Wondering if you can get a mortgage as a foreign national in the UK?
It is possible to get a foreign national mortgage if the lender’s other lending criteria is met.
Getting a mortgage is hard as a British national working and living in the UK. However, it gets even more complicated if you still need an ILR or British citizenship.
In this article, I’ll try to answer all common questions related to mortgage as a foreign national in the UK
- What is a foreign national mortgage?
- Can you get a mortgage as a foreigner to the UK?
- Common challenges to get a foreign national mortgage
- Which Visa is needed to get a UK Mortgage?
- Getting a mortgage as an EU citizen
- Can you get a buy-to-let mortgage as a non-UK citizen?
- How to get a foreign national mortgage in the UK
Let’s dive in to understand how foreign national mortgages work in the UK and how you can enhance your chances of buying a property in the UK as a foreign national.
What is a foreign national mortgage?
Technically, if one of the applicants is a foreign national, it will be classed as a foreign national mortgage application, and lenders will apply the foreign national mortgage’s lending criteria before approving your application.
However, suppose all applicants have indefinite leave to remain (ILR) in the UK. In that case, most lenders consider these applicants similar to British citizens, and generally, there are no additional mortgage qualification checks.
Some lenders have slightly lenient foreign national criteria if you are applying for a mortgage with a spouse who is a British national or has ILR.
Can you get a mortgage as a foreign national who is living in the UK?
Over the years, I have helped many foreign nationals get mortgages in the UK to buy houses.
However, lenders can make mortgage eligibility criteria more stringent because lenders consider foreign nationals a higher risk.
Also, not all lenders lend to foreign nationals without ILR, and those lenders who lend to foreign nationals have different lending criteria, which can be difficult to navigate without the help of a specialist mortgage broker.
Common challenges to getting a foreign national mortgage
Here are the common challenges faced by foreign nationals when it comes to getting a mortgage.
Acceptable Visa Type
Lenders do not lend to foreign nationals with every visa type.
Commonly acceptable visa types by the lender are:
- Indefinite leave to remain (ILR) – Most lenders accept this.
- Spouse visa – number of lenders accept this
- Tier 1 visa – a limited number of lenders accept this
- Tier 2 visa – a limited number of lenders accept this
Every lender has different criteria when it comes to Visas. It is important to check the finer details with the lender before making a mortgage application.
UK Residency
UK residency means how long a person has been living/working in the UK.
When it comes to UK residency, most lenders look for a minimum of three years of UK residency as one of the important lending criteria. However, in some circumstances, there are few lenders who can consider mortgage applications from applicants who have recently moved to the UK and tick all other mortgage lending criteria such as deposit or a certain level of income threshold.
Deposit
Where applicants fulfil all the foreign national lending criteria of the lender, they can qualify for the standard mortgage range without the extra deposit requirements.
However, when a applicant does not fulfil all the lending criteria, some lenders can still consider lending subject to a bigger deposit, typically a minimum 25% deposit.
Income
Some lenders only lend to foreign nationals if they are earning above a certain annual income threshold. Also, if you are self-employed, you typically need two years of accounts to prove your income for affordability.
Employment history
British citizens or applicants with ILR usually have options of several lenders and can get a mortgage for as little as one month of continuous employment history.
However, some lenders who lend to foreign nationals may have longer employment history requirements, which can be challenging if you have recently moved to the UK.
Credit scoring
Lack of sufficient credit in the UK can be another massive challenge for those who have moved to the UK recently and are looking to get a mortgage.
How to get a foreign national mortgage in the UK
Getting a mortgage is a complicated and often highly important matter that can greatly affect one’s life. That’s why 84% of borrowers (even British Citizens) use mortgage brokers to obtain a mortgage: They do not want to take a chance.
Being a foreign national, it is even more complicated to get a mortgage. Therefore, you should speak with an experienced mortgage broker to explore the best mortgage that’s right for you.
