VIP and large mortgages

If you are in the market for an expensive property, you might need a large mortgage, but not quite know how to go about finding one.

There may be problems in trying to find a mortgage over £250,000 on the high street as most regular lenders are not used to dealing with mortgages of this amount and more, and often have a limit of £250,000 for mortgages. Large mortgages like these are often referred to as VIP mortgages. In these days of many properties starting well above that amount, it seems a fairly low threshold. Nevertheless, you may need to look wider for a provider for larger mortgages.

One example of this kind of lender is Mortgages.co.uk, who have a specialist panel of lenders for people who are looking for a UK mortgage for over £250,000.

If high street banks do consider providing mortgages higher than £250,000 then they often charge greater interest rates. You might also have problems with your application if you, as a borrower, have a more complex income stream than usual. Most people simply have a single or joint salaries for the lender to consider, but many wealthier individuals have a variety of income sources, such as investments, stocks and shares. VIP mortgage lenders are used to dealing with this, and can take all income streams and outgoing monies into consideration, and you will not be penalised for wanting to take out a larger mortgage. Some lenders try to take advantage of VIP borrowers simply because they have more capital resources.

So, if you are in the market for a multi-million pound dream home, or looking at an expensive business venture, or simply moving up the market beyond the £250,000 mortgage mark then you’ll be looking for a VIP mortgage. The best advice to start with a financial advisor, who will understand how more complex income streams work for wealthier individuals. You will want to find a lender that will not increase their fees and interest rates for those wanting a larger mortgage. A financial advisor can help you find these lenders and also give you access to companies who would be prepared to discuss lending you a large amount for a mortgage even if you have had some problems with credit in the past, and therefore may have a blemished credit report.

You also need to consider some other points:

• If you receive cash back on a mortgage (due to the fact that it would be more than a normal cash back mortgage), it may be liable for capital gains tax.
• You may also need to consult specialist insurers, to deal with your larger than average home insurance.
• You have many valuables, antiques etc. If so, consider using a specialist moving company and take out a special insurance policy for the day you move.  Your current home insurance will not cover this, and it is best to be protected against the possibility of your possessions being damaged.
• A regular high-street estate agent may not deal with properties that suit your lifestyle, but there are a number of companies that deal with more luxurious properties.
• If the property you are purchasing is listed, you may find that you have restrictions on any renovations/redesign you have planned for your property.

As with all mortgage searches, shop around; do not settle for the first deal that comes your way. You need a range of larger mortgages to consider so that you can choose the one that best suits you.

So what about a Surrey greenbelt piece of dream real estate for £1.4 million? For this you might get a Grade II listed home of exquisite charm and a 400 year history. You could also get a 25 foot dining room, a 30 foot drawing room with Minstrels’ Gallery, a farmhouse kitchen with Aga, five double bedrooms, and a range of garages, stores, and an office.

Down in south Surrey you might choose a 1930s country house with sweeping drive. The house has a pillared entrance and a galleried reception hall. There are six bedrooms around the first floor gallery. The grounds have 31 acres with seven paddocks, and would suit an equestrian enthusiast. There is a stable block. There is also a swimming pool and a tennis court. The price tag is a cool £4 million.

You would certainly a VIP mortgage or a different way of financing property in St George’s Hill in Weybridge. Erstwhile home to members of The Beatles this gated private estate is only for those with VIP credentials. They’re building new developments here too, however, and you can specify and style your own. For nearly £7 million you can help shape four reception rooms, the kitchen/breakfast room, six bedroom suites, a gymnasium, an indoor swimming pool complex with steam room, a roof garden and a triple garage. It sounds like the ultimate in luxury.