’s circumstances are unique, and our job is to look at the full picture rather than relying on a one-size-fits-all approach.
After carefully reviewing her credit profile and the details of the purchase, we identified that this was exactly the type of case where a specialist lender could help. Unlike many high street banks, specialist lenders are often more flexible and willing to consider applications that involve concessionary purchases or recent credit blips.
We worked closely with Lillie to structure the application correctly. This included clearly demonstrating how the gifted equity deposit worked within the purchase and providing additional information around her credit history to give the lender full context.
Once the application was submitted, things moved quickly.
The lender reviewed the case and understood both the purchase structure and Lillie’s circumstances. Just 11 working days later, the mortgage offer was issued.
For Lillie, the relief was huge.
After being told by others that the purchase wouldn’t be possible, she was finally able to move forward with buying her father’s property and securing the home she wanted.
Cases like this highlight something we see every day: just because one lender says no, it doesn’t mean the answer is always no.
Mortgage criteria varies hugely between lenders, and sometimes it simply takes the right knowledge and experience to match a client with the lender that understands their situation.
If you’ve been declined elsewhere, or you’re unsure whether your circumstances will be accepted, it’s always worth having a conversation. There may still be a solution available.