Buy to Let mortgages are generally available to UK expats in much the same way as they are to other UK residents although the lender will probably apply criteria that is a little stricter.
Buy-to-let in the UK has been a very buoyant market and one that has been excellent for expats wishing to invest in the UK property market. There are currently around 25 lenders that will accept expat applications for BTL mortgages with some offering mortgages on fairly flexible criteria with reasonably competitively priced mortgage deals.
Generally, you will need a minimum deposit of 25 per cent and the amount that you will be able to borrow will be controlled by the amount of rental income that the property will attract. As a rough guide, most lenders will be looking for the rental income from the property to exceed the monthly mortgage payments by a factor of around 145 per cent. In assessing this, lenders use an arbitrary mortgage rate of 5.5 per cent when doing this assessment. Using this criteria for a mortgage of say £100,000 on interest only, the monthly rent from the property would need to be around £665. Where rental is not sufficient to cover the mortgage by this criteria, then for the mortgage to go ahead, the deposit amount would need to be increased to balance the amount of rental income available. Some lenders may top up rental shortfall with top slicing personal income.
