High LTV Mortgage

Who can get a high Loan to Value mortgage?

The obvious thing is that it’s all about income. Pretty much all banks will offer you 4.5 times your income. With a £1 million to £2 million property banks might offer five or even six times your income.  

If you’re putting down a small deposit you need a really strong income. Banks look at your profile. So if you have a 5-10% deposit and you’re a young professional fairly early on in your career with a really good income, banks are really willing to help you. They recognise that you just haven’t had time to save up a big deposit. 

There may also have been a life event. Something we do a lot of is where a client is separating or divorcing and has left the family home. That’s a situation where a high Loan to Value mortgage comes in – because their money is tied up in the family property. Some banks will take a lenient view on that one. 

How do I get a high Loan to Value mortgage?

We follow our process – which starts with a fact find. It’s not a form filling exercise. We might identify that you have property in the background, some shares here, some cash there or anything else that may be useful.

There might be things we can leverage in terms of the mortgage. Just be open and honest with us because we might find some creative solutions for you. Then it’s the usual process. We’ll do the research and identify a lender to work with. 

It’s about the structure as well. Let’s say, for example, you’re separating from a partner, you’re maintaining a family and buying a second property for yourself. Banks can structure ‘bullet repayment’ lending. You could do a 90% or 95% mortgage on an interest-only basis, which keeps your monthly payments down, on the proviso that you reduce the debt each year maybe by 1-3%. 

You often find people in this space have bonuses or variable income. So if you’re quite happy to reduce the loan down once or twice a year and keep your outgoings to a minimum, bullet repayment is really effective. Because you are writing into the contract that you’re reducing the loan, the FCA deems it a repayment mortgage as well.

Most people aren’t even aware you can do that. It’s not for everybody – you have to have the means and capacity for this to work and it does tend to be quite self-fulfilling. You might have a basic salary of £200,000 and a bonus of £200,000 – in that case this model is really going to work for you.

What else should we consider with a high Loan to Value mortgage?

In these situations fact finding is so important. It’s all about working with our clients, exploring their situation and finding the best way forward for them. As a broker we have exclusive access not just to products but to actual banks, particularly in the private banking space. 

We’re very good at matching people by industry, by banker, by sector and even by jurisdiction. This is important as well because a lot of our clients are internationally mobile or not from the UK originally. It’s beneficial to find a bank that works out of where their business operation is or where they are from originally. These little nuances save so much time and effort and ensure you get a better outcome. 

Someone looking at buying a £1 million property is a successful person. You’ve got far more important things to do with your time than mess around with a mortgage application. It’s just a case of identifying the right broker to work with to make your life as easy as possible. The side benefit is that you’ll get at least the same terms, if not better, by coming through a broker. We get exclusive rates because of the level of mortgages we organise. 

Your home may be repossessed if you do not keep up with your mortgage repayments.