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Mortgages over 6 million

Author: Myles Robinson - Expert Finance Advisor

Posted: Jun 22, 2022

Mortgages over 6 million in the UK

It can be difficult to find a mortgage lender for those looking for a mortgage worth more than 6 million pounds.

Due to the risk of investing large amounts in one borrower/property and not spreading the burden across several people, many mortgage providers lending limit the amount they will lend to applicants.

This guide will help you find a mortgage broker for more than £6 million. We will show you how to get a mortgage for this amount, the mortgage repayments, and how a mortgage broker specialising in high-net-worth individuals can assist you in getting the best interest rate and overall mortgage deal.

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Is it possible to get a 6 million pound mortgage and more?

You can, but it is unlikely that you will find many options with few mortgage providers lending this amount. Mainstream lenders often have loan limits that prohibit them from lending loans of this size.

You must meet the requirements for high net worth exclusion to be eligible for a mortgage exceeding £6 million. However, if you do qualify, you will have full access to private lenders without any maximum loan limits.

Contact us today here for free mortgage advice on million-pound mortgages.

You may qualify for a mortgage up to £6 million, £10 million, or even £80 to 100million depending on your income and asset-based wealth. Private lenders are well-positioned to offer customized mortgage deals that don’t follow the standard rules of the high street.

Private lenders are not usually available to the public because many of them only work through brokers like our high-net-worth mortgage specialists.

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Requirements for deposits

To balance the risk of lending large amounts to one borrower, the few high-street banks on the mortgage market that operate in this area will require a substantial deposit. They will only lend up to 60% of the loan value, so you will need to deposit at least 40%.

Specialist lenders and private lenders can offer higher LTVs because they will apply their own eligibility lender criteria and use a case-by-case approach to underwriting decisions. They will conduct a custom assessment of your financial situation, including future earnings and illiquid assets. LTV mortgages are available in the range of 85%-90%, which is a 10% to 15% down payment.

Lenders rarely accept lower than 10% deposits. This is usually only possible if the mortgage term is secured by a liquid asset such as cash or jewellery.

We provide mortgage advice to discuss a large mortgage loan and different mortgage subjects.

What amount do you need to make?

You must have an approximate annual income of £300,000. Or assets in excess of £ 3 million to qualify for a high net worth mortgage exemption. You would need to make between £1m-£1.2m per annum in order to qualify for a £6 million mortgage based on standard income multipliers (typically 4.5-6x salary).

To determine how much you would have to earn to pay a mortgage of the amount requested, you can use the same income multiples formula to calculate your salary or contact one of our specialist finance brokers.

Private finance lenders can operate outside standard lending criteria if the borrower is high-net-worth. If this applies, you may be able to borrow 7x your income, or even more.

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How much will your monthly payments be?

These tables show examples of the monthly repayments for mortgages up to £6 million based on a capital-repayment deal with a 2% interest rate and a term of 25 years.

Why is it so difficult to obtain a mortgage for this amount?

A large loan amount is similar to a normal home loan. It is the difficulty of finding a lender willing to lend money that makes this process unique and requires an exclusive mortgage expert.

Higher-value loans are considered to be riskier, so there are fewer mainstream lenders that can meet your needs. You will need to seek out a specialist or private lender if you are dealing with high-value mortgages.

We have a number of specialist lender contacts, when you enquire we will use our mortgage intelligence to put you with the best broker for your needs and make your mortgage journey as enjoyable as possible for you.

How do you find specialist brokers?

Specialist finance continues to be harder to find a broker than typical high street lenders for a standard mortgage. As a mortgage introducer we have private and specialist mortgage brokers who will offer large mortgages with competitive rates to those who meet the high net worth exemption.

All the advisors can be contacted by ourselves and offer tailored advice to find the mortgage for you. There are many advisors who specialise in high-net-worth mortgages.

We can help you find a broker with deep relationships with lenders that offer mortgages up to £6 million, as well as mortgage providers with the flexibility to offer deals in excess of tens, if not hundreds of millions of pounds.

These lenders offer customised mortgage deals and your broker can negotiate with them exclusive terms and rates.

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There are other factors that can affect your eligibility

Once you have found a lender willing to lend, you will need to go through the same eligibility checks as for any mortgage. However, if you are eligible for the high net worth exemption, your lender may be able to determine what type of deal you can qualify for.

Affordability

It is a given that you must be able to afford the mortgage. Lenders require proof that you are able to borrow the amount you have applied for and that you can afford the monthly repayments.

A loan exceeding £6 million will however be evaluated differently than a loan on the high street. Private lenders can offer mortgages that are based on income multiples greater than seven times the salary. They can also arrange asset-backed mortgage agreements for customers with significant wealth.

Ratios of loan to value

A lower LTV generally means that you have more options for lenders and can access better rates. This is because mortgage providers will have more confidence in your ability to invest from your own pockets.

LTV is often a factor in lenders limiting the amount they will lend to you. If you do not have a minimum 90% LTV, a loan provider might not lend to you for a £8 million mortgage. A provider who has an LTV of at least 80% may offer to lend this loan to you for a £10million mortgage.

Credit history

Although private lenders are not subject to the same regulations as those on the high street, having good credit will increase your chances of getting a favorable deal. Lenders who specialize in high-net-worth mortgages can offer mortgages to borrowers with bad credit but this could affect the rates offered.

What are some of the problems with a mortgage for a million pounds?

1 A lender who is interested in this market

Banks, building societies, and private lenders face the biggest problem when lending on multi-million-pound properties.

A prestigious property may be in short supply in a location that is desirable for high-end investors.

This is riskier for lenders than mortgaging a portfolio that includes lower-priced properties that are more affordable to buyers.

You need to match with an experienced lender in order to get the financing you want. Specialist lenders will not price their mortgages too low and will be willing to lend at this level.

What banks offer mortgages up to a million pounds?

Most of the UK’s high-street banks will offer mortgages up to £1M. Only a few banks will accept mortgages up to £10M – sometimes through referrals to large loan teams or private banks within their group (such as NatWest’s relationship with Coutts).

However, the availability of mortgage products does not necessarily mean that this is the best loan for you.

You may find that a private bank’s customised approach, which makes individualised, case-by-case decisions, suits you better.

Private lenders are experts in rural properties.

A mortgage broker’s advice is crucial. They are responsible for looking at all aspects of the lending market to help you finance your property, including private and high-street banks as well as small and large lenders.

Flexible mortgage terms vs. the cost of borrowing

Each client will want the best rate possible on their mortgage financing.

  • If a lender isn’t able to meet your loan-to-value requirements (LTV), then the lowest rate won’t be of any use.
  • If they are unable to offer you the fixed-rate term that you desire or can’t consider a range of assets and earnings,

The most competitive rates are usually offered by high street lenders. They generally use a standardised decision-making process: You fit or you don’t.

Private banks and specialist lenders are available to provide a more tailored approach. They might be willing to take into account your future financial situation, your current earnings, and a variety of wealth sources.

What is the minimum salary for a mortgage of a million pounds?

Conventional salary formulas won’t work at this level of borrowing.

As a general rule, it is worth setting a four-time income multiple cap (which is less than the 4.5x to 5x salary mortgage that you might be eligible for from a high street lender in order to purchase a property of a lower value):

£1M = Property Value

15% deposit = £150,000

£850,000 = 85% LTV Mortgage

Annual Income: £212,500

A large capital repayment mortgage could require a substantial income, and the monthly costs of servicing it could reach upwards of £4,000.

An experienced broker can assist you in arranging the borrowing that you require.

How do I maximise my borrowing for a property worth a million pounds?

Private banks are the best choice if you only need to make a 5% deposit in order to maximize your purchasing power or keep funds for renovations.

  • To reduce your repayment costs, your broker might recommend a capital repayment mortgage that is interest-only.
  • Lenders may be open to lending up to 95% LTV to applicants who have “lumpy” remuneration packages that include substantial bonuses. If you are able to make large capital repayments in the first two to five years, lenders might approve.
  • Standard mortgages allow for a maximum of 10% annual overpayment during the initial fixed period.
  • A specialist mortgage allows you to make large capital payments without penalty.

Obtaining a large mortgage to protect additional assets

We may have assets that you can use to increase your borrowing power.

  • Residential and commercial rental properties
  • A holiday home
  • A boat/yacht
  • Collection of classic cars
  • Artwork of major importance
  • An investment portfolio

Lombard lending is used to extend your borrowing

Private banking clients are usually able to get this type of loan. You can use your liquid assets to secure your mortgage borrowing. This is a cheaper option than securing against physical assets that are more liquid, such as property, which can take longer to sell. Here are some examples of collateral:

  • Stocks
  • Bonds
  • Life insurance plans
  • Other investments

Match with a mortgage expert of high net worth today

You won’t find many mortgage brokers or high street banks if you are looking for a £6 million mortgage. So, it’s best to talk to a broker that specialises in high-net-worth mortgages. You will have access to many viable options, including private lenders that can only be contacted through a broker.

Our broker-matching service is free and will assess your circumstances and match you with the broker most likely to help you get a £6 million mortgage. This is based on their track record and knowledge, as well as their contacts with lenders.

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