- April 22, 2020
-- Many expats move abroad and rent their flats or houses out, often not having had the time to advise their existing UK lender. Whilst not advised, as it can be a breach of the lender's terms and conditions, most UK lenders will be flexible for periods of less than a year and will offer a limited "permission to let," so a temporary solution can be put in place.
But what happens next? You could equally be facing the expiry of a permission to let, or the maturity date for a fixed or discounted loan, so you need to take action to avoid being moved automatically onto your lender's standard variable rate, some of which are running at over 6% at present, whilst UK Base Rate is at just 0.1%. If the COVID -19 pandemic has highlighted one mortgage issue, it might be how to enquire about an expat remortgage (https://www.offshoreonline.org/
form/) during lockdown.
Guy Stephenson, a director of expat mortgage brokers Offshoreonline
explains, "Most UK high street lenders cannot offer expat mortgages (https://www.offshoreonline.org/uk-mortgages-for-expats/
) to customers living abroad – expat lending is a specialist lending field. The job of an expat mortgage broker is therefore to find lenders who can support you with the correct expat mortgage, which will also depend where you are living, while you are resident and working abroad."
If you are a customer of one of the lenders who do offer expat mortgages, you will most likely be offered a follow on product, so the problem is solved. But if you are a customer of one of the major high street banks such as Santander or Lloyds International, these do not currently offer expat solutions via their onshore networks.
Applying for an expat buy to let mortgage can be straightforward, once you have identified a lender who can help. Each lender now has their own individual underwriting, so whilst some will accept e.g. Australian residents, many will not, some will be happy to take Saudi residents, others not. If you live in an active or former warzone, the number of lenders who can help will be very small indeed. The point about expat brokers is that they should only offer loans from companies which they know can support you. Expect to be asked to prove your identity with a certified copy of your passport, prove your address with a utility bill and provide evidence you are have an income, as well as up to date statements for all loans you hold. Thereafter, the process can be fast and completed online or over the phone, with original signed documents being sent at the end.
Should you return to the UK, you can always convert your UK expat buy to let mortgage back into a main residential loan, subject to the conditions in force at the time.