Seafarer Mortgage

What is a seafarer mortgage? How do they work?

A seafarer mortgage is a particular type of mortgage, which is – unsurprisingly – designed for someone that’s based and works out at sea. Seafarers might have a unique financial situation that we need to take into account when arranging a mortgage. 

For instance, if you spend a considerable amount of time out at sea, let’s say six months of the year, then you can get a specific tax allowance which means that you don’t pay as much (or any) UK tax. That’s because you’re not on land to use the things that your tax would normally be used for in this country. 

You may also be paid in a foreign currency – and that’s one of the first things we have to take into account with these mortgages. But also if you don’t pay tax in the UK, most lenders wouldn’t accept you – so a seafarer mortgage is designed for that specific situation. 

How much deposit will I need and how much can I borrow?

Every lender has different criteria and different rules and it all depends on the person’s circumstances. Again, it would depend on whether you were paid in a foreign currency or UK currency; whether you’d done tax returns in the UK and whether you were employed or self-employed. 

Some lenders will still proceed on a purchase with a 10% deposit, while others would want you to have a 20% deposit. So it depends very much on the criteria of the lender and the unique circumstances of the individual.

How do you prove your income for a seafarer mortgage?

Again all lenders are different, but if you’re paid in a foreign currency or you’re paid tax-free, you should still do a tax return in the UK because that’s the way you claim your tax exemption. That also means you can then prove you are resident in the UK when you’re not at sea. 

Someone might be out at sea for 12 weeks and then come home back to the UK. Then they might go back to sea for another four months before returning. So it’s important that you can demonstrate that you reside in the UK when you’re not working. It also depends on the applicant, as everyone’s situation is slightly different. 

With a lot of our employed Seafarer clients we just need their payslips and the last two years’ tax returns from the UK to prove that income.

What else do we need to know about seafarer mortgages?

Every time I arrange one of these I always hope that I’m going to get to meet the client on the yacht they’re working on.

We’ve done quite a few of these. The first one I did was a guy who was working as a chef earning a significant amount of money on a super yacht, and going away for three months at a time to work for an American celebrity who owned the yacht. 

So if you are looking to arrange a mortgage then just invite me out to the super yacht and we can discuss it below deck!

Your home may be repossessed if you do not keep up repayments on your mortgage.

HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes which cannot be foreseen.