Private Mortgage Lenders
Private mortgage lenders lend outside the main high street banks: private banks, specialist lenders funded by investors, and short-term private finance. We explain how each works, when one makes sense and how to check a lender is properly regulated.
- Private banks and specialist lenders
- Complex income and large loans
- Short-term private finance
- Regulated, whole-of-market advice
broad range of UK lenders
Momentum Financial Services Ltd · FRN 1011740
a real adviser, start to finish
rates, fees & total borrowing
Tell Us What the High Street Could Not Do
Tell us about the property, the loan you need and where a bank has said no or offered less, and we will come back with the private and specialist lenders that fit.
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Tell us about your situation and we'll get back to you with tailored advice.
What Is a Private Mortgage Lender?
A private mortgage lender is any lender that is not one of the high street banks or building societies. The term covers several very different businesses, and the right one depends on why the high street is not working for you.
Private banks
Banks that serve wealthier clients and underwrite each case by hand, often in return for holding savings or investments with them. See private bank mortgages.
Specialist lenders
Non-bank lenders funded by investors, which focus on cases high street scoring rejects. Most only accept applications through brokers. See specialist mortgage lenders explained.
Short-term private finance
Bridging and development lenders that lend for months rather than years, against the property and a clear plan to repay. See bridging finance.
Private individuals
Family members or private investors lending directly. This is rarer and needs careful legal advice, because the protections of regulated lending may not apply.
Private Lender or High Street Bank?
High street banks are built for volume: they score most applications automatically and decline anything that does not fit. Private and specialist lenders price for risk and look at the detail, which is why they can say yes where a bank cannot, usually at a higher rate.
| Feature | High street bank | Private or specialist lender |
|---|---|---|
| Underwriting | Mostly automated credit scoring | A person reviews the whole case |
| Income | Payslips and standard accounts | Bonus, dividends, overseas and variable income considered |
| Credit history | A clean file usually expected | Past missed payments, defaults or CCJs often considered |
| Loan size | Standard affordability limits | Large and very large loans, sometimes on assets as well as income |
| Pricing | Usually the lowest rates | Higher rates and fees, set case by case |
| Access | Direct or through brokers | Many specialist lenders only work through brokers |
A general comparison. Every lender sets its own criteria, and some high street lenders now have specialist ranges of their own.
When a Private Lender Makes Sense
Most people should start with the high street, because it is usually cheapest. A private or specialist lender becomes worth the extra cost in a few clear situations.
Complex income
Bonuses, dividends, partnership profit or income from several sources. See professionals with complex income.
Large loans
Borrowing beyond standard income multiples, often for higher earners. See large mortgage loans and high net worth mortgages.
Past credit problems
Defaults, CCJs or missed payments that an automated score will not pass. See adverse credit mortgages.
Overseas income or residence
UK property bought while living or earning abroad. See expat mortgages.
Unusual property
Non-standard construction, short leases, mixed-use buildings or homes needing work.
Tight deadlines
Auction purchases and chain breaks, where short-term finance can complete in weeks rather than months.
Is a Private Mortgage Regulated?
If a loan is secured on a home that you or a close family member live in, it is usually a regulated mortgage contract. The lender must then be authorised by the Financial Conduct Authority, check that the loan is affordable and treat you fairly, and you can take an unresolved complaint to the Financial Ombudsman Service.
Loans for investment property or for business purposes are often unregulated, which means fewer of those protections apply. That is not necessarily a problem, but you should know which kind of loan you are taking before you sign.
Before you deal with any lender or broker, look them up on the FCA register. Be wary of anyone offering a private mortgage on your home who is not on it.
What Private Lending Costs
Rates from private and specialist lenders are set for each case and are usually higher than high street rates, sometimes by a small margin and sometimes by several percentage points. Arrangement fees are often charged as a percentage of the loan, and short-term lenders may also charge exit fees.
Compare offers on the total cost over the period you expect to keep the loan, not on the rate alone, and check the early repayment charges. Many borrowers use a specialist lender for two to five years and then move to a mainstream lender once their circumstances fit, so the cost of leaving matters as much as the cost of arriving.
Looking for a Lender Outside the High Street?
We search private banks, specialist lenders and short-term lenders together, explain the full cost of each option and check every lender is regulated for the loan you need.
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Private Mortgage Lender FAQs
What is a private mortgage?
A mortgage from a lender outside the main high street banks and building societies, such as a private bank, a specialist non-bank lender or a short-term private finance lender.
Are private mortgage lenders safe?
Lenders that are authorised by the Financial Conduct Authority are regulated in the same way as banks for regulated mortgages. Check any lender on the FCA register before you apply, and take advice before borrowing from a private individual.
Do private lenders accept bad credit?
Many specialist lenders consider past defaults, CCJs and missed payments, depending on how old and how serious they are. Expect a higher rate than a clean credit file would get.
Are private mortgages more expensive?
Usually, yes. Rates and fees reflect the extra risk and the manual underwriting, so we compare the total cost against any high street option first.
Can I get a private mortgage for a buy to let?
Yes. Many specialist lenders focus on buy to let, including portfolio landlords, houses in multiple occupation and limited company purchases.
What is the difference between a private bank and a private lender?
A private bank is a bank that lends to wealthier clients and usually expects a wider relationship. A private lender is a broader term that also includes specialist non-bank lenders and short-term lenders.
How do I find a private mortgage lender?
Many specialist and private lenders only accept applications through brokers. A whole-of-market broker can compare them alongside high street options and present the case in the way each lender expects. Our lenders page lists the private banks, specialist and bridging lenders we approach.
Written and reviewed by Osman Emin, CeMAP, mortgage and protection adviser · FCA register OCE01003 · Updated YOUR HOME OR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.