The Ipswich Building Society has revised its expat residential mortgage lending criteria to now allow applications from British nationals living overseas whose deposit has been saved in their current country of residence.

Up to now, the entirety of the applicants’ deposit for the purchase had to be held in a UK-based bank account for a minimum of six months.

Foreign currency deposits will be accepted on purchase and re-mortgage products for both residential and buy to let products for properties located throughout England and Wales. Applicants can apply directly or via intermediaries who are either based in the Society’s ‘heartland’ area or members of selected networks and clubs.

The change is aimed at supporting more British nationals who live overseas and follows the product refresh earlier this year which extended the terms for residential applications to include those who are paid in one of ten selected foreign currencies.

The deposit must be held in an account in the name of either of the applicants (or a joint account in their names) and the applicant must provide evidence (in English) of the build-up or source of the deposit i.e. by providing savings/bank statements, evidence of a previous property sale etc.

Applicants for residential mortgages must be paid in one of the following currencies: GBP, Euro, Swiss Franc, Norwegian Krone, US Dollar, Canadian Dollar, Singapore Dollar, Hong Kong Dollar, UAE Dirham, Kuwaiti Dinar, Qatari Riyal and applicants must be employed by a recognised international employer (i.e. a large multinational firm).

Buy-to-let applicants can be paid in any currency as the rental income is used to assess affordability. Deposits must be from the applicant’s own resources (no gifted deposits accepted) and the funds must be transferred to a UK-based bank account in the name of either of the applicants (or joint account in both their names) prior to application.

Fixed and discount options are available on a two-year basis plus a five-year fixed rate is available. Residential products are available up to 80% loan to value (LTV) and buy-to-let at 75% LTV. Loans are available from £75,000 to £500,000 with a maximum term of 40 years. There is no maximum age limit and new build homes will be considered.

Residential applicants must have a minimum income of £40,000 GBP or equivalent, and employed, self-employed, pension and investment income will be considered when assessing affordability.

Can we help?

If you are looking for a new or re-mortgage please do make contact and one of our qualified independent advisers will be happy to assist.

As an expat whatever reasons you may have for considering purchasing a house or flat in the UK, the good news is that there are lenders who are more than willing to offer expats a mortgage. Many providers don’t even advertise the fact. 

Certain parts of the country are stagnating in terms of increasing but overall the UK market is as vibrant as ever. There is still a lack of housing which makes the buy-to-let market very attractive to expats who want a foothold in the UK and achieve a return on their capital. If you look at the interest rates on offer at the major banks it’s little wonder why expats don’t see savings as a way forward.

Brexit has not deterred expats from buying in the UK, in fact since the vote activity has increase by 13%. After the referendum the industry feared expats would hold back purchasing but that has not been the case. 

The expat mortgage market is very complex, and you should seek professional advice as to what product best meets your needs. We have a select number of companies offering very favourable rates which are tailored to suit most needs, including buy to let.

Items you will need to apply

• Deposit available
• Certified proof of address
• Certified ID (Passport)
• Bank statements (Normally 6 months)
• Wage slips (Normally 6 months)
• Certified accounts if self-employed.

These requirements vary from lender to lender and the above is just to give you a guide to help speed up the process. Contact us for any assistance you may require.

Can we assist you?

If you are looking for a new or re-mortgage do get in contact and one of our qualified independent advisers will be happy to help.

The market so far has been largely unmoved by Brexit. Lenders have continued to drop interest rates across the board since last summer which indicates a lack of concern currently. There seems to still be a large appetite for banks to lend. The rates are very competitive and there are still plenty of high loan-to-value mortgages available to consumers.

If anything is to bring this to halt then it would be the Bank of England base rate rising. If the bank were to raise rates from 0.25 per cent to 0.5 per cent, the impact would be greater than just a rise in mortgage repayment, because inevitably confidence will take a hit. Yet so far, there have not been any firm indications that this is the way the Bank of England wants things to go.

If you are an expat with a mortgaged property in the UK now is a great time to lock in a new deal for the next few years and make the most of the low rates on offer.

Expats re-mortgaging for value

Expat re-mortgaging levels have soared to an eight-year high in September as borrowers take advantage of lower monthly repayments the latest figures have revealed.

The value of re-mortgaging fell due to a drop in the average loan size, but with overall mortgage activity down it still accounted for two-fifths of total lending in September

Expat borrowing activity has been fuelled by the lower rates on offer, rates currently are the lowest they have been for the last 7 years.

Expats who have not reviewed their current mortgage deal recently would be well advised to do so as rates are expected to rise in the future.

Help required?

If you would like to review your current mortgage please do make contact and one of our fully experienced independent advisers will be happy to assist.

The Bank of England has voted 7-2 to hold the base rate at 0.75% in the first split interest rate decision since June 2018.

MPC members Jonathan Haskel and Michael Saunders both voted to reduce the base rate to 0.5%.

The industry was not surprised by the decision to hold the rates.

Frances Haque, chief economist at Santander UK, said: “The decision to hold rates was widely expected, given the delay to the Brexit process and ahead of the general election due on 12 December.

“The economic data published so far for the third quarter of this year suggests the UK economy has returned to growth, although many of the fundamentals such as business investment and productivity remain weak.

“Given this, the MPC is clearly standing by its cautious approach.

“Unless there is a sudden downturn in the UK economy over the next few weeks, it’s unlikely we’ll see a change in rates this year with the MPC likely to wait until the outcome of the General Election is known.

“However, if Brexit is postponed again, continuing the uncertainty, the MPC may wish to act to bolster the economy.”

Alex Maddox, capital markets and digital director at Kensington Mortgages, added: “It’s not a great surprise to see that the Bank of England has kept the base rate on hold at 0.75%.

“Brexit extension after Brexit extension and now a December General Election mean that the bank is going to want to keep its powder dry.

“In the current environment, it would have been a very hawkish move to cut rates.

“While future decisions will very much depend on the nature and timing of Brexit, it now looks increasingly likely that a rate cut may happen in the new year to support the economy if Brexit is delayed again and this impacts businesses and investment.”

Help with your expat mortgage?

Please do make contact and one of our expert independent advisers will be pleased to assist.

Expats using speExpatriates looking for a mortgage or re-mortgage on a property in the UK now have a wider choice of loans than years gone by, so it makes sense to select the best one to suit your needs.

About five million UK nationals live overseas, and many are keen to hold on to a home in the UK, or to invest in one to rent out. But the available mortgage options are quite restricted – and in most cases, you’ll need to get a specialist landlord mortgage.

It is possible to secure a standard residential home loan as an expat, but it’s tricky to arrange, lenders will want to see evidence that close family are living in the house. Since most expats work abroad and cannot live in two places, for the majority, a buy-to-let is the more appropriate solution.

You will typically need to seek out a specialist lender and this is where the expat broker can assist you in making the correct choice.

It can be a difficult process to secure a mortgage when clients are overseas, especially with the time difference and tighter lending criteria.

Another factor is the European Mortgage Credit Directive, introduced in 2016, which means individuals paid in a foreign currency now come under closer scrutiny when their loan applications are assessed. The underwriting process needs to take account of possible exchange-rate fluctuations, as well as looking at a borrower’s overall financial position.

What a broker will do for you

The broker will take control of the mortgage process, therefore relieving you of the stress and paperwork. They will be able to deal with the mortgage company suppling the loan and answer any queries they may have, saving you time and money.

Help required?

If you are an expat looking for a new or re-mortgage, please do get in touch and one of our fully qualified independent advisers will be happy to assist.