Arranging a mortgage in a foreign currency for a UK residential property can be challenging, particularly where the borrower has a complex income profile. I recently assisted an investment banking consultant who was looking to secure a US dollar mortgage against a high-value property in South West London.
My client had recently established his own consultancy and was therefore self-employed. He wanted to purchase a residential property valued at £4.8 million and specifically required the mortgage to be denominated in US dollars.
The client had already approached several brokerage firms, but none had been able to secure a suitable solution. The combination of a large mortgage, foreign currency requirement and recently established business meant that the application did not fit easily within conventional lending criteria.
His income history was also relatively short and irregular following the launch of his consultancy. Rather than relying solely on recent income, the application needed to be presented in a way that gave the lender a broader understanding of his overall financial position.
OUR SOLUTION
I identified a private bank that was willing to take a more holistic approach to the application. Rather than assessing the client purely on his recent income, the lender was prepared to consider his wider assets and financial circumstances when assessing affordability.
The bank was also comfortable providing the required US dollar facility, allowing me to secure a foreign currency mortgage for the UK property.
The resulting mortgage was structured on a five-year tracker basis, providing the client with the dollar-denominated borrowing he required. This represented a successful outcome despite the complexity created by his recently established consultancy and the foreign currency requirement.
The case highlights why specialist lender access can be particularly valuable where a borrower’s income, currency requirements and property purchase do not fit standard mortgage criteria. A private bank mortgage can sometimes provide greater flexibility where a lender is prepared to assess the borrower’s wider financial position.
For clients with international income or cross-border financial circumstances, international mortgage expertise can also help identify lenders familiar with more complex borrowing requirements.
Disclaimer:
This case study is for illustrative purposes only and does not constitute financial, legal, tax or investment advice. Finance is subject to status, underwriting, affordability, property suitability and lender criteria. Terms, rates, LTVs and availability may vary depending on individual circumstances.
Risk Warning:
Your property may be repossessed if you do not keep up repayments on your mortgage or other borrowing secured against it. Property values can fall as well as rise. Foreign currency borrowing can also expose borrowers to exchange-rate movements, which may affect the sterling cost of repayments and the outstanding balance.
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Some case studies are made up of enquiries that have come into the business, not all business completes, and the posting of a case study does not represent a completed piece of business.
Property values can fall as well as rise, and you may not get back the amount originally invested. Property investments can be illiquid and may take time to sell. Where borrowing is used, your property may be repossessed if you do not keep up repayments on a mortgage or other loan secured against it.
