Expats are re-mortgaging to reduce outgoings

EThere are many reasons to consider a re-mortgage especially if you are currently on the standard variable rate (SVR) but you should remain cautious as this is not always the correct action to take. Always seek professional independent advice as to the best way forward for yourself as your current plan may well have penalties.

The most popular re-mortgage reasons are listed below.

Securing a better rate of interest

Changing to a fixed deal to manage outgoings

Raising capital

Reducing current loans or credit cards

How a fixed rate can help you.

Expats are beginning to ask how a fixed deal can assist them now and in the future. Good news is there are still some very good deals available but who knows how long for.

A fixed rate mortgage will do exactly what it says on the tin! It fixes the payments you make to your lender for an initial period of time when the mortgage commences this is usually 2 – 5 years. These days mortgages change in structure frequently and it may be possible to get a longer period than 5 years, just ask what is available.

The benefit of a fixed rate deal is that it allows you and your family budget properly, safe in the knowledge that your mortgage payment will not increase for the fixed period. This is really useful if cash flow is tight or you don’t want the uncertainty of payments increasing without warning.  This can be very comforting if you are an expat landlord running a business as you will know your fixed outgoings and your rental income.

If your budget is flexible and you have a surplus of funds each month you may be prepared to sacrifice the security of a fixed rate. You may select to gamble that rates will reduce and select a variable or tacker type mortgage. To be honest this is unlikely with today’s low interest market but if rates increase then your decision to fix will be a very good one indeed.

Need some guidance?

Can we be of assistance with your new mortgage/re-mortgage we have fully qualified independent advisers waiting to help you.

Expats – Impact of Brexit

EIf you are considering property as an investment in the UK but you live outside of the Country the exchange rate fluctuations are likely to have a significant impact on your decision. Future rates of exchange are likely to depend on the kind of exit deal that is negotiated, combined with the currency that you will be using to purchase a property.

It is also worth being aware that the UK Government has announced that it is considering introducing additional Stamp Duty for non-UK residents buying property in the UK, although this has not been defined nor has a date been set for when/if this could be implemented.

Mortgages

Stepping away from currency and exchange rate fluctuations, it is widely predicted that interest rates may rise at some point. That said, nobody really knows exactly what conditions would have to be met as a result of exiting the EU that would have a direct impact.

We know from experience, immediately after the vote to leave the EU, interest rates were reduced by 0.25%, but whether this would happen again in the event of no-deal, it is unclear.

What is always prudent in such periods of uncertainty is to review your current mortgages rates and consider switching to a fixed rate for a period that is suitable for you. Use a mortgage calculator to establish what would happen if rates rose/fell and then speak to an independent mortgage consultant to discuss whether it is worth re-mortgaging.

If you are already using a fixed rate mortgage, be aware that most UK banks will let you re-evaluate your fixed term without penalty if you are within three months of the fixed term coming to an end.

Can we assist you?

If you are looking for a new or re-mortgage do get in contact and one of our qualified advisers will be happy to help.

Expats continue to buy in the UK

EExpats are in ever increasing numbers trying to either get on the ladder or increase their current UK holding. The majority of expats see property in the UK as a “pension fund” or a way of laying financial security for the long term. Brexit has had it’s effect and will no doubt continue to do so until “the dust settles”.

Bricks and mortar have always been a national obsession. The wisdom that property is fundamentally a very good long-term investment has been passed down from generation to generation. To be honest over the years this wisdom has been very good advice and looks like being so for a good many years to come.

Expat mortgage applications are currently at an all-time high as they seek to establish a foothold onto the UK property market. It would seem that the high property prices do not deter the investor.

According to recently released figures UK property has been the most consistent performing market in the whole of Western Europe. It is therefore not surprising that so many people want to invest in an ever-shrinking market.

Property values have increased year on year for the last 10 years and look set to continue to do so albeit at a lesser rate.

Good time to buy in the UK?

The very quick and simple answer is yes.

The affordable properties that are available to purchase seem to be diminishing on an annual basis, which without doubt will mean higher prices to pay in the future. The good thing is there are still some very good mortgage deals around for expats so it could be the right time to start your search.

Need assistance?

If you require help with your current or new mortgage please call one of our experienced advisers who will be happy to assist.

Expat’s freeing up cash.

EExpat mortgage business is very buoyant currently and in particular the re-mortgage area as expats look to released locked capital within their UK properties.

A recent report shows the average amount released currently stands at over £44,000 per case as of the end of January this year and the number of re-mortgages rose by 12.5% year to date.

There seems to be within the expat community a Brexit caution mode at present, expats are re-mortgaging to fix the deal to alleviate potential problems any Brexit decision could make.

The report shows December and January witnessed a very strong month for mortgage lending within the expat community as house buyers rushed through purchases. This high activity is attributed to the ongoing Brexit situation.

Our director of operations commented “It would seem expats have re-mortgaged their current UK property to raise funding for further purchases within the buy-to-let market”.

Over the coming week’s speculation about Brexit will continue to dominate the news and have an unsettling effect on the markets. However, this should not dissuade people from re-mortgaging if there is a financial benefit to the borrower.

There are some very good re-mortgage deals on offer currently with extremely good interest rates being available. If you are considering a re-mortgage it may well be prudent to explore what fixed deals are on offer as at some stage interest rates are likely to rise.

Can we help?

If you are contemplating a new or re-mortgage please do make contact and one of our fully qualified advisers who will be happy to assist.

Expat mortgage market is all change

EThe mortgage market in Britain is experiencing a notable change as the reasons why expats re-mortgage evolves. Expat UK home owners are moving away from short term deals and variable rates onto two and five-year fixes at low rates in moves to guarantee certainty and financial security, according to the latest reports.

Only 17% of expat owners re-mortgaged to lower their monthly repayments in December last year compared to 21% in September. 15% re-mortgaged to increase the size of their overall loan in December, a fall from 19% in September.

The analysis suggests that instead of re-mortgaging to lower monthly repayments or borrow extra money, expats appear to be nervous about interest rates increasing and re-mortgaged onto long term deals for certainty and financial security. Just 2% of re-mortgagors predict interest rates to fall in the next year, with the remaining 98% expecting rates to either stay the same or rise. The Brexit situation is without doubt having a say as to how people see the next few years panning out.

Over a third, some 37% fixed onto a longer-term deal in December and January, the greatest since numbers were first tracked, and a significant increase from 7% who previously had a fixed five-year product.

This is a meaningful change in expat behaviour when re-mortgaging. Typically, over the last year, people were re-mortgaging to save on their monthly repayments or borrow additional funds. Instead, with rates low and expectations of a rate rise high, expats are fixing for longer for added financial security.

Expats it would seem are taking shelter from future rate rises and preparing for potentially turbulent times to come. The way people borrow is changing, there is a significant decline in interest-only and variable rate deals, fixing for longer appears to be the top priority.

Can we help?

If you are looking for a new or re-mortgage please do make contact and one of our qualified advisers will be happy to assist.