Good news for expats wanting UK mortgages

Published:  28 Feb at 6 PM
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After several years of being left out in the cold by UK mortgage providers, expats hoping to purchase a home in their country of origin may now get a result.

UK buyers living overseas have been ineligible for mortgages from high street building societies and bank for some time, with the only answer being to engage an specialist international mortgage broker who knows the ropes as regards the handful of lenders still in the market. Most specialist brokers regard the sector as buoyant but severely overlooked by the mainstream lenders.

However, changes may well be in the wind, with evidence emerging that conventional lenders are now dipping their toes into the untapped waters of expat mortgages. Experts believe the reason is the increased competition between high-street lenders for the dwindling domestic market.

Three new lenders are now offering mortgage loans to expats of diverse nationalities wishing to purchase a main residence or buy-to-let. Two are regional building societies and the third is an upscale international bank aiming and wealthy would-be buyers of exclusive Central London homes.

Expats working in Australia and Saudi Arabia are the most favoured, with the banks now willing to lend on suitable properties. For UK building societies, joining the rush for overseas mortgagees seems like a sensible move, as most have always underwritten mortgages individually and have a clear grasp of each applicant’s risk profile.

Should 2014 be the year in which the tide turns for expat property buyers, it’s still important to search out the best rates on variable loans as well as their fixed alternatives. At the present time, main home variable rates run around 3.14 percent, and a 20 per cent deposit is required.

For buy-to-let properties, rates begin at 4.99per cent with a 40 per cent deposit, whilst a 25 per cent deposits gets you 5.13 per cent. A UK expat on a fixed, tax-free contract overseas has to be an attractive proposition for any bank.
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