Lombard Financing
Lombard Loans for Buying Property Abroad
Finance a property purchase without selling your investments.
Lombard lending allows eligible borrowers to secure finance against investment portfolios, including shares, bonds and cash holdings, through private banks and specialist lenders. It can provide a flexible alternative to mortgages, bridging loans and asset sales when buying property overseas.
Use Cases
When a Lombard loan makes sense
A Lombard loan is not the right structure for every situation. Where it does apply, it is typically the fastest and most cost-effective borrowing option available. The following scenarios reflect the most common reasons clients approach Worldwide Property Company about Lombard lending.
Borrowing Limits
Loan-to-value by asset class
The amount you can borrow against a Lombard loan depends on the type of assets pledged. More liquid and stable asset classes attract higher LTV ratios, reflecting the lower risk to the lender.
Most lenders require a minimum portfolio value of €1 million or currency equivalent before considering a Lombard loan application.
| Asset Class | Maximum LTV |
|---|---|
| Cash deposits | Up to 95% |
| Investment-grade bonds | Up to 85% |
| Listed equities | Up to 75% |
LTV ratios are indicative. Final terms depend on the specific assets, portfolio concentration, and lending bank. Minimum portfolio value: €1 million / $1 million.
HOW IT WORKS
How a Lombard loan works
A Lombard loan is arranged in five stages. For straightforward cases against a liquid, diversified portfolio, the full process can typically be completed within one to three weeks.
Portfolio assessment
A private bank reviews your investment portfolio to determine its eligible collateral value. Listed equities, bonds, and cash deposits are each assessed individually. The lender applies a discount to each asset class to account for market volatility, producing a net lending value against which a facility can be offered.
Pledge arrangement
You pledge the portfolio to the lending bank as collateral. You retain full ownership throughout and continue to receive dividends, interest, and capital growth on the underlying assets. The bank holds a charge against the portfolio for the duration of the loan.
Facility drawdown
Once the pledge is in place, funds can be drawn down quickly. The facility can be taken in full or used as a revolving credit line — drawn when needed, repaid when convenient — depending on the structure agreed with the lender.
Interest payments
Interest accrues on the drawn balance only. For high-quality portfolios, margins can start from as low as 0.8% per annum above the relevant base rate — making Lombard lending one of the most cost-effective borrowing structures available to private clients.
Repayment
Repayment typically comes from a property sale, a mortgage arrangement, or a liquidity event. If the portfolio value falls below the required loan-to-value threshold, the lender may issue a margin call requiring additional collateral or partial repayment.
Eligibility
Who qualifies for a Lombard loan?
A Lombard loan requires a pledgeable investment portfolio of at least €1 million or currency equivalent. There is no income test in the conventional sense. Serviceability is assessed against the portfolio value rather than employment income, making Lombard lending particularly accessible to a range of high-net-worth profiles.
- Investors and portfolio holders who are asset-rich but income-variable
- Partners at private equity, law, or professional services firms with irregular income
- Early retirees with significant investment wealth but modest salary income
- Clients with complex income structures that standard mortgage lenders cannot easily assess
- Non-residents and internationally mobile individuals who face restrictions with conventional lenders
Comparison
Lombard loan vs mortgage
A Lombard loan is not a replacement for a mortgage in most circumstances. It is a complementary structure and in specific situations, notably wealth tax planning and fast property acquisition, it is the more efficient instrument.
| Lombard loan | Standard mortgage | |
|---|---|---|
| Collateral | Investment portfolio | Property |
| Interest rate | From 0.8% pa margin above base rate (e.g. Euribor, SARON) | Typically 2–5% pa |
| Arrangement speed | Days to weeks | Weeks to months |
| Maximum LTV | 75-95% (depending on type of asset used) | Typically 60–85% (depending on residency & profile) |
| Use of funds | Unrestricted | Property purchase only |
| Mitigate Wealth Tax? | Depends on country & structure | Depends on country & structure |
| Minimum | €1m portfolio | Varies by lender |
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TESTIMONIALS
What our clients say about us
Get in touch
Discuss your situation
with a Lombard loan specialist
Every Lombard loan case is different. The most useful first step is a short, confidential conversation about your portfolio, your goals, and what structures are available to you. We will outline what is realistic, and what is not, without obligation.
Questions Answered
Lombard Loans FAQs
Important Notice: Lombard loans are secured credit arrangements against investment portfolios and are not suitable for all borrowers. If the pledged portfolio falls below the required loan-to-value threshold, the lender may issue a margin call requiring additional collateral or partial repayment. Failure to meet a margin call may result in the forced sale of portfolio assets. These facilities are not regulated consumer credit products and are available to high net worth individuals and sophisticated investors only. Worldwide Property Company (Pontcanna Estates FZCO) acts as an introducer. All facilities are subject to lender credit approval, portfolio valuation, legal due diligence, and AML checks. Tax structuring information on this page is for general guidance only and does not constitute tax or legal advice. All fees are disclosed in writing before commitment.
Further Reading
Other Financing Guides
