We are seeing an increasing amount of mortgage lenders accepting a mortgage with applicants being paid in non-sterling currency but wanting to secure a mortgage on a UK property or re-mortgage with an existing lender.
This article will go through common scenarios lenders look for, the challenges you may face, and important things to consider before applying. Please note we only offer mortgages for investment buy-to-let purposes.
What Are The Common Scenarios For UK Expats Looking To Secure A Mortgage With Foreign Income?
- You’re working and living abroad, earning in a foreign currency, and want to buy an investment property in the UK.
- You’re currently living in the UK, but are being paid in a foreign currency
- You have no plans to return to the UK and are living and working abroad
- You’re applying for a joint mortgage and you or your partner are working overseas but flying back on a regular basis.
What Do Lenders Look For, And A Few Reasons Why It Can Be Difficult To Get A UK Mortgage As An Expat?
The level of risk is the main factor lenders look for when assessing eligibility for applicants. As a non-resident, lenders may find it difficult to obtain all the information needed from your employer, establishing a proper credit footing and external economic factors including exchange rate fluctuations. Below are four red flags lenders will consider.
-Your credit history isn’t traceable- This could be due to spending time in a country where financial data on an individual is not readily available because credit rating agencies do not operate there making it difficult for lenders in the UK to establish the applicant’s financial track record.
-You don’t appear settled- Your Mortgage Lender will ask for proof of income and an address history during your application. If you have multiple jobs and addresses over a few years being a globetrotter this could sign as a flight risk!
-Your main source of income- If your main source of income is earned abroad, it is not a deal-breaker but lenders will be more meticulous about gathering all the necessary paperwork to prove your income is legitimate and secure.
-You are too old- Apply for a Loan that will be paid by the time you reach 70.
How Much Can Expats Borrow For A UK Mortgage?
The amount you can borrow will depend on various factors as you would expect for any mortgage application; quality of security, rentability, and overall affordability which covers income and all types of expenses including priority and non-priority debts. The majority of mortgage lenders offer up to 75% Loan to Value.
How Much Do I Need To Earn To Get An Expat Buy to Let Mortgage?
Lenders typically ask that the minimum income of an applicant for a Buy to Let mortgage be £30,000 or more.
There are some lenders who require income to be paid in a UK bank account, however, there are lenders out there that are happy to accept income paid in a foreign bank account. If you’ve been turned away by one lender there are others that could help as criteria differ between lenders.
What Are The Acceptable Deposit Sources For An Expat Buy To Let Mortgage?
- Savings on account (This can be UK or overseas savings depending on the country
- Investments (Stocks or shares held in the UK or abroad)
- Sale of property (UK & Overseas)
- Equity in another property
- Gifted Deposit from a relative, friend or third party
What Are The Things To Consider Before Applying For A UK Expat Mortgage?
- Proof of Income
Before submitting an application to a lender, you will need the following documents to hand:
- Your Employers details
- At least 3 months’ payslips
- Address of the property you are interested in Buying
- Personal details including personal details
- A letter from an accountant and a recent Tax Return
- Translated Documentation
The majority of lenders require to have all documentation submitted translated into English which should be completed by a professional translator.
Which Currencies Are Acceptable To UK Mortgage Lenders?
It is possible to get a UK mortgage based on income from the following countries around the world, find below a list of currencies that are generally acceptable.
Hong Kong Dollar
This article provides an overview of investing in property in the UK, it does not constitute advice and should not be used to make financial decisions. You must always seek advice from independent financial specialists when making major financial decisions.