- Pupils with No Accounts
- New & Established Tenants
- Limited or Long Track Record
- Use of Income Projections
- Aged Debt Considered
- Common Sense Underwriting
Mortgages for Barristers
- Pupil Barristers – first, second, third six & squatters
- New tenants
- Established Barristers
- Appointed Silks – King’s Counsel (KC)
- Judges (either full or part time)
Pupil Barrister Mortgages
A number of our mortgage clients are pupil Barristers, looking to obtain a mortgage during pupillage. They have often, been taken on by an established set, either in London or the provinces. Chambers will usually have a good track record, with established Tenants having good income potential. The trainee Barristers we generally assist, are usually in receipt of a generous Chambers pupillage award.
They seek to utilise this income, to obtain a mortgage, despite there being no certainty of tenancy.
Typically, they tell us they are looking to organise mortgage finance, because they are frustrated paying excessive levels of rent in the private sector. They are often concerned, they will be declined a mortgage. Sometimes, following research, they believe they are unable to obtain a mortgage, as their income is not guaranteed beyond their pupillage period. This is despite their future earning potential. They may have spoken to their Bank or other mortgage brokers, specialising in barrister mortgages only to be told, they will need to wait. This is usually until they have at least 1 Year accounts, if not 2 years accounts, as a new Tenant. However, this is not always correct and very much depends on individual circumstances.
We regularly assist Pupil Barristers obtain a mortgage and will work in tandem with Senior Clerks within Chambers, to obtain both an income projection and career plan to present to a lender. The more established and larger the Chambers, the more successful we are likely to be able to assist. Your area of legal practice is also an important factor for mortgage underwriters, alongside where Chambers is geographically based and the number of Kings Counsel and Judges that have been appointed from Chambers. Additional factors include the number of tenants taken on each year and Chambers overall reputation within the Legal 500 and profession generally.
Pupillage continues to be one of the most highly regulated areas of the Bar. The only possible exception being that of the Bar Professional Training Course (BPTC). Pupil Barrister positions are highly competitive and the selection procedure is rigorous. In selecting pupils, Chambers are investing significant financial resources in the long-term success of all members and our lending partners, are able to understand that.
There are now strict provisions which govern the pupillage application process and Chambers pay awards have significantly increased over many years with a number of Chambers including Gray’s Inn Tax and Gough Square now providing Pupillage awards of up to £100,000 per year. The rights of audience, supervision, training and selection for Pupil Barristers is highly systemised and yet few mortgage lenders understand the rigorous competition and selection process a successful Pupil has navigated.
As a specialist mortgage broker working in the legal profession, we work with a number of lenders, who can assess affordability. They will consider, not just the current situation, but will take a view on the earnings’ potential of an individual Pupil. A helpful onside Clerk, willing to provide a projection of next year’s earnings, can be of invaluable assistance.
New Tenant Barrister Mortgages
We often work with new tenants who may have a limited track record of income. As newly qualified Barristers, they regularly tell us of the difficulties they are experiencing with income multipliers and meeting the affordability criteria of most mortgage lenders. They want competitive mortgage finance, but quickly realise that most Banks and Building Societies are unfamiliar with the often sporadic bankings and remuneration structure of the profession.
Barristers on lengthy, large ongoing cases, or instructed in public inquiries, may not be paid for some time, but their income is often quantifiable and guaranteed. Barristers we speak to, often wish to rely not only on actual receipts, but also their aged debt. This seems fair as it is work already undertaken and simply awaiting fee collection. They can often be taxed in advance on this earned but unreceived income, yet the majority of UK mortgage lenders, will not consider this earned income, because it is not yet received.
We can successfully assist many Barristers obtain a mortgage based on aged debt if it is accompanied by either a clerk’s projection of gross receipts, or an accountants’ reference. This is particularly so, if the Barrister is using known established barrister accountants such as Place Cambell, Silver Levene, Menzies and other specialist accountancy practices.
We understand that fees billed can sometimes be as significant as received income and our relationship with mortgage lenders, allows this income to be built into an affordability assessment. We assist the mortgage lender to correctly assess a barrister’s professional outgoings such as the costs for chambers, reasonable travel, expenses, legal subscriptions, subsistence and the costs of using your home as an office. These outgoings can often reduce a Barrister’s overall income figure down as much as 20- 40% and we can look to mitigate the effect of many of these outgoings with our lending partners, based on realistic and proper, projections for future years.
Our professional involvement, can often mean the difference in purchasing the appropriate flat or house, as opposed to having to wait a few more years, having to rent in the meantime.
As a barrister mortgage specialist, we know that standard mortgage income multipliers, when applied to the unique circumstances of a practising Barrister can be unfair if not fully understood. The figures on paper sometimes do not reflect true income, or the potential earnings of a new tenant. This in tandem with the Barrister’s Aged Debt often does not reflect the true affordability for Bar members. A significant degree of negotiation and the exercise of underwriter discretion can be required and not all mortgage brokers are the same, in this specialist and unique field.
RockHopper mortgage advisers, have dealt with numerous barristers for nearly 20 years. These include assisting pupils, with no accounts, newly qualified tenants (with or without accounts), King’s Counsel and Deputy and Full -time Judges sitting in all tiers of Court.
If you require assistance with any type of barrister mortgage, feel free to make contact, for a free, no obligation telephone consultation.
Mortgages for Barristers
An established Barrister can have a track record of accounts, but again can fall foul of a lender’s affordability matrix, resulting in application decline. Typically, we often speak to established Barristers, who are annoyed that they have applied to a Bank or through a mortgage broker only to be declined. There is little we can do when this happens as the mortgage application to a lender, will sit on the credit file for a number of years.
On speaking to established practitioners, the regularly cannot understand that despite having good receipts, the mortgage lenders they may have approached will insist on using their net income when assessing a mortgage. This is despite having a significant aged debt of work already undertaken and fees that are owed. Tax can have already been paid on this income, yet the majority of banks and mortgage lenders will not use this income. The deductions of Chamber’s rent, travel and professional subscriptions, further impact the net income figure for affordability purposes.
At RockHopper, we successfully liaise with our lending partners and can look to obtain mortgage borrowing on a Barristers total fees billed as well as those received in any given year. This is a truer reflection of work undertaken and turnover. This can often make the difference between successfully obtaining the required mortgage amount, or not.
We know everyone’s particular situation is unique, which is why we look at every enquiry on a case by case basis. We have direct access to underwriters and will present a case to our lending partners, not just based on income, but on the individual barrister, their experience and reputation. We will also consider the Chambers they practice from and the number of individuals within those Chambers who reach Kings Counsel or whom ultimately sit on the Bench. This gives the lenders a more realistic assessment of a newly established Barrister’s overall earnings potential.
Mortgages for King’s Counsel
According to the General Council of the Bar, there are nearly 2,000 self employed Kings Counsel. In addition, there are over 50 employed KC’s. The majority of Silks are aged between 45 and 65, meaning that when borrowing finance, they usually seek to borrow into retirement. The necessity to borrow into retirement, can create additional complexities when applying for mortgages.
We understand that the decision to become King’s Counsel is not an easy one. As well as a rigorous selection process, the successful applicant may sometimes have to navigate a short term reduction in income. This is because senior juniors, can sometimes receive greater remuneration than a junior senior. This is usually a short term phenomena and may occur for some, in the very early years. We appreciate this, and realise that the appointment to Silk is a significant professional achievement and we can support you through this process.
As specialists dealing with King’s Counsel, we understand the need for confidentiality and discretion. We also understand the complexities of cashflow, particularly for newly appointed KC’s.
On speaking to KC barristers, they can sometimes struggle to understand that despite an increase in seniority, expertise and reputation, mortgage lenders do not recognise that any short term dip in earnings after the transition to Silk, is quickly corrected in the medium and longer term. The sole use of a recently appointed Silk’s net income, does not provide the whole picture. In assessing long term mortgage affordability, deductions of Chamber’s rent, subsistence and other subscriptions can have a detrimental impact on net income figures. This situation can be further compounded, when we see there has also been a recent move, to a different set.
As a specialist mortgage broker, offering mortgages for Kings Counsel, we know that standard mortgage income multipliers, applied to a KC, can be unfair. The income trajectory can be misunderstood. Kings Counsel have unique circumstances as a senior, practising Barrister and the income received on paper, may not reflect true earnings’ potential. This in conjunction with the fact that many mortgage lenders do not fully understand Aged Debt reports, can make the mortgage application process, both difficult and problematic.
We will use our significant lender relationships, built up over nearly 20 years, to negotiate and arrange an appropriate mortgage. We can often seek the exercise of underwriter discretion from either the Head of Lending at smaller Building Societies and on occasion, if necessary, have liaised directly with the Chief Executives of some Societies. These smaller Building Societies are highly competitive on pricing and some have been in existence for well over 150 years. This is a lot longer than many High Street banks. These specialist providers, have a focus on the individual Barrister, rather than relying upon computer systems and algorithms. Our access to them, provides a huge advantage for our legal clients.
We believe that obtaining mortgages for some Kings Counsel can be a specialist area of finance, particularly for those not long appointed. Kings Counsel have provided personal testimonials to our service and we have made mortgages for Barristers, including KC’s, a specialist area within the Company. As King’s Counsel, you will receive our premier service.
If you would like help with any type of mortgages for Barristers mortgage, get in touch for a free no obligation discussion.
Mortgages for Judges
We understand that the majority of Judges are historically Barristers, but they may also have been or continue to practise as Solicitors. Chartered Legal Executives can also apply for Judicial positions these days.
At RockHopper, we assist both part time and full time Judges obtain mortgage finance.
We understand that part time Judges may choose to only sit, the minimum 15 days per year, whilst other may sit for additional periods. In doing so, they receive a judicial salary, whilst also qualifying for a judicial pension. These factors are both important, when considering mortgage affordability. At the same time, many Judges we deal with, choose to continue as a self employed Barrister, an employed Solicitor or Legal Executive. The combination of assessing both employed income received for the Ministry of Justice and self employed income, received from private clients or the legal Aid Agency, can result in a number of challenge when it comes to standard underwriting. We fully understand the issues and sometimes, these matters are best resolved through private banking arrangements such as Coutts Bank.
In contrast, whilst a full time Judge may not experience receiving both employed and self employed income, they may still need to rely upon other received income, such as income from investments either in the UK or abroad, family trust income or rental incomes from property, either here or overseas.
We have assisted a number of Judges with their specific mortgage requirements in the past, sitting in both the criminal and civil courts. This includes District Judges at Magistrates and County Court levels and High Court Judges and their family members. As a financial services company, we understand the need for strict confidentiality and data protection, with all clients, but we ensure an enhanced bespoke service for many of the Judges, who choose to use our mortgage services.
If you would like help with any type of barrister mortgage, whichever stage you are at within your career, get in touch for a free no obligation discussion.