Case Study: High Loan-to-Income Refinance Using Latest Bonus Income
DIRECTOR AND MORTGAGE ADVISER
Case Study: High Loan-to-Income Refinance Using Latest Bonus Income
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Overview
An associate at a London law firm approached us looking to refinance his existing property in order to buy out his former partner. His income included a basic salary and substantial annual performance-related bonuses. With no dependants and strong affordability, the client needed to maximise borrowing and utilise his latest bonus income to remain in the property.
The Challenge
Many lenders calculate bonus income based on a two-year average, which would have significantly reduced the client’s borrowing potential. To buy out his former partner, he needed to stretch both loan-to-income and affordability. A high loan amount in his sole name was essential, and preserving the home was a priority—to avoid moving, incurring stamp duty, and additional legal and estate agent fees.
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Our Solution
We sourced a lender willing to use the most recent bonus alone—rather than averaging over two years—which reflected the client’s current income trajectory and increased borrowing capacity. The lender also offered an income multiple of 5.5 times salary and accepted full use of his bonus income thanks to his strong financial profile. To manage ongoing repayments, we structured the loan over a longer term while selecting a product with a generous overpayment allowance, allowing the client to reduce the effective term using future bonuses.
The Outcome
The client was able to refinance the property into his sole name, securing a loan large enough to buy out his ex-partner and remain in the home. With flexible repayment terms and the ability to reduce the loan balance over time, this solution gave him control over his financial future while avoiding unnecessary moving costs.
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What We Can Do for You
Complex income structures, partnership splits, and refinancing challenges don’t have to mean starting over. We know how to make lender criteria work in your favour—especially when income is made up of variable elements like bonuses. If you're looking to retain your home and need to borrow more than standard routes allow, we’re here to help.
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