Purchase of a £2.35m Kensington apartment for a US national/US resident couple - Case Study

By James Mcgregor on Jul 23, 2020

We previously had two clients introduced to us through one of our partner estate agents. The agent was acting for the buyer on a transaction in which they wanted to purchase a basement apartment for their daughter. They already owned the apartment above and was looking to use equity in this apartment as part of the deal.  

The barriers with this client was the fact they were US residents, US nationals and all of the income was derived from two separate family trusts which had two beneficiaries. Only one of the beneficiaries was linked to the purchase transaction.

We first had to unravel the understanding of the trusts and discover what income producing assets the trusts were made up from. With some help from the clients bankers in New York we was able to do this in a timely manner. We then bumped in to another issue, the drawing from the personal trust was not sufficient for the borrowing requirement. After discussing this with the bank, we came to a solution that the client would agree to draw down a larger sum for the term of the mortgage, this was then confirmed in a letter from the clients US accountant.

The final outcome was a 10 year fixed mortgage at 2.99% of £2.3m against £5m total valuation, secured against both apartments. By fixing for the 10 year term this allowed our clients to mitigate any risk of currency fluctuations during the mortgage term and secured them an excellent rate.

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