Time, tide and the (almost) constant march forward of the UK property market, wait for nobody, which is why it is perfectly understandable for those moving overseas, whether permanently or temporarily (on a short- or long-term basis), will want to maintain an investment position in it, often by means of buy-to-let. While this can be a challenge it is possible. Here are four key points to understand in order to make it happen.
Even if you already own your own home, you will need to change to an expat mortgage
If you are an owner-occupier then you will have a residential mortgage. If you then move out of your home to let it out, you will need to switch to a buy-to-let mortgage and if you’re moving overseas you will need a BTL mortgage which is suitable for expats. You will also need to change your insurance to landlord’s insurance and again make sure your insurer is aware that you are overseas. If you are a forgetful person and you think it might slip your mind to do either or both of these, then make a note in your diary as you could be in a whole world of pain if either your bank or your insurer finds out that you have moved overseas without telling them.
It can help a lot if you are paid in pounds
Given the amount of press coverage it has generated, you are probably already aware that mortgage lenders are under much greater scrutiny than they used to be and that there is a much higher level of emphasis on looking at the issue of long-term affordability rather than simply looking at a (potential) borrower’s income. This can be a tricky one for lenders to manage when dealing with borrowers in the UK, it becomes even trickier for them when they need to start thinking about the potential for currency fluctuations as well. Therefore if you have a choice between having your salary paid in the local currency or paid in pounds, you may well want to give serious consideration to the latter to relieve one potential issue with mortgage lenders.
If you only have family living in your property you may qualify for a residential mortgage
Assuming the relationship between you and the family members in question is non-commercial, i.e. they’re living there without paying you rent, then you may be able to get a residential mortgage even as an overseas resident. Your best bet for these is usually with banks which have an international presence such as HSBC, Santander and Nat West International. In principle the assessment criteria for expat residential mortgages is the same as for their domestic counterparts, however again you need to remember to account for exchange rates and the cost of living where you are.
Remember the basics of mortgage applications
If it’s been a while since you last (re)mortgaged, you may have forgotten the extent to which it’s about taking away reasons to refuse. Standard advice to first-time buyers is to make sure that their credit record is sparkling clean and that they’ve ticked off basics like being on the electoral roll and including a landline telephone number if possible. This applies to those already on the housing ladder, particularly those in unusual situations such as people applying for expat mortgages.