Tier Two Visa Mortgages

What is a Tier 2 Visa?

Foreign Nationals residing in the UK for the purpose of fulfilling a position of skilled employment, do so under a Tier 2 Visa. These individuals do not ordinarily have indefinite leave to remain. Their length of stay in the UK varies, depending on employment need. But maybe up to five years, with the ability to extend, where required.

Tier 2 Visa holders need to be able to speak, read, write and understand English. You must earn a minimum defined income for the type of work you do, and work for an employer on the Home Office’s approved list.

Why is it a challenge to obtain a mortgage with a Tier 2 Visa?

It can be a challenge to obtain a UK mortgage on a Tier 2 Visa. However, this will largely depend on the length of your visa, how long you’ve already been living and working in the UK and how long is left on your current Visa.

Lending criteria will vary between Mortgage Lenders. Many of those offering mortgages for foreign nationals are likely to be the more specialist lenders.

Ideally two year resident in the UK

Most lenders will want the mortgage applicant to have two to three years of prior residency in the UK in order to consider them for a mortgage. As one of the most important acceptance criteria, when you apply for a mortgage, is your credit score, you will need to have lived in the UK for long enough to establish one, and two to three years is usually an adequate amount of time to do so.

How long remains on the work visa?

Whilst some lenders will consider mortgage applications from those with smaller durations left on their Tier 2 Visa, most will be more comfortable with two and a half years or more. Where lenders accept applications from those with less than this, they will usually limit this to six months remaining and will require a higher deposit or want to know that your Visa is going to be extended beyond the end of the current one.

If you’re looking to buy property as an investment, rather than a residential home, you may be able to do so with less time remaining on your Visa. Although you need a Buy to Let mortgage to accommodate this.

How do I check/improve my credit if I am on a Tier 2 Visa?

There are plenty of free credit score checking services available online on credit reference agency websites. Here you will be able to check what your UK credit score is and whether or not it will be a barrier to your mortgage application.

There are two reasons that you could have a low credit score. First of all, if you have missed payments on credit accounts, a default will be recorded against you. Those with more significant debt and financial issues may have a County Court Judgement (CCJ) against them. The other reason a credit score can be low is if you have no history of credit in the UK.

Proving credit history

In order to have a credit history in the UK, you will usually need to have lived here for at least six months, in order for records to be held about you. Credit history is based largely on your use of credit facilities, banks, address history and employment history.

Non-UK nationals will be at a disadvantage in that they cannot register at their address on the electoral roll. Therefore, they will not hold voting rights. It is possible, however, to gain a mortgage under these circumstances. So long as you approach those lenders more accepting of your circumstances.

Improving credit score

There are a number of ways that you can improve your score if you have a lack of credit. Such as ensure your current address is correct on all accounts related to your name. Open a UK bank account registered at your current address if you don’t already have one. There are also credit builder credit cards available to help you show yourself as a responsible borrower