Every year, thousands of Americans explore the prospect of owning property in Europe — a villa on the French Riviera, an apartment in Monaco, or a countryside estate in Spain or Italy. The lifestyle appeal is obvious. What is far less obvious is how to finance such a purchase when you are a US person navigating European banking systems that were not built with you in mind.

The good news is that a practical, tax-efficient route exists — one that most international real estate agents and even many private banks will never mention. It is called portfolio-backed financing, sometimes referred to as a Lombard loan structure, and Amberlake Partners has been using it to help American clients acquire European property without liquidating their existing investments.

Why Buying Property in Europe Is Harder for Americans

The core problem is regulatory, not financial. Since the United States enacted FATCA (the Foreign Account Tax Compliance Act) in 2010, foreign financial institutions are required to identify and report accounts held by US persons to the IRS — or face punitive withholding taxes on US-source income. The compliance infrastructure required is substantial, and many European banks have quietly decided that the cost of serving US clients simply does not justify the revenue.

The result is a paradox: a wealthy American investor with a multi-million-dollar portfolio may find it easier to buy property in their own country with a standard mortgage than to finance a €1.5 million apartment in Monaco or Nice, even if they have far more than enough assets to qualify. European banks will often refuse the application outright, or impose conditions — like requiring the entire purchase price in cash held in local accounts — that negate the financial efficiency of the transaction.

For buyers who do manage to navigate these obstacles, the typical fallback is to pay entirely in cash. This is a perfectly legitimate approach, but it ties up a significant amount of capital in illiquid real estate and forfeits the investment returns that capital might otherwise generate. For a high-net-worth individual accustomed to having their assets actively managed, this is an inefficient outcome.

What Is a Lombard Loan and How Does It Work?

A Lombard loan — also known as a securities-backed loan or portfolio loan — is a credit facility secured against a pledged investment portfolio rather than a physical asset. Instead of the property serving as collateral (as with a traditional mortgage), the borrower's existing financial assets do.

Here is how the mechanics work in the context of a European property purchase:

• The investor transfers an existing investment portfolio under the management of a registered asset manager — in this case, Amberlake Partners, based in Monaco.
• Amberlake Partners, as a SEC-registered investment adviser, can manage assets for US persons in a manner that satisfies the compliance requirements of European private banks.
• A European private bank with whom Amberlake has a working relationship then advances a credit line against the managed portfolio — typically 50–70% of the portfolio's value, depending on the asset composition.
• This credit line is used to fund the property purchase, either in full or to bridge the gap between the investor's available liquidity and the purchase price.
• The property itself may serve as additional collateral, further strengthening the credit structure.

The critical feature is that no new cash needs to leave the US. An existing portfolio — already invested and producing returns — is repositioned as collateral without being sold. The investor retains economic exposure to their investments while unlocking liquidity to acquire real estate.

Why Amberlake Partners' SEC Registration Matters

The central friction in cross-border lending to US persons is that European banks cannot easily manage assets on behalf of Americans without triggering significant US regulatory obligations. An investment adviser managing money for US clients must either be registered with the Securities and Exchange Commission (SEC) or qualify for a specific exemption.

Amberlake Partners is registered with the SEC as an investment adviser — a distinction that makes us one of a very small number of asset management firms based in Monaco and the South of France with this credential. This registration means that when a US client transfers a portfolio to our management, the arrangement is fully compliant with US securities law. European banks, in turn, can engage with that portfolio as collateral without inheriting the regulatory exposure they would face if they managed the assets themselves.

In practical terms, our SEC registration is the key that unlocks the transaction. Without it, European lenders have no compliant mechanism to accept the portfolio as security. With it, the structure works smoothly — and clients retain access to investment management, reporting, and advisory services that meet both US and European standards. You can view our SEC registration documents, including our ADV 2a Brochure and ADV 3 Summary, on the SEC's IAPD database.

What Assets Can Be Used as Collateral?

Not all portfolios are equal in the eyes of a private bank's credit committee. The quality and liquidity of the pledged assets directly determines the loan-to-value ratio offered and the cost of the credit line. In general, the following asset types are accepted — though specific eligibility depends on the partner bank:

• Listed equities — Blue-chip stocks and ETFs are typically accepted at 60–75% LTV.
• Investment-grade bonds — Government and high-grade corporate bonds are often accepted at 70–80% LTV given their lower volatility.
• Diversified funds — UCITS-regulated funds and certain US mutual funds are generally accepted, with haircuts applied based on liquidity and concentration.
• Structured products — Capital-protected notes and principal-guaranteed structures may qualify, subject to the issuer's credit rating.
• Private equity and illiquid alternatives — These are typically excluded or accepted only at very low advance rates, as the bank requires the ability to liquidate collateral in a stress scenario.

A well-diversified portfolio of liquid securities is the ideal collateral base. Amberlake Partners reviews each client's existing portfolio composition before approaching lenders, so that the credit proposal reflects the most competitive terms available.

Case Study: Financing a Spanish Villa Without Liquidating a US Portfolio

To illustrate how this works in practice, consider the following scenario — representative of transactions Amberlake Partners has facilitated for American clients.

A US resident identified a villa in Marbella, Spain, priced at approximately €3.8 million. Under a conventional approach, a European bank would have required a substantial cash deposit in a local account, a full income and tax documentation package acceptable under Spanish lending criteria, and likely a property-backed mortgage that few Spanish banks would extend to a US person without significant conditions.

Instead, the client transferred an existing US investment portfolio of €1.5 million to management under Amberlake Partners. No cash left the US — the portfolio was simply repositioned to a Monaco-based custodial account. Amberlake then worked with a European private bank to establish a credit line of approximately €1.1 million against the portfolio. Combined with the client's available liquidity, this was sufficient to complete the acquisition. The property itself provided additional security to the lender, and the portfolio continued to be actively managed throughout.

The client retained full economic exposure to their investment portfolio — dividends, growth, and rebalancing — while acquiring the property they wanted. The cost of the credit facility was significantly lower than a conventional mortgage rate, and the overall structure was simpler and faster to execute than a standard bank lending process would have been.

How This Compares to a Traditional Mortgage

For American buyers who have explored European mortgages, the comparison is instructive:

• Approval timeline: A standard European mortgage for a non-resident US person, where one can be obtained at all, typically takes three to six months and involves extensive documentation. A Lombard loan against a managed portfolio can often be arranged in four to eight weeks once the portfolio is in place.
• Documentation burden: Traditional mortgages require proof of income, tax returns, proof of local ties, and often a local bank account established for years. Lombard loans focus primarily on the quality and value of the pledged portfolio.
• Rate: Lombard loan rates are typically variable and linked to a benchmark rate (EURIBOR or SARON), plus a margin that reflects the credit quality of the collateral. In stable rate environments, this can be competitive with or below standard mortgage rates.
• Flexibility: Lombard credit lines can generally be drawn down and repaid flexibly, making them useful not just for property purchases but for managing liquidity more broadly across an investor's financial life.

The main risk specific to Lombard financing is margin call exposure — if the pledged portfolio declines sharply in value, the bank may require additional collateral or partial repayment. Maintaining a sufficiently diversified and liquid portfolio, and monitoring the loan-to-value ratio, is an important part of managing this structure responsibly. Amberlake Partners monitors client portfolios on an ongoing basis and advises proactively when collateral coverage requires attention. For more on how we approach ongoing portfolio oversight, see our article on the advantages of working with an independent external asset manager.

US Tax Considerations for American Buyers of European Property

US citizens are taxed on worldwide income, which means that owning European property — and financing it through a foreign account structure — creates reporting obligations that must be managed carefully. This is not a reason to avoid the transaction; it is a reason to plan it properly from the outset.

Key reporting considerations include:

• FBAR (FinCEN Form 114): US persons with foreign financial accounts exceeding $10,000 in aggregate value at any point during the year must file an FBAR. A portfolio managed by Amberlake Partners in Monaco qualifies as a foreign financial account for this purpose.
• FATCA (Form 8938): US persons with specified foreign financial assets above certain thresholds ($50,000 for single filers, higher thresholds for other filing statuses) must report them on Form 8938 as part of their federal tax return.
• Foreign real estate: Directly owned foreign real estate is generally not reportable on Form 8938, but rental income from such property is subject to US income tax, and capital gains on sale are taxable in the US (subject to applicable tax treaties).
• State taxes: Some US states impose their own tax obligations on foreign income and assets. This varies significantly by state of residence.

Amberlake Partners works in close coordination with clients' US tax advisors and, where needed, can recommend specialists in international taxation. We do not provide US tax advice directly, but we structure portfolio management and reporting to facilitate the work of your advisors. We provide detailed annual statements in formats suited to both US and European reporting requirements.

Which European Markets Are Best Suited for This Approach?

Portfolio-backed financing can be used to acquire property in most Western European markets, though the specifics of the transaction structure vary by jurisdiction. Among the markets most frequently sought by Amberlake's American clients:

• Monaco: The most restrictive real estate market in Europe by supply, but also the most stable. Portfolio-backed financing is well understood among Monaco's private banking community. For a full overview of the Monaco property market, see our guide to investing in Monaco real estate.
• France (French Riviera): Nice, Cannes, Antibes, and Cap Ferrat attract significant American buyer interest. French mortgage regulation is specific, but the Lombard loan approach sidesteps many of its complexities for non-resident buyers.
• Spain: Spain's golden visa programme (currently under review) and lifestyle appeal attract buyers; the Balearic Islands, Costa del Sol, and Madrid are particularly active markets.
• Italy: Tuscany, Umbria, Lake Como, and Sardinia see consistent demand from US buyers. Italian banking is conservative, making portfolio-backed financing particularly valuable here.
• Portugal: Lisbon and the Algarve remain popular; Portugal has a relatively welcoming banking environment but US clients still face FATCA-related friction.

If you are considering relocating to one of these markets rather than simply purchasing as an investment or holiday property, our guide to Monaco residency for high-net-worth individuals and our article on relocating to Monaco from the UK may also be relevant — the residency and financial planning considerations are closely intertwined.

The Process: What to Expect When Working with Amberlake Partners

For American clients considering this approach for the first time, here is a simplified overview of how Amberlake Partners manages the process:

• Initial consultation: We review your current portfolio composition, the target property, and your overall financial situation. This allows us to assess feasibility and identify the most suitable lending partner.
• Portfolio transfer: Your existing portfolio is transferred to a Monaco-based custodial account under Amberlake Partners' management. We coordinate this process with your current custodian and advisors.
• Credit facility arrangement: We work with our network of European private banks to structure and obtain a Lombard credit line against the portfolio. Terms — including advance rate, rate of interest, and covenants — are negotiated on your behalf.
• Property acquisition: The credit line is drawn to fund the property purchase, in coordination with the notary or conveyancing attorney handling the transaction.
• Ongoing management: Amberlake Partners continues to manage the pledged portfolio actively, monitoring both investment performance and the loan-to-value ratio on an ongoing basis.

Frequently Asked Questions

Conclusion

The barriers that Americans face when buying property in Europe are real, but they are not insurmountable. Portfolio-backed financing through a SEC-registered asset manager offers a route that is financially efficient, legally compliant, and practically achievable — provided the right advisory infrastructure is in place.

Amberlake Partners occupies a unique position at the intersection of US compliance and European private banking. As the only SEC-registered investment adviser based in Monaco, we bring the credentials and relationships necessary to make these transactions work — and we manage the ongoing complexities so that our clients can focus on the properties and the lifestyle they came to Europe for.

If you are an American investor exploring European property ownership, we welcome a confidential initial conversation to assess whether this approach is suitable for your situation.