UK Mortgage Foreign Income

Can I get a UK mortgage based on foreign currency?

Yes. If you’re paid in a foreign currency then it is absolutely possible to get a UK mortgage. It’s not always as straightforward as a standard mortgage application, but it is possible.

There’s a number of factors to take into account. Not all lenders offer this, but certainly there are mortgage providers that will look at your foreign income.

Why can it be difficult to get a UK mortgage on overseas income?

Lenders like to know that when you’re going to get paid, it’s going to be the same amount each month. When you’re paid in foreign income, you’re at risk from changes in foreign exchange rates, which can cause concern to a lender. They therefore make adjustments to allow for currency fluctuations.

As a result, you may not get a mortgage for the same amount you earn in a foreign currency as you would with UK sterling.

Also, if you’re paid in foreign currency it may also be more difficult to verify information such as the company you work for, which can put off some lenders. Mortgage providers have specific appetites as to who they’ll lend to.

Are there plenty of lenders that accept foreign income?

Over the past few years, more lenders have started accepting foreign income, including some of the main high street lenders. There are lots of specialist lenders that take foreign currency income, as well.

They all have lots of different rules and unique ways of assessing your affordability to confirm how much you can borrow. You might go to one lender and get one figure, and another lender says a different number – or even that this currency is a bit too risky for them.

Do I need to declare my foreign income?

Absolutely, yes. You should declare all your income to HMRC, whether it’s foreign or UK based. Lenders will specifically ask to see that your income has been declared and they will more than likely ask for your tax returns.

With all the mortgages we’ve done in foreign currency, every lender has wanted to see tax returns to verify income has been declared. So yes, you should always declare your income if it’s going to be used for your mortgage.

Can you get a UK mortgage if you work abroad and have foreign income?

Yes, it’s still doable. We have helped a number of clients who have worked in a different country for a period of time and been paid in a foreign income. Their main residence is still in the UK and they have an address history here, so they can still borrow in the UK.

Lenders will look at more detail about the type of company you’re working for and the job you’re doing. They also look at how you’re working that job. For example, if your role meant you had to be away for six months or nine months, they may want to understand what’s going to happen to your home whilst you’re not there.

If you have a family or a partner that will continue living in the UK, that should work absolutely fine. It’s just about finding the right lender to meet your circumstances.

Which currencies are accepted by UK lenders?

There is an extensive list. I won’t go through all of them, but lenders that accept foreign currency will accept all the main ones, such as US dollars and euros.

Lenders also have different appetites for specific currencies. You might have one lender that will take Japanese yen, for example, while another won’t.

Are there any common foreign currencies that aren’t accepted by UK lenders?

Yes, there are definitely currencies that any UK lender won’t accept. If they’re on the government’s blocked list or sanctions list, which means the UK isn’t supposed to trade with those countries, lenders won’t accept that currency for income.

Lenders may also not have an appetite to use specific currencies because they are seen as unstable, or the economy in that country is uncertain. Again, there’s a long list of lenders that accept certain currencies and those that don’t.

What if it’s a joint mortgage and only one of us has foreign income?

That’s still possible. Some lenders don’t like to mix currencies on an application, so it’s one currency and that’s all they’ll consider. Other lenders will accept mixed currency, but one of those currencies usually has to be UK sterling.

So you can’t usually use two different currencies on an application. You wouldn’t be able to have one person using US dollars and another using euros. Most lenders won’t accept that – they’d want one of those people paid in UK sterling.

What about if I’m self-employed and looking to get a UK mortgage with foreign income?

This is where it becomes a little more tricky. You might be self-employed through your own limited company, where some revenue is in foreign currency but it’s converted to UK sterling as part of normal day-to-day business. In that situation you may still be able to secure a mortgage.

But if you’re self-employed and paid in foreign currency, there’s a longer list of lenders that don’t have the appetite to lend to you. They find it’s more difficult to do that. It often depends on your tax status and in which country you’re declaring your tax.

There’s a lot to consider if you’re self-employed and paid in foreign income, and that can affect your ability to get a mortgage.

What if I have bad credit? Can I get a mortgage with foreign currency?

If you have bad credit and you’re paid in foreign currency, it does narrow down the list of lenders quite significantly. It can prove more difficult to secure a mortgage in those circumstances.

It all depends on how bad your credit is, what’s happened and when. We would have to assess your circumstances when you speak to us to understand whether it is achievable or not.

There are some lenders that will take bad credit and foreign income. It just depends on how bad the bad credit is.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.