Bimbobread Posted August 19, 2013 Share Posted August 19, 2013 Hi, We are moving to Oz and we were hoping to rent out our house in the UK and then buy a house in OZ however both houses would be with a mortgage... is this possible? We have a sizable deposit for the Oz house and the house in England has guaranteed tenants. Thanks for any advice! :arghh: Quote Link to comment Share on other sites More sharing options...
boganbear Posted August 19, 2013 Share Posted August 19, 2013 Your house in the UK is of no consequence in Australia. The Aussie bank won't be able to make a claim on it if you default. Quote Link to comment Share on other sites More sharing options...
Phoenix16 Posted August 19, 2013 Share Posted August 19, 2013 We have mortgages in UK and OZ, no problems at all, when we applied for the mortgage in OZ we had to evidence the UK mortgage, house value and rent etc (rent doesn't cover mortgage so we don't get an income as such and no Australian tax implications). The UK mortgage isn't through choice and we will sell as soon as we can, definitely before 7 years of it being our home to avoid capital gains! Quote Link to comment Share on other sites More sharing options...
runslikeafish Posted August 19, 2013 Share Posted August 19, 2013 Your house in the UK is of no consequence in Australia. The Aussie bank won't be able to make a claim on it if you default. Your UK house does have some consequence in Aus - it is taken into account when deciding your assets etc when applying for a mortgage for example. I agree that an Aussie bank shouldn't be able to make a claim on it though. Back to the original post, yes you can certainly have a UK and Aus mortgage at the same time. We have. Quote Link to comment Share on other sites More sharing options...
thombatt Posted August 19, 2013 Share Posted August 19, 2013 You can Your Australian mortgage provider will basically consider two things before giving you a mortgage (or the size of the mortgage) 1 the security they have for the debt (this is effectively the value of the property and is it greater than the debt) 2 your ability to pay the debt. For this they will assess the payments you have to make on your UK mortgage, but will take into account the rent you receive. An Australian bank can certainly attach foreign assets to settle a debt. Whether it is worth the trouble is another mater. They would have to make application through the UK court system. Quote Link to comment Share on other sites More sharing options...
Peach Posted August 19, 2013 Share Posted August 19, 2013 An Australian bank can certainly attach foreign assets to settle a debt. Whether it is worth the trouble is another mater. They would have to make application through the UK court system. Oh no they can't. UK court has no jurisdiction over Australian debt to a bank. Government debt is a different matter tho. Quote Link to comment Share on other sites More sharing options...
Andrew from Vista Financial Posted August 19, 2013 Share Posted August 19, 2013 So just to clarify, yes it is possible to have an Australian mortgage and UK mortgage no issues on that side of things. There may be implications when applying for an Australian mortgage as you will have to disclose to the lender the mortgage debt, repayment amounts and also the rental income. The new Australian mortgage will have to be able to service with the above taken ino account. However it is not always black and white as every lender has different policies so it may or may not affect your ability to borrow what you would like. For instance some lenders will purely take into account the actual repayments you are making on the UK mortgage as an expense whereas some will use the same servicing rate they apply for the new loan based on the balance outstanding (example if the servicing rate for the new loan is 7% this will be the rate they will apply to the UK loan as well). When looking at the rental income again this differs, some lenders will allow it to be used for servicing but will reduce it to say 90% or 80% of the amount to account for currency fluctuations whereas others will not allow it to be used at all (and so there is a double whammy!!) Your best option will be to use the services of a Broker that regulary deals with UK expats as they will be able to assess your case and understand which lender/s it fits with and from that filter the best lender/product for your needs. Regards Andy Quote Link to comment Share on other sites More sharing options...
Bimbobread Posted August 23, 2013 Author Share Posted August 23, 2013 Great thank you for all your responses. Very useful and put my mind at ease. :biggrin: Quote Link to comment Share on other sites More sharing options...
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