Categories
Advice

Navigating the UK Mortgage Market for Overseas High Earners: How IMS Can Help

The UK mortgage market can be a challenging landscape for high net worth individuals, especially those earning abroad. Recent research from Investec highlights a significant issue: a vast majority of high net worth individuals face mortgage rejections or are forced to accept lower loan-to-value ratios due to lenders’ inability to understand complex remuneration structures. This problem is particularly pronounced for overseas high earners, who often find their income mistrusted by many UK lenders.

The Challenge for Overseas High Earners

Consider the case of an expat earning £150,000 a year tax-free, with an additional £100,000 annual bonus. Despite a consistent income over seven years, traditional lenders might disregard the bonus, significantly reducing the loan amount available to the borrower. This scenario is not uncommon and highlights the difficulties faced by high earners based overseas when attempting to secure a mortgage in the UK.

IMS: Tailored Solutions for High Net Worth Individuals

International Mortgage Solutions (IMS) addresses these challenges head-on by offering bespoke underwriting for High Net Worth and UHNW individuals. Unlike many UK brokers, IMS goes beyond standard salary slips, providing a comprehensive analysis that includes full source of wealth and wealth trajectory reports. This approach stems from the expertise of our founder, Rupert Bastick, who has extensive experience in the wealth division of one of the world’s largest investment banks. By gathering a detailed seven-year history and conducting a deep dive into the client’s background, education, employment, and reasons for receiving bonuses, IMS presents a complete financial story to underwriters. This method allows lenders to consider the full income amount — in our example, £200,000 or even the full £250,000 — enabling clients to secure financing for their dream properties.

Why Choose IMS?

IMS stands out in the UK mortgage market for several reasons:

  • Expertise in High Net Worth Mortgages: Our team specializes in navigating the complexities of high net worth mortgages, ensuring that our clients receive the best possible terms.
  • Global Perspective: With a focus on expats and foreign nationals, IMS understands the unique challenges faced by overseas borrowers and offers solutions tailored to their specific needs.
  • Personalized Service: We believe in a client-focused approach, taking the time to understand your financial situation and goals to provide the most suitable mortgage options.

Conclusion

For high net worth individuals based overseas, securing a mortgage in the UK can seem daunting. However, with IMS, you have a partner that understands your unique financial landscape and has the expertise to navigate it successfully. If you’re considering financing a UK property purchase from abroad, IMS is here to help. Visit us at mortgageims.com for more information and to start your journey towards securing your dream property in the UK.

Categories
Future landscape

Could there be a resurgence in the UK housing market in 2024?

Several factors could contribute to a resurgence in the UK housing market in 2024: 

Mortgage Pricing War and Interest Rate Cuts:  

A mortgage pricing war and anticipated Bank of England interest rate cuts could rejuvenate the UK housing market. Lower mortgage rates make home buying more affordable, potentially stimulating demand. However, the decision by the Bank of England to hold rates at 5.25% (1 Feb 2024) brings uncertainty to the future path of rates for the remainder of the year.

Political Factors:  

The possibility of a general election in 2024 could impact the housing market. If the election is scheduled for later in the year, it could invigorate the housing market in the spring. 

Housing Policy Evolution:  

The adaptation of housing policy to better reflect the economic, demographic, and social realities in the UK could stimulate the housing market. This includes support for the ‘build-to-rent’ sector, which has seen growing demand due to high mortgage costs and changes in consumer lifestyles. This could lead to the emergence of more large-scale, multi-tenure residential schemes. The new-build market in the UK is under significant pressure to expand exponentially due to the highlighted pressures on social and government housing for families under the cost-of-living crisis and the building asylum/refugee housing situation. 

Demand Outstripping Supply:  

With an estimated demand of some 230,000 new homes per annum needed in 2019 pre-Covid, this figure is now estimated to be over 350,000 per annum just to keep pace with demand. Currently, less than 50% of this target is being met. This will likely result in lenders needing to support the new-build market again, with signs of this already being seen as lenders relax their property lending criteria. 

Return of Confidence:  

After a year of sustained price falls in 2023, returning confidence could stimulate the housing market. This is indicated by a succession of unexpected monthly rises in the past three months and a larger-than-expected pick-up in activity. 

Increased Demand for Private Rented Housing:  

High mortgage costs and increased costs of living have led to growing demand for private rented housing. This could stimulate the ‘build-to-rent’ sector and lead to the emergence of more large-scale, multi-tenure residential schemes. 

So is now a good time to buy?

The factors identified in this post suggest that there are a number of reasons to be optimistic about the path of house prices in 2024.

If you’re an expat or overseas resident considering a house purchase in the UK, IMS is here to help. Visit mortgageims.com/services/ for more details

Categories
Mortgages

Navigating the UK Mortgage Market: A Blueprint for Expats and Foreign Buyers

Introduction:

As the Bank of England Policy Committee meeting approaches on 3rd August 2023, there’s growing anticipation about the future of interest rates. The recent rate rise of 0.5%, higher than expected, has stirred discussions among lenders and analysts. However, indications of a potential hold on rates during the upcoming meeting are gaining momentum. Several lenders, including TSB and Cooperative, have already lowered their 3-year fixed rates, with some first-time buyer 5-year fixed rates following suit. As inflation becomes less of a concern, the political landscape comes into focus, with the conservative government aiming to demonstrate economic control ahead of the 2024 general election.

In this blog post, we will delve into the key factors influencing the mortgage market, the prospects of interest rate changes, and the potential opportunities for overseas investors and British ex-pats amidst the evolving landscape.

Factors Influencing the Mortgage Market:

The last rate rise of 0.5% took the industry by surprise, leading analysts to ponder the possibility of no change in rates during the upcoming Bank of England meeting on 3rd August 2023. This cautious approach may be attributed to a number of factors, including lenders lowering their 3-year fixed rates and some first-time buyer 5-year fixed rates. Such actions may reflect a response to inflation becoming less concerning and the conservative government’s desire to showcase economic control ahead of the 2024 general election.

Favorable Indicators for the UK Property Market:

Despite slight dips in house completions compared to the same period in 2022, June 2023 showed improvement from May, signaling ongoing interest in the UK property market. Additionally, certain regions experienced minor declines in property prices, creating attractive opportunities for overseas investors and British ex-pats looking to seize the right moment to enter the market.

Navigating the Uncertainty:

The UK property market remains in a state of flux, with uncertainty surrounding interest rates, inflation, and market dynamics. This environment, however, can present advantageous prospects for astute investors, offering potential buying opportunities for those aiming to make well-timed decisions.

Conclusion:

As the UK mortgage market anticipates the outcome of the Bank of England Policy Committee meeting, investors and buyers must stay vigilant and well-informed. Navigating through the ever-changing landscape requires a keen eye on uncertain interest rate developments, inflation trends, and the government’s economic control measures ahead of the 2024 general election. For overseas investors and British ex-pats eyeing the UK property market, being attuned to these factors can help them make strategic decisions and capitalise on promising market opportunities as they emerge.

Categories
Mortgages

Expat Mortgages for Non-UK Residents: What You Need to Know

For many non-residents seeking to purchase property in the UK, securing a mortgage can be a complex and confusing process. However, with the help of an experienced mortgage broker, navigating the intricacies of the UK mortgage market can be made much simpler.

In this blog post, we’ll cover the basics of expat mortgages for non-residents, including what you need to know about eligibility, income requirements, and the application process.

Eligibility
To be eligible for an expat mortgage in the UK, non-residents will typically need to have a strong credit history, a sizable deposit, and a regular income stream. Additionally, lenders may require proof of a minimum income level, which can vary depending on the lender and the type of mortgage being sought.

Income Requirements
When it comes to income requirements for expat mortgages, lenders will typically look for consistent income that can be verified through documents such as payslips or tax returns. This can be particularly challenging for self-employed applicants or those with irregular income streams, but there are lenders who specialize in working with these types of borrowers.

Application Process
The application process for an expat mortgage can be more time-consuming than for a standard mortgage, due to the additional documentation and verification required. It’s important to work with a broker who has experience in this area, as they can guide you through the process and ensure that all necessary documents are submitted in a timely and organized manner.

In addition, non-resident buyers should be aware that they may be subject to additional taxes and fees when purchasing property in the UK, such as stamp duty and non-resident capital gains tax. A broker can provide guidance on these costs and help ensure that they are factored into the overall budget for the purchase.

Overall, obtaining an expat mortgage for non-residents can be a complex process, but with the right guidance and support, it can be made much simpler. By working with an experienced mortgage broker, non-residents can navigate the UK mortgage market with confidence and secure the financing needed to purchase their dream property.

If you’d like to speak to a broker about an expat or foreign buyer mortgage, contact International Mortgage Solutions at contact@mortgageims.com.