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High net worth mortgages guide UK

Written By:
Myles Robinson - Expert Finance Advisor

Posted: Feb 6, 2023

High net worth mortgages guide for UK residents

While not all mortgage lenders are aware of the unique needs of a high-net-worth individual, there are some specialist lenders, private banks, and mortgage brokers that can help you find the right deal for high-net-worth mortgages.

We have created this guide to high-net-worth mortgages to help you get the information you need if you are looking for a high-net-worth mortgage.

You’ll find out how to apply, what rates you can expect, and how to find the best lender on the mortgage market for high-net-worth mortgages.

We can get you approved discreetly for a high net-worth mortgage. All of our brokers are regulated by the FCA, start online below:

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What is a high-net-worth mortgage loan?

A high net wealth mortgage is for those with a net income above £300,000. Or assets over £3 million. Customers do not always meet this criterion. Mortgage lenders that specialise in high net worth loans are more likely to offer high loan amounts, multiple incomes, and custom terms and conditions.

High net-worth mortgages are often required to purchase high-value properties and/or investments to build a portfolio. These loans can be more expensive and complicated than regular residential home loans.

These mortgages are popular with customers who want to protect their assets. To do this, they may need to borrow through offshore structures, special-purpose vehicles trusts and foundations. This can cause problems for some mortgage lenders. Many prefer to use mainstream mortgages, which are easier to process.

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How to get a mortgage if you have a high net worth

These steps you need to take to get your application on the right path.

  1. Get your documents prepared in advance: You will need to submit all the necessary paperwork for a high-net-worth mortgage agreement. This includes proof of income, ID, and address. You should have all the necessary paperwork to prove any assets you plan to declare as income or security to the loan. Our guide to mortgage application contains a complete list of all the documents that you will need.
  2. Finding the right mortgage broker is key to securing a custom deal for high-net-worth mortgages. These agreements are only offered by brokers. A broker can help you save time and money by negotiating a custom deal for your account. Send us an enquiry to match you with a high net worth mortgage advisor today.
  3. Your broker will take care of the rest. There are many steps involved in the mortgage process. However, the beauty about using a broker to help you is that they will manage them all for you. They will guide you through the application process and ensure that everything runs smoothly.

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Why would you want a mortgage with a high net worth?

Investors often take out mortgages with high net worth when they are able to buy outright. This would reduce their liquidity for potential investment opportunities. It can also be financially inefficient to hold a large amount of money in one asset.

Asset protection is a crucial aspect for many buyers. Our advisors have extensive knowledge in this area and can help you choose the best option for your particular situation.

Is it possible to get one with a low income?

Yes, provided you have the right circumstances. Mortgages for high net worth are typically offered to those who earn more than the average income. However, lenders may still be willing to exempt you from high net worth mortgages and protect your assets against debt, provided you have sufficient wealth.

Each lender will have its own affordability check. However, in most cases, income will be a major factor in deciding how much or if they are willing to lend to you. Many lenders will limit lending to you to 4.5 times your annual income. Some will cap it at 5, while others will limit it at 5. A few will lend up to 6x your income when the circumstances are right.

High net worth mortgage borrowers may be treated differently than mainstream customers because some lenders consider the value of assets when assessing affordability. You could be eligible for a mortgage that is based on more than 7x your income and bespoke terms.

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Mortgages backed by assets

An asset-backed mortgage is a popular choice for high net worth individuals, particularly if they have more income than their assets. An asset-backed mortgage is secured by high-value assets such as stocks and shares, instead of the property.

An asset-backed mortgage allows borrowers to buy property without the need to sell their assets. It may be possible to get a larger mortgage than you would receive from traditional high street lenders if your assets are sufficiently valuable. Rates are often more favourable than other types of mortgages.

Mortgage brokers are the only way to get bespoke, asset-backed mortgages for high-net-worth borrowers. However, the good news is that our mortgage advisors specialise in this area of lending and can ensure you are introduced to the right lender.

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Are they possible to be secured across multiple properties?

Yes, if you are a landlord looking to refinance your entire portfolio to finance new purchases or to release capital for existing investments. A single asset-based mortgage can be used to refinance the entire portfolio.

Again, this will depend on the lender’s ability to pay and the strength of the intangible assets being used as collateral against any lending.

Refinance an asset-based mortgage

Talk to your lender about refinancing an asset-backed mortgage. You can also remortgage to another lender if you wish. The advisors that we work with will help you find the best deal that suits your needs.

Be aware that your existing mortgage provider may charge additional fees for assets against which you have secured the loan.

What happens if your credit score is not good?

Even for someone with a high net worth, a poor credit rating could cause problems if they’re looking for an asset-backed loan. Poorly performing businesses are a common reason for wealthy people declaring bankruptcy.

The good news? No matter your financial situation, there are high-net-worth mortgage lenders that will consider applications from borrowers with credit problems in the past. A few specialists also specialise in these types of mortgage applications.

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What rates should you expect?

Some property buyers or investors make the mistake of focusing on their bank or current lender when searching for the best rates. If you are a high-net-worth individual, it is possible to find a better rate if you look for lenders that offer customized deals.

Many banks and building societies offer exclusive rates for customers. However, if you look closely and compare these rates to other rates on the market, sometimes a better rate can be found. This is where our expert advisors come in.

They are experts in high net worth agreements and can access deals that aren’t available to the general public. They can negotiate rates and terms if you meet the criteria for high net worth.

The property market is subject to rapid change. Lenders can have different criteria to meet affordability requirements, and interest rates can fluctuate.

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Let us match you with a high-net-worth mortgage broker

It can be difficult to get a high-net-worth mortgage without the right advice. The good news is that our brokers are experts in the arrangement of these types of mortgages. They can access private lenders that offer high-net-worth clients special terms and conditions, such as higher loan amounts and larger income multipliers.

We’ll arrange a no-obligation, free chat between you (and a high-net-worth mortgage broker) by starting your application below:

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Are deposits required higher for high net worth mortgages?

As you might expect, the greater the property value (and borrowing), the lower the deposit requirements. As mentioned, higher borrowing requests are often subject to stricter loan-to-value criteria.

For example, an asset-backed loan may be approved for a £4,000,000 property. The 50% loan-to-value restriction means that the deposit must be £2,000,000 An HNWI would not expect such a high amount to come from disposable income. An HNWI may access these funds from many sources.

  • UK Property Sale
  • International property sale
  • Investment portfolio cash funds
  • Trust monies or inheritance
  • Gift for the family
  • Funds from the sale of a company

No matter the source, a lender will require documentation to prove where these funds originated for it to meet its money laundering and internal requirements.

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Can I get a mortgage for a buy-to-let with a high net worth?

Yes. Lenders tend to be less strict about criteria like income streams. Instead, they focus on assets that can provide security. Rent income can then be used to pay the mortgage. This will reduce the tax liability on rental income.

While most lenders require proof of income for a buy-to-let mortgage, some will not accept income below a buy-to-let purchase. A large portfolio is another benefit. This portfolio could be used to raise financing for a property purchase that will serve as your primary residence.

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Can I get a mortgage with a high net worth on a second house?

It’s possible if you meet the criteria of a high-net-worth lender for second mortgages.

High net-worth individuals are likely to own additional homes for personal use, whether in the UK or a vacation home abroad.

A second home would not be possible to borrow money for, as it is difficult to buy to rent properties. Instead, you would need to show proof of income to pay the mortgage.

It is worth contacting a local broker/lender if the property is overseas. These people will be better informed about the laws and regulations in each country governing property purchase.

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