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How much does a £2 million pound mortgage cost?

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Page edited and updated 05/02/2024

How much does a £2 million pound mortgage cost?

If you are planning to purchase or remortgage a high-end property and require a £2 million mortgage, Trinity Financial has access to a range of lenders offering large mortgage loans.

Banks and building societies have reduced the price of their £2 million mortgages, and fixed rates start from 3.94%. View our million-pound mortgage best buy table and borrowing calculators

How much is a £2 million two-year fixed-rate mortgage?

One of the most competitively priced two-year fixes for £2 million mortgages is available through Barclays for Intermediaries' large loan team priced at 4.38%, down from 4.78% on the 10th January 2024. 

Wealthier clients with clear credit histories could access £2 million mortgages with monthly repayments of £7,300 on interest-only, rising to £9,991.60 on full capital repayment over a 30-year term.

Barclays for Intermediaires' 4.38% fixed rate has a £699 arrangement fee and 2% early repayment charges. The APRC is 6.9%, and borrowers must put down a 40% deposit to qualify. The mortgage reverts to the 8.74% standard variable rate.

Not long ago, two-year trackers were increasing in popularity, but now more lenders offer two-year fixes priced around 4.4%, which undercut the trackers. 

It is still possible to access £2 million tracker rate mortgages without early repayment charges. These allow borrowers to repay the mortgage without charge, and they can also switch to a fixed rate without charge.

 

Lenders offering up to 5.5 times salary for £2 million+ mortgages

Banks and building societies offer more generous income multiples to professionals like doctors, dentists and lawyers or those earning over £100,000. 

While many applicants may not need the full 5.5 times salary income multiple, it is useful, especially if you receive bonuses or have ongoing credit commitments.

The lenders often reduce the maximum loan size if borrowers have children, cars on finance, other properties or credit cards and loans.  

For borrowers keen to secure interest-only, Trinity's brokers have access to 25% deposit interest-only mortgages using the sale of the property as the repayment vehicle. 

 

How much is a £2 million five-year fixed-rate mortgage?

Trinity Financial's £2 million+ mortgage specialists have access to a five-year fix priced at 3.94% with a 6.6% APRC. The monthly repayments on a £2 million mortgage would be £6,566.67 on interest-only or £9,479.25 monthly over a 30-year term.

This mortgage has a £1,495 arrangement fee, and borrowers must put down a 40% deposit to qualify. The mortgage reverts to the lender's 8.24% standard variable rate. The rate is marginally more expensive if you have a 25% deposit.

 

What has happened to £2 million+ mortgage rates recently?

Mortgage lenders have lowered the price of their rates over the last couple of months, but Halifax and Nationwide Building Society have just pushed up their rates. There has been a real push to offer sub-4% rates, particularly five-year fixes.

Some mortgage lenders provide their cheapest rates to borrowers looking for £1 million+ mortgages, mainly when they take a five-year fix. They also offer lower rates to people purchasing a property rather than remortgaging.

Our brokers have London-based business development managers at the most prominent lenders who help us arrange larger loan mortgages swiftly and efficiently.

 

What types of £2 million+ mortgages are borrowers taking?

Aaron Strutt, product director at Trinity Financial, says: "More of our clients are taking two-year fixes rather than five-year deals because they expect mortgages will continue to come down over the mid-term. There has been more talk the Bank of England will reduce the base rate, but this doesn't mean mortgages will come down."

"Some rates have been going up, although not all lenders have increased their pricing. Two-year fixes are getting closer to the price of five and ten-year fixes, although there is still a gap in pricing."

 

Is it best to use a high street lender or a private bank for a £2 million+ mortgage?

It depends on the deal's complexity, including the applicant's financial situation and the type of property they buy. High street lenders have set up teams to compete with the private banks, and in many cases, they agree to provide similar deals. 

Trinity Financial's brokers tend to approach the most prominent lenders, offering the most competitively priced rates and lowest arrangement fees before going to the private banks. 

It is important to consider what will happen at the end of the initial fixed or tracker rate period and if the bank or building society will offer you a decent rate switch product. This is something our brokers typically take into consideration. 

 

Do lenders offer £2 million+ mortgages on interest-only?

The vast majority of lenders providing larger mortgage loans offer interest-only or part-interest-only mortgages. 

More banks and building societies are using the sale of the property as an interest-only repayment vehicle. They also accept bonuses, other properties, stocks, and shares as repayment vehicles to satisfy their compliance departments.

 

Lenders accepting more complex income sources for £2 million+ mortgages, including: 

  • Bonuses higher than the basic salary
  • Interest-only mortgages or part interest-only mortgages
  • Vested stock bonuses and RSU income
  • Stock portfolios (onshore and offshore)
  • Income from royalties and trusts
  • Global assets
  • Income from different companies
  • Property portfolio income

 

Call Trinity Financial on 020 7016 0790 to secure a £2-million mortgage or book a consultation

The information contained within was correct at the time of publication but is subject to change.

Your mortgage is secured on your property. Your property may be repossessed if you do not keep up repayments on your mortgage  

One of the most competitively priced two-year fixes for £2 million mortgages is available through Barclays for Intermediaries' large loan team priced at 4.38%.

The repayments on a £2 million mortgage would be of £7,300 on interest-only, rising to £9,991.60 on full capital repayment over a 30-year term.

Barclays for Intermediaires' 4.38% fixed rate has a £699 arrangement fee and 2% early repayment charges. The APRC is 6.9%, and borrowers must put down a 40% deposit to qualify. The mortgage reverts to the 8.74% standard variable rate.

A selection of banks and building societies provide £2 million+ buy-to-let mortgages.

NatWest for Intermediaries offers one of the cheapest two-year fixed buy-to-let rates for property purchases and remortgages. It is priced at 4.59%, has a £3,499 arrangement fee, and the maximum loan size is £2 million.

After the fixed-rate period, the mortgage reverts to the lender's current standard variable rate of 8.24%, and the APRC is 6.6%.

The monthly repayments on a 4.59% fixed £2 million buy-to-let interest-only mortgage would be £7,650 per month. This rises to £10,240.94 on capital repayment over a 30-year term.

Buy-to-let mortgage lenders use stress tests to work out maximum buy-to-let loan sizes, and they are tougher to meet because of the Bank of England's base rate rises.

Some lenders will take personal and rental income to boost the maximum loan size.

The Financial Conduct Authority does not regulate most Buy to Let Mortgages

The high street banks and building societies have set up large loan departments for selected mortgage brokers to use to provide additional competition to the private banks.

These large loan teams regularly offer mortgages to clients who thought they would have to go through a private bank. They will not ask for assets to be transferred to them as part of a mortgage transaction.

One of the main differences between high street lenders and private banks is that way they calculate how much someone can borrow. A high street lender will assess income and outgoings, basing the application on affordability to determine the amount you can borrow.

Private banks will assess your overall financial situation and also lend against assets including cash, stocks, shares, and properties.

Most lenders have a maximum income multiple for larger loans of between four and five times the salary of single and joint applicants. More banks and building societies will lend up to 5.5 times single or joint incomes for those earning over £75,000 or £100,000. 

A limited number of providers offer up to six times salary mortgages.  

For high-net-worth individuals with an annual net income of £300,000 or assets worth £3 million, it may be possible to structure a mortgage to meet your requirements. 

Trinity Financial specialises in arranging large mortgage loans, and our team of expert mortgage advisers and their assistants do everything possible to secure the cheapest rates and the fastest mortgage offers. 

We have access to the decision-makers at the lenders offering the leading large loan rates and provide our clients with a first-class service.

We regularly work with clients over the phone to discuss applications and confirm the documentation we will require, and we also have offices in St James's and Islington where we meet clients. 

Click here to view some of the mortgages we have arranged over the last 14 years.

If you are in a rush to purchase a property, can't secure a mortgage quickly enough, or can't sell your property, then bridging lenders help borrowers get transactions through.

Bridging loans are also used to pay for refurbishment work to bring properties up to standard for mortgage purposes, to buy at auction and for other business purposes or to buy land.

Trinity Financial has access to a bridging lender offering a 0.59% per month rate up to 50% loan-to-value. It has a 2% completion fee, and it is available for loans between £75,000 and £15,000,000. The price gets marginally more expensive if you have a smaller deposit.

Some of the big banks provide bridging loans, and we have access to a lender offering £1 million+ bridging loans and the rate is typically 2% over the Bank of England base rate.

It has a 1% arrangement fee and no exit fees. The interest is calculated on a daily basis, and it can do higher loan-to-values for those with clear exit routes. For many larger bridging transactions, this product is hard to beat. 

The lender will also offer a mortgage product once the applicant or their property is in a suitable position, so they do not have to refinance.

Our brokers are used to working with clients with complex financial situations and the mortgage lenders offering highly competitive large loan rates have the experience to agree these applications.

If you own your own company of you're a director of a number of firms, we have access to lenders that will assess your overall financial situation. They can also take a range of overseas income including dollars and euros.  

At least 50 banks and building societies provide interest-only mortgages. 

Most of the larger lenders expect borrowers to earn in excess of £75,000 to qualify.

Sometimes the whole mortgage is available on interest-only, or for lower deposit mortgages we regularly arrange for 50% of the mortgage on an interest-only basis and 25% of the loan on capital repayment. 

Private banks regularly ask wealthier clients to make bullet repayments and they are linked with their bonuses to bring the loan-to-value down. These repayments are written into the mortgage contract.

If you earn over £250,000 one bank provides full interest-only for those with a 25% deposit.  

It should take around ten working days for a £2 million mortgage to be agreed when the lender receives all of the documents it needs.

Some banks and building societies use system-generated property valuations rather than sending a valuer to assess the property and this speeds up the process.

If you would like to get a thorough inspection of the property our brokers can recommend specialist firms or you can find a local property surveyor.

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