Expat mortgages for UK property
If you get the chance to work abroad, it can be life-changing. But it can also have unforeseen consequences in relation to managing your property. From getting a mortgage as a returning expat to renting out your existing home while you’re away, you need expert advice.
That’s where Freelancer Financials comes in. As an experienced broker catering to expat buyers, our professional advisors can help you maintain your roots in the UK while your career blossoms abroad.
Securing a UK mortgage as an expat
When buying property in the UK, lenders will want to see evidence of:
- Your credit score
- Payslips and/or invoices, depending on your employment status
- Conversion of foreign earnings into GBP
- Your deposit and how it’s funded
- An active UK bank account.
When you consider that list, think about what relevant documents are available to you in the country you’re working. On the face of it, nothing you have relates to what the lender wants, but we can help you fit your square peg into their round hole.
Which mortgages are available to expats?
Expat buyers can access the following types of UK mortgage finance:
Residential expat mortgages
These are for expats planning to return to the UK or buying a property for family members. Consequently they are often taken out on a repayment basis, where the borrower repays both capital and interest. By doing so, the borrower would not have to repay a significant amount of capital on their return to the UK, for example if retiring.
Buy-to-let expat mortgages
A buy-to-let (BTL) mortgage is ideal for expats looking to invest in UK property while living abroad. In some cases, the BTL would simply generate income both before and after the expat returns home. In others, the borrower could be looking to move into the BTL property on their return to the UK. BTL mortgages are often taken out on an interest-only basis, with the capital amount due at the end of the term, so careful planning is required to cover the capital.
Expat lending criteria
Getting yourself prepared before you approach a UK lender is key to your success. Here we break down each component of an expat mortgage lender’s criteria, to ensure your application is successful.
Prevention is better than cure when it comes to your credit “health”. Keep a credit card and bank account live in the UK so you have at least a minimal credit history. You will need an active UK bank account from which to pay your new mortgage payments.
Expat mortgage deposits are greater than typical residential mortgages. You’ll need to find a minimum of 25%-35%, depending on your status and the home you’re looking for. This does have the upside of you having more equity in your home in the mid- to long term.
How does a lender equate what you’ve earned abroad to the UK cost of living?
They have to start somewhere. To meet their minimum criteria, lenders initially need documents showing:
- Your job/role and your employer
- Proof of how sustainable your income is
- Confirmation of the effect currency exchange rates potentially have on your income
There are then further conditions, depending on whether you’re employed or self-employed. In both instances, your income must be the equivalent of £25,000 GBP.
Then, if you’re self-employed, your accountant must have international accreditation/recognition.
Finally, if you’re a contractor, the lender will want to see a copy of your contract and evidence of your recent employment history.
If you’re employed, the payslips and references you provide must be translated to English. Depending on the country in which you work, this provide an extra barrier. Lenders also prefer you to work for a large-scale multi-corporate company, but have some flexibility here.
We're here to help
Got questions or need assistance? We’re here to help.
Whether you’re looking for mortgage advice, have specific queries, or just want to discuss your options, our expert team is ready to assist you. Reach out using the form here, and we’ll get back to you as soon as possible.
Let’s connect and start making your homeownership goals a reality.
To speak to an adviser, please call us on 020 8421 7999
Getting started with your expat mortgage
Not all lenders offer mortgages to expats purchasing property in the UK. Without expert help, finding the right deal can be difficult.
Our experienced advisors can arrange expat mortgages with specialist providers, offering more flexibility than mainstream lenders, for those moving abroad or planning to return to the UK.
