How Do I Get A Home Loan When I’m an Expat?
Recently I was helping an expat client get a home loan. She is living and working overseas and wanted to buy a property that would be an investment in the short term and be her home when she finally came home.
Makes sense right?
Some lenders are more accommodating than others but not all will even lend to expats and to make it all that much more complicated, time zones mean that she isn’t necessarily awake when the banks are open. That’s why she worked with the team at Mortgage World Australia to get this done.
Here Are the Hurdles That We Had To Work Through To Get Her Loan Approved.
In this case, she makes good money and she had a deposit saved up and she was looking to buy a property she could service the debt on. Then on top of all the usual steps in the home loan application process we also have to deal with:
- Not all lenders will approve your mortgage application when you are paid in a foreign income – like she was.
- Different lenders will only accept certain currencies and may only consider 70-80% of the income paid in those currencies. Because of this, your borrowing power could be far less than you expect.
- A lender may use Australian tax rates rather than the tax rate of the country you live in, which can limit your borrowing power if you live in a low-tax location. Having said that, some lenders accept the net foreign income you receive instead of taxing your gross income at Australian tax rates. This can result in a significant difference in borrowing capacity if you work in a low-tax country.
- There are often extra documents that need to be signed
- Witnessing documents can be difficult. You may need to visit the Australian embassy. Now that many state land title offices and lenders are on board with digital documents it is becoming easier.
We take care of our clients – we find the right lender for our clients based on where they work and what currency they are paid in and make sure that their tax situation is assessed fairly.
The extra documents are something we work with our clients on to make sure their application is correct and we even help as best we can to figure out their best path forward with witnessing documents. In a recent case, our client struggled because all notaries were closed due to COVID-19 as were all consular services, but eventually, we found an option for online witnessing that she could use.
The secret is to be patient and not to give up. There is always a way to get things done.
If you are an expat and need help with getting a loan while living and working overseas, Mortgage World Australia is here to help. Call 1300 661 211 or register online at https://www.mortgageworldaustralia.com.au/contact-us/ we will help you find the right lenders to apply to, and manage your application so that it gives you the best possible chance of being approved all with little to no stress.