Client
Our client has lived in the Czech Republic for around 13 years, where he is employed full time managing a school. He owns his residential property there and also owns an unencumbered residential property in the UK, with no mortgage against it. He earns the equivalent of £60,000 a year in the Czech Republic.
Background
The client wanted to buy a UK studio flat as a buy-to-let mortgage for expats. The studio in question is over 35 sqm and sits in a block of flats under five storeys, which already narrows the field before residency is even considered. Living in the Czech Republic, an EEA country, and having no UK mortgage in over a decade, meant he had no meaningful UK credit footprint to point to either.
Requirement
- Purchase a UK studio flat (35 sqm+, block under five storeys) via a buy-to-let mortgage
- Work with a lender willing to accept residency in an EEA country
- Work with a lender willing to take a sensible view of a thin UK credit file caused by long-term non-residency
Challenges
Studio flats are a restricted category for many buy-to-let lenders, and this one needed to clear both a minimum size threshold and a maximum-storeys limit on the block. On top of that, EEA countries are typically not considered by many lenders at all. Because the client had been out of the UK for so long and had no UK mortgage, he also had no meaningful UK credit score to demonstrate his conduct.
Solution
As a whole-of-market, specialist expat mortgage broker, we knew some lenders would accept studios over 30 sqm, and that more lenders than most brokers assume will accept flats in blocks of five storeys or under. Combined, those two factors opened up real options. There is also a limited but genuine pool of lenders who are comfortable with EEA-based applicants, even though most are not.
This matched well with a sensible approach some lenders take to a thin credit file, where the only reason for it is that the applicant simply hasn’t lived in, or borrowed in, the UK for some years.
Outcome
With all of this in mind, we secured a lender offering competitive rates who was willing to lend against the studio, accept the client’s EEA residency, and take a sensible view of his limited UK credit history. If you’d like to see roughly what you could borrow in a similar scenario, our expat mortgage calculator gives an instant estimate.
Summary
Experienced mortgage brokers are able to secure lending for complicated setups that most lenders would otherwise see as undesirable.
Key Point
Key things for expats to consider:
- Some lenders will allow the purchase of studios, as long as they’re over a certain size and in a block of five storeys or under.
- Some lenders will allow expats living in an EEA country to purchase in the UK.
- Some lenders will take a sensible approach to a low UK credit score if the reason is simply that the applicant hasn’t lived in, or borrowed in, the UK.
Whole-of-market mortgage brokers with CeMAP qualified advisors are always able to look at creative ways to solve complex scenarios such as this.
Frequently Asked Questions
Can I get a UK buy-to-let mortgage for a studio flat?
Yes, but many mainstream lenders exclude studios altogether.
Specialist lenders will typically consider studios over roughly 30 sqm in a block of five storeys or under, since smaller flats and taller blocks are seen as harder to value and resell.
Can expats living in an EEA country still get a UK mortgage?
Yes, but only through a smaller pool of specialist lenders.
Most UK lenders won’t consider applicants resident in EEA countries, so it comes down to matching the case with the right lender rather than relying on a mainstream panel.
What if I don't have a UK credit score because I've lived abroad for years?
A thin or non-existent UK credit file isn’t automatically a barrier.
Some lenders take a sensible view when the only reason for it is long-term non-residency rather than any adverse history. See our guide to UK credit score options for expats for more detail.
Why do lenders restrict studio flats and flats in tall blocks?
Lenders are cautious about resale demand and valuation risk on small units and taller blocks.
That’s why minimum size and maximum storey limits vary so much between lenders, and why matching the property to the right lender matters as much as matching the applicant.
If you have any questions relating to an expat buy to let mortgage, contact us today to speak directly with one of our CeMAP certified Mortgage Advisors.
Expat Mortgages UK is a specialist broker directly authorised and regulated by the Financial Conduct Authority. We work exclusively with expats and foreign nationals buying UK property with overseas income. Your home may be repossessed if you do not keep up repayments on your mortgage.
Call: +44 1494 622 555 Email: info@expatmortgages-uk.com
Related Pages
- UK credit score options for expats – What to do when years abroad have left you with no UK credit history.
- Expat mortgage income requirements – The income evidence expat lenders typically expect.
- Currency haircuts on expat mortgages – Why lenders discount foreign-currency income and how it affects borrowing.
- instant UK borrowing calculator – Get an estimate of your UK borrowing capacity on overseas income.
- Other expat mortgage case studies – Real examples of expat and foreign national UK mortgage completions.