What is a private bank mortgage?
A private bank mortgage is lending from a bank such as Coutts, Hampden & Co, Arbuthnot Latham, or Handelsbanken, offered as part of a wider wealth management relationship rather than as a standalone product. You will not find these deals on comparison websites; they are arranged through a broker or directly with a relationship manager at the bank.
These banks focus on high-net-worth clients, meaning people with large incomes, sizeable assets, or financial affairs that do not fit a standard template. They underwrite by hand, so a real person weighs up your case instead of a computer scoring it automatically.
Advantages of private bank lending
Private banks are often more flexible on how they work out affordability. They will weigh your net assets alongside your income, and they can lend more than a typical high street lender. Many will also offer interest-only mortgages with more relaxed rules on the repayment vehicle, the plan you set out for clearing the balance at the end of the term.
The service is usually more personal. You deal with one named person who knows your case, and decisions can come back faster as a result. Where things are complicated, say a trust is involved, or income comes from overseas, or you hold several properties, that direct contact can count for a lot.
When to consider a private bank
A private bank is usually the right call when you need to borrow a large sum, when your income or assets are complicated, or when you need something tailored that a high street lender simply cannot put together. If your case is straightforward, a high street lender may well offer a lower rate, so it is not the answer for everyone.
A broker can line up private bank options next to mainstream products and point you to the best route for your circumstances. Often the flexibility of a private bank more than makes up for any gap in the headline rate.