Who overseas borrower bridging is for
Overseas borrowers fall into three broad groups. UK nationals living abroad, often called expats, may want to buy or keep property in the UK while they are away. Foreign nationals may live in the UK or overseas and buy UK property as an investment or for future use. And some investors hold UK property through companies registered outside the UK, such as in the Channel Islands, the Isle of Man or other jurisdictions.
Many mainstream lenders restrict lending to UK residents. Bridging lenders tend to be more flexible, focusing on the property and the exit, but each sets its own rules about which countries of residence and nationalities it accepts. Countries subject to sanctions or considered higher risk for financial crime are commonly excluded.
Documents and checks
Lenders and solicitors must carry out anti-money laundering checks, and these take more work when the borrower or funds are overseas. Preparing documents early is one of the most useful things you can do. Expect to provide:
- Certified copies of passports and proof of address, with translations where needed
- Evidence of the source of the funds for your deposit and costs, and how they were built up
- For companies, constitutional documents, registers of directors and shareholders, and identification for the people who ultimately own or control the company
- Bank statements and, where relevant, evidence of income or assets
- Details of any UK credit history, address history or existing UK property
Certification requirements vary, and some lenders need documents certified by a lawyer, notary or embassy. Your solicitor will usually need to verify documents too.
Structure, guarantees and the exit
Where an offshore or UK company is the borrower, lenders usually want personal guarantees from the directors or shareholders. Some lenders are cautious about guarantees from people living in countries where a UK judgment may be hard to enforce, and may ask for additional security or a lower loan to value instead.
The exit needs particular care. If the plan is to refinance onto an expat or foreign national buy-to-let mortgage, check early that such a lender will accept your country of residence, nationality, income and the property type, as that market is narrower than the mainstream. If the exit is a sale, the usual evidence of value and saleability applies.
Currency is another factor. If your income or funds are in another currency, movements in exchange rates can change the cost of repaying the loan in your own terms.
If you need finance that does not charge interest, Sharia-compliant bridging is structured around a profit rate instead, subject to the provider's own residency criteria.
Tax and costs to consider
Non-UK residents buying residential property in England and Northern Ireland pay a stamp duty land tax surcharge in addition to the standard rates and any higher rates for additional properties. Different taxes apply in Scotland and Wales. Ownership through an offshore company can bring further tax and reporting requirements, including registration of overseas entities that own UK land. Take advice from a UK tax adviser and solicitor before committing.
Bridging costs include interest, arrangement and exit fees, valuation and legal fees. Legal costs can be higher where there are overseas structures or documents to verify. We compare lenders on the countries and structures they accept, the documents they need and the overall cost. Instant Quotes gives indicative figures as a starting point, and final terms depend on each lender's valuation and checks.
If you or your family will live in the property
If the borrower is an individual or the trustees of a trust, and the property is, or will be, lived in by you or a close family member, the loan is a regulated mortgage contract with additional protections. We will tell you at the outset if that applies and how your case will be handled, and Instant Quotes shows only products built for regulated bridging when you tell us so.
Your home or property may be repossessed if you do not keep up repayments on a mortgage or any other debt secured on it.
