Expatriate Mortgage

Summary: UK nationals living abroad who require an expatriate mortgage to continue, extend or renew the finance on a principal residence that they still own in the UK or for the purchase of single or multiple buy-to-let properties in the UK are fairly well catered for.

UK nationals living abroad who require an expatriate mortgage to continue, extend or renew the finance on a principal residence that they still own in the UK or for the purchase of single or multiple buy-to-let properties in the UK are fairly well catered for among high street and specialist lenders, as are EU nationals wishing to purchase in the UK.

There are also specialist mortgage lenders who can raise finance for those looking for an expatriate mortgage in the US, Australia and other countries with an established real estate and property finance market…but the terms that have to be accepted and the criteria that have to be met can vary massively from country to country and lender to lender.

Expatriate mortgages can be fairly restrictive, for example they are usually only available to citizens of the country in which the property is to be purchased – i.e., a UK citizen living in France who wishes to re-mortgage his old family home back in London.  The majority of lenders will stipulate that at least one of the mortgage applicants is a holder of the given nation’s passport and that the money being applied for is for the purchase or re-finance of real estate in the given nation. 

Those who live abroad who wish to purchase property in a country other than the one in which they reside or are a domiciliary of will struggle to raise the finance directly and may be better off examining equity release opportunities.  One exception is the UK where there are some lenders in the UK who allow expatriates who hold an EU passport to apply for an expatriate mortgage to purchase real estate in the UK.  However, generally the more complicated the circumstances the higher the arrangement fees.

Those expatriates interested in purchasing buy to let property either in the country in which they reside or in which they are domiciled should find the process of finding a potential lender fairly straightforward particularly if they are British domiciled and wish to purchase buy to let real estate in the UK.  There are a number of lenders, the latest of which is the Derbyshire Building Society, who have released expatriate buy to let mortgage products. 

The product on offer from the Derbyshire, the latest lender to join the ranks of those offering such finance to British expats has a fixed interest rate of 5.25 percent until 2009 after which the mortgage interest rate will track the BoE’s base rate plus one percent.  Other lenders willing to consider expatriate mortgage related finance include the Bank of Scotland, Cheltenham and Gloucester, Dresdner Bank, Fortis Bank Group, the Halifax, HSBC Offshore Banking and the Portman Building Society.

There are also specialist expatriate mortgage and international finance brokers who can assist with securing mortgage and re-mortgage products for expats living around the world.  Anyone considering using such a brokerage should ensure the company are authorised and regulated by the correct compliance body for the country in which they operate (for example it is the FSA in the UK), and also check out any fees and charges that you may be liable for for the arrangement of finance to purchase property.

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