The amount you can borrow with an expat residential mortgage depends on your deposit size and income, with lenders typically offering loans between 3 to 5 times your annual income.

Various factors impact borrowing, including employment history, existing debts, credit history, dependents, and overall outgoings.

For buy-to-let properties lenders use rental stress tests to assess whether the rent sufficiently covers mortgage interest payments. Some also consider your overseas income, country of residence and existing financial commitments.

As lenders use different calculations and criteria, the amount available can vary considerably. We compare these requirements to help establish your borrowing options.

Choosing the ideal mortgage for expats relies on individual circumstances, such as opting for fixed-rate, tracker, interest-only, or repayment mortgages.

Due to the complexity of expat situations you should discuss your situation with a mortgage advisor, and they can recommend the best type for your situation.

Expat mortgage rates are generally somewhat higher than standard mortgage rates, reflecting the added risk lenders take on with borrowers residing overseas.

The duration to secure an expat mortgage varies based on individual circumstances. Generally this could be between 2 and 6 weeks.

If you are moving abroad and intend to let out your property, you should inform your mortgage lender.

Many UK lenders are open to approving consent to let for individuals moving overseas for work, though they typically prefer not to extend this consent for prolonged periods, such as beyond two years.

Should your current lender deny consent to let due to an extended stay abroad, considering a remortgage to an expat buy-to-let mortgage with a lender that offers expat mortgages might be a suitable alternative.

The majority of expat mortgages can permit borrowers to make capital overpayments, generally this is up to 10% without penalty.

If you plan to move abroad and intend to rent out your existing home, you’ll need to remortgage your existing residential property as a buy-to-let. This will be considered a expat buy to let mortgage.

Expat mortgages often come with heightened scrutiny from underwriters due to the perceived increased risk. Here are key aspects lenders will evaluate:

Credit History: Extended periods abroad can complicate credit history checks for UK lenders, possibly necessitating an adverse credit mortgage or a period of credit improvement upon returning to the UK. Usage of a UK-based credit card may be advantageous.
Income Verification: Lenders need assurance of your ability to repay the mortgage, looking at your income closely. Verifying overseas income can be challenging, but an expat mortgage broker can provide guidance.
Employment Status: Stability of income through employment is crucial, with lenders requiring proof. While working for a globally known company is beneficial, it’s not mandatory. Pay slips and income evidence, potentially needing translation into English, are required. Some lenders might also prefer income history through a British bank account.
Self-Employed Income: Mortgage application for self-employed individuals, especially expats, involves complex verification processes. Your income must be validated by a globally recognised accountant, meeting standard self-employed mortgage criteria.

Additionally, lenders may have unique assessments. Consulting with a mortgage advisor like Kerr & Watson, familiar with your preferred lender’s procedures, can streamline the application process.

To secure an expat mortgage, a traditional starting point has been a deposit of 25% of the property’s purchase price.

However for a second home residential mortgage, the specific deposit required can widely vary based on the lender, the location of the property, your financial situation, and the type of property you’re considering. While some lenders may offer expat mortgages with as little as a 10% or even a 5% deposit, such options are relatively uncommon. If possible, getting a larger deposit can be advantageous, granting you access to a broader range of mortgage deals and potentially reducing the overall cost of your home.

International anti-money laundering regulations impose stringent rules on the sources of your mortgage deposit, requiring you to clearly demonstrate the origin of these funds.

Acceptable sources typically include savings, earnings from investments, proceeds from selling another property, released equity from an existing property, inherited money, or gifts from immediate family members.

You can get an expat mortgage with bad credit, though it introduces additional challenges, potentially complicating and increasing the cost of the process.

Working with an expat mortgage advisor like Kerr & Watson is advisable; we can assist in selecting the most suitable mortgage option, considering your credit history to identify lenders more likely to approve your application.

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