Large Loan Amounts:

• These mortgages are intended for expensive properties, often worth more than £500,000 in the UK or above the standard mortgage loan limits set by government-sponsored entities like Fannie Mae and Freddie Mac in the US.
• The exact threshold varies by lender and location, but high-value mortgages generally start at amounts greater than £500,000 to £1 million in the UK (with higher limits in some high-cost areas).

Higher Deposit Requirements:

• Lenders often require a larger deposit, usually around 20% to 40%, compared to the 5-10% typical for standard mortgages.
• This is because high-value loans carry greater risk for lenders, so they seek to reduce that risk by asking for larger down payments.

Stricter Eligibility Criteria:

• Lenders typically have stricter qualification requirements for high-value mortgages due to the size of the loan.
• Borrowers need:
  • A high income to prove they can manage large monthly repayments.
  • A strong credit score (generally above average).
  • A stable financial history, including proof of sufficient assets and savings.
  • Lower debt-to-income (DTI) ratios compared to standard mortgages.

Who Typically Uses High-Value Mortgages?

• Wealthy individuals buying luxury homes or high-value properties.
• Buy-to-let investors purchasing multiple properties or expensive properties for rental income.
• Self-employed individuals or business owners with significant but irregular income streams.
• Foreign buyers investing in high-end real estate.