Expat Mortgage - Australian Citizen Living in UK Earning £ - Best Lender for Australian Investment Property?

LChocolateandcake on 14/01/2021 - 23:11
Last edited 15/01/2021 - 09:14 by 1 other user

Hello!

Australian citizen working (earning £ and paying UK tax) and living in the UK hoping to return to Aus in the next few years.
My income = UK salary + predicted Aus rental income from this property.
I am temporarily back in NSW visiting family for the next few months, but I will return to the UK. Still working for my UK company (not self-employed).

I would like to buy my first property (very) soon so I have something stable to return to when I return to Aus permanently.
This property would be rented out while I am overseas (so investment property) and I will move-in when I return.

Can anyone recommend the best lending institution for my situation?
I have spoken to the big 4 +some internet banks but was wondering if anyone had/knew someone who had gone through a similar process and could share their experience?
I know some banks only consider 60-80% of foreign income and that GBP are readily accepted (thankfully).

Fortunately, I have a sizeable deposit so I am hoping to borrow around 40% of my goal property value (I have been looking at some places) in NSW.

Thank you :)

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  azm on 14/01/2021 - 23:41

  It may be easier for you to use a Mortage broker instead of doing it on your own. Pls have a look at Propertychat

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    Chocolateandcake on 16/01/2021 - 23:20

    I actually read that exact thread before posting here. Thank you for replying

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  dasher86 on 15/01/2021 - 08:57

  you could schedule an online appointment with an AU mortage broker - pretty simple these days due to covid.

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    Chocolateandcake on 16/01/2021 - 23:21

    I’m actually in AU at the moment temporarily. I’ve contacted a mortgage broker so hopefully they can assist. I’ve never used one before

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  GG57 on 15/01/2021 - 09:11

  I don't know for sure, but would HSBC be a good option, particularly if you were to use them for your domestic banking in the UK?

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    Chocolateandcake on 16/01/2021 - 23:21

    They only accept 60% of foreign income while the other banks accept 80%. I assumed they would be good for expats too!

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  sweefu on 15/01/2021 - 10:07

  Broker here.

  I find Macquarie and Bankwest the simplest to deal with the expat loans. They will both shade your income and have policy niches to work through, but both are generally simple to work with.

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    Kinko82 on 16/01/2021 - 19:25

    Recently asked Macquarie and they said foreign income cannot be sole source or majority source of income required to meet loan serviceability.

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      Chocolateandcake on 16/01/2021 - 23:20

      Oh no! When did you ask?

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        Kinko82 on 16/01/2021 - 23:21

        Just this week so best to contact them to check it out if you’re considering Macquarie bank as a potential option.

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          Chocolateandcake on 16/01/2021 - 23:22

          @Kinko82: Thank you!
          May I ask what foreign currency you were asking about? Also pounds?
          Banks seem to have different rules for different currencies

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  netjock on 15/01/2021 - 11:43

  There is a Commonwealth Bank branch in London. Might be helpful to talk with them.

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    Chocolateandcake on 16/01/2021 - 23:21

    Thank you. CBA has offered the least to loan :(

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      netjock on 16/01/2021 - 23:40

      +1

      I tried the same as you a few years ago.

      But the way the banks view income is the problem not the LTV. I feel for you.

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        Chocolateandcake on 16/01/2021 - 23:42

        Who did you end up borrowing with?

        It’s just mental that I have a considerable deposit but they will barely loan me anything. If I were unreliable with money how would I have such a large deposit?!?

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          netjock on 16/01/2021 - 23:52

          +1

          @Chocolateandcake: No one.

          Funny enough I have a UK Buy to Let on 1.99% tracker for 2 years with a £349 fee with HSBC (I have to pay same fee and pick a deal after two years). HSBC paid for my valuation and legal fees too basically I had to pay nothing for the mortgage.

          It is a lot easier to work in Australia and mortgage borrow in the UK than the other way around. There is more banking competition in the UK although they still moan about power of NatWest (RBS), Barclays, HSBC and Lloyds.

          Here in Australia two problems. One is there is no shortage of borrowers given they don't really discriminate unless you are on 80%+ LTV. Where as in the UK 90%+ LTV mortgages get pulled first and if you are <60% the banks will basically give you money without a thought.

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            Chocolateandcake on 16/01/2021 - 23:59

            @netjock: So true!
            Congratulations on the UK property. I was tempted but I don’t like the leasehold concept.
            Who do you normally bank with? I’m with lloyds.

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              netjock on 17/01/2021 - 00:11

              @Chocolateandcake: Don't buy leasehold. Stay well away. Read money saving expert on leaseholds. Buy freehold which is like our forever ownership. If you can't find a place in England go for Scotland, they don't have leaseholds.

              Best thing about UK buy to let is your tenants pay all costs. You are just left with building insurance + mortgage.

              Yield in some places are 6% - 7% when mortgage rates are really low.

              Who do you normally bank with? I’m with lloyds.

              Barclays & Halifax (part of Lloyds). Mostly due to historical relationships as I worked Barclays and Halifax gave monthly credit for paying salary into their accounts.

              Since you are still in the UK look into geting a SIPP (Self Invest Personal Pension) 0% tax going in, 0% tax on returns, 1/3 tax free when you retire and the rest is on marginal tax rate. A lot better than super in Australia.