£1 million private bank mortgage for a high-net-worth client with investment income

£1 million private bank mortgage for a high-net-worth client with investment income

Trinity Financial was approached by a 45-year-old Italian/British client looking to buy a main residence for around £1.5 million.

The client no longer worked and therefore did not have a conventional salary, but they had substantial savings and investments with a net worth of approximately £7.4 million.

They wanted to understand whether it would still be possible to arrange a mortgage in the UK and, importantly, whether they could avoid moving a large investment portfolio to a lender under an Assets Under Management arrangement.

The challenge

The client was also selling a property in Italy and wanted to make sure the UK purchase was carefully timed to take place after the property sale.

They were concerned that buying the UK property too early could create additional tax liabilities, so the mortgage needed to fit around the wider transaction.

Another key issue was affordability. Most mainstream mortgage lenders focus heavily on employment income, salary and bonuses. This client did not have traditional earned income, but they did have a substantial investment portfolio capable of generating income.

The client had also heard that some private banks require borrowers to transfer investments or cash to them before agreeing a mortgage. They were worried that selling or restructuring investments to meet an Assets Under Management requirement could create unwanted tax consequences.

How Trinity Financial helped

Trinity Financial's director knew which private banks were most suitable for this type of case and approached a lender that was comfortable assessing the mortgage using investment income.

Crucially, the private bank did not require the client to transfer assets or investments to them as part of the mortgage arrangement.

This meant the client could keep their existing investment structure in place rather than moving assets purely to qualify for the mortgage.

The client proceeded with a two-year fixed-rate mortgage through the private bank.

Why lender selection was so important

Private bank mortgage criteria can vary considerably.

Some lenders are willing to consider investment income and a borrower's wider net worth, while others may require substantial Assets Under Management before they will offer competitive mortgage terms.

Another well-known private bank also offers mortgages where investment income can form part of the affordability assessment. However, that lender recently increased its minimum mortgage size to £1.5 million, meaning it is no longer suitable for every high-net-worth borrower.

Knowing which private banks to approach can therefore make a significant difference, particularly for clients who are asset rich but do not receive a traditional salary.

The outcome

Trinity Financial arranged a private bank £1 million mortgage for the client without an Assets Under Management requirement.

The mortgage was agreed on the strength of the client's investment income and wider financial position, and the client selected a two-year fixed rate.

The structure allowed them to retain control of their existing investment portfolio while using mortgage finance to help fund the purchase of their new main residence.

Can you get a mortgage if you live from your investments?

Potentially, yes. Some private banks and specialist lenders will consider borrowers who receive investment income rather than conventional employment income, particularly where they have significant savings, investments and overall net worth.

The key is approaching lenders with the right criteria. Trinity Financial regularly helps high-net-worth clients, international borrowers and investors compare private bank and mainstream mortgage options, including lenders that do not always require Assets Under Management.

If you have substantial investments but little or no employment income and want to understand your mortgage options, contact Trinity Financial to discuss your circumstances with one of our brokers.

Call Trinity Financial on 020 7016 0790 to secure a fixed or tracker rate mortgage, book a consultation, or use our appointment calendar

The information contained within was correct at the time of publication but is subject to change. It is for general information purposes and is not advice.

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