Mortgages for returning expats and foreign nationals

The approx. 5 million self-employed people in the UK today form a huge, active segment of the labour market. Many of those are expats and foreign nationals on long term contracts, relocating to the UK. They're often highly skilled specialists (their skill having taken them abroad) and command long term contracts in well paid roles. As homebuyers go, expats can offer some of the highest quality borrower profiles for lenders.

The problem they have when looking for a mortgage is that this potential is neither acknowledged nor realised by High Street lenders. That's often because traditional UK banks and building societies struggle to provide competitive mortgages for people who fall outside their preconceived low-risk borrower profile. So, anyone without a permanent UK address in the last 3 years and a lack of credit history is going to struggle to buy a home at a competitive rate.

Much Ado About Nothing

What repatriating workers will find is limited choice and high interest rates. To add insult to injury, advisors will ask for reams of proof of income from abroad—not that they always understand it—and then for a huge deposit. At a time when so much of their life is up in the air and cashflow tight, these demands are utterly unrealistic. Thus, the outcome rarely reflects an expat's true borrowing potential, real 'risk' appraisal and their overall creditworthiness.

Freelancer Financials ' core mortgage broking specialism aims to set the record straight. Their independence and spectrum of finance products give independent professionals access to the service and loans their status deserves. One call to their experienced advisors will give expats the boost in self-confidence they need to realise the freedom that their talent and skillset deserves.

For more information and to find out what is available to you, please fill in the form below. Within 24 hours (Mon-Fri business hours), one of their specialist mortgage advisors will be in touch.

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Rebuilding a credit 'history' from scratch

If you've been abroad for some time, the biggest problem you'll face as an expat is your lack of recent credit history. Here are some at-a-glance, expert tips to help you identify the best way to begin building a solid credit footprint that will make you attractive to lenders.

Registering on the electoral roll and for utilities

Even if you're short-term leasing or staying with family, get on the Electoral Roll. It's the first step to re-establishing your presence in the UK. This, and al these tips, are the same if you're on an immigrant VISA coming to work in the UK for the first time.

Registering to pay Council Tax is not the same as getting onto the Electoral Roll. Also, ensure that you enrol on the full Electoral Roll (not just the open version), as this makes up part of almost all credit checks.

Similarly, utility bills don't establish your official presence, even though many lenders use them to confirm identity when running a credit check. If you're in a leased property, make sure that gas, electric, water, TV license and Council Tax are registered in your name.

Check what credit agencies already know (or hold on record) about you

You'll want to know what shows up in history that impacts your current credit store, to give you a base to work from. Never assume you know everything: old overdrafts, loans, utility bills and Council Tax could all be counting against you if you inadvertently left them unsettled before you departed for foreign shores.

There are many credit agencies available today, probably many more than when you moved abroad if you've been gone some time. It's often worth paying for a report to get yourself to a starting point. When you get your report, take action as soon as you can; some historical records may take longer to correct than others.

Register for a copy of your credit report with one of the major credit referencing agencies. The main UK ones are Clearscore, Equifax and Experian. There are so many now that you can even compare Credit Agencies; but do remember, just because you can get a free report doesn't mean you should.

Give your cash a home

Take out a UK bank account in your own name. Your personal account will be the platform upon which you build your new credit score. Don’t rely on your business account to improve your score, especially if you're a limited entity, which separates you from any company debts.

Your personal account should have a minimum of a debit card and a nominal overdraft facility. When paying yourself, ensure you pay all personal drawings from your business into your new personal bank account.

Credit where it's due

Those above are the basics. But to build your credit score, you'll need to demonstrate that you can repay creditors. Apply for a credit card in your name, even if it's one with a small limit and—if no other options are available—a higher APR than you'd normally like.

Use the credit card regularly for groceries, petrol and online shopping; besides building a history, there's also often a better security guarantee with a credit card than with a debit card for online transactions. But the key point to make it work is to repay what you use your credit card for before the repayment's monthly due date. You'll avoid those higher interest rates and show that your cashflow and sense of responsibility are healthy.

Be prepared to play the long game

Building (or repairing) a credit history isn't going to happen overnight. Expect to wait anything from 4-6 months up to a year to begin to see real changes to your credit score. But by planning ahead and remaining patient, your credit footprint will solid when you are ready to apply for a mortgage – and the higher your chances of success.

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