Published 2nd October 2020 · Updated 14th October 2023 by Martin Alexander
If you live abroad and want a buy-to-let in the UK, you’ll likely need an expat buy-to-let mortgage. Fortunately, lenders have an entire range of buy-to-let mortgages for expats, which we’ll explore in this guide.
Can I get an expat buy-to-let mortgage?
Yes, an expat can get a buy-to-let mortgage in the UK, and the process can be straightforward if you still have a UK credit file and a 25% deposit. However, lenders do have strict criteria for overseas buyers, so you’ll need to select a lender carefully.
Your country of residence can be a significant factor in your approval. For instance, some lenders will only lend to applicants living in Europe, while others will consider you irrespective of location. Your deposit size, income and credit will also play a part in your assessment.
Do I need to be a homeowner?
Most lenders won’t consider expats who are first-time buyers for a buy-to-let mortgage. Don’t panic if you are, as some lenders may still accept you if you meet the rest of their criteria.
Learn more: How to get a buy to let mortgage as a first-time buyer
What criteria do I need to meet?
As an expat, you’ll need to meet the following criteria to qualify for a buy-to-let mortgage:
- Country of residence – Most lenders only accept expats living in the European Economic Area (EEA). This includes countries in the EU, Iceland, Liechtenstein and Norway. However, some lenders will consider applicants living outside the EEA.
- Deposit amount – Depending on your lender, you’ll need at least a 25% deposit, possibly more. The more you can save for a deposit, the better, as you’ll qualify with more lenders and have a better choice of deals.
- Experience – You’ll have many options if you’re an existing UK homeowner. It can be challenging to get a buy-to-let mortgage as a first-time buyer, especially as an expat, but it is possible.
- UK footprint – You’ll need a UK bank account to be eligible, and some lenders will require you to have a UK correspondence address. Your UK address will be used to carry out a credit check for your application.
- Income – Each lender varies, ranging from no income requirements to earning at least £75,000. Having a larger income will give you more options. That said, some lenders don’t assess employment for a buy-to-let mortgage.
Which lenders offer buy-to-let mortgages for expats?
Some of the lenders that accept expats for buy-to-let mortgages include:
- Foundation accepts expats with a credit file, bank account and correspondence address in the UK. You also must already own a buy-to-let property in the UK.
- Lendco requires expats to have an annual income of £75,000 for a buy-to-let mortgage.
- West One accepts expats who own a UK buy-to-let but won’t accept first-time buyers.
- Keystone requires applicants to have a UK credit file and pay tax in the UK.
We’ve only included a handful of lenders to give you an idea of how it works. Lenders constantly change their criteria, so speak to an advisor before applying.
Are buy-to-let mortgage rates higher for expats?
Buy-to-let mortgage rates for expats are typically higher than regular mortgages. This is due to the reduced number of lenders within this market, along with being an investment mortgage. Currently, rates start at 6-7%. Still, they can be higher depending on the rest of your application, such as your country of residence and deposit amount.
As with any investment, buy-to-let is considered a risk, as landlords typically rely on rent to repay the mortgage. With the additional risk of living abroad, a buy-to-let is very high risk. This is one of the main reasons some lenders won’t consider buy-to-let mortgages for expats under any circumstances.
You may be charged higher fees in addition to slightly higher rates. Again, this offsets some of the risks lenders take with buy-to-let mortgages. That said, you may still qualify for a favourable rate with minimum fees. It simply depends on the strength of your application.
How can I get the best rates?
A large deposit is one way to unlock the best mortgage rates. Many lenders will require a 25% deposit at least, but having a deposit of over 40% can unlock better deals.
To ensure you get the best rate, speak to an advisor who can compare rates across multiple lenders. We’ll also assess the likelihood of your application being approved.
How can I apply for a mortgage if I’m overseas?
Assessing your entire financial profile and country of residence is the first step. This will give you a better understanding of suitable lenders before you apply.
Once you have several eligible lenders, you can compare the best deals. This isn’t as simple as finding the lowest interest rate, as you’d need to calculate the overall cost of the mortgage.
Successful property investment relies heavily on the numbers, beginning with the price you pay for the property and your mortgage deal. Your application will be assessed in-depth as an expat, so it’s crucial to get everything right. If you are declined for any reason, it can make getting a mortgage even more difficult.
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About the author
Martin Alexander
Martin is a senior mortgage advisor who has held a CeMAP qualification for over 15 years while completing an MBA in Global Banking and Finance.