UK mortgage for expat

Chris72

Hi, does anyone know the mortgage rules for British expats working abroad ? My brother works in the US, he would like to buy a property here as an investment.
Has anyone here done this ? Any info would be much appreciated.

Chris

herbiesjp

Depending on his exact circumstances he may well be able to get a mortgage in the UK. HOwever, he may be limited tohaving to put down a highe deposit - again this would depend on his actual circumstances.

Chris72

Thanks for the answer. He has a good credit record, has had a mortgage before (joint with father) which is almost paid off now. Has been working for multinational co. for 2 years+ salary is over £60k. What LTV could he be looking at ?

mummytofour

Natwest I think do expat morgages.

Cook_County

There are several issues here.
1. He is US resident so will need to consider US tax issues on the UK mortgage and investment. These include Federal and State tax on the rental profit, Federal tax on foreign currency mortgage gains, Federal tax on recaptured depreciation on the sale.

2. I agree that a Sterling loan makes most sense if he wants a Sterling denominated asset. I assume he banks offshore to minimise his UK tax obligations, will his British bank assist.

3. As this is a BTL he could well try a mortgage broker.

Chris72

Thank you.

myfairlady

Chris72 wrote:

Hi, does anyone know the mortgage rules for British expats working abroad ? My brother works in the US, he would like to buy a property here as an investment.
Has anyone here done this ? Any info would be much appreciated.

Chris

My husband (US citizen) and I just got our mortgage approved. We used a very good financial advisor who checked out the best deals for our particular situation. Our mortgage is with Intelligent Finance (Who are very good with 'special cases'!) and were extremely quick to approve us. May be worth taking a look at their website https://www.if.com.

Good luck.

Cook_County

An American citizen married to a Brit is indeed a special case because the mortgage interest paid by the American spouse would be deductible annually on the US tax return; but the currency gain on repaying the mortgage would be taxable to the American. The capital gain on selling the property is also potentially taxable to an American (although the UK has no tax on sales of main residences). The final crunch comes on death where there is potentially tax on both sides of the Atlantic because of differing citizenship/domiciles.

Because of these complications you'd need a specialist IFA who is comfortable giving advice to US persons.