For too long, it’s been a struggle for foreign nationals working in the UK to get a mortgage. Irrespective of the way they work, lenders perceive immigrants as a risk.
It needn’t be this way. As with most of life’s challenges, the answer lies in finding the relevant authority for help. That authority figure is a specialist mortgage broker who understands how immigrants work.
Working with foreign contractors who’d struggled to get mortgages unveiled a much bigger picture. Immigrants from all manner of employment backgrounds find High Street mortgages hard to come by. Even Ancestral VISAs don’t cut any ice with lenders, so where was the hold up?
Overcoming the barriers
Many restrictions imposed on immigrants working in the UK on HSMP, Tier 1/2/3 or Ancestral VISAs are harsh. These barriers could take the form of lenders expecting an excessive deposit. In other words, they impose a maximum of 60% LTV, or minimum 40% deposit.
Most mortgage lenders also insist upon a 3-year work history. Often, they expect continued employment, too. Others may require a minimum of 2 years remaining on your VISA. Or, in many instances, they won’t accept your application unless you meet both sets of lending criteria.
For immigrants new to the UK, hoping to make it their permanent place of residence, these values are unrealistic. The good news is that some lenders are changing their attitude.
Why won’t lenders accept my HSMP status?
In recent years, we’ve noticed lenders softening their attitudes towards non-UK resident workers. Some have dropped the minimum employment history requirement to 2 years. Others have dispensed with the higher deposits, or their restrictions on a maximum LTV.
The net effect is that immigrant workers can now secure a mortgage with as little as 10% deposit.
No doubt this will come as a surprise if you’ve paced the High Street several times without success. You may even have approached an IFA, resulting in similar disappointment.
It’s not your fault. What’s let you down in the past may neither be your work nor nationality status.
Finding a mortgage broker with influence is essential!
The root of the problem is the same as that which lets self-employed applicants down. Call centre and in-branch banking staff don’t understand your unique circumstances.
In contrast, a specialist broker will understand the nuances of HSMP, Tier 1,2 and 3 or Ancestral VISAs. By helping mortgage lenders understand your unique problems, such brokers have gained their trust. It’s relationships like this can help you get your mortgage:
- packaged so that underwriters understand your criteria;
- avoid the hold-ups and rejection on the High Street;
- processed with the minimum of fuss and delay.
Highly-Skilled Migrant Workers needn’t settle for mortgages with expensive charges and high interest rates. Avoid lenders and IFAs who place such restrictions upon you, either through greed or ignorance.
Yes, there are minimum criteria potential borrowers have to meet. But that’s true of people from all backgrounds, no matter what their nationality or the way they work.
Don’t become a victim to ignorance or prejudice. There’s no need; the right mortgage exists for foreign nationals. It’s a simple matter of matching the appropriate lender to your circumstances.
Author: John Yerou
John Yerou is the owner and founder of Freelancer Financials; a trading style & trade mark of the award winning Mortgage Quest Ltd. One of the most recognised names in providing mortgages for contractors and freelancers across the UK.
In 2004 John began his career in Financial Services as an independent mortgage adviser and broker. John has been instrumental in negotiating bespoke underwriting for contractors with high street lenders.
His presence in the industry as a go-to expert is growing by the day and he is regularly cited and writes in publications both locally and nationally.