The main issues for any bank are:

1)identifying you and where you live

2)establishing that the sources of your own money is legitimate, which lenders find problematic when it comes from abroad

For these reasons most UK banks won’t lend. However, there are a number of specialist lender who will and we understand their requirements and we can help guide you through their processes to be accepted as a legitimate borrower.

Ideally, you will already have some UK debt that you have been servicing.

Don’t worry if you do not have any current UK debt, we are able to fund ex-pat and Foreign National investment property purchases without UK Landlord experience and also re-finances and short term refurbishment loans, which you can either repay with a sale of the property, or a re-finance to a long term lender.

Make no mistake, in today’s climate, it can be a frustrating and lengthy process to establish your borrowing credential in the UK, but Bond Finance is on hand to help.

Please see below a few case studies.

 

Scenario 1: Foreign National buying property in the UK teaming up with a property expert

An Australian professional living in Melbourne earning $150k pa. He had $180k (Aus) in cash and he wanted to invest in the UK property market.

Solution:

• He teamed up with one of the property professional we know in the UK

who was happy to do a JV (joint venture) property project with other people. 

• We regularly speak at UK property investment club meetings and we are recognised as expert brokers for PIN (Property Investment Network) members. 
• In this case a PIN member agreed to the JV
• Following this introduction, a property company was set up and a property was purchased. 
• The project was to buy a residential property and to convert it to an HMO (House of Multiple Occupancy) to maximise the rent. 
• The PIN member was the “local expert”, who sourced the property and ran the project through to conversion to a fully licensed HMO. 
• He put forward one of his existing properties for secondary security. 
• He now manages the newly created HMO property alongside his own HMOs. 
• The Australian professional, was “the investor”. He supplied the cash required the costs of the conversion works and various fees. 
• Bond Finance arranged the funding. 
• Both parties are shareholders and directors of the company. 
• They are continuing to make more acquisitions using this model.

 

Scenario 2: Foreign National re-mortgaging an unencumbered property and purchasing another on the same application

A client from Hong Kong purchased an investment property in the UK using 100% cash a few years ago when mortgages for Foreign Nationals were not readily available. The client wanted to remortgage and purchase another UK investment property. The client earned £50,000 and owned their own home in Hong Kong also. The property value was not high enough to meet a lot of UK lenders minimums. 

Solution

• We used a specialist mortgage lender that allowed us to offer their existing property and the new low value property as sufficient security to allow 100% funding and meet with the lender’s minimum loan size

 

Scenario 3: Foreign National first time buyer purchasing an HMO

A Client from Singapore wanted to invest in the UK and for his first investment purchase he chose a high income-producing House of Multiple Occupancy (HMO). The client owned their own home in Singapore and no other properties. The client had a good salary of £80,000, working for a large banking corporation. 

Solution

• We set up a meeting with one of the specialist foreign national lenders to discuss the application. 
• Even though the client did not have and landlord experience, the client had a very positive salary position. 
• The client was required to take on the existing managing agent for the property
• The property was required to be fully tenanted at completion of the purchase
• The lender agreed to lend at 65% LTV of the value of the property

Scenario 4: Foreign National purchase, refurbishment and remortgage

Two business partners, one residing in Singapore and the other one residing Hong Kong work in the property industry in their residing countries, although no direct buying experience. One of the clients had a BNO (British National Overseas) passport and had also lived in the UK for a period of time in the past. The clients’ plan was to build a portfolio by: buying a property, refurbishing and adding value and then refinancing to pull out some of their initial investment to invest I the next property. The clients found two properties to purchase. The purchase price was £110,000 for one and £90,000 for the other. The build costs were £17,000 for each property. One project was to refurbish the very dated property to a high end property, the other project was to create a 2 bedroom house into a 3 bedroom house. 

Solution

• As one of the clients had a BNO passport and also a UK credit footprint we were able to utilise a UK lender that provides a “bridge finance to let” process, allowing the clients buy and carry out works using a bridge loan and then switch onto a term finance mortgage at the uplifted value and rent out the property.
• We helped the clients prepare a valuation pack which breaks down the project in detail and is presented to the valuer to assist with his value now and post-works projected value
• The valuer appreciated the valuation pack and provided a post works value of £160,000 for one project and £145,000 for the other project. 
• We took the clients through to completion of the purchases
• Within 3 months, the build works were completed.
• We arranged for the same valuer to return and re-inspect the finished properties
• The valuer confirmed both post-works values again and we took the client through the refinance process maximising the full 75% LTV (loan to value) against the uplift values of £160,000 and £145,000
• Our clients were able to pull out all of their deposit and the money they spent on the works and recycle it for their next project

Scenario 5: Ex pat Buying another property in the UK

An English couple emigrated to Australia and after a couple of years they decided that they wanted to buy a property for investment purposes in the UK. They were renting out the property that had been their main residence in the UK and they had two other investment properties. One of these investment properties was valued at £500k with £150k mortgage and the other one was valued at £400k and had a mortgage of £120K. The fact that they already owned investment properties in the UK and they could demonstrate that they were renting them successfully whilst living in Australia provided a mortgage lender with the comfort it required to lend to them. They could also demonstrate that their UK mortgage accounts were well-maintained. Between them they had an earned income in excess of the equivalent £50K.

• A local agent identified a suitable property for them to invest in
• The purchase price was £400K
• Our client did not want to send cash to the UK

Solution

• We refinanced the property worth £500K to repay their current lender and raise the 25% deposit required to buy the new property as well as sufficient funds to pay the local taxes, valuation, legal and other fees
• We then raised a mortgage of £300K to assist with the new purchase
• The other property remains available to help with the purchase of another purchase

Scenario 6: Expat buying, refurbishing and selling property in the UK

An English ex-pat retired to France and has a property portfolio in the UK. The rent from this is his primary source of income. He is benefitting from the fact that his mortgages are at exceptionally low rates. His brother lives in the UK and he has had some experience with buying and refurbishing properties in the UK. The brother could demonstrate that he made a profit from buying, refurbishing and selling a couple of properties. The ex-pat wanted to use the considerable equity in his UK properties to work on similar projects with his brother.  The brother in the UK identified a property and agreed a purchase price at £250K. The project costs were £100K and the post-works value was £475K.

Solution:

• We arranged Ex-pat short term refurbishment finance. 
• We arranged a first charge mortgage of 75% of the purchase price of the new property. 
• Using the same lender, we raised more funding secured, on a second charge basis against one of the properties in the ex-pat’s portfolio to raise a second 
• A second property in the existing property was used to secure more second charge funding to cover the local taxes, fees and costs of refurbishment works as well as all of the interest costs
• After 7 months the property was sold for £480K and the brothers were able split the profit
• In fact, they had bought the property in a UK property company that they had set up for this purpose (an SPV) and they left the profits in the company, which has enabled them to move on to their next project