A specialist approach and a dedicated team will support clients who need a more personalised service, says Georgina Burrows, premier relationship team manager at Halifax Intermediaries 

Rising house prices have made a £500,000 mortgage par for the course in many areas.

In London, for example, the average property price in March this year was £537,250, and larger loans are now standard in great swathes of England and Wales.

Intermediaries know only too well that, as the loan size gets bigger, so too can the complexity of the deal.

Of course, there are some straightforward cases, but large loan mortgages are more likely to include bonus structures or more complex income streams and assets. The proportion of self-employed applicants is also higher, as well as those who want to borrow on an interest-only basis.

Often, a case doesn’t fit into standard lending criteria, but it still stacks up and the client has a high financial contingency.

That’s why large loan cases need personal service from a specialist team of experts who intrinsically understand this market. These might be prime borrowers, but they often have non-standard features and need a specialist approach.

At Halifax Intermediaries, we understand complex loans and have deep and broad experience in this sub-sector. We believe this gives us a clear competitive advantage in the market.

What to look for

Most lenders will provide mortgages above £500,000, but what’s on offer will vary.

Experience and expertise in the nuances of large loan lending can make all the difference between a smooth process and one beset by hold-ups.

Look for lenders that offer:

• A specialist dedicated team – This is important because large loan lending requires the expertise of professionals that deal with these cases day in, day out. Whatever issues arise, they’re likely to have seen it before and know exactly how to handle it.
• Experience counts – Does the lender have a track record of supporting large loan borrowers? That goes for mortgages above £500,000 but also large loans over £2m, for example.
• Choice of products – A wide choice of large loan mortgages and product transfer options gives your client options. Some lenders might agree to lend a large sum but only have a limited product option at that level. Look for those that provide choice, both now and when your client comes to switch.
• Consistent service – Can you trust the lender’s service to be consistently excellent? Your large loan clients will have high expectations that both you and the lender will need to meet.

Halifax’s Premier Team is renowned for providing specialist service to intermediaries and your clients before, during and after submission. These cases often need to be discussed and sense checked before they’re keyed, so we work with you and your clients to offer a tailored service.

We understand complex loans better than most, because our specialist relationship managers have years of expertise in dealing with larger mortgages, from £500,000 up to £5m.

Listening and learning

The mortgage market never stands still and nor do we.

That starts with listening carefully to intermediaries about what your large loan clients want and need from a lender.

From intermediary surveys to listening exercises with small focus groups, we’re continually working to improve our service, products and lending criteria.

That’s been more important than ever this year, with rising rates impacting affordability for all borrowers, even high earners. You told us they needed more flexibility on criteria. We listened and delivered.

Here’s what we’ve changed:

• Increased our loan to income (LTI) caps, up to 5.5 times income for borrowers with income over £75,000 borrowing up to 75 per cent loan to value (LTV), or incomes greater than £125,000 up to 85 per cent LTV. For incomes greater than £75,000 up to 85 per cent LTV, an LTI cap of five times income will apply.
• Removed the cap for high earning, low LTV self-employed customers so they benefit from the standard LTI cap of 5.5 (up from 4.49), boosting their borrowing power.
• Increased maximum LTVs from 80 per cent to 85 per cent on loans between £1,000,001 to £2m, and from 70 per cent to 75 per cent for loan amounts from £2,000,001 to £5m. We’ll lend up to 85 per cent from £750,000 to £1m, up to 90 per cent up to £750,000 and up to 95 per cent on loans up to £570,000.
• Reduced the qualifying income required on interest-only borrowing for Sale of Mortgaged Property (SOMP), bonus and cash repayment plans, to £75,000 for sole applicants and £100,000 for joint income.
• Changed our SOMP criteria, so this option is available to more customers. The maximum LTV on interest-only with SOMP has been increased to 75 per cent from 50 per cent. For part interest-only and part repayment, the minimum equity will now be calculated at the end of the term, not at application.

All of these changes potentially boost the maximum loan available to those borrowers who have a high financial contingency, as a direct result of intermediary concerns about affordability.

And we won’t stop there. We will be introducing more changes to our large loan criteria in the coming months, after listening to intermediary feedback.

Personal service

Large loan lending demands a personal service, both to our intermediary partners and the borrower.

That’s why we provide a direct phone number and email address for your own case manager who will be on hand throughout the process and has serious expertise in dealing with larger mortgages.

Our bespoke pre-submission service goes above and beyond a standard decision in principle (DIP), giving you extra support when you need it from our dedicated Halifax Premier Team.

Whether your client is borrowing £500,000 or £5m we’ll provide a tailored service to meet their needs.

Your large loan clients get the best of both worlds – a mainstream mortgage with specialist support from a lender that really understands complex mortgages.

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