Overseas Mortgages A guide to overseas mortgages Many of us dream of the day when we’ll be able to retire and move to a sunnier climate to enjoy our later years, some may also have sufficient capital that they would be able to potentially afford a holiday home.  Either way, in order to be able to afford this dream not everyone has hundreds of thousands of pounds floating around to afford such an expense, especially in the current financial climate. In most cases many people looking to buy overseas property will need some form of lending such as an overseas mortgage, that or a lottery win!  But until our numbers come up then it will most likely be the overseas mortgage option.  Much like domestic mortgages you’ll be borrowing a percentage of the property’s value in return for monthly repayments with interest. There are a number of ways to go about buying property abroad and it can be a risky investment. With volatile property prices you could find that as soon as you invest, within a few months you’ll be left out of pocket.  Some people may try to remortgage their UK property to finance their new home but this can be a bit risky considering that if you struggle to meet these repayments then you stand to lose not just the holiday home but also your home here! It’s recommended that you take out a separate mortgage for your new investment and that it would be much simpler if you ask UK banks or Building societies that are familiar with the overseas mortgage lending business.  Whilst it’s possible to go to local lenders in the country you’re going to there may be different laws or procedures that you will not be familiar with and an experienced lender would be able to advise you at the very least even if you opt to borrow elsewhere. The benefit of using a British lender is that they will tend to offer more attractive rates and terms than overseas lenders, a UK lender will normally be able to offer 25 or 30 year terms at lower percentages whereas overseas lenders will insist on a 15 year term with a larger deposit of 30%. Many Brits looking to buy to rent abroad may run in to trouble as in many European countries there simply isn’t a market and so any mortgage will be based upon your income and not rental payments which normally cover mortgages of people who have tenants in the UK.  Also those already with mortgages should know that the larger your mortgage is over here then that will mean you will have a smaller mortgage overseas and this can tie in to what kinds of property you will be able to afford. As with all mortgage matters it is best to search around for the best deal that suits your situation, when you add that you are dealing with overseas mortgages, foreign laws and procedures it is also advised that you get advice from lenders in the UK first as they will have dealt with this situation for quite some time and have experience and knowledge to help you.   [ Back ]