Using liquid securities
Lombard
Loans
Lombard Loans are the practise of using liquid securities, such as equities, bonds or investment funds, as collateral for a loan
Summit Capital Mortgages are leading brokers of Lombard Loans. These types of arrangements are offered by private banks and financial institutions and in exchange for pledging your asset, you receive a credit line that you can use in an agreed time frame.
Lombard Loans have a number of distinct advantages for some clients
- Underwriting is often quicker and less involved than arranging finance on real estate, which means you can have access to the funds quicker. Generally, the underwriting is limited to the asset being offered as security.
- Lombard Loans provide an alternative to selling the asset and the potential tax implications. You maintain the long-term benefits of ownership, but still have access to capital, should you wish to invest elsewhere.
- The interest rate charge on a Lombard Loan, could potentially be cheaper than the rate you can find on real estate. This will be down to the underlying asset you are offering as security and the loan to value. The lender will determine the level of assets they will take into consideration as investment values can go down or up.
Making it easy
Our mortgage advice process
Step 1: We listen
It’s important for us (and you) to take the time to get to know each other and to make sure we understand what you would like to achieve. It’s a cliche, but no two people are the same. And we want to make sure our advice and service is tailored to you.
Step 2: We provide our initial thoughts
After that, we’ll provide you with some details. Things like how much we think you can borrow and what kind of a mortgage deposit you’ll need to buy that dream home. We’ll also suggest the best type of mortgage for you, looking at fixed and variable rates.
Step 3: We search the market for you
We’ll then move on to search the market for you. In addition to finding you the best rate, we’ll take into account other things like lender service levels and affordability calculations. It’s all part of having an expert on your side. We can even arrange an Agreement in Principal for you with a lender so you know exactly how much you can borrow.
Step 4: Completion
We finalise your mortgage and you move in. Alas, we can’t guarantee the moving experience will be easy, but at least you are safe in the knowledge that you have the most appropriate finance for you.
Please note that Lombard Loans are Non-Regulated products and not regulated by the Financial Conduct Authority. Therefore the protection afforded to Regulated products does not apply. If you unsure what this means, we can tell you.
Lombard Loans
Case Study
Case Summary
We were approached by a client looking to buy a main residence, who didn’t currently own a property, but had a substantial investment portfolio. Rather than selling a large part of his portfolio, he was looking for a bank to offer a loan against this portfolio.
Our Solution
We introduced the client to a large private bank, that secured a loan against his portfolio and the new property, so that he didn’t have to sell his investments. The loan on the portfolio was at a very competitive rate and meant that he could still benefit from any growth in his investments.
The numbers
Mortgage Calculators
Our useful mortgage calculators can help you work out the key numbers without any hard questions.
