Customers often get in touch with us because they’re looking to buy property in another country.
This type of product is referred to as an “offshore mortgage”.
This article is going to cover how UK offshore mortgages work, who they’re suitable for, eligibility factors, and what to look out for if you’re buying property in the UK via an offshore company.
Is an offshore mortgage the right product for me?
The expert advisors we work with have arranged offshore mortgages for various types of customer, including foreign nationals, UK expatriates, and those who simply wish to make a UK mortgage application based on foreign income.
Generally speaking, this mortgage product is most appropriate for customers’ whose main income comes from outside the UK, or for those who are not a UK resident for tax purposes.
Offshore mortgages are available for those seeking a residential UK property to be used by themselves or family members when visiting the UK. There are also options available for customers seeking buy to let investments.
Speak to an expert on offshore mortgages
What to look out for if you’re after an offshore mortgage for a UK property
Whenever you purchase property overseas, it is inevitable that the process will be slightly more complicated than getting a mortgage in your native country.
Securing an offshore mortgage can be very complex, so ensure to seek legal advice from a lawyer who is familiar with UK property law, fluent in both English and the native language, and independent of everyone else involved in the deal.
Also, be sure to consider the following:
Tax liability on foreign mortgages for UK property
While offshore mortgages can be very tax-effective for some, you should always take personal tax advice because the process can be very complicated. The smallest oversight could have big (not to mention expensive) consequences.
Check the paperwork thoroughly
Read through any legal documentation and contracts thoroughly. Your mortgage broker and lawyer can do this on your behalf to make sure that you have the correct permissions, licences and planning consents in place before you sign anything.
Exchange rate changes
Even a small change to the exchange rate could significantly affect the value of your property, and your mortgage payments. A drastic fluctuation could result in your mortgage becoming unaffordable overnight.
To prevent this from occurring, all lenders are under obligation to tell you if the exchange rate fluctuates by more than 20%, in which case you’ll have the option to repay the mortgage in another currency.
Can I get an offshore buy to let mortgage?
One of the most common reasons people seek an offshore mortgage is for a buy to let (BTL) property. After all, if you’re based overseas for the majority of the year, a BTL is a good investment opportunity considering the cost of UK living.
We have access to a number of specialist brokers, both in the UK and overseas, who offer offshore mortgage services for those looking to invest in BTL property in another country.
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Our advisor was amazing from the start!
Aaron went above and beyond. He worked late and kept in contact with me and worked tirelessly to find me the best mortgage he could
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Are there self-cert offshore mortgages?
Self-certified mortgages let you specify how much you earn when you apply without having to back up your claim with documentation.
They were originally aimed at borrowers who find it difficult to prove their income, such as the self-employed, those who need to apply for a mortgage based on bonuses or commission, or borrowers who have a number of different sources of income.
Although they have been banned in the UK, if you’re taking out an offshore mortgage on UK property, you may find that your native country has more flexible rules surrounding self-certs.
Offshore mortgage affordability requirements
Being able to prove your mortgage affordability is a key requirement of all lenders. But as established, lending criteria varies by country as well as by provider.
For example, lenders in certain countries may accept self-cert mortgages, others will not. Some are happy to lend you a multiple of your income without question, whereas others carry out additional assessments.
What else impacts my eligibility for an offshore mortgage?
Residential offshore mortgages tend to be capped at around 75% LTV, although some lenders may be slightly more generous depending on your country of residence and your individual circumstances.
For example, a history of adverse credit on your record may restrict the numbers of mortgage providers willing to lend to you, meaning you could be offered less favourable rates and be required to put down a larger deposit.
You can find out more about how each of these factors can affect your mortgage application by clicking the links above.
How to get the best offshore mortgage rates
This product is so niche that there are very few offshore mortgage lenders out there – it’s not something your typical high street bank is likely to offer. That’s why it’s so important to seek advice from a whole-of-market broker such as the ones we work with.
They can help you find the right offshore mortgage lenders
Because they have access to such a large range of lenders covering almost every niche imaginable, they can put you in touch with all the specialist offshore mortgage companies and providers who are willing to consider your mortgage application.
Not only does this mean that you’ll have an expert on hand to guide you through the whole process, it also ensures that you will receive the most competitive offshore mortgage rates given your circumstances.
We're so confident in our service, we guarantee it.
We know it's important for you to have complete confidence in our service, and trust that you're getting the best chance of mortgage approval at the best available rate. We guarantee to get your mortgage approved where others can't - or we'll give you £100*
Why speak to the offshore mortgage brokers we work with?
We’ve helped over 120,000 people find the right mortgage, even for buyers who have been declined a mortgage or have a bad credit history.
In fact, our customers consistently rate us 5 stars on Feefo, mainly due to our high levels of service, but also because we offer offers a 5-star service with access to expert brokers who:
- Are whole-of-market.
- Can offer bespoke advice to customers buying in the UK or overseas.
- Have a working relationship with all lenders, including those who offer offshore mortgages.
- Already know the lenders to go to as they have successfully arranged offshore mortgages on UK property.
- Are OMA Accredited advisors.
- Have completed a 12 module LIBF accredited training course.
Talk to an offshore mortgage expert today
If you require more information on how to go about getting a foreign mortgage for UK property, and to find the best interest rates for your circumstances, call Online Mortgage Advisor on 0808 189 2301 or make an enquiry.
Then sit back and let us do all the hard work in finding the broker with the right expertise for your circumstances. We don’t charge a fee, and there’s no obligation or marks on your credit rating.