What you need to know
- Lombard loans allow you to borrow against your stock portfolio, giving you far more flexibility than alternatives.
- The number of Lombard loans we provided to clients more than doubled in 2025.
- Following the most recent Bank of England base rate reduction, Lombard Lending is now offering increasingly competitive rates.
When an entrepreneur with a young family needed funds quickly to buy a country house, a Lombard loan gave him the competitive edge of a cash buyer. He secured the £1.5 million purchase in mid-2025 and, after a few months of renovating, is about to move into a home where he plans to live for years to come.
For this Brown Shipley client, the Lombard loan proved to be the saving solution they needed. A property developer also wanted the house and although the selling family preferred our client, they needed to sell as the house was in probate. Without the loan, it’s unlikely our client would have managed to sell his own house in time to go ahead.
In a sluggish property market like 2025’s, a Lombard loan allows you to behave as a cash buyer, even if your own house takes time to sell. Showing quite how slow the 2025 market was, UK property website Zoopla reported in August that some houses in southern coastal areas like Truro, Exeter and Bournemouth had been on the market for more than six months.1
Lombard loans aren’t well known but they’re becoming more popular. In 2025, the number of Lombard loans we provided to clients more than doubled. These loans are secured against your stock portfolio and some individuals moved their wealth to Brown Shipley to access this lending facility, which some other investment firms don’t offer.
Lombard loans explained
So, what are Lombard loans? Named after the Italian Lombard bankers of the Middle Ages, they’re loans for high-net-worth individuals with stock portfolios. However, the portfolio cannot be in a tax wrapper such as an Individual Savings Account (ISA) or Self-Invested Personal Pension (SIPP).
We find clients commonly using them to pay unexpected tax bills, make gifts to children for house purchases and fund various other opportunities such as buying a business. You could mitigate triggering large capital gains tax bills from selling stock portfolios that have gone up in value by borrowing against them in anticipation of being able to repay the loan following events such as a property sale, business sale or inheritance.
Typically, the loan lasts for 12-18 months before being repaid, although it can be longer. It’s interest-only and priced at a margin over the Bank of England base rate that’s normally more than a mortgage but less than a bridging loan. What’s more, you can choose to roll-up interest, which may suit you if you’re waiting for money to come in.
The attraction of a Lombard loan is that you can do things at your own pace – whether making your purchase or repaying the loan. You also avoid being governed by the strict conditions of bridging finance, with its fixed terms after which you pay more expensive rates.
Brown Shipley Client Advisor, Zia Qureshi, noted that ‘Increasingly clients are finding Lombard to be a practical, efficient and cost-effective way of solving a myriad of short-term financial requirements. It’s a lesser used solution in a wealth managers toolkit but can be very useful for the right clients’.
As with any lending, there are a number of risks such as rising interest rates, or the possibility of your loan being ‘called in’ during volatile stock markets if your portfolio’s value falls below a certain level. To help mitigate the risk we stipulate conservative loan-to-value ratios. For instance, we might agree a loan of 50% of the value of a portfolio, building in a buffer against falling financial markets.
Looking forward to 2026
As we enter 2026, the Bank of England base rate stands at 3.75% following the reduction at the end of 2025. This makes the cost of a Lombard loan competitive, especially when compared with the 5.25% base rate peak in 2024.
As for our house-moving entrepreneur, he’s looking forward to moving into his newly-renovated dream home with his family. A loan that was arranged in just a few weeks gave him the flexibility to buy the house, sell his own home and do the renovations in his own time.
Brown Shipley takes great pride in delivering comprehensive support, across our core services of Investment Management, Wealth Planning and Lending.
If you have any questions about Lombard Lending, please speak with one of our Client Advisors or take a look at our Guide to Lending.
Important Information
Information correct as of 19 February 2026.
- Brown Shipley is authorised and regulated by the Financial Conduct Authority and the Prudential Regulation Authority
- Investing puts your capital at risk.
- Lending is subject to status.
- Lombard loans are only likely to be suitable for clients who are experienced investors and understand the associated risks. Leverage is backed by liquid assets from an investment portfolio, which is known as ‘collateral’. The borrower’s capital is at risk with such a loan and if the assets held as collateral lose value because of market volatility or exchange rate risk, the borrower must provide additional collateral or accept the possibility of a sale of their assets to reduce the amount of the loan.
- Lombard Loans are not regulated by the Financial Conduct Authority and clients of Brown Shipley will not benefit from the protections provided by the UK Financial Services Compensation Scheme.
- We recommend that you take independent tax advice on such loans. It is important to appreciate the specific risks associated with investment leverage before making any investment decisions.
- This is a marketing communication provided for information purposes and does not constitute investment advice or a recommendation.