How Much Does A Million Pound Mortgage Cost

11-May-2022

11-May-2022 17:13

in Mortgage

by Jennifer Stevenson

The good news for UK residents and expats is that borrowing a million pounds or more has seen many lenders reserving their best rates for larger loans.

At Clifton Private Finance, we have access to the large loan teams at high street banks and private banks who can offer bespoke arrangements depending on your circumstances.

What will my monthly repayments be on a 1 million pound mortgage?

As with all borrowing, it will depend on your circumstances.

For a new residential property purchase, assuming you have a 40% deposit, the cost of a £1 million mortgage on a repayment basis over a 25-year term would be approximately:

2 Year Fixed Rate:

£4,311 pm on a current top 2-year fixed deal. If you opted for an interest-only basis, the cost would be £1,791 pm. This would be the monthly cost payable for 25 months, after which you would revert to the lender's standard variable rate. A product fee of £1,499 would apply, which could be added to the loan. Early repayment charges apply.

5 Year Fixed Rate:

£4,415 pm on a current top UK deal. If you opted for an interest only basis, the cost would be £1,966 pm. This would be the monthly cost payable for 63 months, after which you would revert to the lender's standard variable rate. A product fee of £1,999 would apply, which could be added to the loan. Early repayment charges apply.

The above mortgages are available currently at the time of writing, subject to income affordability and your credit status.

How do I secure a large mortgage of over a million pounds?

Whether you are refinancing or buying a new property for residential or investment purposes, a lender's criteria will depend on several factors.

A standard employed income that supports repayments opens up an extensive range of lenders if you have a standard employed income. More complex income, e.g. where you are self-employed or where income comes from more than one source, e.g. foreign income or company earnings, may require a different approach.

Many lenders are comfortable structuring a large loan mortgage over £1 million where a high percentage of overall income is made up of bonuses and dividends - lenders will typically look at your requirements on a case by case basis.

As well as existing properties, other assets such as personal pensions and listed security investment portfolios can be taken into account when determining the level of finance you can access.