Cash Savings for Settlement Visa

[crazydrummerpauly]

Hi. Some time back - 'Tony M' writes in a thread about the Savings route for the financial requirement for a spouse visa -

"In addition, a recent change to the immigration rules says that, basically, cash savings can also come from the sale of property ( within the last 6 months) as long as the property was owned bu you or your wife, or both."

That's copy/pasted from the thread, the emphasis added.

Does this mean that savings from a property-sale years ago can NOT COUNT as all or part of the £62.500 required ?

This is of considerable importance for me (and i'm sure for others) as my savings date all the way back to 2005 when i sold a large house.

Also, as savings have to be held for a Minimum of 6 Months - property sold 'within' the last 6 months at the time of application would not qualify ?

[Tony M]

I have answered your PM.

[Jay Sata]

If you have had the cash savings for a considerable period of time as you suggest I cannot see how it matters where they came from.

Edited February 3, 2015 by Jay Sata

[crazydrummerpauly]

Thanks to Tony M i have the answer, which i will summarize in case it is useful to others -

The updated rule means that you can have sold a house within the last 6 months, and as long as the money is now in the bank, it can qualify towards the savings requirement. The rules previously said that the money had to be in some kind of savings for "the past 6 months" to be eligible as savings.

As with all applications based on savings, it would be extremely beneficial to have original documentary evidence - solicitor's letters for example / bank statement showing receipt of funds from house-sale etc - to prove the source of the savings.

[TCA]

The updated rule means that you can have sold a house within the last 6 months, and as long as the money is now in the bank, it can qualify towards the savings requirement. The rules previously said that the money had to be in some kind of savings for "the past 6 months" to be eligible as savings.

I'm glad it helps you, but it's yet another rule where I can't see the logic. I'm surprised that they don't EXCLUDE it, seeing as there's a fair chance that such monies would used to finance the purchase of another property, therefore potentially only a short-term boost to the cash position of some applicants or their sponsors. An example of where the 6 month rule would perhaps be sensible.

Edited February 3, 2015 by TCA

[crazydrummerpauly]

The updated rule means that you can have sold a house within the last 6 months, and as long as the money is now in the bank, it can qualify towards the savings requirement. The rules previously said that the money had to be in some kind of savings for "the past 6 months" to be eligible as savings.

I'm glad it helps you, but it's yet another rule where I can't see the logic. I'm surprised that they don't EXCLUDE it, seeing as there's a fair chance that such monies would used to finance the purchase of another property, therefore potentially only a short-term boost to the cash position of some applicants or their sponsors. An example of where the 6 month rule would perhaps be sensible.

Yep - i see your point on the dodgy logic of the change completely. The only thing to throw in the mix is that at the 2.5-year Leave-to-Remain point if all the savings have been consumed by purchasing another property, then the combined incomes of the couple had better be over that £18,600 hurdle (assuming there are no kids). So if that planning is not up to scratch, the 'short-term boost' you mention really won't get a couple very far along that long 5-year route; and it would all have been an expensive waste of time. Slightly veering off to the side - i'm hearing about more and more people choosing the 'Surinder Singh' route into the UK, NOT because they haven't got the finances at the start to go the normal settlement route, but because the SS route is completely free of both the mid-point hurdle, and also because it doesn't have the tight rule about having to be in the UK together for at least 9 months of every 12 throughout the 5 years. The SS rule on that is easier but i can't quote it with 100% certainty right now. There is also the absence of an English language and TB test - though personally i'm not against them at all. There are to my knowledge at least FIVE Facebook groups dedicated to using the SS route - it's working for many, though it's difficult in various ways - and the UK government would love to block it. Sorry to veer off - but there is a connection underlying it all!

Edited February 3, 2015 by crazydrummerpauly

[7by7]

This is one of the many illogical aspects of the poorly thought out financial requirement.

One could sell one's house, put £62,500 of the money in a bank and use the rest of the money as a deposit on a new one and take out a mortgage; or simply rent!

also because it (Surinder Singh) doesn't have the tight rule about having to be in the UK together for at least 9 months of every 12 throughout the 5 years.

There is no such rule as far as settlement and qualifying for ILR is concerned.

The only residential requirement for ILR is that the applicant needs to show they are a UK resident, and have been for the five year qualifying period. There is no set restriction on time spent out of the UK, but showing residency may be difficult if more time has been spent abroad than in the UK.

Obviously, there are exceptions for the spouses of members of the armed forces and other Brits stationed outside the UK.

I think you are confusing it with the residential qualifying period for naturalisation as British.

For the spouse or civil partner of a British citizen this is a maximum of 270 days out of the UK in the preceding three years, with no more than 90 days in the final year; though, again, there are exceptions where longer than this outside the UK is allowed.

[TCA]

This is one of the many illogical aspects of the poorly thought out financial requirement.

One could sell one's house, put £62,500 of the money in a bank and use the rest of the money as a deposit on a new one and take out a mortgage; or simply rent!

Yes. The fact that they don't look at outgoings, means that someone could show a whopping amount of sales proceeds from a house sale at point of visa application, and the following week it could all be gone on a nice big house with a whopping mortgage that they can't afford.

Meanwhile the applicant who owns his/her own home but has less than £62,500 in savings and less than £18,600 income, despite minimal monthly outgoings, will fail the test. Non-sensical. If I had £50k in the bank and earned £18k p.a. I'd be mightily hacked off. You'd probably end up borrowing (and increasing your outgoings) to meet the savings requirement!

[crazydrummerpauly]

This is one of the many illogical aspects of the poorly thought out financial requirement.

One could sell one's house, put £62,500 of the money in a bank and use the rest of the money as a deposit on a new one and take out a mortgage; or simply rent!

Yes. The fact that they don't look at outgoings, means that someone could show a whopping amount of sales proceeds from a house sale at point of visa application, and the following week it could all be gone on a nice big house with a whopping mortgage that they can't afford.

Meanwhile the applicant who owns his/her own home but has less than £62,500 in savings and less than £18,600 income, despite minimal monthly outgoings, will fail the test. Non-sensical. If I had £50k in the bank and earned £18k p.a. I'd be mightily hacked off. You'd probably end up borrowing (and increasing your outgoings) to meet the savings requirement!

Surely if you had £50k in the bank and an income of £18k it would be a breeze to do the combined Savings + Income method. You would not fail the test, far from it. In fact it is possible to pass the test as a State Pensioner on just £6,000 a year with the Savings you mention - £18,600 minus £6,000 = £12,600 x 2.5 yrs = £31,500. Plus the Disregarded first £16,000 of savings = £31,500 + £16,000 = £47,500. That's the savings needed to pass the test on just £6,000 a year income.

Edited February 3, 2015 by crazydrummerpauly

[crazydrummerpauly]

This is one of the many illogical aspects of the poorly thought out financial requirement.

One could sell one's house, put £62,500 of the money in a bank and use the rest of the money as a deposit on a new one and take out a mortgage; or simply rent!

also because it (Surinder Singh) doesn't have the tight rule about having to be in the UK together for at least 9 months of every 12 throughout the 5 years.

There is no such rule as far as settlement and qualifying for ILR is concerned.

The only residential requirement for ILR is that the applicant needs to show they are a UK resident, and have been for the five year qualifying period. There is no set restriction on time spent out of the UK, but showing residency may be difficult if more time has been spent abroad than in the UK.

Obviously, there are exceptions for the spouses of members of the armed forces and other Brits stationed outside the UK.

I think you are confusing it with the residential qualifying period for naturalisation as British.

For the spouse or civil partner of a British citizen this is a maximum of 270 days out of the UK in the preceding three years, with no more than 90 days in the final year; though, again, there are exceptions where longer than this outside the UK is allowed.

But as an Average it is no more than 90 days in any year isn't it, as the ILR rules do stipulate no more than 450 days outside the UK in the 5 years ? (5 x 90) Or did i mis-remember this....Your second and fourth paragraphs seem to contradict each other ? : "There is no set restriction on time spent out of the UK" but then, in the last paragraph you state the restrictions ? - "this is a maximum of 270 days out of the UK in the preceding three years, with no more than 90 days in the final year" - which is pretty much what i meant.

[TCA]

Surely if you had £50k in the bank and an income of £18k it would be a breeze to do the combined Savings + Income method. You would not fail the test, far from it.

Sorry, you are of course correct. It's been a while since I've looked at this and always think from my own self-employed perspective, where earnings cannot be combined with savings. Apologies.

[7by7]

crazydrummerpauly

You are confusing the residential requirements for ILR with those for naturalisation as British.

Poor paragraphing and wording in my previous doesn't help! Sorry.

As said, the only residential requirement for ILR is that the applicant needs to show they are a UK resident, and have been for the five year qualifying period. There is no set restriction on time spent out of the UK, but showing UK residency may be difficult if more time has been spent abroad than in the UK.

Obviously, there are exceptions for the spouses of members of the armed forces and other Brits stationed outside the UK.

Naturalisation as British is more strict.

For naturalisation the residential qualifying period for the spouse or civil partner of a British citizen is three years with a maximum of 270 days out of the UK in that three years and no more than 90 days in the final year.

For anyone else the residential qualifying period is 5 years with a maximum of 450 days out of the UK during that 5 years and no more than 90 days in the final year.

These periods outside the UK are not set in stone, for example periods of up to 100 days in the final year will usually be disregarded. Also, as said, if the applicant is out of the UK due to their spouse or partner working overseas then exceptions can (not definitely will, though) be made.

In addition the applicant must have no time restriction on their stay in the UK; i.e. ILR or the equivalent.

The spouse or civil partner of a British citizen can apply as soon as they have ILR or the equivalent; provided the other requirements are met.

Everyone else needs to have held ILR or the equivalent for at least 12 months before they apply.

As it now takes at least 5 years to obtain ILR, this effectively means that the spouse or civil partner of a British citizen needs to have lived in the UK for at least 5 years before they can apply for British citizenship; everyone else for 6 years.

But as far as time spent out of the UK is concerned, it is the three years or five years, as appropriate, prior to the application which matter; no matter how long the applicant has actually lived in the UK for.

Hope that's more clear.

For more details see British citizenship basics.

Edited February 4, 2015 by 7by7

[7by7]

Surely if you had £50k in the bank and an income of £18k it would be a breeze to do the combined Savings + Income method. You would not fail the test, far from it.

Sorry, you are of course correct. It's been a while since I've looked at this and always think from my own self-employed perspective, where earnings cannot be combined with savings. Apologies.

Which is another totally illogical aspect of this poorly thought out and rushed through piece of legislation.

What possible reason can there be for not allowing the self employed to use their savings to reduce the income requirement?

[crazydrummerpauly]

Surely if you had £50k in the bank and an income of £18k it would be a breeze to do the combined Savings + Income method. You would not fail the test, far from it.

Sorry, you are of course correct. It's been a while since I've looked at this and always think from my own self-employed perspective, where earnings cannot be combined with savings. Apologies.

Which is another totally illogical aspect of this poorly thought out and rushed through piece of legislation.

What possible reason can there be for not allowing the self employed to use their savings to reduce the income requirement?

On the illogicality of the legislation - i have an email from UKBA confirming that if i rented out a house in the UK for £1000 a month income, and then rented another house in the UK for £1000 to live in, i WOULD be allowed to include the £12,000 a year from the letting even though it would be wiped out by renting the other place. This is possible because of the lack of means-testing, so it should be taken on board as one way an applicant could actually benefit from the illogicality for a change, if they have a property in the UK. Obviously, it would be sensible to rent a second property at well below the letting-income in the real world, but the example does illustrate the way the agency only looks at the headline income when judging the Financial Requirement.

[7by7]

To paraphrase Mr Micawber:

" Annual income £18,600, annual expenditure £18,601; result happiness (visa granted)

Annual income £18,599, annual expenditure nil, result misery (visa not granted)."

[crazydrummerpauly]

To paraphrase Mr Micawber:

" Annual income £18,600, annual expenditure £18,601; result happiness (visa granted)

Annual income £18,599, annual expenditure nil, result misery (visa not granted)."

A perfect summary of the madness of crude thresholds !