The Scenario
The customers, a couple with two children based in Fleet, Hampshire, were looking to capital raise for home improvements. They were also considering using the additional funds to clear a loan but had not made a final decision. Their current mortgage with Nationwide had an outstanding balance of £297,905, and they wanted to raise an additional £32,095, bringing the total loan amount to £330,000.
Their preferences included:
- 5-Year Fixed Rate: They wanted predictable monthly payments for the next five years to support their budgeting and protect against interest rate fluctuations.
- Capital Repayment Mortgage: They preferred to keep the repayment structure to ensure the loan would be paid off at the end of the term.
- Term Retention: They wanted to maintain the existing 26-year term to keep monthly payments within their budget.
Additionally, they wished to explore protection options closer to completion.
The Challenge
The key challenges included:
- Seamless Process: As existing Nationwide customers, they wanted a straightforward solution to secure the additional borrowing without unnecessary complexity.
- Affordability: Ensuring that the combined mortgage and additional borrowing remained manageable within their budget.
- Future Flexibility: The solution needed to align with their potential decision to allocate the funds toward a loan clearance or purely home improvements.
The Process
Step 1: Understanding the Customers’ Needs
We conducted a detailed consultation to understand their financial priorities and goals. Their focus on stability, affordability, and the ease of budgeting guided our recommendations.
Step 2: Identifying the Right Solution
Given their existing relationship with Nationwide, we identified that a further advance with their current lender would be the simplest and most cost-effective option. This approach eliminated the need to switch lenders and provided continuity with their current mortgage terms.
Step 3: Structuring the Mortgage
We structured the mortgage to combine the existing balance of £297,905 with the additional £32,095, maintaining their 26-year term and securing a 5-year fixed rate. The capital repayment structure ensured they would continue to pay down the principal over time.
Step 4: Simplifying the Application
To make the process even smoother, we waived the application fee as part of our service. We also scheduled a follow-up to review protection options after the mortgage offer was issued.
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The Solution
Nationwide provided a tailored further advance solution:
- Loan Amount: £330,000 (£297,905 existing + £32,095 additional borrowing)
- Product Type: Capital Repayment Mortgage
- Rate: Fixed for 5 years
- Term: 26 years
This solution met the customers’ needs for affordability, predictability, and ease of budgeting.
Why This Solution Worked
- Seamless Transition: By staying with Nationwide, the customers avoided additional complexity or delays.
- Predictable Payments: The 5-year fixed rate offered stability, aligning with their budgeting priorities.
- Affordability: Maintaining the 26-year term ensured payments remained manageable within their budget.
- Flexibility: The additional funds allowed them to proceed with home improvements and kept the option open to clear a loan if needed.
The Outcome
The customers successfully secured the further advance, giving them the financial flexibility to improve their home and manage their budget effectively. Key benefits included:
- Enhanced Living Space: The additional funds enabled them to proceed with home improvements that would enhance their family’s quality of life.
- Stability and Affordability: The fixed rate and retained term provided predictable, manageable monthly payments.
- Future Planning: They had the option to revisit protection solutions and allocate the funds as needed for further financial clarity.
Closing Thoughts
Whether it’s for home improvements, debt consolidation, or future planning, securing a tailored mortgage solution can empower families to achieve their goals with confidence. This case demonstrates the value of a straightforward, customer-focused approach.
If you’re considering capital raising or exploring further advance options, we’re here to help.
Contact us today to find the right solution for your needs and take the next step toward your financial goals.
