It may have taken a while, but we have seen an increase in the appetites of mainstream lenders in offering large mortgage loans in the last few weeks of 2012 and the prospect that this will continue to improve this year.
Until recently Private Banking institutions cleaned up in the High Net Worth lending market as high street lenders pulled back post credit crunch, but we are seeing the first signs of a return of the high street.
This has been led by lenders such as Halifax, Woolwich and Nationwide who have bespoke Large Loan Underwriting Teams, experienced and efficient when dealing with more complex enquiries. Recently we have also seen the revamped Virgin Money looking carefully at lending just over the £1m mark for the right applicants and the return of Scottish Widows bank offering loans to professionals at 75% Loan To Value up to £2,000,000.
NatWest, ING Direct and Clydesdale Bank will all also look at loans over the £1m mark which means that there is now some real choice in the market, with borrowers no longer having to tie themselves in to a Private Bank and offer Assets Under Management.
Even Yorkshire Building Society, incorporating Chelsea and Accord, will look at high value loans, although these lenders are notoriously tricky to get things through for all but the very simplest of transactions. For those that tick the boxes, however, the rates on offer are very competitive and come without the higher arrangement fees associated with many Private Banks.
Above £2,000,000 however, is still very much the preserve of the Private Banking Fraternity, but we are starting to see a change, especially as the Funding for Lending Scheme kicks in and lenders need to lend more funds to meet their targets.
We have even seen Private Banks applying for access to the Funding for Lending Scheme, which means that they are able to offer lower rates than they may have been able to and even relax their asset requirements.
With the mortgage market set to battle for share once more in 2013, expectations are that the large loan sector will grow further in the coming year with more lenders starting to feel comfortable once more in the £1m plus space.
This means more choice for the more discerning borrowers and I also expect to see many more traditionally cash buyers look for funding. After all, if you can borrow below the 2.5% level, most High Net Worth individuals can make much better use of their cash elsewhere, especially if obtaining finance becomes easier.
All in all, it looks like a promising year for prospective buyers in the High Net Worth market, with deals to be done and potentially the lowest rates for a generation.
All you need is a professional, independent broker who really understands this end of the market and can advise on all the available options to make sure that no stone is left unturned.