Mortgages from abroad now offering better value than those at home

27 July 2009

As British financial institutions continue to shy away from big-style lending to customers, more and more mortgage brokers are fixing up deals from outside the UK for money-hungry would-be borrowers.

Cheap, available mortgages from Swedish, Israeli and Chinese banks are becoming increasingly popular as the UK mortgage market continues to splutter along in first gear. The eligibility criteria is also looser which could be good news if you’re self-employed or have quirky income patterns.

According to The Times, Bank Of China is offering tracker rates from 3% for borrowers who can provide a 25% deposit, with a minimum fee of £995, and is undercutting UK lenders on buy-to-lets. HSBC are offering a similar tracker deal, but some applicants are having to wait as long as eight weeks before getting a decision, meaning that they are likely to miss out on the house they’re trying to buy.

The number of mortgages available from UK lenders has fallen by 59% to 2,242 over the past year and one in ten home sales have collapsed in the past three months after the potential buyers were unable to obtain funding.

Have you been stuck in the mortgage mire lately and would you consider looking outside of the UK as you attempt to raise the cash for a house purchase? Are the banks shooting themselves and the UK economy in the foot with their stingy approach? Or will the whole thing result in another credit crunch? Let us know what you think in the little box underneath this bit.


  • Geoff J.
    No, I have a job, so my mortgage application went through fine.
  • chrisg.
    Did they rename the name of the product just to get around FSA issues? ;)
  • Ian
    Looking at buying my first house so this article has been of great interest
  • Andy D.
    @chrisg - disgusting bit of work that wasn't it?
  • Greg T.
    As a mortgage broker for some years I see day to day the issues caused with the lenders and their "stingy" approach. Im all for them being a bit tighter and not lending 6 times an applicants income or lending to people with multiple missed payments. However I think at the moment they are struggling to find the fine line between tightening up their criteria and being stupid for declining applications for silly reasons. Just to give you some ideas of this - an application with a 25% deposit being declined becase an applicant went overdrawn once by £4?? Is that really how tight they need to be? I would say about 50% of all applications get declined at least once at the moment and then about 2 thirds of them will get agreed through a different lender and the remainder just cant be placed. I am all for looking at alternitive sources for securing funds for my clients however I think some of these lenders need to tread very carefully with any kind of self certified mortgages (which the artical implies they may offer). Again its finding that fine line of offering mortgages to people that pose a fair risk, without being silly in the process.
  • chrisg.
    @Andy Dawson - they're just so BRAZEN about it. Although, in hindsight they should have dropped the silent T, as noone would miss that particular letter.
  • quagmire
    I'm going through an app at the moment and can't believe how ridiculously stupid the lender is being! Got a joint income of over 60k and going for a mortgage of 120k so no problem there. Perfect credit history for both of us as well. My gf is employed but im self employed and that is where the problem lies. They will not belive my figures even though I have produced all my accounts and shown my past 3 years tax returns which are counter signed by bothe certified and chartered accountants . Despite all this they want more proof and details from hmrc! WTF! It's been going on for 7 weeks now and you quite simply cannot believe how frustrating it is! What an absolute joke these banks are becoming, Got bailed out n keep seeing on the news they're meant to be lending more freely but from my experience this just is not true!

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