Coutts interest-only mortgage policy: 85% LTV part-and-part update
Tags: Private banks, Residential mortgages
Quick Summary
Coutts has updated its interest-only and part-and-part mortgage policy, giving high-net-worth borrowers more flexibility at higher loan-to-values. The private bank now offers up to 85% LTV on capital repayment mortgages and part-and-part structures, with the interest-only element capped at 80% LTV. The additional 5% can be repaid over the full mortgage term, helping borrowers structure larger mortgages more efficiently. This change may appeal to entrepreneurs, business owners, senior executives and wealthy clients seeking flexible mortgage options. Trinity Financial’s brokers can compare Coutts with other private banks and high-street lenders.
Coutts improves interest-only and part-and-part mortgage policy for higher loan-to-value borrowers
Coutts has updated its residential mortgage loan-to-value criteria, giving high-net-worth borrowers more flexibility when structuring larger mortgages.
The private bank says it is now prepared to lend up to 85% loan-to-value on capital and interest repayment mortgages and up to 85% loan-to-value on part-and-part mortgages, where part of the loan is on repayment and part is on interest-only.
The key change is that the interest-only element can be capped at 80% loan-to-value, with the additional 5% now amortised over the full mortgage term. This could make Coutts more appealing to borrowers who want to keep monthly payments lower while still borrowing at a higher LTV than many private banks may allow on a pure interest-only basis.
Coutts mortgages are designed for more complex, high-value property cases, and its published criteria states that new-client mortgage loans should usually exceed £1.5 million. The bank can consider interest-only mortgage options for up to 35 years, subject to the borrower’s circumstances and underwriting.
The change does not apply to properties valued above £4.99 million, so larger prime London or country house purchases may still need to be structured differently.
What is Coutts’ interest-only mortgage policy?
Coutts can consider interest-only mortgages for suitable high-net-worth clients, but applications are assessed individually rather than through a standard “one-size-fits-all” policy. Borrowers typically need a strong financial profile, a credible repayment strategy and a case that fits the private bank’s appetite.
Under the updated rules:
| Coutts mortgage structure | Updated loan-to-value (LTV) position |
|---|---|
| Capital and interest repayment mortgage | Up to 85% LTV |
| Part-and-part mortgage | Up to 85% LTV |
| Interest-only element within a part-and-part mortgage | Capped at 80% LTV |
| Additional borrowing above 80% LTV | Can be repaid over the mortgage term |
| Property value restriction | Change excludes properties above £4.99m |
Why is this useful for high-net-worth borrowers?
Many wealthy borrowers prefer interest-only mortgages because they may have irregular income, bonuses, investment portfolios, business assets or other liquidity events that do not fit neatly into a standard high-street mortgage assessment. They often have alternative plans to make sure the mortgage is paid off at the end of the term.
A part-and-part structure can be particularly useful. It allows a borrower to place a significant portion of the mortgage on interest-only while gradually repaying the remaining balance. This can reduce monthly payments compared with a full repayment mortgage, while giving the lender more comfort than a pure interest-only loan.
For clients buying expensive homes, refinancing large mortgages or restructuring existing private bank borrowing, the change may create more options at higher loan-to-value's.
Aaron Strutt, product director at Trinity Financial, says: "Coutts’ policy update is a helpful move for high-net-worth borrowers who want more flexibility, especially where they are looking for larger mortgages with an interest-only or part-and-part structure. There is a lot of competition between lenders for larger-loan, lower-deposit mortgages now.
“Private banks often take a more individual view of a borrower’s income, assets and wider financial position, which can be useful for entrepreneurs, business owners, senior executives and clients with complex wealth structures.
“The ability to go to 85% loan-to-value on part-and-part, with the interest-only element capped at 80%, gives brokers and clients more room to structure deals sensibly. It could help borrowers who want to keep repayments manageable but do not want to be restricted to a lower loan-to-value. Borrowers must understand how the capital will be repaid and whether the structure remains suitable over the long term.”
Can Trinity Financial help with Coutts mortgages?
Trinity Financial works with high-net-worth clients, private banks and mainstream mortgage lenders to help structure larger and more complex mortgage applications.
For some borrowers, Coutts may be an attractive option. For others, a high-street lender, specialist lender, or another private bank may offer a cheaper rate, a more suitable affordability assessment, or a better overall structure. It really does depend on the client, their finances and the property they are buying or remortgaging.
Our brokers can compare the options and help clients decide whether a Coutts interest-only mortgage, part-and-part mortgage or alternative lender is the right route.
Speak to a Trinity Financial adviser today
The mortgage market moves fast — and the right advice can make a significant difference to the rate and deal you secure. Get in touch with our team to discuss your options.
Call Trinity Financial on 020 7016 0790 to secure a Coutts interest-only 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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