British expats residing in the EU are being turned away for a standard residential mortgage in the UK by lenders according to Chris Sykes, mortgage consultant at Private Finance.
Sykes outlined that as a result of Brexit, lenders who were until recently active in this space of the market are now turning away clients.
He said: “This is regardless of the strength of the case and appears to be a blanket change in policy with one client, working in the pharmaceutical sector with significant income and assets (both liquid and property) being rejected by a number of lenders.”
The products are still available to expats outside of the EU, with certain exclusions, but the change was announced recently outlined Sykes.
He added that this amendment stands to affect a large number of UK expats with over one million living in the EU, according to UN data from 2019.
Sykes outlined that one lender said this was due to Brexit, and as far as they were aware this was a “permanent change” in policy.
Sykes said: “I think lenders would be fools to discount a whole market of clients who are, and have been, perfectly viable candidates for their mortgages.
“We are in somewhat of an adjustment period as borrowers, lenders and many more try to understand the long term affects that Brexit will have and it is not a simple task.
“This seems a lot to do with the EU passporting rules and some banks potentially withdrawing accounts for expats in the EU, so if this is at risk it needs addressing and if that means halting lending to that market while things adjust that is a risk decision for a bank to make.”