Posted on 30 July 2012 by sharon
I currently live outside of the uk but have my property rented out. I would like to take some equity from the property, would the fact that I am out of the country be a problem? Also, would I have to pay tax on this money?
The number of lenders who will consider you for a mortgage will certainly be reduced because you are out of the country, but depending on your individual circumstances and how much rent you are receiving it should be possible to release some of the equity in your property.
Typically you can expect to be able to release up to a maximum of 70/75% of the property value, less any existing borrowing you may have secured on it. Lenders will be looking either for the rental income to cover at least 125% of the monthly mortgage payment or for you to be able to afford them using your earned income. How they underwrite an application will largely depend on whether you intend to return to the UK and live in the property within the near future?
If you have an existing mortgage on the property I recommend that you speak to your current lender first to see what their position is. If they can not help or you do not have an existing mortgage I believe we can help you and that you would benefit from speaking to one of our independent mortgage advisers. Please call +44 (0)845 413 1053 and tell the consultant the date and title of your question, they will then be able to help you find the right mortgage for your situation.
I regret that we can not give tax advice and you will need to speak to an independent qualified tax specialist.
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We recommend you seek professional advice with regard to any of these topics where appropriate.