Case Study: Foreign National Buy to Live Mortgage
Our client – a US national living in the States with no familial ties to the UK – wished to purchase a two bedroom flat in Colindale, where he planned to live during the months that he would be working in the UK each year. There were three main obstacles to our client’s aspirations: firstly, it was necessary that he account for the running of two houses, because, in addition to the flat he was hoping to purchase in the UK, he also owned a property with a mortgage in the US, which had to be factored into the affordability assessment for his second mortgage. Secondly, our client was paid in US dollars, which disqualified him from the consideration of certain lenders. And finally, many lenders are reluctant to offer buy-to-live mortgages to foreign nationals because they believe that foreign mortgage holders will let out their property regardless of their stated intentions. It was therefore necessary to locate lenders who were willing to take our client’s stated intentions at face value.
We were able to obviate the first of these difficulties with relative ease, because our client’s income was of sufficient size as to convince most lenders of his ability to run two properties at once. In addition, while some lenders are reluctant to accept foreign income in their affordability calculations, there are many others who are perfectly happy with an overseas income source. The final hurdle created the greatest difficulty, because there is no sourcing system available for expat or foreign national mortgages of the type desired. Having worked out which lenders would be receptive to mortgage seekers with a foreign income stream, we then chose to send out an anonymised summary of our client’s situation to a number of lenders who have proved open to clients with similar profiles in the past. A number of lenders were responsive, and we were able to secure our client a competitive mortgage of the amount he desired.
We were able to secure our client a 5 year fixed repayment mortgage of £315k with an LTV of 75% and a rate of 3.65% and a monthly mortgage payment of 1,863.69.