Type of loan
Repayment and interest-only finance is available for the purchase or remortgage of US property. Only repayment mortgages are currently available in the Caribbean. Remortgage and capital raising options are available in both destinations. Loans can be denominated in Sterling or US dollars, subject to criteria.
Purchaser
Purchasers can be individuals or certain types of companies.
Loan size
The minimum loan size SPF will consider on a US or Caribbean mortgage is $250,000. There is no maximum but it must not exceed 70% of the mortgage valuation or purchase price (whichever is lower). In the Caribbean, loans are generally available up to a maximum of 60-70% of the mortgage valuation although this varies between islands.
Term
Maximum of 30 years up to age 75 (no age limit in US).
Lending criteria
Lenders determine how much you can borrow by taking into account the value of the US property and your financial situation.
In most instances, buyers can borrow up to 3.5 times income although a strong credit history is essential. US lenders may take into account potential rental income from the property providing it has been on the rental market with proof of leases.
Lenders also require proof of income, which can comprise earned income, pension, investment or rental income. However, not all lenders will take all of these into account when calculating how much you can borrow.
SPF has exclusive arrangements with a number of US and Carribean lenders, offering minimal and bespoke underwriting terms and conditions on mortgages.
Insurance advice
Buildings insurance on property in America and the Caribbean is compulsory. Most lenders don’t require you to take out life or critical illness cover but SPF can provide independent advice for all your insurance needs when buying property abroad.
Property laws and legislation
Do not sign anything until you have taken legal advice and don’t put a deposit down on a US or Caribbean property before ensuring that it is refundable. You should also check what legal costs and government taxes you are liable for before committing yourself to a purchase or remortgage in the States.
Completion
SPF endeavors to secure the loan on your US or Caribbean property within your preferred timescales but delays may occur as a result of the local closing and banking system.
Applying for a mortgage
It is advisable to arrange a mortgage in principle before committing to a purchase. This will enable you to find out how much you can borrow, so you don’t waste time looking at US properties beyond your budget. Even if you haven’t found a property in the US or Caribbean yet, the SPF international team can help you establish your affordability and issue an approval in principle based on your financial situation.
If you have already found a property, SPF will send you a mortgage application pack.
Should you require funds to put towards a deposit, or if you don’t qualify for a US or Caribbean mortgage, we may be able to help raise finance for your proposed property.
Contact SPF on +44 (0) 20 7877 4710 or email international@spf.co.uk