20-05-2019

In our latest case study, we will be looking at what goes into financing the purchase of a freehold main residence (including a separate second property a ménage and 7 stables!) Put simply, a mortgage for house with stables and land. Keep reading to learn more about agricultural mortgages and the challenges they can pose.

The Story

This client was trying to purchase an equestrian property however they had been refused by a high street lender. 

The client’s usual broker had been trying to get her to accept an interest rate of over 5% with a specialist lender.  She was moving over 215 miles from her current home.  The property consisted of a freehold title on which were two semi detached houses, 7 stables and just over 5 acres of land.  The client wanted to move into the main house with her husband and children; she had 2 horses that she would keep in the equestrian facilities and her parents-in-law had sold their home and were moving into the other house on the freehold.  Her current broker was unable to help with anything competitive – as to be expected they were not used to securing finance on this type of property.  

The Challenge

This case has a few variables which traditional lenders would take issue with.  Firstly, the distance of the move. Moving 215 miles brought up some issues with work and commuting; the client had a job offer in the new location and her partner had a travelling job so his employer confirmed the move would not affect his work. 

Next, having two properties on one freehold title – both properties had separate bills and council tax.  We asked for a letter from the parents-in-law to confirm that they would be moving into the second property.

Lastly the equestrian facilities.  Having 7 stables and a ménage raised the question of whether the facilities would be used on a commercial basis. The client was able to confirm that 2 would be used for her horses and the others would be used for storage.  

The Result

The expert team at Fox Davidson were able to secure a 5-year fixed rate agricultural mortgage at 2.10% for the client. Upon receiving the initial call, we had indicative terms out the next day. We liaised closely with the lender throughout the application process to explain each part of the purchase; this enabled the underwriter to become comfortable with the scenario and approve the application 4 days after receiving it.  The client is over the moon and now able to move into her dream property. 

Don’t be put off if you are unsuccessful finding agricultural mortgages via High Street lenders – give Fox Davidson a call and we will take a logical and methodical approach to securing you a competitive mortgage.