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Bridging Finance
Specialist Mortgages

If you’re a high net worth individual,
you deserve an individual service.

Many High Street lenders have yet to catch up with the fact that property prices in London and the home counties run into the millions and continue to rise. This in turn, creates the need for £1,000,000 plus mortgages.

At the Mortgage Marketplace we work with more forward-thinking lenders and private banks who specialise in larger mortgages.

When applying for a £1,000,000 plus mortgage, you need the lender to look beyond standard income multiples and to consider your assets and net worth.

At the Mortgage Marketplace, all clients requiring a mortgage of £500,000 or more will be allocated an advising principle, senior mortgage consultant and mortgage administrator to ensure you receive a personal service second to none.

How does the high net worth mortgage market work?

When deciding whether to advance a mortgage to a high net worth borrower, lenders will often assess affordability on assets, as well as income. It is not unusual for a borrower to take out a loan at a relatively high LTI ratio, even though there is no issue with affordability. The borrower’s assets may also provide security for the loan and can be drawn upon if mortgage payments are not maintained – so the lender’s risks are well covered.

Private banking relationships tend to be built on a thorough understanding of individual personal financial circumstances and the needs of the client. If a customer takes out a mortgage, it may be a bespoke product, and for a much shorter term than is typical in the mainstream market – perhaps for only a few years. The decision to take out a mortgage may also be shaped by broader decisions about the financial management of assets in a complex and highly individual portfolio

The result is that lenders in this sector may therefore often have a large proportion of customers with high loans relative to income (as opposed to assets). It is therefore not uncommon for them to wish to advance more than 15% of their mortgage book at a ratio higher than 4.5 times income. But such a business model – and indeed the business itself – remains entirely sustainable.

Compared to the mainstream mortgage market, affordability for high net worth customers is also much less likely to be affected by changes in interest rates. They have investment and funding strategies that are fundamentally different to more mainstream borrowers, and their spending commitments and levels of debt are much less likely to be affected by interest rate movements.

High net worth customers also take out mortgages for reasons that are less likely to apply to mainstream customers. It is possible, for example, that they may take out a large mortgage to fund a business. Imposing unnecessary restrictions on lending in this sector could therefore have some implications for the funding of small- and medium-sized enterprises.

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Contact us on 0800 170 7474 or make an enquiry

The Mortgage Marketplace