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Bridging Finance for UK expats
If you're a British expat looking to buy UK property, bridging finance could be the key to moving your plans forward.
You might be hunting for a residential property to move into, looking for an investment buy-to-let, or contemplating a ground-up development opportunity.
Whatever your situation, with the UK property market moving as quickly as it is, bridging finance could be the right option for you.
Key Takeaways
- Fast Access to Funds: Bridging loans can be arranged in as little as 3–5 days, giving you competitive buying power in the fast-moving UK property market.
- Solves Mortgage Delays: Bridging finance helps overcome delays often faced by expats during standard mortgage approval due to overseas residency.
- Short-Term Loan Solution: These loans act as a temporary funding solution until a long-term mortgage is secured or a property is sold.
- Eligibility Factors: Lenders assess existing assets, the value of the new property, loan duration, and available documentation.
- Challenges for Expats: Proving identity and income can be more complex without a UK footprint; some lenders require in-person meetings or original documents.
- Expert Support Recommended: Using an experienced expat mortgage broker such as ourselves, and UK-based solicitor can speed up the process and improve approval chances.
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What is bridging finance for expats?
Bridging loans 'bridge' the gap between securing a mortgage for a new property before an existing property is sold.
They enable short-term access to funds,with the value of any assets you currently own, the future value of the property you intend to buy, and the length of time you'll need the loan for all key factors in your eligibility.
Why bridging finance might be the right option for you
When you've made the decision to buy property in the UK, you may quickly realise that you will need to be in a position to move fast.
Demand for UK property is outstripping supply which has obvious implications if you're an expat buyer.
If a delay in raising funds or securing a UK mortgage loan means you are going to miss out on a new property opportunity, a bridge loan can be the perfect solution.
The 7 advantages of bridging finance
To move fast and secure the deal against competing buyers
A bridge loan can be set up in as little as three to five days, and effectively gives you the same purchase power that cash-buyers enjoy.
2 To enable you to grab an opportunity if you are on a visit back to the UK and see a property you like
If you're an expat back in the UK on a visit, you'll often be time-pressured and trying to pack a lot in - including property buying. Longer-term mortgage finance naturally takes a lot longer to complete, while short-term bridging finance is fast.
3 To secure a quick-purchase discount
Sellers are always ready to shave the price in order to get a confirmed sale in the bag sooner rather than later. So if you're in a position to move quickly, there's a greater chance of getting a buyer discount.
You want to do some refurbishments before moving into a property
If you’re only over in the UK for a short time, you don’t want to spend it living in a building site because you’ve had to sell your previous property to fund the renovation works. Bridging finance enables you to complete renovation work, improve the value of your new home and secure a longer-term mortgage on a higher valued property.
You want to do refurbishments quickly before selling a property
Short-term finance allows you to do the work that will help a property to sell.
You need time for a property to find its full market value
If you're waiting for your current home to sell and want to realise its full market value, short-term lending can save you having to accept the first buyer who comes along.
7 You need to pay inheritance tax on a relative’s estate
Although property bridging finance is secured against the value of a property, it doesn’t necessarily have to be used for purposes relating to the property – so long as there's a clearly achievable “exit” for repaying the loan. Which could be the value of an inheritance currently in probate.
Read our blog about using bridge finance to pay inheritance tax
Things to bear in mind if you're an expat thinking about bridging finance
- It is more difficult for lenders to verify your identity and income. The various forms of identity required are very dependent upon a UK "footprint": bank accounts, utility bills, council tax records, the electoral register etc.
- Some lenders will require "wet signature" original documentation, rather than verified documentation filed online, which can slow things down a bit.
- But a good mortgage broker will tell you everything that will be needed, and streamline the submission of your documentation, to speed the process.
- It is possible to provide alternate sources of verification, but not all lenders are willing to be flexible. Fewer willing lenders means less competition, so rates can sometimes be higher.
- You’ll need your accounts to be prepared by an internationally-recognised accounting firm.
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- You’ll need a solicitor to verify your documentation who’s either based in your overseas country of residence but experienced in UK property law. Or is based in the UK but able to work effectively with a client in a different time zone.
- We would usually recommend using a UK solicitor experienced in bridging finance. But it may be possible to use the services of your lender’s solicitor in order to speed up the process.
- Your lender may want to meet you face-to-face: be prepared to time a return visit around a bank meeting.
Will it take longer?
One of the most useful features of bridge finance is how quickly it can be set up.
- A bridging loan is secured primarily against the value of the property you already own, rather than your present or future income.
- Property values can be more easily verified. Sometimes, depending on the loan-to-value (LTV) of the borrowing you need, a desktop valuation may be sufficient.
- An experienced expat broker will tell you all the records you need to assemble, package your application, and chase it through the approval process.
- Unless your circumstances are particularly complex it’s possible to set up bridging finance for expats in a very similar timeframe to local deals – sometimes in less than a week.
Contact Clifton Private Finance
To access this kind of specialist finance, you need a mortgage advisor who’s up-to-date with the range of deals available across the whole market, and who can get access to the private banks and lenders who are willing to offer competitive terms on this kind of "niche" lending.
Our specialist team of expat brokers will chase their contacts to find the most affordable finance for you, with the terms you need.
Call us on 0117 959 5094 to discuss your requirements.
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