Many people will choose to buy a house in the UK, so what are the common problems in applying for a loan in the UK? This is a problem that many people are concerned about. Let's take a look at the frequently asked questions about housing loans in the UK. Welcome to reading.
I come from China, and my income is also in China. Can I apply for a mortgage in the UK?
Yes, but there are not many banks that can accept overseas income loans now. If there is local income, there are not only more than 100 banks to choose from, but also portfolio loan products from different banks according to their own needs. For China people whose income is in China, the mainstream in the market at present is the Bank of China in Britain, as well as the relatively small HSBC and Standard Chartered Bank. However, the policies of these banks are constantly changing. Due to Britain's withdrawal from the EU, uob announced to stop this loan service in June 20 16, and it was gradually opened in the first half of 20 17. This aspect will be introduced in detail later.
I have a lot of real estate assets in China, but my income is not high. Can I apply for a loan?
Yes, there are many sources of income defined in Britain, such as income, rent received by real estate, extra income, etc., but the valuation of real estate itself is not the main consideration. In 2007, due to the economic crisis in Britain, many related policies were formulated. In order to reduce the bad debt rate and default rate, the policy pays more attention to cash flow than inherent assets, but the cash flow generated by inherent assets can also be considered.
3. What percentage of loans can I apply for and how low the interest rate can be?
The loan products of different banks are different, mainly for personal qualifications and needs. For example, HSBC has a fixed interest rate of 1.98% in the first two years and 3.5% in the later period. Although the interest rate in the previous two years was low, its general application was based on the multiple of the shared rent, so the ratio was not only low, but most of them required to go to the UK for face-to-face visa and deposit requirements. These objective requirements have greatly increased the cost of loans. Therefore, according to different qualifications, choose the loan product that suits you best and has the best cost performance.
I have a high income, but some of it is not taxed. Can I get a loan?
Yes, most domestic business owners or self-employed individuals have good cash flow, but there is no corresponding tax bill. This requires professional financial treatment, and also explains to banks that for the corresponding banks, they can make loans with good cost performance.
I already have a house in England and want to refinance it. Is it okay?
Yes, there is a 20% differential tax on real estate transactions in Britain, so unlike China, most investors will choose the value-added part of refinancing. However, the specific evaluation amount varies from bank to bank, and its core will be the main reference of BTL investment real estate, its rent, real estate evaluation and lots. In principle, it is similar to the first loan and can be operated completely.
Popular science: what documents do I need to show when I borrow money to buy a house in the UK?
Popular science: what documents do I need to show when I borrow money to buy a house in the UK?
Overseas real estate investment, with the purpose of buying a house, is actually a more important choice in any country. Britain is a typical capitalist country, and here is a country that is rarely sought after by investors. In addition to the investment crowd, there are also investors flocking to Britain in the year, hoping that buying a house with investment can bring them some benefits.
Because the cost of buying a house is very high, everyone will suffer certain economic harm. Therefore, most people choose bank loans to reduce certain risks for themselves. This is also a common choice in many capitalist countries. Bank loans, in addition to paying a certain interest, more property or holding it in your own hands, can make people enjoy more freedom of economic development. Take the bank loan as an example, the whole process is very troublesome.
The certificates that must be presented for housing loans in the UK include:
0 1 proof of salary and income
This is an ordinary document. Only by better confirming your income can financial institutions estimate you conveniently and have a certain estimate of your loan amount, including your personal loan interest.
02 personal credit information confirmation
This is a personal credit certificate in Britain, which clearly indicates your credit. Many areas where credit can be recorded can be successfully completed if there are no violations.
Confirmation of your personal purchase of real estate
This is to make a better calculation of your housing loan, including your personal loan conditions, to see if you meet it. All the property rights around your house are estimated according to the new price, and then you will gradually file and realize the approval step by step. Until the last paragraph, the above three certificates are the general documents that you must produce when you borrow money to buy a house in the UK.
Proportion of home purchase loans in the UK
The interest rate of housing loan in Britain is lower than that in China, generally 2.5%-3.5%. Together with the benchmark interest rate of 0.5% of the Bank of China, the annual interest rate and policies of each bank are different. Generally speaking, the personal loan amount is 4-4.5 times of the applicant's annual income, and it is limited to 70% of the total house price. The mortgage period depends on the applicant's age. The proportion of housing loans available to customers in China is closely related to their own operating conditions (property and income), the transaction price of real estate (house inspection report) and the main uses of buyers (self-occupation and project investment). According to the international practice of Bank of China UK Branch, customers can get up to 70% loans.
Comparison between British Housing Loans and Domestic Loans (2)
Many people will choose to buy a house in the UK, so what's the difference between a UK home loan and a domestic one? This is a problem that many people care about. Let's take a look at the comparison between British housing loans and domestic loans (2). Welcome to reading.
First, bank loans will be made directly to lawyers.
Unlike domestic banks that lend directly to sellers, the mortgage here will be paid directly to the buyer's lawyer, and then the buyer's lawyer will pay the seller's lawyer. The transaction risk between two lawyers who know relevant laws and regulations will be less.
Another feature of British mortgage loan is its wide choice and flexibility. For example, you can choose fixed interest rate or floating interest rate. The advantage of fixed interest rate is that the interest rate remains unchanged during the term, but the disadvantage is that it is often higher than the floating interest rate. For example, you can choose to repay the principal or both. If you choose the principal, you only need to pay interest every month, and when the loan expires, you need to pay off all the loans in one lump sum. The advantage of this is that it helps to alleviate the current financial pressure, and the disadvantage is that you push the pressure.
For example, if you sign a contract for two years, after two years, if the price of this bank is unreasonable, you can always find another bank and change to another place for a loan. If you think it is reasonable, you need to sign a new contract. In China, it is rare to change banks. Compared with China, British banks have a stronger sense of crisis. If the service is poor or the interest rate is high, consumers will change banks. It's a bit like a consumer watching TV with a remote control panel. If it's not good, I can replace you at any time. These characteristics determine that consumers have greater initiative.
Second, the interest differential policy.
In Britain, as long as you are the buyer of the first house, you can enjoy very favorable interest rates. If it is high, you can also enjoy preferential interest rates. But if you buy a house, the interest will be higher. The house I bought is worth 370,000 pounds. Except 6,543.8+3,000, the five-year fixed interest rate for the remaining 240,000-pound 28-year loan is 3.39% (in Britain, the loan term is determined by subtracting your current age from 70). I need to pay back the mortgage principal and interest of about111pound every month.
Third, the appearance is glamorous and the service is lacking.
When I got a loan last year, I chose Barclays Bank. I chose it because of its popularity and appearance. Indeed, if you go to the front of this bank, the magnificent decoration and the thoughtful service of the staff will definitely make you feel that it is extraordinary. As soon as the two banks were compared, I decided to choose this one. Unexpectedly, trouble came.
According to what the bank staff told me, it will take about 2 weeks to get the loan after the materials are handed in. Plus the time for lawyers to exchange materials with each other, you can live in a newly bought house in about three weeks. After two weeks, nothing happened. I asked the staff and told me to wait another week. Nothing happened after a week. Ask again and say wait another week. Then nothing happened, and I asked again, saying that I sent an investigation letter to the unit and there was no reply.
From the point of view of competition, the measures taken by British banks, various loan methods and flexible policies are all beneficial to consumers, giving them more choices. But this kind of competition can often be reflected in the visible level, such as the facade and the service of the field staff. The investment of telephone service personnel is obviously insufficient. Although things like my experience will happen less, it is easy to cause deeper harm to consumers.
What documents do you need to prepare for the UK housing loan?
Britain is the most economically developed country in the world. What documents do I need to prepare for housing loan in the UK? I'm here to sort out what documents need to be prepared for the UK housing loan, hoping to help you.
1. Application documents required for housing mortgage loan.
1, valid passport;
2. Bank statements for the last three months (please note that banks do not accept online bank statements);
3, the last three months of the payroll and tax certificate form (P60)
4. If the lender is self-employed, it needs the financial report of the last three years and the latest HMRC and tax calculation form (SA302), which is applicable to applicants who file their own tax returns;
5. Proof of deposit.
Second, how to handle housing mortgage loans?
1, preliminary assessment
The buyer provides personal assets certificate, income certificate and identity certificate to the bank. After receiving the information, the bank will make a preliminary assessment to determine the loan amount of the buyer. Ensuring good asset credit is very important for loans. In fact, all unsecured debts will be included in the bank's assessment of lenders, and any credit card arrears or loans will reduce the loan amount. Time required: the preliminary evaluation process can be completed in about one week from the time the bank receives the buyer's certification documents.
2. Buyer's house inspection If the preliminary evaluation results given by the bank meet the actual needs of the buyer, the buyer can enter the actual house inspection and purchase. The house inspection report not only describes the house quality and other related information, but also gives the corresponding valuation, which will determine the final loan amount of the bank.
3. After the loan is approved and the lender obtains the house inspection report, the bank will give the buyer the final loan amount according to the valuation of the report and the financial situation of the buyer. Time required: 1 to about 2 weeks.
Third, loan interest rate, loan ratio, etc.
Housing loans in Britain are generally divided into self-occupied housing mortgage loans and housing loans. The proportion and interest of the loan will vary according to the value of the property and the type of loan.
Different banks have different mortgage products and interest rate standards. To apply for a mortgage, the applicant needs to have a deposit, a good credit record and a stable income. Almost all banks estimate loans according to the loan-value joint system, that is, the less the lender deposits, the more he has to pay back. In addition, most banks will charge a loan fee and pay it when accepting the loan agreement. The exact amount depends on the loan amount.
Comparison between British Housing Loans and Domestic Loans (1)
Many people will choose to buy a house in the UK, so what's the difference between a UK home loan and a domestic one? This is a problem that many people care about. Let's take a look at the comparison between British housing loans and domestic loans (1). Welcome to reading.
First, there are many banks and many choices.
I bought several houses in Shanghai, mostly state-owned banks. In addition to state-owned banks, there are Fujian Bank and China CITIC Bank, but they are not the mainstream after all. In contrast, there are many banks in Britain. So that when you negotiate with the intermediary, they will recommend some small banks to you, which will be more favorable than big banks. Even people like Tesco have their own banks, and they try to sell me their home loans.
Second, the competition is fierce.
Almost every bank, you can go in and make an appointment for a loan. The loan specialist will ask you in detail about the total purchase price of the house, the situation, the annual household income and other details, and give you a loan amount and interest standard.
Last year, some banks also launched the activity of "You buy a house and I pay taxes", promising to pay 1% of the house purchase price within the price range (250,000 pounds). When you open the newspaper, you can often see the advertisements of large loans from banks. Under normal circumstances, there are two ceilings for bank loans in Britain, which are 4.5 times the annual household income (some are 5 times) and 80% of the overall house price. If your income is less than 20%, most big banks will refuse to lend you money. At this time, many loan intermediaries will tell you that you only need to pay a few hundred pounds (1 pound or 10 yuan) to help you find a bank willing to lend you money. Off-topic, when I was in America, I felt that banking services were exaggerated.
There is a cash commission for opening an account and a cash reward for introducing customers to open an account. Once a friend dragged us to another bank to open an account, and the account holder could get 100 USD in cash on the spot, and each introducer could get $50 USD when opening an account. Third, because we want to leave the United States, there are no additional conditions when we close the account. I've also seen people stir-fry popcorn for customers in the bank. The service in Britain can't reach that in the United States, and you can feel the fierce competition.
Third, housing inspection and loan insurance.
Slightly different from China, in Britain, buying a house requires a loan. Before getting a loan, housing testing is also essential. When applying for a house loan, two tests must be done: one is about the house, the land and the surrounding environment, and the other is about the house itself. For buyers, this kind of test is actually needed.
Buying a house is safe, even if there are invisible cracks in your wall, this institution can detect them. Each test is about 600 pounds. If you want to test the sword more carefully, you may have to pay a higher fee.
When applying for a loan, the applicant will also be told to buy two kinds of insurance: real estate insurance and personal insurance. Housing property insurance is to prevent losses caused by the destruction of houses in the event of major disasters; Personal insurance is a kind of compensation to protect buyers from personal injury or death after buying a house.
The two kinds of insurance premiums to be paid each month add up to 120. For banks, with such insurance, it can be guaranteed that the interests of banks will not be lost in the event of natural disasters or personal injury or death of property buyers. For property buyers, it also increases the risk prevention ability of life and property. I remember that when I bought a house in Shanghai in 2003, the loan required compulsory insurance. There seems to be no mandatory requirement now.
How to get a loan to buy a house in the UK?
With the continuous improvement of the quality of life of Chinese people, many people want to own their own real estate overseas, and Britain, as the new favorite of overseas real estate in recent years, has attracted more and more attention. How to borrow money to buy a house in Britain? I've compiled the relevant information for you.
1, UK housing loan certificate
First, you must have a passport as proof of identity; The second is the need for nearly three months of bank running accounts and nearly three months of bank statements; The third is the need for personal deposit certificates;
2. How to apply for a housing loan in the UK?
To apply for a housing loan in the UK, you must provide your own asset certificate, income details and identity certificate. After receiving the information, the bank will make a preliminary evaluation to determine the buyer's loan amount.
Good asset credit must be guaranteed, and unsecured debts will be included in the bank's evaluation of lenders. The whole process is estimated to take about a week to complete.
3. Loan approval and house purchase payment
After the bank makes an evaluation report on the purchased British real estate, the bank will give the buyer a loan amount in combination with the buyer's financial situation.
4. British housing loan interest rate.
There are two kinds of housing loans in Britain. The first is self-occupied property mortgage loan, and the second is investment property loan. The proportion and interest depend on the value of the property and the type of loan.
Now in the process of buying a house in Britain, lawyers will participate in it, which can guarantee the interests of buying a house. Moreover, there are many loan banks, which is very different from the domestic situation, and the competition between banks is fierce. Therefore, there are many preferential loan policies, and the strength is also great, which can save your purchase cost in the UK.
The mortgage interest rate in Britain adopts floating interest rate, which varies according to the needs of users to buy a house. Details are as follows:
Self-occupied housing: add 2.68% to the benchmark interest rate of the Bank of England, and fluctuate with the benchmark interest rate according to this spread during the loan period. .
Invest in buying a house: add 3.38% to the benchmark interest rate of the Bank of England, and fluctuate with the benchmark interest rate according to this spread during the loan period.
Remarks:
A. In order to repay the loan conveniently, investors need to open a settlement account with China Bank Co., Ltd., and your rental income must be received through this account.
B different loan interest rates are applicable to the application for investment lease real estate loans submitted in the name of the company. Please consult the UK branch for details.
3. Loan life: According to the financial situation of the buyer, the longest loan life of Bank of China UK Branch is 25 years.
5. How to remit money
Although the Bank of China has a branch in China, it is not as convenient as you think to remit money from China to the British branch. Just turn around. Domestic buyers are still subject to a limit of not more than $50,000 per person per year when remittance and down payment are made. For ordinary domestic investors, it is a feasible way to find more people to help and remit money to the accounts of investors in the British branch.
6. Loan costs
The specific amount of appraisal fee is determined according to the purchase price of the house and paid when you submit the loan application.
The bank will charge a mortgage fee and pay it when you accept the loan agreement.
7. Repayment method
The mortgage for self-occupation and investment needs shall be repaid in the form of equal principal and interest.
The introduction of British housing loan and the experience of British housing loan come to an end. I wonder if you found the information you need from it?