Paid in a Foreign Currency

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Paid in a Foreign Currency

Paid in a Foreign Currency

If you are paid in a foreign currency then getting a mortgage is slightly more complicated then it would be for someone that is paid in GBP (£)

The reason for this is that not every lender in the marketplace will actually allow other currencies on their mortgage applications due to the rules placed upon them should certain changes happen in currency exchange rates.

However as experts in mortgages for those paid in a Foreign Currency we work closely with the lenders that will accept this type of income. As long as you work in the UK

as long as you work in the UK and it’s just you are paid in a different currency then we can help you.

What Currencies Are Acceptable?

There are a number of currencies that could be considered depending on the different lenders so it is worth getting in touch about your specific case but some of the most common currencies that we deal with are;

– US Dollars (USD)

– Euros

– Japanese Yen

– Swiss Francs (CHF)

– Canadian Dollars

Is Foreign Currency Assessed Any Differently?

There are a few different things a lender will need to do to calculate your assessable income.

First your salary needs to be converted into sterling and a lot of lenders use the website xe.com.

Once they have your GBP equivalent, some lenders will then take what is known as a “Haircut” which is where they deduct an element of the income to account for any currency fluctuations. A normal haircut applied would be a 25% deduction.

As an example;

As of 30/12/2022 using XE.com a USD Salary of $100,000 converts to £82,834 which after a haircut is applied would make an assessable income of £62,125

We do work with some lenders that don’t haircut certain currencies which could make a big difference in the amount that you could borrow.

Bank Accounts

Most lenders would want your income still paid into a bank account in the UK as this further evidences you living in the UK and just being paid in a foreign currency. To hold a bank account in a different country would normally mean that you are a resident there and being an Expat is very different to just being paid in a different currency

Translations

Some lenders will ask for documents to be translated to English by a reputable company at mortgage application. We don’t suggest rushing out and getting your documents translated now but when assessing your requirements and looking at lenders, if it appears we are going to need translations we will let you know so you can work on getting these obtained.

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