If you or your partner are living in the UK on a spouse visa, you may want to understand the impact of your residency status on your mortgage application. The good news is that plenty of lenders consider these types of applications, although some may be more accommodating than others and requirements may vary. The options available to you will depend on your individual circumstances. We’ll discuss the available options and how to maximise your chances of success with your application. Strive Mortgages specialises in securing mortgages for foreign nationals of all visa types and is available to assist you.
What is a spouse visa?
A spousal visa, also known as a marriage visa or a spouse/partner visa, is a type of visa that allows an individual to join their partner or spouse who is a citizen or permanent resident of a country. It is typically granted to individuals who are married to or in a civil partnership with a citizen or permanent resident of the country they wish to move to.
In the context of the UK, a spousal visa specifically refers to the visa granted to the husband, wife, civil partner, or unmarried partner of a British citizen or settled person (someone who has indefinite leave to remain or permanent residency) in the UK. This visa allows the individual to live and work in the UK for a specified period, usually initially granted for 30 months or 2.5 years, and can be extended further.
To obtain a spousal visa in the UK, the applicant must meet specific requirements, including demonstrating a genuine relationship, meeting financial thresholds, and meeting English language proficiency standards. The visa is subject to renewal and can lead to settlement (indefinite leave to remain) in the UK after a certain period of continuous residence.
Can I get a joint UK mortgage if my partner is on a Spousal visa?
Yes, it’s possible. Both applicants will need to meet the lender’s usual criteria along with residency requirements. If one applicant is British or has permanent residency, some lenders may overlook the residency status of the foreign national borrower, although this is only the case with a relatively small percentage of lenders. In most instances, both applicants will need to meet the criteria, including deposit level, length of time in the UK, remaining visa type/length, property type (residential or buy-to-let), and credit score/profile.
Can I get a sole applicant mortgage if my partner has a spouse visa?
Yes, it’s possible to get a sole mortgage if your partner is on a spouse visa, but several factors need consideration. Some lenders don’t allow deposits from individuals not named on the mortgage and residing in the property. Therefore, they’d need to fund the deposit themselves. Additionally, if someone not named on the mortgage isn’t contributing to it for residency reasons, they may be classified as a dependent on the borrower’s income, potentially causing affordability issues. However, some lenders do accommodate this scenario and consider deposits provided by non-borrowers residing in the property.
How much can I borrow with a spousal visa?
The amount you can borrow with a spousal visa is subject to the same checks as any other application and is based on several factors: age, term, income, credit score, dependents, deposit, and debt-to-income ratio. Typically, lenders offer multiples of 4.5 to 5 times income. For example, someone earning £50,000 may be able to borrow £225,000 to £250,000. This amount can be reduced for those with shorter terms, high levels of commitments, or lower incomes. It’s also possible to secure higher income multiples, potentially up to 5.5 times, but these are typically reserved for higher earners, usually above £75,000 to £100,000 income.
How much deposit do I need with a spouse visa?
The required deposit for a spouse visa mortgage depends on your circumstances and the lender’s affordability model. For some, a minimum 5% deposit is possible, but residency status can necessitate a larger deposit. If you’re on a spousal visa buying with a UK national or someone with permanent residence, you may secure a mortgage with as little as a 5% deposit; otherwise, you’ll usually need at least 10%, although there are exceptions. Some lenders may require a minimum 25% deposit. While a minimum percentage of the deposit is required, you must also afford the mortgage balance itself, typically divisible by 4.5 to 5 times income.
Credit history
There is no set credit score required to get a mortgage with a spouse visa because a credit score is just a guide provided by credit reference agencies. It’s the overall credit profile that matters. Generally, you need an average to good credit score to get a mortgage, although there are specialist lenders catering to those with poor credit. The deposit amount will also play a factor; for example, those with smaller deposits will face more stringent credit checks, while those with 15-25% deposits may have an easier time during credit scoring. If you’ve recently moved to the UK, you may also need to allow time to build a credit score.
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Property
The purpose you intend to use the property for will also determine the options available to you. For example, buy-to-let mortgages typically require a minimum 25% deposit as standard. If you’ve not owned a property in the UK before and are on a spousal visa, you may have a smaller pool of lenders willing to secure a buy-to-let mortgage for you. However, those buying jointly with a British national may have more options. Additionally, there are other requirements for certain property types; for example, new build properties usually require larger deposits, ranging from 15% to 25%, depending on whether it’s a flat or a house. Some ex-local authority blocks, high rises, or flats above commercial premises may also necessitate larger deposits.
Age
Age can indeed impact your ability to secure a mortgage. Shorter terms can lead to higher monthly payments, potentially affecting affordability. Typically, you can borrow based on your earned income until your planned retirement age or age 70/75, depending on your occupation’s plausibility for working to that age. This is also usually subject to maximum terms of 35 or 40 years. However, borrowing over a longer term until a later age must be approached with caution.
To improve your chances of securing a mortgage:
- Ensure you have a good deposit. Rounding up to the next loan-to-value threshold may – improve rates and chances, e.g., reaching 5%, 10%, 15%, or 25% milestones.
- Aim to have a reasonable amount of time remaining on your visa, ideally 6 or 12 months.
- Consider buying with someone who has permanent residence, as this may increase your options.
- Work on improving your credit score, which will help widen the pool of lenders willing to consider your application.
- Avoid missed payments and maintain clean bank statements.
- Ensure you have a clear audit trail for your deposit proof, especially if it’s coming from abroad. Lenders usually require at least 6 months of history for funds from outside the EU.
- Work with a broker who specialises in mortgages for those on visas to get expert guidance and assistance throughout the process.
What are the steps involved?
For someone with a spousal visa, the mortgage process typically involves the following steps:
- Check your credit score.
- Get your documentation in order, including proof of income, residency, and deposit funds.
- Reach out to a specialist broker who can assist you with navigating the mortgage market.
- Conduct thorough research to understand your options and the requirements of different lenders.
- Obtain an agreement in principle (AIP) from a lender to understand how much you can borrow.
- Begin your property search, considering your budget and preferences.
- Make an offer on a property that meets your needs and fits within your budget.
- Apply for a mortgage with your chosen lender.
- Instruct a solicitor to handle the legal aspects of the property purchase.
- Arrange for a surveyor to assess the property’s condition.
- Underwriting process, during which the lender assesses your application and conducts checks.
- Receive a mortgage offer from the lender, outlining the terms and conditions of the loan.
- Completion, which involves exchanging contracts, transferring funds, and finalising the purchase. This typically takes 2-4 months from the point of the offer being accepted.
- Throughout the process, it’s essential to ensure clear communication with all parties involved and to address any issues or questions promptly.
Contact us today, and we’ll work hard on your behalf to find you a competitive mortgage.
For more information on mortgages for contractors, please contact a member of the Strive team, by emailing [email protected] or call us on 01273 002697.
