Getting a mortgage as an expat living abroad

[David Choe]

Hi, I'm a US citizen currently living in London. I have a stable job working at a British company, but have not had any US income in the past 9 years. Looking to invest in the US real estate market again, and have enough for a down payment, but curious how feasible it will be to get a mortgage. Anybody have any experience getting a mortgage while living abroad? Thanks!

[Matthew McNeil]

Originally posted by @David Choe:

Hi, I'm a US citizen currently living in London. I have a stable job working at a British company, but have not had any US income in the past 9 years. Looking to invest in the US real estate market again, and have enough for a down payment, but curious how feasible it will be to get a mortgage. Anybody have any experience getting a mortgage while living abroad? Thanks!

 Hi David.  I have experience getting a mortgage while living overseas.  Although you don't have any "US" income, you have "income" and your worldwide income is subject to tax according to the IRS which I'm assuming you've been reporting on Tax Form 2555 each year.  In addition, any bank accounts you have where you're depositing your non-US income is supposed to be reported by your foreign bank (in London I assume) according to the Foreign Account Tax Compliance Act (FATCA) where you also need to comply by filing a FBAR FinCEN Report 114. 

All this to say, your compliance to these will certainly allow you to qualify for a mortgage (not that its a requirement, but supports your claimed income) - which is what I've done many times while living overseas. 

The only problem I've encountered is that lenders are not familiar with the the figure that Form 2555 generates and drops into your 1040 because its listed as a credit - currently $103,900.  So, it just takes a little explaining for them to understand what's going on. I've always been successful clearing that up with the lender and get approved.  Hope that helps.