UK mortgages and home loans: A foreigner's guide


Wherever you go in the UK, you’ll find active expat communities. Whether you’re looking for a career in one of the major cities, or a more peaceful rural life, there will be somewhere that suits you in the UK. Although many foreigners arrive in the UK for a shorter stay, to study or explore, many more settle for the longer term.

If you're one of them, then you might be considering joining the 63% of Brits who own their own home by buying your own property. Maybe you want a place to live in yourself, as an investment purchase, or to use as a vacation home. Whatever your reasons, you need to understand the type of mortgages available in the UK, and the steps needed to get one set up. This handy guide covers which banks offer mortgages and home loans in the UK to non-residents, the paperwork you'll need to get your loan, the legal ins and outs and what it might cost.

Mortgages in the UK : What types of mortgages are available?

The mortgage market in the UK is very well developed. In fact, the choice of different mortgage products can be overwhelming, so you need to know a bit about how each of them works, to make a considered decision.

The first thing you have to decide is whether you want a fixed rate, or variable rate product. Fixed rate mortgages will guarantee the same interest rate will be applied for the duration of the agreement - usually up to five years.

Variable rate mortgages, however, can cost more or less depending on how the interest rates change. They might be based on the Standard Variable Rate (SVR) your bank decides on, or the Bank of England (BoE) rates. Some products match the SVR or BoE rates exactly, some are slightly higher than these rates, but track them as they move up and down, and some offer a discount on these rates - typically only for a short period.

There are also different products which are available only to buyers in specific situations. First time buyers, or those purchasing a second home for buy-to-let, for example might be entitled to different offers than other buyers.

Different banks will offer different products, and not every customer can access all of the loans available - so it’s important to check the small print. It’s a good idea to get some specialist advice from a qualified financial advisor or mortgage broker, who can explain the options available to you.

Should I go to a bank or use a broker?

In the UK it's perfectly possible to arrange a mortgage directly with your chosen bank. However, in some cases, and especially if you’re not sure what type of product is best for you, taking expert advice from a qualified mortgage broker is a good idea. It’ll cost you, but could work out good value in the end.

That’s because a mortgage broker is obliged to work in your interests, and explain in detail why they recommend a specific product for you. If you’re unhappy with their services, you can lodge a formal complaint. However, if you speak directly to a bank, and aren't really sure what you want from your loan, you might take on a mortgage which works out to be a poor fit to your needs. Although a bank must check that any product they offer you is affordable for you, they don’t have to make any further recommendations beyond this. This can result in a costly error if you’re not confident and clued up about the UK mortgage market.

What are the legal requirements to get a mortgage in the UK as a foreigner?

Foreigners, resident or not, can legally buy property in the UK. As an expat you can also apply for a mortgage, although individual banks will set their own terms. You might find that you're offered slightly less favourable conditions, or higher interest rates, as a foreign investor.

How can I get a mortgage in the UK as a foreigner?

Getting a mortgage in the UK is relatively straight forward, although subject to a number of checks to ensure that you can afford the loan. Availability of finance depends on your circumstances, but because the UK mortgage industry is highly competitive, it’s worth talking to a few banks to see what deals they can offer you.

Paperwork (documentation)

The exact paperwork you'll need will depend on the bank you use. However, you can expect to be asked for the following:

  • Copies of your personal identification documents (passport)
  • Proof of legal residence in the UK
  • Documents to prove you're creditworthy (usually a credit check, bank statements, proof of your wages, your P60 benefits statement or a letter from your employer)
  • Documents to prove the affordability of the mortgage (these might be household cash flow statements, utility bills or bank statements which show that you can afford the monthly payments)

All of these documents should be provided to the bank to get a mortgage in principle, which means that they agree how much they'll lend you if you find a suitable property. Once you have an offer accepted on a home, you’ll have to hand over more paperwork, such as a property valuation and survey to prove it’s priced fairly.

The step-by-step process

To get a mortgage in the UK, you’ll generally need to follow these steps:

  • Decide if you want to use a broker to explore your options for a UK mortgage
  • Choose a bank with a mortgage that suits your needs
  • Hand over the paperwork requested and get an offer in principle
  • Find a property within your budget and agree on a purchase price with the seller
  • Choose a local solicitor who will help with the legal aspects of the purchase
  • Pay your deposit to secure the sale, and agree a completion date
  • Commission searches and surveys as required by your bank
  • Once the surveys are complete, you're able to ‘complete’ the sale. You’ll take ownership of the property and become liable for the mortgage payments and any additional taxes such as stamp duty


Arranging a mortgage in the UK will mean you have to have fees to pay such as administrative fees and legal costs. The exact costs will vary depending on your circumstances, but when you add it all together, it’s a costly transaction. In addition, you have to consider stamp duty, which is a progressive duty, based on the value of the property, and can be up to 15% if you're buying a second home in the UK.

In the UK, when arranging a mortgage, you can also expect to pay the following fees:

  • Mortgage booking fee, to hold the offer in principle for a fixed amount of time: up to £250
  • Arrangement fee: up to £2000
  • Property valuation fee: £150 - £1,500
  • Broker fee: around £500

If you’re trying to arrange your home purchase before moving to the UK, you might find paying fees and incidental costs difficult unless you’ve already opened a local UK bank account. Even then, if your main account is outside of the UK, and you need to send money to yourself from abroad to pay fees, then it’s important to check what you’ll be charged when you make an international money transfer. You’ll probably find that your home bank won’t offer you the best deal. Even if they claim to offer fee-free transfers, you can be sure that their cut will be rolled up into a poor exchange rate.

A better option is the use a specialist service like Wise, to transfer cash using the same real exchange rate you can find on Google with only a small, transparent fee. Alternatively, you can hold cash in many different currencies in a Wise Borderless account, so it’s ready to transfer over to the UK as soon as you close the deal on your new home.

What are the major banks in the UK providing mortgages to foreigners?

All major banks and building societies in the UK offer mortgage products, but they might not all have a service suitable for expats, or non-residents. It’s worth checking out the products offered, as they come with fairly strict terms and conditions. Ultimately, the decision about who is eligible for a mortgage or home loan is made by the institution. It’s worth calling into the local branch of banks which you’re interested in, for a chat about which products might suit you - or enlist a broker to help.

You might be able to get a local mortgage with one of the following banks:

  • HSBC is a global banking brand, offering a specific mortgage service for UK based expats
  • Barclays has a service dedicated to non-resident investors, looking to buy a property in the UK
  • Natwest can offer UK mortgages to residents of certain countries looking to buy in the UK
  • Skipton International have a specific buy-to-let product for expats investing in the UK

Glossary of important terms

If you’re starting to look for your perfect new place in the UK, the jargon can be a bit bewildering. Here are some important terms to help you:

  • A loan-to-value (LTV) ratio - this is the value of the mortgage expressed as a percentage of the total property value.
  • Standard variable rate (SVR) - the standard interest rate offered by the bank
  • Mortgage calculator - a mortgage calculator is an automated tool that can help you find out how much you can afford to borrow, as well as an estimation of what your monthly repayments might look like.
  • Repayment mortgages - with a repayment mortgage you pay back both interest and the capital amount borrowed over the term.
  • Interest-only mortgages - here, you pay only the interest accruing on the capital borrowed, with the capital to be repaid in full at the end of the term,
  • Fixed rate mortgages - the interest rate is fixed for a set period of time, usually two to five years, and does not change even if the SVR or BoE rate moves.
  • Variable rate mortgages - the amount you pay in interest can be changed by the bank if the SVR or central bank interest rates change.
  • Tracker mortgages - these loans track the movements of interest rates, usually the BoE rate, and move up and down at a fixed level above it. You might have a BoE + 1% rate, for example, which will always charge interest 1% higher than the level set by the central bank.
  • Discounted rate mortgages - usually these also move with the market, but instead of having a rate higher than the reference point (usually SVR), they have a discount on this. Generally offered for a short time period only.
  • Capped rate mortgages - although the interest amount charged can change, these products come with an upper limit, and you’ll never be charged more than the cap amount.

Buying a new home is a big step, and when you’re buying in a new country, it can be a daunting process.

However, the mortgage market in the UK is well regulated and you have a very good range of products on offer. They don’t come cheap, but if you do your research, you’ll get a deal that works for your circumstances. Before you know it, you could be enjoying your new home in the UK .

Good luck with buying your new home!

Please see terms of use and product availability for your region or visit Wise fees and pricing for the most up to date pricing and fee information.

This publication is provided for general information purposes and does not constitute legal, tax or other professional advice from Wise Payments Limited or its subsidiaries and its affiliates, and it is not intended as a substitute for obtaining advice from a financial advisor or any other professional.

We make no representations, warranties or guarantees, whether expressed or implied, that the content in the publication is accurate, complete or up to date.

Money without borders

Find out more

Tips, news and updates for your location