Mortgage rates have plummeted since January, but would-be expat borrowers and re-mortgagers are being urged to strike now to take advantage of the competitive market.

Whether you are borrowing using a two-year deal, a five-year fix or even locking into a long-term 10-year fixed rate, prices are more attractive now than they were in January.

Indeed, the data analysts, revealed those borrowing money for their home using an average two-year fixed-rate mortgage this month will have paid an average rate of 4.2% compared to the 4.45% they would have been charged in January.

Five-year fixes, meanwhile, have fallen from a typical 4.33% in January to 4.1% today.

In fact, it’s much better to be a borrower than a saver as whilst prices are falling on mortgages, when it comes to savings the interest rates on offer have fallen since January too.

Borrowers urged to fix soon

The message from experts, for expats who might be waiting for prices to go down further, is to consider fixing their mortgage soon to take advantage of the deals currently on offer.

Interest rates are currently low but how long this trend will continue with Brexit looming is anyone’s guess.

Expat first-time buyers should keep a close eye on their finances and be mindful that with house prices on the rise in the UK, their dream of getting onto the property ladder may be further away than first thought. While interest rates are a convenient measure to compare deals, it is important that borrowers consider a mortgage based on the overall true cost, particularly to save on any upfront fees.

Seeking out independent financial advice is a good idea to navigate the mortgage minefield.

Can we help?

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

SThousands of expat borrowers could be missing out on a better mortgage deal by not speaking to an independent adviser, research has found.

The survey of over 1,000 expats revealed that 31% who went direct to a lender didn’t understand how a independent mortgage adviser could help with their search.

The findings also showed that 69% of borrowers who went straight to a lender hadn’t re-mortgaged in the last five years, while 74% stayed put because they felt they had a ‘good deal’.

Without seeking independent mortgage advice, individuals would have missed out on the extra mortgage deals that are only available through a mortgage adviser.

The analysis showed that the mortgage industry still needs to demonstrate the value of independent mortgage advice to expat borrowers – just 30% of those who went direct to the lender said that they would likely speak to a mortgage adviser next time.

Meanwhile, 60% who didn’t seek advice when they took out their last mortgage didn’t know mortgage advisers were there to help the borrower, and just over a third (34%) thought a independent mortgage adviser was there to support the lender.

What’s more, borrowers going through a mortgage adviser have access to far more mortgages than those going direct to the lender.

Expats who benefitted from a mortgage adviser searching the market for the best mortgage deal were more likely to have switched in the last five years (29%), compared to just one in five (19%) of those who went direct.

Expats who used a mortgage adviser were also in favour of doing so again. Nearly all (98%) said that they found the support of a mortgage adviser ‘valuable’ and a further 95% said they would recommend using an independent mortgage adviser to family or friends.

Can we help?

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

OIf we put Brexit to one side for the moment, there are many expats originally from the UK looking to acquire property in their former homeland. The value of sterling has fallen since the 2016 referendum on the EU and even though it has made a short-term recovery, the real spending power of the euro and dollar has increased significantly. However, how hard is it to obtain an expat mortgage?

Criteria

There are a number of items to take into consideration when looking at expat mortgages. These include

• Proof of income
• Using assets as security 
• Credit history
• Identification and address

Proof of income

If you are employed by an international company, with a footprint in the UK, this is probably the Holy Grail for lenders and borrowers. You will likely be paid in sterling, have a good track record and be able to prove your income. The situation can be different if you have your own company, you are self-employed, or you are paid in a foreign currency.

Credit history

In many ways creating your own credit history in the UK is something you can begin well before you make an expat mortgage application. For many expats, in the far-flung countries of the world, there may not be a credit history system and even if there is, it may not be as accurate as its UK counterpart

Expat market is expanding daily

Immigration was a major issue during the EU referendum and while much focus was placed upon European citizens working in the UK, there are many UK expats living the length and breadth of the globe.

 Can we help?

As expat mortgage specialists we offer a much-valued service to our client so please make contact if we can assist you.

Figures very pleasing for expat property owners

House prices in the three months to April were 5% higher than in the same three months a year earlier, a robust and surprise increase in a market that had been considered muted.

The average UK house price now stands at £236,619.

On a monthly basis house prices were up by 1.1% in April, compared to a fall of 1.3% in March.

Are buyers throwing off the Brexit shackles, or is the recent volatility in the monthly data indicative of something else?

Skewing the figures

This month’s figures were driven by a higher volume of London sales and more expensive new build properties.

In a market where stock and overall transactions are lower, any change within the make-up of the data can have a disproportionate effect and skew the figures.

The index has already come under scrutiny this year after months of erratic monthly growth figures. These can be sprightlier than the smoothed annual and quarterly numbers, but even so, they’ve been turning heads with the extremes with which they have been moving.

By this measure for April, the housing market is still comfortably making money for homeowners in real terms.

One explanation for ricocheting growth figures like this is persistently low stock levels. In sought after areas, this can lead to demand being supercharged one minute and gone the next, with price rises coming in waves as brief competitions for limited numbers of homes come and go.

Long-term growth

What is reliable is the longer-term growth trend. It’s now 10 years since the lowest point of the house price index in the wake of the financial crisis in April 2009 – and average prices have bounced back. Over the past decade annual house price growth has seen the average price increase by £81,956, or an average rise of 4.3% each year.

In need of some guidance?

Can we be of assistance with your new mortgage/re-mortgage we have fully qualified independent advisers waiting to help you.

Mortgages with five-year fixed rates have undergone a surge in popularity within the expat community, nearly half of the completed deals recently have been for 5 years or more.

Data revealed 49% of expats are now choosing an initial fixed rate period of five years compared to only 25% back in 2013.

Meanwhile, mortgages with rates fixed for two years have experienced a plunge in popularity with 37% of customers choosing the shorter-term fixes compared to more than half in 2013.

Mortgage brokers think the fact the Bank of England base rate is currently low, coupled with fears over future rate rises, is main driver behind the soaring popularity of five-year deals, which allow customers to lock into a specified rate for a longer term.

Potential pitfalls of five-year deals

While they provide a certain amount of security, five-year fixes aren’t necessarily for everyone. Indeed, several of those questioned in the survey of 200 mortgage intermediaries raised concerns.

They stressed that products with a longer term initial fixed period might only suitable for customers who expected to stay in their current home for an extended period. This was because anyone considering a house move might have to pay early redemption penalties which could outweigh the benefits of a longer-term deal.

Low interest rates, economic uncertainty around Brexit, a reduction in home-mover transactions and more re-mortgaging means that five year products have become a viable option for a much larger proportion of customers.

Outlook

Going forward, the brokers questioned, did not see any reason for five-year fixed rates to fall out of favour.

However, many said a stable economic climate post Brexit, which could lead to an interest rate rise, was the most likely cause of any reduction in the attractiveness of the five-year fix.

In need of some guidance?

Can we be of assistance with your new mortgage/re-mortgage we have fully qualified independent advisers waiting to help you.