Mortgage without ILR?

Hi all,

I'm the USC and my wife is the UKC.  We've been looking into buying a house, but both HSBC and LloydsTSB have told us they won't give us a joint mortgage because I only have FLR, and their policy is to only loan to foreigners with ILR or UK citizenship.  We asked about my wife applying alone with my income counted with hers, but they wouldn't do that, either.

Has anyone found 1) a UK bank that will make a mortgage loan to someone with FLR, or 2) a US bank that will make a mortgage loan for a property in the UK?

Any other advice appreciated.

thanks,
Carl

Hi Carl,

I'm not so familiar with the rules and the visas and the rights to live/remain kind of things, so I'll put down what I suspect you already know based on what some of relatives who are in similar positions have done and from what I read and have read.

The above scenario you mention would've gotten much further pre credit crunch days - seeing as your better half is a UKC the banks would've felt better about throwing the credit to her/you both. Nowadays it's not going to happen as easily.

The way around it and it's what my cousins did is to stump up a substantial deposit. Their first property was a 1bedroom flat which I think they got in 2004 at around £110,000 and I 'think' they stumped up around £20K in a deposit. They're both here on what was then HSMP as they're both Skilled Doctors. The 2nd property they bought in around late 06 early 07 I think it was as they had their 1st sprog. that was around £160K and I think they stumped up another £30K as a deposit. the 'rule' books were saying that non UK citizens or foriegn investors could purchase like this with a minimum deposit of around 25% of the asking price in order to bypass all the credit checks etc and have the mortgage approved. Beucase of their excellent pay as doctors I beleve the mortgage companies relanted a little and allowed them slightly smaller percentage deposits to secure the mortgages. For me, it' sthe same as I want to buy USA property, rule books says I need to stump up 30% in order to bypass all the red tape of obtaining a US mortgage. 


Nowadays I'd strongly suspect that they've upped the deposit to like 35-40% in order to do the same. Look into that an dask around, it may  be the case that a smaller percentage will be accepted to secure the mortgage if you can also show good payslips and credit records etc etc.

I'm also going to suggest what you already know, and that's to contact as many brokers as possible to see if any of them can offer you a product/loan not normally tabled or available from the high street banks. I think this solution may well be the one you'll probably have to go for to find a deal that you guys can go for in buying a proerty.

Stamp duty is abolished in todays' budget for properties up to 250K , however be prepared to offset that with much higher than previously normal levels of mortgage arrangement fees etc.

UK property is in a real bad shape at the moment as far as thinking of it as an investment for the future etc goes. Mortgage market is all over the show and first time buyers are still utterly and completely priced out. However if you are in the position of some of the above, and it's a required part of your life to buy a place then certainly look into the above.

Is there any USA properties that you may be able to sell off in order to help fund this purchase here? or are you renting any USA properties etc to help fund here? also, how about you do all the above and not mention that you want to be on the mortgage etc, just your better half, just in case a normal hgh street banks says yes and approves her. You could then get it all done and then perhaps look nto adding your name to the account later?

I can't think of anything else to try so good luck with any of the above.
If there's other options suggested by anyone else, I'd be interested in looking into them as well!

Good luck !
Cheers, DtM! west London & Slough UK!

My husband and I got a mortgage with Northern Rock when he was on FLR but that was in  early 2007 before the housing crash.

Thanks both of you for the advice.  Dennis you're spot on with what we heard from HSBC and Lloyds.  Neither of them would put me on the loan at all, nor would they count my income as part of my wife's income.  We could just apply with her name only, but obviously we'd be approved for a much lower amount.

I do have property in the US that I'm selling this summer, so having some cash for a deposit isn't going to be as big a problem as finding someplace that will take both our incomes into account.  I think you're right that we're going to have to look around and find something that fits our circumstance.

Where could we go to get independent advice about what's available?  Is there such a thing as an independent mortgage broker?

http://www.charcol.co.uk/  (there are probably others besides that one, but that is one that I know of)

We got a mortgage, pre-credit crunch, with my being on FLR only - but adding my name to the whole shebang was an afterthought (to us & the bank) at the last minute, it all went on my UKC husband's details.

We also put 1/3 of the purchase price down.

Our first mortgage was with Scarborough Building Society.  The one we have now is with ING but isn't offered anymore (to new peeps) cos we're paying a ridiculously low interest rate of about 1.5% (it's never more than .9 something above Bank of England rates & the lenders don't offer these sort of products these days).  We were lucky & we are overpaying right now. 

Hi Carl,

Yep, property purchasing at the moment for anyone who hasn't got that exemplary credit score or 20%+ at least deposit is going to find it tougher to get approved etc. The mortgage market changes all the time, just recently they were saying in reports about how there's more products available now since a year or so ago, but they're just really re-hashes of basically the same thing, have a large deposit and be a 'model' applicant and it'll be easier to be approved. If not, be rejected or have to jump through lots of hoops, be offered less amounts and of course pay higher interest rates etc.

Won't find me buying anything in the UK! Wanna sell me your house in the US?!!!!

There is independant mortgage brokers -

http://dalemortgagebrokers.com/
http://independentmortgagebroker.org.uk/index.html
http://www.modelmortgages.co.uk/

they're just ones of the first page of a search engine - I don't know what they're like or anything.

Where abouts are you looking to buy and what type of property?!

Cheers, DtM! West London & Slough UK!

Thanks Mrs R and Dennis!

Wanna sell me your house in the US?!!!!

Sure!  It's a condo in Alexandria, Virginia, which I can't sell until July when the lease is up, but you're welcome to buy it. 

Where abouts are you looking to buy and what type of property?!

Within a decent commute to London (45 mins to an hour by train) and a semi or detached house with 2 or more bedrooms in a village, but we haven't started looking seriously yet.  We really liked how Kent looked when we visited, so that's where we're going to start looking, but we're open to most anyplace.  Was that vague enough? 

We were approved for a 90% LTV mortgage with RBS two weeks ago. My FLR expires in May, and we told them we were in the process of applying for my ILR. I thought it would be quite a big roadblock, but they didn't seem too concerned.

We were approved for a 90% LTV mortgage with RBS two weeks ago. My FLR expires in May, and we told them we were in the process of applying for my ILR. I thought it would be quite a big roadblock, but they didn't seem too concerned.

Thanks!  We'll check them out.

We did RBS as well.  I had lived here for 4 years (work permit) and married for about 1, so still on my FLR...they seemed to be fine with it once I produced my contract and with 20% down.

Hi

Across - that does sound encouraging! Of course, I and we don't know your circumstances so although you've been approved has it been at a relatively high rate of interest? There are much less Tracker mortgage deals out there, and the very best rates are still for those with impeccable credit histories and large downpayments - 25,30 40% etc.

Fixed rate deals for like 2,3 or 5 years, are around and I daresay those interest rates have gone up since pre credit crunch days, however seeing as the UK is going to be stuck in the mud for a number of years yet, the base interest rate is only going to rise, and if by the time your fixed rate ends and base interest rates have gone up to say 5,6,7 % (we reallllllly hope they dont go higher than that!!) then you will see your monthly repayments shoot right up. This is all ok if your monthly income levels can cover it, if not...   well you don't need me to tell you what'd be next.

Carl, see if you can push as hard as you can for a good long term rate, I really am happy I'm on a +1% tracker, great for me that the rates have gone down, not so good when they're higher up. However, seeing as my circumstances changed a few years into my mortgage term, I'm so thankful for the tracker as I'd not got re-approved for another mortgage say on a 3 year fixed rate (went self employed etc etc)

How much is your place in Alexandria? type and size and location etc?!!   i 'could' be interested! will you do Car enthusiasts mates rates?!!!

Good luck !

Cheers, DtM! West London & Slough UK!

Thanks Onetiger.  Looking like RBS is going to be one to check. 

Dennis, I'll PM you some info.

ciao,
Carl

We didn't have a higher rate of interest...it was the best on the market...but we also had 20% down so I think that had something to do with it.

We didn't have a higher rate of interest...it was the best on the market...but we also had 20% down so I think that had something to do with it.

Was that relatively recent? {edit: Never mind, I just saw your marriage date and did the math.  }

With us the issue is not so much the deposit amount or percentage but getting both of our incomes counted.  If RBS doesn't mind that I don't have ILR and will take both of our incomes into account we should be fine.

Thanks again for the response.  

Carl

RBS told me that its their company policy not to discriminate against a British person with their other half being of a different nationality, as the Brit can't choose who they fall in love with.
However, they also told me they won't give a mortgage to someone without ILR if they're not British and the sole person on the mortgage- so they won't give one to me. 
I guess they figure someone who's married to a Brit can't run away so easily as those of us who aren't 
So try them...