In this article, we take a look at the challenges multiple income sources can present when applying for a large mortgage and how you can overcome them on the best possible terms to make your property finance aspirations a reality.
If you are a high net worth (HNW) individual looking to secure a large mortgage on high-value property, chances are your income is derived from multiple sources. With the gig economy increasingly on the rise, over five million self-employed persons in the UK, and more people earning income from multiple streams than ever before, it’s surely easy to get a high-value mortgage on favourable terms, right? Unfortunately, not. Traditional lenders tend to view ‘multiple’ income as ‘complex’, meaning the more diverse your wealth profile, the more difficult it is to secure a large mortgage.
Having said this, securing mortgages with multiple income sources, or ‘complex income’, isn’t impossible – it’s just more complicated. As such, in order to have the greatest possible chance of securing a large mortgage on excellent terms, it’s always best to enlist the advice and guidance of a specialist finance broker. At LDN Finance, we understand just how difficult this area of property finance can be to navigate. Our expert brokers take the time to understand your financial profile in its entirety, before presenting your case to our trusted network of lenders.
Why is it more difficult to get a large mortgage using multiple income sources?
Whether you receive bonus income or dividends, earn a salary paid in a foreign currency, or have rental income, a complex income structure can involve all of the above and everything in between.
No matter your affordability for the loan or how large your asset profile, the pool of available mainstream lenders is much more limited for those with multiple income sources, as high street banks prefer to take a view on a regular income from a singular employer. Even if your income is consistent, it can be variable, and therefore harder to assess from a risk perspective, meaning many high street lenders prefer to steer clear of applications with more than one income stream.
What about private banks and specialist lenders?
Good question! Whilst HNW clients with multiple income sources may find their borrowing options limited by the strict eligibility criteria used by high street banks to assess affordability, private banks and specialist lenders offer a more bespoke approach by taking the client’s wider wealth profile into account. As a result, private banks are able to offer much better terms and present a particularly attractive proposition for those looking for a large loan using complex income.
Will I be able to get a large loan if my income includes foreign currency?
Yes, you can. And once again, nine times out of ten, specialist banks will be your golden ticket. There is no doubt that securing a mortgage in the UK with foreign currency income is much more difficult than if you were only earning in pounds sterling. Traditional lenders generally take the view that foreign currency leads to greater risk; foreign income checks can take time, can be more difficult to verify, and ultimately may require resources that mainstream banks simply do not have, want, or need to provide. With an in-depth understanding of the HNW mortgage space, private lenders are able to navigate the complexities presented by international or expat clients, foreign income, and the risk associated with high loan to value (LTV) loans with ease and at speed.
Away from the rigid affordability checks of high street banks, private lenders understand that every mortgage application should be reviewed individually. Their flexible and holistic approach on a case by case basis means that if a HNW client has foreign, or indeed complex, income from multiple sources, this does not cause an issue as they are well adept to providing bespoke products and solutions for a wide range of scenarios.
How can LDN Finance help?
As we’ve discussed throughout this piece, the solution is to work with niche lenders, who are experienced in dealing with HNW clients looking to secure large mortgages with multiple income sources. Private banks and specialist lenders can understand, navigate, and account for complex requirements – such as those whose income involves foreign currency, rental income, large bonuses, dividends etc – the list goes on.
These lenders are also typically able to offer more complex and favourable finance terms, such as interest only loans or high LTV mortgages. But as specialist lenders can’t be easily accessed on the high street, it’s both crucial and invaluable that you work with a specialist intermediary to negotiate the best possible terms on your behalf.
At LDN Finance, we regularly assist clients with a range of complex scenarios that require the attention and bespoke tailoring only a private bank or specialist lender can provide. Working closely with our trusted network of niche lenders that take a more holistic view of your affordability and overall wealth, our strong relationships will ensure you receive the best terms for your circumstances.
Ultimately, the terms you will be able to secure as a HNW client with multiple income streams will depend on your unique circumstances. Get in touch with us today to discuss your requirements – one of our expert brokers will be happy to advise and guide you through the entire property finance process.