Many business owners underestimate how powerful private banks can be when it comes to structuring mortgages in 2025. While high-street lenders continue to focus on reported salary and dividends, private banks take an entirely different approach. They assess the director not just as an individual, but as an economic engine supported by a profitable, stable and growing business. This shift dramatically changes borrowing outcomes for directors who run companies with strong financials but choose tax-efficient remuneration.

The widespread belief that a director’s income equals the salary and dividends on their tax return is increasingly outdated. As highlighted in related Willow blogs such as Directors’ Remuneration & Retained Profits: Smarter Borrowing for Ltd Company Owners in 2025 and Profit-Based Mortgages in 2025, lenders have expanded their understanding of how modern companies function. Nowhere is this more evident than in private banking.

Private banks take the time to understand how your business operates, how profits are generated, how liquidity is managed, and how stable future revenues are. For directors who retain earnings, run multiple companies, or work within a complex structure, this approach can open lending possibilities that high-street banks simply cannot match.

This guide explores how private banks analyse director income, why their methods create opportunities for business owners, and how Willow Private Finance helps clients access these bespoke lending solutions in 2025.

Market Context: Why Private Banks Are Leading in 2025

The 2025 mortgage market has become highly segmented. High-street lenders remain rigid, relying heavily on standardised affordability models that ignore how business owners actually operate. This leaves many directors with strong companies appearing “low income” on paper. At the same time, private banks are actively increasing their share of the entrepreneurial, high-net-worth and international markets by offering underwriting that reflects real economic strength.

Private banks have three strategic motives in 2025. First, they want long-term relationships with business owners whose companies generate substantial revenue. Second, they favour clients with liquid assets, investable wealth or future profitability. Third, they recognise that directors often understate their personal income intentionally for tax planning purposes. These three factors create a landscape in which private banks can comfortably lend far more than traditional lenders, even where personal drawings are minimal.

This broader understanding is particularly helpful for clients with cross-border income, complex remuneration, multiple entities or lumpier profit cycles—situations discussed in several of your existing blogs such as Private Banks and Offshore Income in 2025.

The result is a lending environment where business owners with strong companies increasingly gravitate toward private banks for affordability, flexibility and deal certainty.

Understanding the Private Bank Mindset

A high-street lender starts with your tax return. A private bank starts with your business.

Private banks assess directors as wealth-generating individuals, not employees, and their underwriting reflects this. They analyse the business model, sector, contracts, and growth trajectory. They review reserves, cash balances and investment behaviour. They look at the director’s financial decisions, not just their drawings.

Private banking is relational rather than transactional. This means the lending decision is not based on a narrow snapshot of income but instead on the totality of your financial ecosystem. For directors, this approach recognises what truly matters: your capacity to generate income, not just the portion you choose to withdraw.

How Private Banks Assess Director Income in 2025

Private banks use multi-layered assessments that go far beyond salary and dividends. Their underwriting models are built to capture underlying economic reality. These assessments vary from bank to bank, but the following elements are consistently reviewed.

Private banks begin with the profitability of the business. They look at net profit, adjusted profit and multi-year trends. They want to see a track record of reliable performance or clear evidence of future revenue. Short-term fluctuations are less of a concern when long-term profitability is clear. A company that generates strong profit but retains earnings is often seen more favourably than one that pays out all profit as dividends.

They also review retained earnings in depth. Retained profit indicates that the business can support increased remuneration if required. This makes it a powerful indicator of borrowing capacity. Instead of assuming the director “earns” what they draw, private banks interpret retained earnings as evidence of responsible financial stewardship and sustainable income potential.

Liquidity and cash reserves carry significant weight. Private banks want reassurance that the business can withstand temporary downturns. A company with strong cash reserves or recurring revenue streams gives a lender confidence that the director could increase their personal income if needed to support mortgage affordability.

One of the most distinguishing features of private-bank underwriting is the treatment of EBITDA. EBITDA provides a clear view of operational profitability before non-cash expenses and financing structures. Banks use EBITDA to understand the core earning power of the business, which often paints a more accurate picture than net profit alone. For directors with investment-heavy companies or significant depreciation, EBITDA can materially increase assessed borrowing power.

Forward contracts and future revenue pipelines are also examined closely. Private banks often lend on the basis of future expectations, not just past output. If a company has secured multi-year contracts, recurring revenue subscriptions or predictable fee income, this can significantly strengthen a mortgage application. High-street lenders rarely consider this, even though it is central to how many modern businesses operate.

Directors operating multiple companies or group structures often struggle with mainstream lenders because income attribution becomes unclear. Private banks instead assess consolidated business strength, looking across all companies, ownership percentages and cash flows. They examine inter-company support, revenue diversification and group-level liquidity. This holistic approach is particularly advantageous for entrepreneurs who manage several profitable entities.

Finally, private banks review personal wealth, asset diversification and investable funds. They consider liquid assets held outside the business, investment portfolios, savings, international holdings and future liquidity events. This broader perspective allows banks to construct lending solutions that reflect the director’s full financial picture.

The result is an affordability assessment rooted in business strength, future earning power and overall wealth—not narrow personal income lines.

Why This Matters for Borrowing Power

This method of assessing income produces materially better outcomes for business owners. A director who pays themselves £12,570 and modest dividends but oversees a business generating £400,000 profit is treated very differently by private banks than by traditional lenders. On the high street, the applicant looks like a low-income borrower. To a private bank, they appear as a high-earning entrepreneur with substantial future income potential.

Private banks also offer higher loan-to-income multiples, often significantly exceeding the rigid caps used by high-street lenders. They can structure interest-only facilities, longer terms or flexible repayment plans tailored to business cash flow patterns. Some will lend using blended assessments across both the director’s personal and corporate assets.

This flexibility is transformative. It allows directors to borrow at levels aligned with their true economic position rather than their tax-efficient remuneration. It also enables them to structure property acquisitions strategically, whether buying a primary residence, an investment asset or a high-value property where speed or discretion matters.

Why Business Owners Often Miss Out Without Private Banks

Many directors never access these advantages because they simply apply to the wrong lenders. High-street banks are not designed for complex income. Their automated affordability systems cannot interpret retained earnings or group structures. Tax-efficient remuneration becomes a blocker instead of a neutral decision. Even strong companies are often invisible to their underwriting models.

This is why business owners are frequently mis-advised into thinking they “earn too little” to qualify for the borrowing they want. It is the lender that is unsuitable, not the applicant.

Private banks, on the other hand, welcome borrowers whose financial profiles do not “fit” conventional models. They are designed for entrepreneurs, international clients and directors whose income is generated through business activity rather than employment.

Generalised Case Insight

Consider a situation where a director takes only minimal drawings but operates a company with strong, consistent EBITDA, a seven-figure retained-earnings position and significant cash reserves. A high-street lender might assess income at under £50,000. A private bank, reviewing the company holistically, may treat the director as having multiple times that level of income for affordability purposes. This structural difference—not tied to any specific client—illustrates why private banking is so effective for entrepreneurial borrowers.

Outlook for 2025 and Beyond

Private banks will continue expanding their lending to directors in 2025. Competition between banks is intensifying, and each institution is refining its approach to attract entrepreneurial clients. Underwriting is becoming more personalised, more forward-looking and more aligned with real-world business operations.

For any business owner seeking property finance in 2025, understanding how private banks think—and positioning your financials accordingly—will be one of the most important strategic decisions you can make.

How Willow Private Finance Can Help

Willow Private Finance has deep experience placing business owners with the right private banks and specialist lenders. The firm understands how to present company accounts, retained earnings, liquidity, EBITDA and multi-entity structures in a way that accurately reflects the director’s true borrowing power. Whether a client runs a single profitable business or a complex group structure, Willow ensures their financial position is interpreted correctly—not reduced to tax-return figures.

By leveraging long-standing relationships with leading private banks, Willow secures tailored solutions that align with business performance and long-term financial goals.

Frequently Asked Questions

Q1: Why do private banks ignore my low salary?
Because they assess your economic capacity through your company’s profit, liquidity and EBITDA rather than tax-efficient remuneration.

Q2: Do private banks accept retained earnings as part of affordability?
Yes. Retained earnings are often treated as evidence of sustainable income capacity.

Q3: Will a private bank consider my group of companies together?
In many cases, yes. They often assess consolidated group strength rather than treating entities separately.

Q4: Can private banks use EBITDA as the basis for income assessment?
Yes. EBITDA frequently plays a central role in evaluating business-owner affordability.

Q5: Do private banks offer higher loan sizes than high-street lenders?
Typically yes, because they use more flexible, forward-looking underwriting.



Q6: Do private banks require large assets under management?
Some do, but many of Willow’s partner banks offer lending-first relationships without mandatory asset transfers.

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