1.1 Background To Our Meeting

Further to our meeting, during which we discussed and recorded your financial circumstances, I would like to take the opportunity to outline my recommendations, confirming the suitability and reasons for them. If you have not disclosed any information which you feel could affect my advice, you should contact me immediately.

1.2 Agreed Objectives & Priorities

There are 4 objectives to be completed
select a different dropdown for each one
Where there is an x enter answer

• 1. Competitive rate & low upfront fees
• 2. Fixed for certainty of repayment and budgeting purposes
• 3. Speed of offer due
• 4. Best rate – considering adverse history
• 5. Monthly budget of less than £X
• 6. Best overall cost
• 7. Free valuation & Free Conveyancing including a cashback to assist with the Broker Fees
• 8. No booking fee
• 9. Repayment before planned retirement age of x

1.3 Current Personal And Financial Circumstances

A summary of your personal and financial circumstances is contained in the appendices of this report.

2.2.1 Why This Mortgage

• 1. As per your objectives This mortgage was recommended as it was the best rate with the lowest fees for your circumstances and objectives as above.
• 2. X were recommended as they sourced top of the market with the best rate, reasonable fees and a quick turn-around time to offer.
• 3. X are one of the only lenders to take into account equity gifted from landlord and treat it as deposit to lower the Loan to Value.
• 4. X was the only lender to consider applicants with a CCJ in and a default within the, with an IVA, with a DMP
• 5. X do not credit score and rely on credit searching and affordability
• 6. Although this was not the best rate available, I have recommended you proceed with this because it meets with your objectives, specifically XXX

2.2.2 Debt Consolidation

Our initial discussions included details about your existing credit card / unsecured loan balances. Based on the information you provided, the total amount outstanding is approximately (£xxx). You told me these debts were incurred because (insert reason). Your goal is to (insert reason i.e. reduce outgoings to an affordable level / save for future house move etc.). Because of this you would like to look at adding your debts to your mortgage to have one reduced monthly payment. Although adding debts to your mortgage can reduce your monthly outgoings, you may end up paying more overall – because you will be repaying the loans for longer. You will also increase the size of debt secured against your property. Your property can be repossessed if you do not keep up mortgage payments. This is not the case if you miss payments on other types of borrowing – like credit cards and unsecured bank loans. In the table below, I have provided a summary of the outstanding debts. I have also included the estimated difference in cost to repay the debt if it is added to your mortgage rather than repaid via the existing arrangement. It also explains the reason why we have either recommended you do or don’t add them to your mortgage.

2. You are not consolidating any of your debts.

2.2.3 Attitude To Risk

• 1. Balanced = P&P You wanted to ensure the balance was decreasing month on month and would be repaid by the end of the term in full.
• 2. Cautious = repayment You wanted to ensure the balance was decreasing month on month and would be repaid by the end of the term in full.
• 3. Speculative = interest only You wanted to ensure the balance was decreasing month on month and would be repaid by the end of the term in full.

2.2.4 Why This Mortgage Term

• 1. The term recommended ensures the mortgage would be repaid in full before your planned retirement age.
• 2. It also allows you to have enough disposable income to save for emergencies.
• 3. It ends the same time your repayment vehicle matures
• 4. We have had to extend it into retirement for affordability, however, after assessing your retirement income evidence you have provided, it will remain affordable.
• 5. The term of XX years takes you to XX years of age, which is X years before your planned retirement age of XX.

2.2.5 Lending Into Retirement

The term of this mortgage means you will still be making repayments after your planned retirement age. (Explain reason and confirm how affordable both now and into retirement). (If using earned income include). There are risks with taking out mortgages to older ages. In particular, there is a higher chance of ill health preventing you from working. This could make it difficult for you to meet your mortgage repayments. We discussed what alternative options you have to maintain payments if your income reduces or stops before the end of the term and you confirmed you would (insert how payments would continue to be met). Your future pension income is not guaranteed and could be higher or lower than your current projection. I recommend you regularly review these plans to ensure they are on track. Although it is currently your preference to take the mortgage over this term, we strongly recommend that you review the term regularly.

2. The term of your mortgage is not taking you in to retirement age.

2.2.6 Why This Product Type

• 1. A fixed-rate product type was recommended as this matches your attitude towards risk. The repayments will be fixed for a set amount of time, therefore you can budget accordingly for the next x years It was important you had the certainty of repayment as opposed to a fluctuating monthly payment that could change with any bank rate changes. This means you have protection against any possible future rate rises.
• 2.You wanted protection against possible rate rises during the next 2 years. You do not feel rates will rise beyond 3% for a similar deal after 2021 and we have calculated repayments would still be affordable at this hike, so you are willing to take the risk with a relatively low initial fixed-rate term.
• 3. You wanted a fixed rate for the next 5 years – anything longer was just too long to predict
• 4. You wanted a fixed rate for the next 10 years – you do not foresee any changes at all and wanted protection against rate rises for as long as possible – you understand you are tied in until xxxx
• 5. *** High Loan to Value Mortgages (95% and above) *** The recommended mortgage has a high ‘loan to value’ (this means your mortgage is quite high compared to how much the property is worth). Higher loan to value loans tend to carry higher interest rates. As property prices can go up and down. So there is a higher risk that your outstanding mortgage loan could end up being higher than the market value of your property.
• 1. *** High Loan to Value Mortgages (95% and above) *** The recommended mortgage has a high ‘loan to value’ (this means your mortgage is quite high compared to how much the property is worth). Higher loan to value loans tend to carry higher interest rates. As property prices can go up and down. So there is a higher risk that your outstanding mortgage loan could end up being higher than the market value of your property. We reviewed alternatives to borrowing above 95% but none were available to you. I have explained the risks and to you during our meetings.
• 2. You wanted a rate that was linked to the internal variable rate of the lender, not linked to the Bank of England Base Rate. Because…they don’t always increase 30 days after a rate change and the lender can decide exactly how much it does increase by.
• 1. You required a rate that was linked to the external bank base rate as you believe rates will not increase in the next x years. If they do, you understand the rate will increase approx. 30 days after any base rate change. You are willing to take the risk of increased interest rates and can withstand an interest hike of up to x% on my calculations.
• 2. *** High Loan to Value Mortgages (95% and above) *** The recommended mortgage has a high ‘loan to value’ (this means your mortgage is quite high compared to how much the property is worth). Higher loan to value loans tend to carry higher interest rates. As property prices can go up and down. So there is a higher risk that your outstanding mortgage loan could end up being higher than the market value of your property. We reviewed alternatives to borrowing above 95% but none were available to you. I have explained the risks and to you during our meetings.

2.2.7 Reason For Recommending This Lender

• 1.The lender credit searches as opposed to credit scored, which you needed as you have previously been declined due to credit core.
• 2. This lender does not have a debt to income ratio.
• 3. This lender offered the best rate for applicants with CCJ and defaults.
• 4. This mortgage was recommended as it was the best that sourced wit lending criteria to match your circumstances.
• 5. They are the only lender to allow the landlords deposit.
• 6. This lender had the best rate for a concessionary purchase.
• 7. As per your objectives

2.2.9 Adding Fees To The Mortgage

We discussed the implications of adding fees to the loan and discussed the interest payable over the term by producing 2 illustrations. The fee has been added to the loan, costing you £X.XX extra each month increasing the total interest repayable. You decided to add the fee as opposed to pay it upfront to keep money aside for legal fees and stamp duty. £XXX has been added to the mortgage at your request. We looked at mortgages with no fees but the rates were higher. By paying the fee, you receive a lower rate and it works out cheaper of the 60 months to pay it. You are adding it to your loan as you didn’t have the funds to pay this upfront. You understand you will pay interest on it as follows: I have illustrated below, the cost comparison of adding the fee

2.2.10 Potential Disadvantages

The Payment is only fixed for the next X years, and after this time the rate will revert to the standard variable rate. We therefore recommend we review your mortgage 3-6 months before the end date of XX/XX/XXXX to ensure your payments do not increase substantially Rates could rise after the X years fixed period has ended meaning your payments would increase, so we have looked at potential rises and planning for this.

2.4 Cost Of Our Services

2.5 Risks Warning

The lender has the right to withdraw the offer at any time. Please do not obtain any further credit until your mortgage has legally completed as this can affect your offer validity. This mortgage will be secured on the property you reside in which can be repossessed if you do not keep up to date with Mortgage Repayments, as per section x of the mortgage offer. If you fail to keep up with and kind of credit repayment, including this mortgage, you could be declined for a mortgage in the future if you need to change the mortgage amount, term or repayment type in the future, you will be assessed on your new circumstances.

2.6 Risks Without Protection

• 1. Your current protection fully meets your mortgage needs and this will remain in place.
• 2. Your current protection does not fully cover your mortgage, but you have chosen to keep it. I have informed you of the possible shortfalls.
• 3. After evaluating your current protection needs, I have proposed a solution that addresses your mortgage requirements. Further details regarding this recommendation will be provided in a separate letter.
• 4. I have carefully assessed your current protection needs and, while I have suggested a solution to address your mortgage requirements, you have chosen not to proceed with this recommendation due to (enter reason). I have also ensured that you are fully informed of the potential risks involved in this decision.

3 Planning Ahead/Your Will

We recommended you update your will in the event of any major life change, such as; getting separated or divorced, having a child, moving to a new house or if the executor named in the will dies. Our protection adviser will talk to you more about our will writing service

4 Review Your Mortgage

We recommended that you review your mortgage at least once a year or at least 6 months before the initial product end date. Your lender will be in touch at least 3 months before and most offer a retention deal. We will get in touch up to 6 months before, to search the market as most clients are able to obtain a better deal, especially if they have had a credit repaid type mortgage and are now in a better position. This is also particularly important if you have had any changes, so we have enough time to secure you a new deal to avoid you going onto Standard variable rate with the lender.