Foreign Finance Close to Home
The benefits of using UK finance to buy overseas property …
Thousands of Britons are looking at buying property abroad and the majority of them need finance to raise enough cash to carry out the purchase. There are many foreign banks and UK intermediaries who will offer you finance to purchase the property but depending on your circumstances this may not be the best way forward.
Although borrowing in a foreign currency is becoming more and more competitive it can never contend with the flexibility and ease of borrowing against a UK asset then buying the property outright. Foreign based mortgage lenders will often ask for an extensive list of documentation as part of the application such as mortgage statements, bank statements, proof of income etc. The lender will also need to consider you overall financial profile, looking at all outgoings before deciding how much they will lend. You will also have to arrange for a monthly transfer to pay the mortgage, banks or money transfer companies will charge for this.
The alternative is to look at your own home, if you are still working you would be able to re-mortgage to release the funds required and even if you are retired many companies offer competitive rates for equity release schemes. This may allow you to move the transaction at a quicker rate and ease the completion on the property, you may also find it easier to deal with the foreign developer and Solicitor.
At present borrowing in the Eurozone is relatively cheap due to the Euro's lower interest rate but with all considerations and costs incurred, raising the finance in the UK may be the better option. You would always have the option of re-mortgaging the foreign property if you were desperate for funds.
Written by: Ben Saxton
From: http://www.quicksaleproperty.net
Date written: 25/06/2006
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