Tier Two Visa Mortgages

What is a Tier 2 visa?

Anyone that is a non-UK and non-EU national that is looking to come to the UK to work and live will need to apply for a Tier 2 visa. This grants you residency status and gives you the rights to live and work in the UK. The Tier 2 visa is for those in a skilled role, and a list can be found on the home office website which determines the nature of the term ‘skilled’.

Why can it be a challenge to obtain a mortgage with a Tier 2 visa?

The challenge is typically because of the lack of time spent in the UK, as it can take time to develop a credit footprint. If you are new to the UK and have a new job, lenders tend to be a bit stricter.

How do I check or improve my credit rating if I am on a Tier 2 visa?

Anyone can check their credit score. There’s lots of different credit reference agencies, with the most popular being Equifax, Experian and TransUnion. You can go online and check your credit report. Try not to pay too much attention to your credit score, however, because when it comes to applying for a mortgage, lenders look at the overall risk based on their own risk profile, and apply their own scoring system.

In terms of how you can improve your credit score, there are lots of things you can do which will help, such as applying for a credit card and then using that credit card and paying it off in full every month to show yourself to be a responsible borrower. When you are eligible to vote, being registered on the UK electoral roll can help as well. Keeping up with payments and not applying for lots of different types of credit in a very short space of time is also important. The credit reference agency websites can also give some helpful insights into how you can improve your score.

How much can I borrow if I’m on a Tier 2 visa?

It’s the same across the board in terms of how much you can borrow. There are so many variables that will determine how much you can borrow and whether you’re on a Tier 2 visa or not really won’t make too much difference on its own.

You can typically borrow four to five times your household income, but it depends on how much deposit you’ve got, your employment type and the specific lender’s criteria. You could get a number of different responses in terms of how much you can borrow from different lenders

In our discovery call, which is the first appointment with us, we can give you a really good indication of how much you may be able to borrow on a Tier 2 visa, and based on the other factors mentioned.

Is there any specific mortgage advice for foreign nationals in terms of criteria?

Generally lenders will want to see that you’ve been in the UK for a certain period of time, so you will usually need to show at least three years, and as much as six years of UK address history. You can get a mortgage with a Tier 2 visa but as your options are more limited you need to take initial advice from a broker like ourselves.

There are lenders who will be a bit more flexible if you’ve got a bigger deposit, so if you don’t have permanent status or indefinite leave to remain in the UK, then some lenders will still lend to you if you’ve got a 25% deposit.

What if I have a Tier 1 or Tier 5 visa?

There are lenders that will want permanent residency, but a Tier 1 entrepreneurial visa is not seen as massively different to a Tier 2 visa. The lender will always assess the risk of you not being able to pay the mortgage and on a Tier 1 visa now would suggest that you’re probably more likely to be able to keep up with mortgage payments due to the specific nature of your job.

A Tier 5 visa is a temporary work visa and lenders are less likely to lend to people who are only residing in the country on a temporary basis, with temporary work rights, as they may be seen as a much higher risk, so it would be a lot more difficult to find a mortgage.

How can a mortgage broker help if you’re looking for a Tier 2 visa mortgage?

There are different ways to find the right lender but getting in touch with a broker so that we can get as much information as possible, is the best way of understanding which lender will be suitable for you.

If you do get declined, don’t assume that there’s one rule for all banks, because we’ve helped clients who have been declined by their main bank to get a mortgage offer, because we’ve got the experience. We’re based in a very diverse county and we see a lot of foreign nationals who haven’t yet got permanent rights to remain in the UK, so it’s an area we really specialise in.

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