Providing mortgage solutions during divorce
Our clients’ wishes
Mr and Mrs Ali were a recently married couple who were introduced to Nedbank Private Wealth by their mortgage broker during the purchase of their new house. They were struggling to find a lender to assist them with a new mortgage due to the loan structure required and their affordability following Mr Ali’s previous divorce.
Our clients’ situation
Mr Ali is a partner in a law firm. Because of this, he had been advised by his accountant to structure the mortgage on a joint borrower sole proprietor basis, with the title in his wife, Mrs Ali’s, name.
Following his divorce, Mr Ali pays his ex-wife maintenance towards their two children and is responsible for paying the mortgage on his ex-marital home. These commitments are to remain in place for the next 7 years.
His wife, Mrs Ali, had started her own business 2 years ago and her turnover, profits and income were increasing annually.
Their broker had approached a number of lenders, none of which could achieve the borrowing amount required. Due to Mr Ali’s committed expenditure post-divorce, servicing requirements was also proving to be a challenge.
The purchase price was £2,800,000 and the clients required a mortgage of £1,680,000 at 60% loan-to-value.
Mrs Ali’s accountant gave us projections and evidence of contracts that showed her business was flourishing, and that her income was increasing year on year.
How we helped
We were able to work with the clients’ accountants and advisers to confirm their income was on an upward trajectory and that paying the mortgage both now and, in the future, was sustainable. Mrs Ali’s accountant gave us projections and evidence of contracts that showed her business was flourishing, and that her income was increasing year on year.
At the same time Mr Ali’s accountant and the Chief Financial Officer of the law firm also confirmed his future earning potential and job security.
To support Mr and Mrs Ali with their affordability queries, we were able to request evidence of all savings and investments balances. This provided us with confidence that they had surplus liquid funds post purchase to call upon if required to cover the maintenance payments and the mortgage costs associated with Mr Ali’s ex-marital home.
We were able to gain comfort with a new lend of £1,680,000 with evidence that affordability both now and in the future could be met, enabling Mr and Mrs Ali to purchase their new home.
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Contact
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Any examples of investments and structures used are for illustrative purposes only. This case study does not constitute an invitation or inducement to buy any financial investment or service. None of the content constitutes advice or a personal recommendation. Individuals should seek professional advice, based on their jurisdiction and personal circumstances, before making any financial decision.
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