Which high-street banks offer multi-million-pound mortgages?

Be it for a country mansion or perhaps a London townhouse, thousands of buyers are taking out mortgages of more than lb1m each year.

But where are you able to get a seven-figure mortgage, and just how much deposit will you be needing? Which? investigates.

How many million-pound mortgages are granted?

Last year, lenders gave out a total of 3,791 mortgages of lb1m or over, according to data presented to Which? by UK Finance.

While this figure may appear insignificant (it’s just 0.3% from the overall market), it marks a 9% increase on 2022’s figure of 3,477.

Which lenders offer mortgages of lb1m and above?

High-net-worth borrowers sometimes look to private banks or use company structures to finance property purchases. But it’s actually possible to get a mortgage of lb1m or even more in the most of high-street lenders.

Of the three,709 residential purchase mortgages currently advertised by banks and building societies, 855 have a maximum loan size a minimum of lb1m – that’s about 23% of available deals. And, as with lower-value loans, the vast majority of these products can be found on a fixed-rate basis.

The interactive table below shows the utmost loan sizes provided by every UK lender that provides mortgages with a minimum of lb1m.

As you can see, Barclays, Metro, NatWest and Ulster provide the biggest mortgages – up to lb10m every time.

Can you receive a million-pound mortgage with a small deposit?

The majority of these products are only available to buyers with hefty deposits, though a handful of deals are theoretically available with a first deposit of just 10%.

Nine lenders – Chorley, Clydesdale, Dudley, Kensington, Kent Reliance, Leek, Newcastle and Saffron – offer some fixed-rate and variable lb1m+ products at 90% loan-to-value (LTV).

For a better range of options, though, you’ll need a deposit with a minimum of 15% from the cost. At 85% LTV, high street names for example Barclays, Halifax and Santander enter the fray and introductory rates drop considerably – as shown in the table below.

How do banks judge how much deposit you’ll need?

With higher-value loans, it’s common for banks to adopt different lending criteria because of the quantity of risk they’ll be taking on.

Some lenders use a sliding scale, using the maximum loan-to-value you can borrow dropping because the size of the loan gets bigger.

For example, Leeds Building Society imposes the next criteria:

How do income multiples work?

If you’re looking to take out a large mortgage on the high street, you might need higher earnings as well as a bigger deposit.

That’s because on loans in excess of lb500,000, some lenders set an income multiple cap of four times your annual salary – less than the four-and-a-half or 5 times you might be able to obtain on mortgages of the lower value.

If you’re purchasing a property for lb1m, the numbers might exercise such as this:

Repayment vs interest-only mortgages

Interest-only mortgages aren’t very common within the residential market these days, but some lenders are prepared to be flexible on repayment with regards to higher-value loans.

For example, Skipton Building Society says that on a loan in excess of half a million pounds, the very first lb500,000 can be offered with an interest-only basis (susceptible to the borrower using a repayment strategy in position), but any further borrowing following this has to be solely on a repayment basis.

This example must only be utilized for guidance, as repayment rules will be different between banks and will be affected by your particular financial circumstances.

Alternative ways of obtaining a lb1m mortgage

Some high-net-worth individuals look to specialist lenders and brokers to finance their property portfolios, instead of seeking finance from high street lenders.

Some specialist brokers will hook up borrowers with finance from private investors, boutique lenders and banks who specialist in larger loans and could potentially offer more flexible underwriting criteria than high-street lenders.

One illustration of this is Investec Private Bank. Investec provides a bespoke mortgage service for people earning a minimum of lb300,000 a year with a net worth of a minimum of lb3m. Investec’s service involves a ‘dedicated private banker’ to guide you with the process.

As along with your earnings, it may be possible in some cases to use your portfolio of assets – such as stocks, shares and pension funds – as leverage to acquire a larger loan.

Borrowers considering these options should take independent financial advice before rushing in.