Client case study: The speedy house buyer
Coutts Private Banker Teresa Norton explains why one of her clients decided to use IBL from the range of borrowing options available when they needed to move quickly on a property sale.
“My client found a fantastic investment property in Chelsea and wanted to move quickly,” she says. “They considered a buy-to-let mortgage but because of the competitive marketplace, felt it better to raise all the funds for the property in advance so they could complete the purchase quickly.
“They had a substantial investment portfolio, but selling would have led to a significant tax event. Raising the money through Investment Backed Lending meant my client was ready to complete the purchase quickly while leaving their investments in place.”
If you have over £1 million in investments you could be able to borrow against them with Coutts.
Like any form of borrowing, it’s important that you are aware of the risks versus the returns, as well as the other options available.
Please contact your private banker to talk through your borrowing needs.
IMPORTANT INFORMATION – INVESTMENT BACKED LENDING
This product may not be suitable for you if:
- you are using it to purchase your primary personal residence, a second or holiday home for personal use, or related expenses, such as renovation/improvement on such properties or related lease/service charges.
- you require any advice to you on the merits or suitability of the product for you.
- you rely on the income and capital from your investments and cash to maintain your standard of living.
We strongly recommend you seek your own independent advice if you are unsure whether this product is suitable for you. We also recommend that you seek tax advice as this is not something we provide.
Before you borrow against investments, you should understand these risks:
- If the security you provide is insufficient to support the amount you have borrowed, you may be required to rectify the shortfall at short notice – this is referred to as a margin call
- If you borrow to purchase investments and these investments are themselves provided as security for your liabilities, your losses or gains could be magnified
- If your borrowing is in a different currency to the limit, fluctuating exchange rates could result in the limit being exceeded and you may be required to rectify the shortfall at short notice – this is referred to as a margin call.
- Lending secured over investments can have an adverse impact on the value of your investments. This risk is amplified if the funds are used for leverage purposes. Investment values can fall as well as rise, your capital is at risk.
The final decision whether to proceed must be your own and in making your decision you should carefully consider the comparison between borrowing costs and potential investment gains/losses.
LENDING AGAINST INVESTMENTS MUST NOT BE USED FOR RESIDENTIAL PROPERTY PURPOSES. SECURITY IS REQUIRED. OVER 18s ONLY.
Your home or property may be repossessed if you do not keep up repayments on your mortgage.
Over 18s only. Terms and conditions apply. You may not be eligible for all Coutts mortgage solutions. Security may be required.