rebs

Hi,

My husband works for a large US bank and has been offered an L1 transfer to Dallas - initially for 3 years.

I'm pretty comfortable with the aspects of the move that involve getting us set up in Dallas - the company will provide help with sorting out drivers licenses, ssn, finding a house to rent, sorting out a school for our 10 year old son etc, so I'm cool with all that.

However, I am finding in harder to work out the best ways to deal with things back in the UK, and I'm wondering if people might be able to share hints/tips from their experiences.

We have a house in the UK, which we are hoping to rent out. However, even with a rental income, I anticipate that there will be a shortfall between rental income and the mortgage cost, so we will be looking to top up with the US salary.

My husband can elect to have a portion of his salary whilst in the US paid into a UK bank account, with no transfer fees for us to pay, so that seems an ideal way to get money back over to the UK.

Currently, we have a combined current account and mortgage, but I think we will need to restructure this as we wouldn't continue to have all our salary paid into it (which I think is a condition of the account).

I can check out the comparison sites for best mortgages & current accounts, but it's not always obvious which ones would allow non uk residents to apply.

So, I guess my initial questions boil down to the following:-

• Any specific recommendations regarding current accounts that are ok for non uk residents to use, and don't have charges (or if they do, what balance/deposits are required to avoid charges).

• My assumption is that we don't need an 'official' buy-to-let mortgage as we are simply re-mortgaging our home – do you think that’s correct?

• Any specific suggestions on mortgage providers - again that are ok for non uk residents.

Any other hints/tips/things to consider welcome.

Thanks in advance…

Rebecca

scrubbedexpat099

[• Any specific recommendations regarding current accounts that are ok for non uk residents to use, and don't have charges (or if they do, what balance/deposits are required to avoid charges).

I am with the Nat West, have used the same account for more years than I can remember, location not relevant.

• My assumption is that we don't need an 'official' buy-to-let mortgage as we are simply re-mortgaging our home – do you think that’s correct?

IF you do it now, you may well have issues if you wait until after you have moved.

• Any specific suggestions on mortgage providers - again that are ok for non uk residents.

Avoid the problem, do it before you are non resident, your choice diminishes as a non resident.


Just thinking, if he works for a big bank, does he not have access to all this info?

See wiki on this site.

Tootsie Frickensprinkles

Without wishing to be the bearer of unwanted news your assumptions are unlikely to be correct. You need permission from your lender to rent out and insure your property so you need to ask your current lender if they will allow you to do so. If they will allow you to, what conditions will apply.

Given it sounds like you will need to remortgage due to not meeting the conditions of your current loan I highly doubt they will give you a normal homeowners mortgage seeing as you are A, planning to rent and B, going overseas. This is even more likely because your rental yeild will not meet your mortgage payment - given that fact you are also likely to be looking at a higher interest rate and therefore more of a shortfall than you are looking at now. A close friend in Dubai has just done all this.

I have current, mortgage and savings in fact all deposit style monies at the NW and I highly recommend them. They allowed me to rent my property on my homeowners ... but at the time I had no intention of leaving the country. That said, I have been a member all my life and all of it was set up before I left so I do not know what they are like for setting it up knowing you are going to be a non resident. Personally I would open a current account now anyway, I do not get charged anywhere in the world for taking my money out and I don't think any other current account can claim that.

The above is based on you being honest about your intentions to relocate overseas .. you could indeed do it all as per normal and hope that all the permissions required will not mean changing anything in order to rent. I think it depends on how long you have until you are supposed to leave to be honest.

BritGuyTN

why do you want to rent it out?


if its so you have somewhere after 3 years, then thats a fine idea

if its as an investment, its a crap investment and you need to sell the place

rebs

Hi everyone,

Thank you for the quick responses - really useful.

So, I'm hearing 'nat west' loud and clear! Do you guys with nat west accounts live overseas now? Did you simply 'inform' them of the move or did they move you to a different type of account?

We've got 2 or 3 months before we move, so I'm looking to get stuff sorted as soon as possible. As far as a current account goes, as long as there is not a specfic question on that application that says 'are you planning to become a non uk resident in the next 6 months' I don't think I need to specifically tell them (bit like answering the questions at POE from what I've been reading ). Having said that, if I can get the inside track on a specific account that should be ok, WHEN we tell them of the move - so much the better.

I think the mortgage is probably a bit more problematic - I know that you need permission to let out your property, but I was hoping that as we are not buying a second home, we could do that on a standard mortgage, rather than a buy to let. Tootsie - I'd be interested in what your friend in Dubai found out - do you happen to know any details of what turned out to be the best deal?

Hubby works for a US bank, and nothing to do with retail banking, so unfortunately, no real expertise on this kind of stuff -

I have had a quick look round the wiki, but couldn't find anything specific about uk finances - I was probably looking in the wrong place, so if anyone could point in the right place, I'd be grateful.

BritGuyTN - Understand completely what you say about investment. We love our house and would quite like to come back to it, hence the plan to rent not sell. Having said that, if it turns out that we can't rent and selling is a better option (from the market perspective), then that's what we'll do.

Cheers

Rebecca

scrubbedexpat099

I mentioned Nat West because I am with Nat West, I have no reason to believe that all of the other Banks would not be similar. I change the address, not the account.

I have used both US and UK addresses, they know where I am.

I am not so sure you need a Buy to Let mortgage, perhaps you do need a good Broker, best to go conventional usually.

Credit is the big issue, some things you can do to kick start it, look for American Express and AIG.

Elvira

(1) The Motley Fool is one of the best sites/discussion boards for UK finance Qs: www.fool.co.uk

(2) You really want to think about the long-term implications of the move - particularly as far as the upheaval for your son is concerned. Is this purely temporary - or might it become permanent? In which case things become way more complicated.

dbj1000

NatWest send me my monthly statements via airmail... to say that I have 4 pounds and change in my current account, and 43 pence in my savings.

And to my amazement I still have ~15,000 of available credit on my NatWest credit card that I haven't used in 5 years.

They certainly seem relaxed about their foreign/expat account holders. They even sent me one of those silly pin-and-chip card readers for added security on my account... again via airmail.

...which may explain the fees that all you UK NatWest account holders are paying!

dunroving

Banking: These days almost any major bank has electronic account facilities, and so I'd recommend you stay with whoever you currently bank with, as you have a history with them

Having said that, nothing to stop you opening a current account or two with other banks before you leave, "just in case". So many things change for expats, and if you end up deciding to stay longer term in the US, be aware it is very difficult to open a new UK bank account. I already had savings and ISA accounts with Smile bank and even they would not let me open a current account with them once I was overseas. If you found after leaving the UK that your bank was pretty useless for you as an expat, you would not have any choice (i.e., you wouldn't be able to switch to another bank).

Mortgages - with the advent of BTL mortgages banks are now much more reluctant to let you rent out a house that is covered by a residential mortgage - even if you do intend to return. My brother had a fixed rate motgage with Halifax and they were happy for 3 years to let him rent out - all he needed was a permission letter from them saying it was OK. His fixed term deal ran out recently and he had to remortgage to a different (needless to say, more expensive) type mortgage. It wasn't a straight BTL (which you DON'T want, as you can't live in a house that is covered by a BTL motgage), but a "lease to buy" or something, i.e., some sort of hybrid mortgage that is like a residential mortgage but also allows you to rent it out.

You don't want to lie to the mortgagor or insurer on your property either. I believe if you rent out a house that's got a residential mortgage, without express permission, you can come a cropper in terms of not being properly insured, etc. (you have to declare to a home insurance company if your house is being rented - or is empty, for that matter).

If your current mortgage is higher than the potential rental yield, you might look into switching to an interest-only for the 3 years you are away.

Good luck on your adventure and with the long To Do list I'm sure you have!

scrubbedexpat099

Insurance and Mortgage is a seperate issue.

Whatever the rental diference, something is better than nothing, and there is a lot to be said for the insurance of keeping one foot in both camps.

dunroving

I understand that insurance and mortgage are separate, my point was just that lying in these situations (either to a mortgage company or an insurance company) is not a good thing and you can end up coming unstuck.

Besides, some mortgage companies require evidence that a house is insured, so they are not entirely separate (i.e., if your insurance policy says something different than what you are telling the mortgage company, they won't be happy to see it, plus if you take out regular (residential) house insurance on a rented property it may not be valid).

Bottom line is: tell the truth.

Tootsie Frickensprinkles

Ooops, my The NW is Nationwide. Its not a bank and works a little differently.

I'll ask the details for you. Btw 2-3 months is pushing it to get a house rented from scratch. You need to get a move on =)

Big D

I kept all my UK accounts open and active - never told them we moved and everything gets redirected by Royal Mail - although all have internet banking.

You should get permission from your lender and they will usually do this without any problem, as long as you say you are planning to return etc then you dont need a buy to let.

We rent our house out and get about 150 quid less than the mortgage - that said i am so glad we didnt sell as its gone up over 100k GBP in the last 3 years. I couldnt afford to get back in the housing market - while the market is slowing in the UK I still dont think that it will dive or crash so property in UK is a much better investment than in (most of) the US.

I would do your research before telling anyone you are moving as some will close the accounts (I know many dont either)

We rent our house unfurnished so only have buildings insurance

BritGuyTN

glad you've got a proper reason, unlike my dumbass mate in boston who bought a house and continued to rent the flat he lived in for less than the mortgage

dunroving

Lenders have changed their perspective on this in recent years. There was an advice column on this in one of the Money sections (can't remember - might have been the Times) a couple of weeks ago. Plus, as per my email above, my brother's lender would not allow him to rent out his house on his regular residential mortgage - even though he is overseas temporarily.

From what I remember of the advice column, a small number of lenders are still lenient, but many either require you to remortgage to one of those "hybrid" mortgages I described above, or pay a hefty fee for a "special arrangement" type contract (i.e., more money for the banks).

And as you said, BTL does not make sense for an expat's primary residence - because when you come back you'd have to remortgage again (b/c you are not allowed to have a BTL mortgage on a property you live in).