What is a high net worth mortgage and who is eligible?

A high net worth mortgage is a type of mortgage designed for individuals with a high net worth.

These individuals typically have significant financial assets, which may include cash, investments, real estate, and other valuable holdings. These mortgages are tailored to meet the specific needs and financial complexities of borrowers with substantial wealth. They are specialist mortgages intended for buyers with a sizeable income or who hold valuable assets.

Interest-only mortgages can be arranged, which can reduce outgoings on monthly payments, allowing the client’s assets and future earnings to take care of the overall balance.

Find out more about this type of mortgage and who is eligible in this article.

What are the key features of a high value mortgage?

• Loan size: They often involve larger loan amounts compared to standard mortgages. This reflects the greater value of the properties typically purchased by individuals with significant wealth.

• Asset-based underwriting: Lenders may take into account the borrower’s total assets and wealth, including investment portfolios, real estate holdings, and other valuable possessions, when evaluating eligibility and determining loan terms.

• Customisation: They also may offer more flexibility and customisation in terms of repayment structures, interest rates, and other loan terms. Borrowers may have the ability to negotiate personalised arrangements that suit their financial preferences.

• Private banking services: Some lenders catering to high value individuals may provide additional services, such as access to private bankers, wealth management, and exclusive financial products.

• Deposits: While not a strict rule, high value borrowers may be required to pay larger deposits as a percentage of the property value.

What is a high net worth individual for a mortgage?

You are considered a high net worth individual if you have an annual income in excess of £100K or have assets in excess of £250K beyond your pension fund assets and your private residence.

Who is eligible?

The Financial Conduct Authority (FCA) states that if you have net assets of at least £3 million or an annual income of at least £300,000, you are eligible for this specialist type of mortgage.

However, it’s important to note that eligibility criteria and specific features can vary across lenders.

High net worth individuals can be offered a specialist mortgage tailored to their needs. This is helpful where there is complex income from various sources, such as interest in various different businesses, commission-based income or foreign currency earnings.

High net worth mortgage brokers and lenders often work with the following:

• Self-employed individuals
• Entrepreneurs
• Adventure capitalists
• Stock and crypto traders
• Social media influencers and YouTube bloggers
• Professional sports players

Borrowers interested in these types of mortgages should consult with financial advisors and lenders specialising in serving high value clients to better understand the available options and requirements.

If you think you could benefit from arranging a higher-value custom mortgage, feel free to get in touch with our mortgage specialists to discuss the best financial options for you.