Tier 2 Visa mortgages UK: What you need to know about foreign national mortgages
If you’re a foreign national with a Tier 2 Visa who is hoping to purchase a property in the UK, the process won’t be the simplest. But it’s certainly still possible to get a mortgage to put down roots here.
At The Mortgage Genie, our expert mortgage brokers have handled many cases like yours, so we know exactly which lenders will be open to your application, what you’ll need to provide during the process, and how to give you the best possible chance of securing the loan you need. So, if you’re seriously thinking about buying a home in the UK, get in touch with us today by calling 033 33 44 33 72 — we would love to help you make your plans a reality.
We’re sure you have a lot of questions you want the answers to before you begin your application, too, so we’ve answered them here. In this guide, we’ll cover:
- What is a Tier 2 Visa?
- What is a Tier 2 Visa mortgage?
- Can you get a mortgage on a Tier 2 Visa?
- How much will you need for a Tier 2 Visa mortgage deposit?
- Are there many mortgage lenders for Tier 2 Visa holders?
- What do foreign national mortgage rates typically look like?
- Can you get a Tier 2 Visa mortgage with bad credit?
- Can I get a buy-to-let mortgage with a Tier 2 Visa?
- How can you get a foreign national mortgage in the UK?
Read on to find out everything you need to know before applying for a mortgage for Tier 2 Visa holders in the UK.
What is a Tier 2 Visa?
Tier 2 Visas provide the primary immigration route for skilled workers who wish to come to the UK and take up employment. To secure a Tier 2 Visa, you must already have a job offer, as well as a certificate of sponsorship from the company that plans to employ you. And, you must score at least 70 points on the UK’s points-based immigration system, which looks at factors like whether you’ve been offered an appropriate salary, whether you speak English, and what kind of education you’ve had.
There may also be more specific criteria you need to satisfy, depending on the category of Tier 2 Visa you require. For more information, visit the UK government website.
What is a Tier 2 Visa mortgage?
A Tier 2 Visa mortgage isn’t necessarily a specific product that’s available to foreign nationals. Rather, you will typically be able to apply for a normal mortgage — the process and criteria you need to meet will simply be slightly different.
If you’re a foreign national with a Tier 2 Visa, you may have been given the impression that you won’t be able to take out a UK mortgage, but this is a common misconception. As long as you’re in a good financial position, it’s likely you will be able to access the loan you need, and mortgage lenders will primarily assess your mortgage application based on the usual credit and affordability checks associated with buying a property. But, they will also be interested in factors such as how long you’ve lived in the UK and how much time is still left on your current visa.
While the requirements can vary from lender to lender, most will want you to have been a UK resident for at least two years, so you will have had time to build up some credit history. Others may ask that you’ve spent upwards of three years in the UK, but these stricter terms will often come with better rates.
Can you get a mortgage on a Tier 2 Visa?
Yes, you can get a mortgage with a Tier 2 Visa! But, the process can be more complicated and there will usually be some additional hoops you need to jump through. As well as the usual credit and affordability checks, a lender will look at:
- How long you’ve lived in the UK
- How long you have left on your current visa
Plus, they will typically require you to provide:
- Your proof of identity and residency
- Proof of your name and address
- Evidence of your income
- A rundown of your current monthly outgoings and any debt you already have
To give yourself the best possible chance of securing the mortgage you need, it’s important that you ensure you’re organised and suitably prepared before beginning the application process. It’s also a good idea to enlist the help of a mortgage broker who has experience with cases just like yours, as they will be able to help you get all of your paperwork in order, find the perfect lenders, and ensure everything is submitted correctly.
How much will you need for a Tier 2 Visa mortgage deposit?
As long as you satisfy all of the criteria to take out a UK mortgage as a foreign national, you may be able to secure a mortgage with an LTV of up to 90%, which means you could require a deposit of as little as 10%. But, it is worth noting that having a larger deposit will provide you with access to a larger pool of lenders and more affordable deals.
If you can put down a deposit that’s 15–25% of a property’s value, you’ll put yourself in a great position to get a fantastic deal.
Are there many mortgage lenders for Tier 2 Visa holders?
Most mainstream mortgage providers don’t accept applications that come with added complications, such as if you’ve had credit problems or are a foreign national. So, you will typically need to browse products from more specialist lenders. Fortunately, many of them will still offer competitive rates you’ll be happy with.
To gain access to the widest range of suitable mortgage products, it’s important that you work closely with an expert mortgage broker. They will have a network of contacts and lenders they’ll be able to call upon to find you the best deal possible. In fact, you’re likely to find that you wouldn’t have been able to access some of the most suitable products if you had decided to carry out all of the necessary research and work on your own.
What do foreign national mortgage rates typically look like?
As a foreign national with a Tier 2 Visa, mortgage lenders may see your application as more complex and possibly even high risk. As a result, you may find that the mortgage rates you can access are higher than if you were applying for a loan under more simple circumstances.
There are also other factors that will affect what kinds of mortgage rates you’ll be eligible for, such as your credit history, the size of your deposit, the source of your income, and the type of property you’re looking to buy. But, if you’re in a healthy financial position, you haven’t had any credit issues, and you’re working with a mortgage broker who has experience in this space, you will be able to find some very competitive rates you’re bound to be happy with.
Can you get a Tier 2 Visa mortgage with bad credit?
If you’ve struggled with credit problems in the past, you might be wondering whether this will make it impossible for you to get a foreign national mortgage loan. And, while it can certainly complicate your application further, bad credit won’t necessarily stop you from purchasing the UK home of your dreams. Your chosen lender will consider your unique application in full, also looking at other factors such as the size of your mortgage deposit and what your income looks like. So, credit issues won’t automatically mean that your application is going to be rejected.
You may be seen as a high-risk borrower, though, which will limit the number of mortgage products that are available to you, and the rates you can access will often be higher. If you’re particularly worried about your past credit issues making your mortgage too expensive, it could be worth holding off for a few years to work on your rating. In the UK, most credit issues will fall off your record after six years, which can give you access to a much wider range of options when taking out your home loan. Speaking to a seasoned mortgage broker is the best way to work out what the most suitable route is going to be for your situation.
Can I get a buy-to-let mortgage with a Tier 2 Visa?
If you’re hoping to buy a property to rent out as an investment, you will require a buy-to-let mortgage. It is possible to access this type of loan with a Tier 2 Visa, but the lending criteria is a lot more strict and it can be more expensive than buying a residential property. For instance, you’ll usually need a larger deposit and some lenders will even ask for a business plan that outlines how you intend to ensure your investment is successful.
If you would like to learn more about the ins and outs of investing in property here in the UK, make sure you read our buy-to-let mortgage guide, which outlines everything you’ll need to know, including the criteria you’ll have to fulfil and the additional costs you should be aware of.
How can you get a foreign national mortgage in the UK?
If you don’t have one already, the first step in your mortgage application journey should be to open a UK bank account and work on keeping it active. It’s also important that you have a permanent job here in the UK, so lenders will see that you’re not planning to leave any time soon.
You’ll need to start saving for a deposit, too, and keep an eye on your credit rating, so you know what kind of position you’re in before applying. It’s worth regularly conducting a free credit check (free for 30 days, then £14.99 a month - cancel online any time) to make sure you’re on track, or at least know if there are any areas where your credit report could use some work.
Then, when you feel like you’re approaching the right time to buy a UK property, reach out to a mortgage broker who knows just how to find the product to suit your needs. They’ll also be able to hold your hand throughout the application process, ensuring you don’t make any mistakes and giving you the best chance of being accepted the first time.
If you’re planning to apply for a Tier 2 Visa mortgage any time soon, we’re here to help! At The Mortgage Genie, our expert mortgage brokers are well-versed in helping people just like you to buy the home of their dreams in the UK, and we would love to do the same for you!
To find out how we can help, get in touch with us today on 033 33 44 33 72 — we’ll be waiting for your call.