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I have been abroad for 3+ years, but I am British and have had my wages paid (no UK tax paid on it) into my UK bank - can I get a mortgage?

by GambellaJon 07 March 2010 |

6 comments | Love

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I want to buy a house back in the UK after 5+ years way, I still have a UK address for post etc... and my salary has been paid into a UK bank account... but when I approached my bank (First Direct) for a mortgage, despite a 35% deposit they still refused me as I had not paid UK taxes. Who can I get a decent mortgage from now?

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410

manzanilla posted
Do you want to live in this house? Have you now got a job in this country? Or are you staying abroad and in that case will this be a holiday home for you or rented out?
These are very different circumstances, so let us know which applies to you...
manzanilla
Posted on 07 March 2010 | Love 0 loves Report
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GambellaJon posted
In the short term I intend to stay abroad - for the next 12 months or so, then I would like to come back and will find a job in the UK as my daughter starts school in Sept 2011. The house will not be rented out, will be a primary residence but will only be fully occupied from mid 2011
Posted on 07 March 2010 | Love 0 loves Report
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MikeGG1 posted
There are 2 problems that you have. The first is that any mortgage provider subject to the Financial Services Act, has to do an identity check. The first place that they look is the Electoral Roll for your current address. As this is abroad, you fail at the first hurdle.
You might be able to get a bank offshore or abroad to lend to you you, but it is unlikely that you will do onshore.
The other problem is that it would not classify as your private residence for Capital Gains Tax purposes until you move back, Consequently, a portion of any gain would be taxable.
Mike
Posted on 08 March 2010 | Love 0 loves Report
272

Swarbs posted
I think you will struggle to get a mortgage from any lender in the current climate. As you have been out of the country for over three years, and have not paid UK tax, you are unlikely to be resident or ordinarily resident for tax purposes. Mortgage lenders are unwilling to lend to non residents as they do not have much legal recourse if they default on the mortgage. Whilst a UK resident can be pursued through the courts in the UK, if you default on the mortgage whilst living in another country, they are unable to pursue you through the civil courts.
In my opinion, the best option is to wait until you move back to the UK, rent for a few months until you find a job, and then look to buy a place. This will save you having to pay a mortgage for a full year whilst the house is empty. Prices are unlikely to rise significanly above inflation with the mortgage market so messed up at the moment, so you are unlikely to lose out. If you are determined to buy a house, then you have two main options:
1. Use a broker who specialises in finding mortgages for non residents.
http://www.mortgageman.co.uk/our-mortgage-customers/non-resident-mortgage-deal-to-best-suit-your-circumstance/
http://www.offshore.barclays.com/non-resident-mortgage/
http://www.jaygaltd.co.uk/offshore_ownership_of_uk_property.htm
Be aware that, due to the higher perceived risk of lending to non residents, you are likely to have to pay a higher rate of interest and fees.
2. Take out a buy to let mortgage then put the property on the market with a stupidly high rent. No one will rent it, so it will stay empty. When you want to move to the UK, contact the lender and tell them the property is currently empty, and ask their permission to move into it. They are likely to grant this if you can prove income, but you may have to pay a fee. When the buy to let mortgage term runs out, you should have a UK job and be UK resident again, and so should have no trouble getting a residential mortgage.
Posted on 08 March 2010 | Love 0 loves Report
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TheWelshman posted
Hi GambellaJon
Thanks for your question.
It is possible for you to get a mortgage if you are an ex-pat. You can do this either as a buy to let ( but you will have to working for a multi-national company ) or you can still do it as a residential mortgage.
They just take a little longer to source as there aren't many lenders out there that are offering this facility.
Natwest have just come into the market and have some competitive deals, but its specialist lending so they need a little more information than usual.
If you would like us to do some research then you can email me direct on tim@lovemoney.com or ring me direct on 0207 297 8163.
Regards
TheWelshman ( a member of the lovemoney.com mortgage team)
Posted on 09 March 2010 | Love 1 love Report
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expatabroad posted
Hi GambellaJon - like Swarbs said, there are some specialist lenders out there that will provide mortgages for people in your situation - what you don't make clear is whether you are living away 'permanently' and don't intend to come back, or if its just for the next few years...
..I would take a look at http://www.expat.barclays.com/uk-mortgage/ which is from Barclays, and is for expats living abroad looking to buy property in the UK - you'll get the basic info from there, but I would probably speak to one of the advisers.
you could have a look at http://www.offshore.barclays.com/non-resident-mortgage/ - same bank, so they can tell you more about what would be best.
Good luck!
Posted on 03 August 2010 | Love 0 loves Report

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