In this brief blog, we will discuss getting a mortgage with a tier 2 visa or as a foreign national.
Your tier 2 visa will usually be one of the types below:
Tier 2 Company Transfer
Tier 2 Religious Visa
Tier 2 Sports Person
Tier 2 Priority Service
Can I get a mortgage on Tier 2 visa?
Yes, you can get a mortgage on a tier 2 visa but this may not be as straightforward as it sounds. You may be required to put down a larger mortgage deposit or be faced with mortgage rates that are not competitive based on your circumstances.
Most mortgage lenders may lend to you if you have lived in the UK for at least 2 years (this means you have lived here long enough to have an established credit history) and if your tier 2 visa still has some years left and there is a reasonable chance that you will be extending your tier 2 visa.
Some mortgage lenders will also want to see that your tier 2 visa has at least 1 year left on it and there are mortgage lenders that will insist that you have had a bank account open since you have been in the UK and some utility bills which can prove your home address..
Different mortgage lenders will have different criteria to which they will rely on when considering a tier 2 visa mortgage.
You may even be able to get a Tier 2 help to buy mortgage.
How will mortgage lenders consider tier 2 visa mortgages?
Mortgage lenders still consider the standard factors when looking at a tier 2 visa mortgage. This will be your mortgage deposit, the loan to value, your credit score and history.
Most importantly, mortgage lenders will consider how long you have lived in the UK and how long is left on your tier 2 visa.
The mortgage lender will also want to see a record of employment or employment-related studies during your time in the UK.
The tier 2 visa mortgage lender will consider your complete mortgage affordability for a tier 2 visa mortgage taking into account the factors that make the mortgage unique.
What mortgage deposit will yu normally need for a tier 2 visa mortgage?
Most mortgage lenders will require a mortgage deposit of between 25% and 30% for a tier 2 visa mortgage.
You may also not be able to use any government first-time buyer and home mover schemes to pay for the mortgage as after you have filled in the help to buy property information form as part of the scheme process you may find that the regional help to buy agent or agent overseeing the government scheme will reject you as they may prioritize naturalized citizens of the UK for the first-time buyer and home mover schemes.
Can I get a tier 2 visa mortgage without any credit?
It may be much harder for you to get a tier 2 visa mortgage if you don’t have any credit. Most mortgage lenders may reject you and your best bet will be to start bulding creditand plan to make your mortgage application in the future.
Can you get a tier 2 visa mortgage with bad credit?
Getting a mortgage with bad creditis hard enough as it is, so getting a tier2 visa mortgage with bad credit may certainly be much harder but not impossible.
When considering bad credit mortgages, mortgage lenders will all have their own internal criteria for what they may accept and what they certainly won’t accept. So whilst it may be very possible to get a tier 2 visa mortgage with bad credit, it will depend on your personal circumstances and the mortgage lenders criteria.
Some mortgage lenders may accept CCJs if the total value of the CCJ is a certain amount or of the CCJ is satisfied. In other cases, the mortgage lender may not accept CCJs but will accept missed payments.
Bad credit mortgages are therefore a specialist side of the mortgage market and bad credit mortgage brokers may be essential in helping you get a tier 2 visa mortgage with bad credit.
Bad credit could include:
A debt management plan
A home reposession
Credit account defaults
Missed credit repayments
Can you get a visa mortgage if you are self-employed?
Just as having bad credit, getting a self-employed mortgage may be harder as mortgage lenders often scrutinize the income reliability of self-employed borrowers.
This means self-employed borrowers have to go an extra mile to prove that their income can be relied upon for the foreseeable future.
If you have a visa and are self-employed in the Uk you may be able to get a mortgage but may want to speak to a self-employed mortgage broker to assist you further.
How to increase your chances of getting a tier 2 visa
There are several ways you may be able to increase your chances of getting a tier 2 visa mortgage and most of them are very achievable with a little bit of planning prior to you applying for a mortgage.
If you want to increase your chances of getting a tier 2 visa mortgage then one of the first things you should do is look to build credit in advance of applying for your mortgage. Building credit will make it easier to get a mortgage as the mortgage lender will have a record of your credit file as you would have stayed the minimum amount of time needed to get a credit file in the UK.
You should look to register on the electoral roll
Get a credit builder loan or card
Open a bank account
Increase your visa length
You can also increase your chances of getting a tier 2 visa mortgage by increasing the length of your visa before applying for the mortgage
Increase your mortgage deposit
The final way you can increase your chances of getting a tier 2 visa mortgage is by increasing your mortgage deposit. A bigger mortgage deposit will reduce the tier 2 visa mortgage lenders loan to value rate and therefore make the tier 2 visa mortgage less risky.
Can you get a buy to let mortgage with a tier 2 visa?
Yes, you may be able to get a buy to let mortgage with a tier 2 visa as long as you have sufficient mortgage deposit and are not looking to purchase a non-standard construction property.
Can foreigners get a mortgage in UK?
Yes, foreign nationals can get a mortgage in the UK but just like the tier 2 visa mortgage, you may be required to put down a large mortgage deposit in order to reduce the mortgage lenders loan to value rate.
As a foreign national in the Uk looking to get a mortgage, you will be expected to have indefinite leave to remain or a visa to remain in the UK.
If you are a foreigner in the UK on a tier 5 visa then you may find it harder to get a mortgage as you are considered temporary workers.
Can you get a mortgage with leave to remain?
Yes, you can get a mortgage with indefinite leave to remain or limited leave to remain as long as you have some time left on your current leave.
Can I get a mortgage on a work visa?
Yes, you can get a mortgage on a work visa in the UK but most mortgage lenders will expect that you have at least 1 year left on your work visa and that you have been in the UK for at least 2 years with an established credit file.
Use a mortgage broker for your mortgage in principle
You may want to use an independent mortgage broker to help you get a mortgage on your new home.
Mortgage brokers are important as they can access mortgage products from across the whole of the market in some cases.
This could be over 11,000 mortgage products. This may have some advantages rather than going directly to a mortgage lender.
A mortgage broker will look to understand your financial circumstances and then provide recommendations on which mortgage products may be suitable for you based on your mortgage affordability.
After giving you these mortgage recommendations, most mortgage brokers will seek your consent to apply for a mortgage in principle.
This will allow you to shop for your home as more estate agents and sellers may take you seriously and it will also give you confidence that your mortgage is indeed a possibility before you make a full mortgage application.
Once you have found a home you want to buy and are satisfied with the mortgage offer for your mortgage then the mortgage broker will then look to get you a mortgage offer.
This will come with a key facts illustration document that details the features of your mortgage including how much you will pay per month.
It will also contain information on if there are any limits such as early repayment fees, or annual overpayment limits.
If you are happy with everything you can then go on to secure your mortgage with the help of a conveyancer.
Your conveyancer will manage the legal searches on the property to ensure there aren’t any issues with it.
They will oversee the sales agreement to ensure it is in your best interest, they will manage the transfer of mortgage funds, exchange contracts with the seller or their conveyancer, and set a completion date with the seller or their conveyancer.
This will then bring an end to the conveyancing process, at which point you will receive the keys to the house and move in.
If you need financial advice and you live in the UK then you could contact the Money Advice service over the phone or via chat for impartial advice.
You can also contact the debt charity “Step Change” if you are in debt and need help.