---
title: Interest-only mortgage for a £1.9m Spanish second home | Clarendon Private Finance
description: A private-bank structure built around wider wealth, preserving liquidity and future repayment flexibility.
image: https://www.clarendonprivatefinance.co.uk/hubfs/raw_assets/public/clarendon-private-finance/assets/images/residential-finance.jpg
---

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Residential finance

# Interest-only mortgage for a £1.9m Spanish second home

Finance secured**£1.2m**

ClientPrivate clients

FinanceInterest-only residential mortgage

![Editorial residence representing residential finance](https://www.clarendonprivatefinance.co.uk/hubfs/raw_assets/public/clarendon-private-finance/assets/images/residential-finance.jpg)

The objective

To finance the purchase of a £1.9m second home in Spain while keeping monthly commitments low and preserving flexibility around future capital repayments.

The clients’ current earned income represented only part of a substantial financial position held across business interests, property, pensions and liquid assets.

Transaction story

Every case study is anonymised and describes a historic transaction. It is provided for general information only.

Client

Private clients

Finance

Interest-only residential mortgage

## The context

The clients were purchasing a £1.9m second home in Spain and wanted to balance the purchase with their wider approach to managing their wealth.

They had more than £1.1m available through directors’ loan account balances, around £150,000 in cash savings and more than £900,000 in liquid pension assets available for future drawdown. Their wider property position included a mortgage-free UK residence worth approximately £2m and a pension-owned commercial property worth more than £2m, generating around £150,000 in annual rental income.

With further employment income of approximately £200,000 per annum due to commence in the coming months, the clients had a clear picture of how their financial position was expected to develop. The requirement was to structure borrowing around that position, rather than viewing their wealth solely through current earned income.

## What needed to be considered

The lender needed to understand the nature and accessibility of the clients’ wider assets, as well as how these could support the proposed repayment strategy over time.

The structure needed to retain the flexibility the clients wanted around future capital repayments, while accommodating meaningful borrowing against a high-value overseas property.

## Our approach

We began by understanding the clients’ wider position in its entirety, including their business interests, property holdings, liquid assets and anticipated future income. This created a clearer picture of their available resources and how they intended to manage the borrowing over time.

We then considered which private banks could take that broader view while accommodating the interest-only structure and the flexibility sought around future capital repayments. Within one working day of the initial referral, we identified a suitable private bank and presented the application around the overall financial position.

The property was subsequently valued below the clients’ original expectations. We worked with the lender to reshape the facility around the revised valuation while preserving the key features that mattered to the clients, remaining closely involved across valuation, onboarding and legal stages.

## The outcome

The clients completed the purchase of their £1.9m Spanish residence with a £1,202,500 interest-only mortgage structured around their wider financial position and longer-term plans.

The two-year tracker provides a relatively low monthly commitment while preserving flexibility to make substantial capital repayments without early repayment penalties. The mortgage offer was issued within six weeks of the initial referral and the transaction completed within two months, despite the lower-than-anticipated valuation.

Why a private client approach mattered

The clients’ wealth was held across a number of different assets and income sources, so their financial position could not be understood through current earned income alone.

Taking the time to understand how their wealth was structured, where liquidity was available and how they intended to repay the borrowing allowed the mortgage to be considered within their wider financial plans.

Related expertise

[Residential finance](https://www.clarendonprivatefinance.co.uk/services/residential-finance?hsLang=en-gb)

Continue reading

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Clarendon Private Finance is a mortgage intermediary and not a lender; the firm acts for the benefit of its customers to organise applications to mortgage lenders. Clarendon Private Finance achieves this by researching the relevant mortgage market to assess available loans that meet the financial needs and objectives of our customers and arranging for an application to be submitted to the chosen lender in order to effect the drawdown of mortgage funds secured against a UK property. Clarendon Private Finance is not tied to any one mortgage lender but can research a wide variety of lenders, In certain circumstances we are able to research the whole of market while in other cases it is against a panel of lenders; details of our scope will be provided at initial engagement, Clarendon Private Finance receives a commission payment for any loan we submit to a lender that results in a drawdown of funds; specific details on the amount and basis of commission will be disclosed at our initial engagement as well as via the mortgage contract offer or facility letter. Clarendon Private Finance is a trading name of Aria Finance Limited. Aria Finance Ltd is authorised and regulated by the Financial Conduct Authority (firm reference number 302964). Certain types of loans are not regulated, for example loans for business purposes or certain buy-to-lets. Registered in England and Wales. Registered office at The Edward Hyde Building, 38 Clarendon Road, Watford, WD17 1JW. Company Number: 04440152.

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