How much can I borrow for a mortgage if I earn £250,000 or £300,000?
Mortgage lenders are working harder to attract higher-earners seeking larger mortgage loans. As a result, they provide more generous income multiples and sometimes more competitively priced rates.
If you are a single applicant with a clear credit history earning around £250,000, borrowing up to £1,375,000 may be possible. If you have a partner going onto the mortgage and they earn £75,000, this could increase to £1,787,500.
A single applicant with a £300,000 salary could borrow up to £1,650,000, and with a partner earning £50,000 added to the application, the loan could rise to £1,925,000.
Aaron Strutt, product director at Trinity Financial, says: “Many of the bigger banks and building societies offer up to 5.5 times salary to higher earners, and they have set up departments to manage their high net worth clients.
“Many borrowers taking larger mortgages often have part or all of the loan on interest only to minimise their monthly repayments, although they do like to have the option of making lump sum overpayments. Barclays for Intermediaries has recently updated its policy so Premier Customers taking specific Premier Rates can overpay 25% of the mortgage per annum. The normal overpayment level is 10% each year.”
Frequently asked mortgage questions for higher earners
How much of a deposit will you need for a £1 million+ mortgage? If you are looking for a larger mortgage loan, the most competitively priced rates are available to borrowers with a 35% or 40% deposit. Fixed rates are not much more if you have 25% to put towards a purchase although 10% is the minimum deposit required.
Will you need a good credit score? A higher credit score will improve your chances of borrowing, although some lenders use credit searches rather than credit scores. Some lenders are more open than others to issue mortgages to those with credit blips.
Do mortgage lenders have different acceptance policies? Banks and building societies have different acceptance criteria. This means one lender may not be happy to offer you a mortgage, but a rival bank may be keen to lend.
Is it worth taking a private bank mortgage? The high street banks tend to have the most competitively priced rates and some of the most generous acceptance criteria. Private banks are often really useful for international clients and borrowers with complex financial situations.
Are interest-only mortgages available? Trinity Financial has access to many banks and building societies offering interest-only mortgages. One large bank has a particularly good policy where if any part of the mortgage is on an interest-only basis, the maximum loan to value for the overall lending is 85%.
Where there's a combined gross income of £200,000 or more, any lending over 75% loan to value must be on a capital and interest basis. For applicants with a combined gross income of less than £200,000, any lending over 50% loan to value must be on a capital and interest basis.
Do lenders have maximum loan sizes? It is quite surprising how large the mortgages many of the biggest banks issue are. Nationwide's lowest rates are available for mortgages between £300,000 and £5 million. NatWest issues multi-million mortgages, while lenders like HSBC offer their lowest rates for £5 million mortgages. Halifax for Intermediaries has a dedicated Premier team to provide mortgages of £500,000 to £5,000,000.
Call Trinity Financial on 020 7016 0790 to secure a larger mortgage loan 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
Nationwide for Intermediaries offers a two-year fix at 3.90% for larger mortgage loans between £300,000 and £5 million for borrowers purchasing a property. The overall cost for comparison is 6.7% APRC. The fixed rate is 0.05% more expensive for remortgages.
If you borrowed £1 million on the 3.90% two-year fix, the monthly interest-only cost would be £3,250 increasing to £4,716.68 on capital repayment over a 30-year term.
This mortgage is available on either an interest-only or capital repayment basis, and borrowers require a 40% deposit to access the rate. After two years, Nationwide's mortgage will revert to a standard variable rate of 6.99% unless you switch deals, and early repayment charges apply.
Representative example: A Nationwide capital and interest mortgage of £1,000,000 payable over 30 years, initially on a fixed rate basis at 3.90% for two-years and then on the lender's 6.99% standard variable rate for the remaining 28 years. The 3.90% rate would require 24 monthly repayments of £4,716.68 followed by 336 payments of 6,541.36. The total amount repayable would be £2,312,611.28 made up of the loan amount, plus interest (£1,311,097.10) and £1,495 (product fee), £0 (final repayment charge), £15 (completion fee). The overall cost for comparison is 6.7% APRC representative.
Contact Trinity Financial on 020 7016 0790 to find out how much your £1 million mortgage would cost.
Many high-net-worth clients are looking for larger mortgages to purchase luxury homes.
As a result, more £2 million+ mortgages are available, either through high-street lenders or private banks.
Trinity Financial's brokers have access to specialist large loan teams across the mortgage market, and our contacts assist with arranging mortgages above £2 million. These underwriters consistently offer mortgages for our high-net-worth clients.
Our experts will look at a client's overall circumstances to find the best lender. It does not matter if you receive bonuses bigger than your primary income or have a complex income structure requiring specialist understanding.
We regularly arrange mortgages for borrowers with:
- Vested stock bonuses
- Stock portfolios (generating onshore and offshore income)
- Foreign Income
- Income from royalties and trusts
- Global assets
Private banks tend to consider "high net worth individuals" if they earn above the threshold of £300,000 per year or have net assets of £3 million+.
Private banks often offer very good service. They aim to provide flexible and accessible mortgage products for wealthy clients, but they also provide high-quality, discreet, and professional services.
At Trinity Financial, we constantly monitor the £1 million+ mortgage market. Click here to view our £1 million mortgage table, which highlights the pick of the large loan rates.
https://www.trinityfinancialgroup.co.uk/mortgage-tools/million-pound-mortgage-best-buys/
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