Project Description

This case study is for illustrative purposes only and does not constitute advice.
Your home may be repossessed if you do not keep up repayments on your mortgage.
The value of investments can fall as well as rise, you may get back less than you invested.

What Brought Harriet to us?

Harriet is in her 70s and received a recommendation from one of my existing clients. We met for a cup of tea and she began to tell me why she needed my help…

“I’d like you to look at renewing my mortgage.” Began the 71-year-old sitting opposite me “My friend Amanda has a larger mortgage than mine – and she’s paying far less for it!”

I soon established that Harriet’s mortgage was on an investment property in London, and was one of four that she owned in the capital. This mortgage was for £70,000 yet it had never been reviewed by the company who originally arranged it for her (we hear about this all too frequently!)

Harriet was paying a standard variable rate of 5.79% on an interest-only mortgage amounting to £337 each month. However, Harriet had no idea that she could change her mortgage lender without selling the property. She also thought that her age would mean that she had no options when renewing her mortgage.

What did we do for Harriet?

I soon found a lender who was happy to advance mortgages to older clients, who would offer Harriet a new deal at 2.79%, reducing her monthly payment to £162.76 per month.

Harriet was delighted that her payments had more than halved, and that her age was no barrier to a better mortgage deal.

With her mortgage woes out of the way, talk turned to the rest of Harriet’s finances. Her investment properties brought in a health annual income for her, but she also had a sizeable chunk of money just sitting in a bank account.

I asked her what the money was for and if she knew what interest rate the bank was paying her.

After some digging, we discovered that the bank’s interest rate was basically 0% and that Harriet’s money wasn’t working for her. My thoughts turned back to her mortgage deal…

“Why pay interest on your mortgage, Harriet? You could utilise some of these savings and pay it off. You’d be mortgage free and still have money in the bank for that rainy day, but at least that cash would be working for you instead of earning you nothing!”

Adding Value

As we arranged a future appointment to put this new plan into place, Harriet admitted to me that she had been somewhat lax and that the insurance on two of her rentals had lapsed recently, leaving them unprotected and putting both Harriet and her tenants at risk.

A quick call to our sister company, Together Insurance Solutions, got her case sorted and her properties are now fully covered and protected!