UK National Living Between the UK and US Looking to Refinance UK Property

• Client: UK national splitting their time between the UK and US with income from both jurisdictions
• Property: UK residential property valued at £550,000
• Challenge: Required refinancing of bridging finance while managing dual UK and US income streams and a split living arrangement
• Finance: £412,500 mortgage at 75% LTV, fixed at 1.34% for two years over a 30-year term

Clients who divide their time between the UK and overseas can face additional considerations when arranging mortgage finance, particularly where they receive income from more than one country. Enness was approached by a UK national who was splitting their time between the UK and US and looking to refinance an existing bridging facility secured against a UK property.

The property was valued at approximately £550,000, with the client looking to refinance borrowing of £412,500. This represented a loan to value (LTV) of 75%.

The client had originally used bridging finance to fund the purchase of the property. While bridging finance can provide a useful short-term funding solution, the client was looking to replace the facility with a longer-term residential mortgage and reduce the cost of borrowing.

The application presented several considerations for a prospective lender. The client was living between the UK and US, while their income was generated through two separate streams, one from each jurisdiction. The US income was also received in a different currency, creating an additional consideration when assessing affordability and potential currency fluctuations.

The client intended the property to be their main UK residence, but their split living arrangements meant that some lenders would apply more restrictive criteria or pricing. The existing bridging facility also carried a significantly higher rate than the traditional mortgage finance the client was seeking.

Enness therefore approached lenders that were comfortable considering international income alongside borrowers with non-standard residency arrangements. The objective was to identify a lender able to assess the two income streams together while still providing competitive residential mortgage terms.

Following discussions with a private bank, Enness secured a mortgage of £412,500 against the £550,000 property, representing 75% LTV. The facility was arranged at a fixed rate of 1.34% for two years over a 30-year term at the time.

This represented a substantial reduction from the client’s previous bridging finance rate of 7%. The new structure therefore provided a longer-term mortgage solution while significantly reducing the cost of borrowing during the initial fixed-rate period.

The case demonstrates how UK mortgage finance can be structured for borrowers who divide their time between the UK and overseas and receive income in multiple currencies. Where a borrower’s circumstances fall outside standard high-street criteria, specialist and private banking lenders may be able to take a broader view of the overall financial position, subject to individual circumstances and lender criteria.

For clients looking to replace short-term borrowing with longer-term residential finance, remortgage solutions can provide an opportunity to restructure existing borrowing and potentially reduce the cost of finance, subject to affordability, valuation and lender criteria.

Read the UK version of this case study.