There are many individuals who are resident in the UK, yet receive payment of part (or all) of their income in a foreign currency. Many law firm professionals, investment bankers and sports professionals receive their salary, bonus and sponsorship payments in US dollars, Euros and various other currencies.
Can I Get A UK Mortgage If I Am Paid In A Foreign Currency?
The short answer is, yes you can. If you visit your current bank to acquire funding, it may be discouraging to be turned down due to part or all of your income being paid in non-sterling currency. However, some high street lenders can still take a view on non-sterling income, often involving what they call a ‘haircut’ off the top of the income. A haircut is essentially a subtraction of 10% to 25% from the income before assessing mortgage affordability.
The reason for the haircut is to mitigate possible fluctuations in exchange rate, with different lenders using different percentages when applying the haircut to the income. As a result of this, affordability can vary substantially between mortgage providers.
Which Foreign Currencies Are Acceptable For A UK Mortgage Application?
Income paid in Euros, US Dollars, Canadian Dollars, Australian Dollars, New Zealand Dollars, Japanese Yen, Singapore Dollars, Swiss Francs, Danish Krone, Norwegian Krone, Czech Koruna and UAE Dirhams are just a few of the common currencies which can be accepted by high street lenders.
In order for a high street lender to accept this income you would need to be UK resident. If you are a non-UK resident and are looking to purchase in the UK as a main residence, a lender will need to know your intentions for your return. They would likely need confirmation from your employer that you are relocating back to the UK.
What If I Don’t Meet The Standard Criteria For A Foreign Currency Mortgage?
If your income is more complex and involves shares, carry-and-deferred bonus payments, or income which is generated and left in another country, we can look at lenders who can take the time to understand this complexity and use these income streams for affordability. Often this may be via the Private Bank route due to the loan size involved.
Using A Broker For A Foreign Currency Mortgage Application
Fox Davidson are award-winning mortgage brokers with offices across the south-west and in London. If you require a mortgage in the UK but are paid in a foreign currency, give one of our team a call today on 0117 989 7950.