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Offshore mortgages

Written By:
Myles Robinson - Expert Finance Advisor

Posted: Feb 8, 2023

Offshore mortgages

Purchasing property is a great way to invest, as the property market generally does not fluctuate all that much, therefore a great way to make your money go even further when investing in property is by purchasing an offshore property.

In some countries, property prices and interest rates are much lower than they are in the UK, so it is a great option to explore. The unfortunate thing, however, is the fact that it can often be a long, difficult process to secure an offshore mortgage.

Thankfully, this does not need to be the case, as we can offer you expert advice here at Loan Corp that can help you choose the best offshore mortgage lenders and get the best deal possible.

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What is an offshore mortgage?

An offshore mortgage can easily be described as taking a home loan on a property that is not based in your home country.

This may be a UK resident seeking to purchase property overseas or non-UK residents looking to purchase property in the UK.

There are many reasons why someone would want to purchase a property not based in their country of residency, and offshore mortgages can make this process significantly more attainable.

There are also usually a few different types of mortgage products that people will be able to choose from, depending on how they intend to use their overseas property, but these will be discussed in more detail later on.

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Important things to consider if you are interested in an offshore mortgage

Applying for an offshore mortgage can be a tedious and arduous process that can be confusing and time-consuming.

Thankfully, we have expert advisors at Loan Corp who can help guide you through this process, though there are some important things to consider if you are interested in getting an overseas mortgage.

Tax in foreign countries

If you are looking to buy property overseas as a UK resident or looking to buy property in the UK while living outside of the country, you should consider getting some personal tax advice.

You should always seek independent tax advice if you are planning to buy a property outside of your home country, as this process is often complicated, and there will likely be certain things that you will miss when reading the fine print.

Personal tax advice can save you from making some costly mistakes and could save you a lot of time and money in the long run.

Exchange rate

You should always consider what the exchange rate looks like when you are purchasing a property in another country and changes in the exchange rate can affect how much your monthly mortgage payments cost, especially if you choose to borrow from offshore lenders.

While this generally will not be much of an issue for UK residents, as the GBP is one of the strongest currencies around, it can be a big problem for a foreigner looking to buy offshore property in the UK.

If the exchange fluctuates heavily, it may not be a good idea to purchase property in that country, as you could end up struggling to make your monthly payment, and your home may be repossessed.

Thankfully, some offshore lenders will allow you to pay for your mortgage in your home currency, and at Loan Corp, we can help you figure out which option will be best for you.

Read through your paperwork thoroughly

While tax advice is important, it is also important to have someone with knowledge of the property laws in your chosen country look over your mortgage contract.

This can be a mortgage advice company like Loan Corp, a property lawyer based in your chosen country, or an international property lawyer with knowledge of the country you are looking to buy in.

They will know whether you have the correct documents, such as licenses, planning consent, and permissions, and they should also be able to help you source these documents if you do not have them.

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What are my options for an offshore mortgage?

When you are consulting with offshore mortgage brokers, they might be interested to know what you intend to use your property for, as this can help determine which mortgage product will be best for you.

Principal mortgage

A principal mortgage is one of the most common mortgage products around, as there isn’t all that much to it, as they are usually mortgages on residential property.

A principal mortgage will require you to pay a portion of the capital you borrowed and some of the interest that accrues on it.

Principal mortgages are offered in many countries around the world, as well as the UK, so you will usually be able to secure a principal mortgage in the UK as a foreigner if you meet the eligibility requirements.

You can choose to use the home personally as a holiday home or for any other personal reason you like, but if you want to receive rental income from the property, then you should likely consider one of the other mortgage products available to you.

Buy-to-let mortgage

If you want to save some money on your mortgage payments every month, and don’t intend on living in your overseas property permanently or soon, then you should consider an overseas buy-to-let mortgage.

This type of mortgage entails you taking a mortgage out on a home that you intend to rent out on a long-term basis. You can also use the rental income that you receive to help pay for your mortgage payments.

Unfortunately, some buy-to-let mortgages in certain countries do not allow you to stay at your property, even if it is unoccupied, so you should make sure to read the fine print of your mortgage application and ensure that your mortgage broker or lawyer does too.

Holiday let mortgage

Holiday let mortgages are similar to buy-to-let mortgages; however, they differ in the way that these mortgages allow you to rent your home out on a short-term basis.

This means that you can charge more for rent, and you’ll also be able to stay in the property if it is unoccupied. The only issue is that rental income is not guaranteed to be consistent, as you won’t always be able to find guests all year round.

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What are your borrowing options for overseas mortgages?

When you are considering offshore mortgages, it is important to choose the right borrowing option for your situation.

UK lender

There are quite a few private banks and lenders in the UK that can provide you with a mortgage on a property based outside of your home country. Alternatively, if you aren’t a UK resident, and want an offshore mortgage, then many of these lenders will be able to provide you with one if you meet all of the eligibility criteria.

Remortgage UK property

As a UK resident, if you want to buy property overseas, then one of your options will be to remortgage your own home and purchase your home outside of the UK with cash. This can make it much easier to pay your mortgage payments, and you will need to jump through far fewer hoops.

This can also work if you live outside of the UK and want to purchase a UK property.

Local lender or international lender

You can choose to go with a lender from the country you are looking to purchase a home in, but this can sometimes be very complicated. You will, however, often receive better deals this way, especially if there is a lot of competition in the property market.

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What are the lending criteria for offshore mortgages?

As with applying for any loan, if you are applying for a mortgage, you will need to meet certain eligibility criteria to be granted credit.

Listed below are some of the criteria that you will usually need to meet:


Your credit score will have a rather significant effect on the offshore mortgage rates that you’ll be offered. If your credit is bad offshore mortgage lenders won’t be as willing to provide you with a loan.

Thankfully, there are still some lenders that offer offshore mortgages to people with bad credit, although you’ll likely need to pay a larger deposit and be offered a high-interest rate.


The size of the deposit you need to put down on an overseas property will differ from country to country, with some countries allowing deposits of between 10 and 20%, while some countries may require a 50% deposit if you are not a resident.



How long do you have to live in the UK to apply for a mortgage?

In order to secure a mortgage in the UK as a foreigner, you will need to have lived in the UK for at least three years, have a UK bank account, and have a permanent job-based in the UK.

Do I need to declare foreign property as a UK resident?

Yes, you have to declare all of your assets, whether they are foreign or not.

How much of a deposit do you need to put down on offshore mortgages?

If you are a non-UK resident and have applied for a mortgage in the UK, you will need to pay a deposit worth 25% of the property’s value.


Get Mortgage Advice From Loan Corp Today

If you are interested in getting an offshore mortgage either within the UK or another country, then you could benefit from some expert advice on the topic.

Thankfully, this is exactly what we provide at Loan Corp, so so contact us now and we can help you get the best deal possible.

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