It was recently revealed that Chancellor George Osborne was searching for a cheaper deal on his mortgage (aren’t we all!), which has at the very least resulted in a flurry of discussion and criticism.
If you are currently searching for a mortgage deal, you will be aware of the obstacle course we like to call the financial market. Even more so, how hard it is to be accepted for a mortgage loan by a high street lender.
George Osborne’s mortgage makeover
Recent claims state Osborne has moved his mortgage to an exclusive overseas bank, in order to cut the interest rate on the loan for his £4 million Notting Hill property (of which he rents for £10,000 a month while brushing shoulders at Number 10). A property value which has reportedly doubled since its purchase in 2006.
Osborne has reportedly switched to RBC Europe (part of the Royal Bank of Canada) from Barclays and C. Hoare & Co.
The rationale behind this decision is ultimately down to the preferential rates that private banks can offer, in contrast to the rigid criteria found on the high street. Instead, private bank mortgages take the entirety of a prospective client’s picture into consideration, producing a rate through negotiation.
Osborne will presumably place assets with RBC Europe for management to consolidate any debt and in turn gain a favourable mortgage deal, qualifying due to the excellent equity in his London property. Yet contrary to popular belief, this is not an exclusive arrangement reserved for politicians and the like… Many private banks work on an invitation only basis and seek specific requirements which are often unapproachable from the high street, however, working with the right broker can ultimately include these non-high street lending options for you.
Why opt for a private bank mortgage?
Many journalists have tried to suggest the nature of Osborne’s mortgage is wrong, simply to encourage the general public to work with an institution that operates on the basis of calculations -irrespective of personal circumstances. Private Banks will discuss your finances from a holistic view, upholding a standard of service that has been lost in so many industries over the 21st century.
Osborne’s case is an example of the lending opportunities available in the high net worth market: opting to remortgage for a better rate with the reception of a better service. This may not be so readily available, as many private banks start their lending from £500,000 and require a wealth of assets. Despite this, there are great rewards to be reaped from private lenders if you pitch yourself in the right way.
How a (good) broker can help you
“Everyone is looking to avoid pesky interest rate rises and get the best deal for their situation. That’s just good sense. But in such a volatile market, taking the correct path and understanding your options is crucial in gaining financial success and stability”, says Islay Robinson, CEO at Enness Private Clients.
That’s where the benefits of an expert broker come in.
Here at Enness we know that a well-structured and thoroughly planned proposal is essential when consulting lenders for better deals on your personal mortgage. With excellent relationships across every type of lender, we will scour the market to ensure the very best deal for you, with a whole host of opportunities you may not have considered. You too, could be benefitting from a private bank mortgage like George Osborne!
If you have any questions on how you could improve your financial situation or simply wish to discuss alternative options, feel free to contact us anytime or take a look at our latest banking guide.