Is it possible to take out a Euro mortgage on a UK property?
- Thread starter Jonny69
- Start date
[TW]Fox;20020840 said:
It's not pegged to the Euro, only limited to one side (i.e. the Swiss central bank will do all it can to not allow it to appreciate ANY MORE than a certain rate), which means it can depreciate. That is not pegging.
To OP, there are various things to consider when linking your debt to another currency, such as:
a) rates, now and in the future - and compare them to UK rates
b) any fees to originate and close or move your mortgage (could be too high and prohibitive)
c) what about the conversion of you £ to the Swissie when you make your monthly payments? will that affect you or not? (meaning that you will pay a % as fee for the conversion, used to be the commission but now priced in the conversion rate). Still, it may yet be profitable to take that on the chin
d) more important than all is timing. Obviously currencies go up and down, but what happens if you HAVE to sell at a bad time when the FX rate is not in your favour?
good luck and make sure that you can afford multiples of your monthly payment as it could rise to 2x easily.
Associate
http://www.news.cyprus-property-buyers.com/2011/07/08/foreign-currency-mortgages-turn-sour/id=008200
as mentioned above - some folks are now stuck with huge negative equity with swiss franc mortgages
as mentioned above - some folks are now stuck with huge negative equity with swiss franc mortgages
Some thoughts to consider:
- It's hard enough to get a mortgage here. How will the same fair in France?
- I'm uncertain a normal French lender will mortage a UK house. Their valuation system will break.
- Buying a French house in France is tricky enough.
- Do you expect a french lender to provide a mortgage when they don't see your income?
- How will you pay each month (you can't DD, and, you'll get rinsed some months on the exchange rate even if you have a French fixed mortgage)?
Ok, so it seems I am right on the economics side, with regards to changes in the exchange rate. What might not work is the potential charges each month from the currency conversion and direct debit, also because it might need a foreign bank account which also might have its own charges. Assuming they come in at less than the change in the debt, then the theory works.
I can't believe you all think the Pound will never rise to the levels it was when the Euro started. It's a very short-termist view to have. The pound is weak compared to the Euro at the moment; it's the worst it's ever been!. As soon as we and they (Euro zone) return to normal the exchange rates will be as they were. It'll probably take no more than 5 years and certainly won't take 10. And even if it does, it's a mortgage! You take them out for 20 years or more!
I can't believe you all think the Pound will never rise to the levels it was when the Euro started. It's a very short-termist view to have. The pound is weak compared to the Euro at the moment; it's the worst it's ever been!. As soon as we and they (Euro zone) return to normal the exchange rates will be as they were. It'll probably take no more than 5 years and certainly won't take 10. And even if it does, it's a mortgage! You take them out for 20 years or more!
![[TW]Fox](/data/man-of-honor/2009.png){kind=avatar}
How though? It's as likely to go down as it is go up, which would increase your debt in sterling terms?
This is such a utopian view to take and a very dangerous gamble to make on something as significant as a mortgage.
Where is this renewed strength in the value of Sterling going to come from?
[TW]Fox;20021931 said:Err, it is a currency
Not in terms of finance at the highest level, spending it on a day out is different to the bull in Brussels atm, even over the years they are still arguing over whether to save it or not, I really do pity the smaller countries in all this, no rules were set at the start and now the world has to pay for it.
Completely incompetent bunch of whiny little kids fighting over a candy bar as far as i see it.
Caporegime
Wrong 3 times in one sentence. Incredible. Go back to school.
Caporegime
What is that even supposed to mean?
Soldato
It kind of is a currency. A shambles of one arguably, but a 100% a currency
Well, to be fair, the idea of the Euro was simple (in my mind).
If I went to Germany and bought a marsbar, it would cost me 1EUR. If I went to France and bought a marsbar, it would cost me 1EUR. If I went to Slovakia and bought a marsbar, it would cost 1EUR.
Of course, this was never going to be the reality, hence, failure
If I went to Germany and bought a marsbar, it would cost me 1EUR. If I went to France and bought a marsbar, it would cost me 1EUR. If I went to Slovakia and bought a marsbar, it would cost 1EUR.
Of course, this was never going to be the reality, hence, failure
Soldato
It means he knows the inner workings of the financial system way better than you or me. Either that or he's been watching way too many money/debt creation videos on youtube
Caporegime
Germany will save us!
Soldato
Personally I wouldn't touch paper with a barge pole.
Jonny, you're taking a gamble and I see your logic but I can't see the cycle happening again.
Maybe one should be looking at the gold to house price ratio instead ?
Jonny, you're taking a gamble and I see your logic but I can't see the cycle happening again.
Maybe one should be looking at the gold to house price ratio instead ?
Associate
No there isn't, a floor or 1.20 was announced on Tuesday and because of safe haven currency purchasing that was seen as a peg but it isn't. Consequently we're currently at 1.2148.
Well, to be fair, the idea of the Euro was simple (in my mind).
If I went to Germany and bought a marsbar, it would cost me 1EUR. If I went to France and bought a marsbar, it would cost me 1EUR. If I went to Slovakia and bought a marsbar, it would cost 1EUR.
Of course, this was never going to be the reality, hence, failure
Right, because a mars bar at Texas costs the same amount in $ as it costs in New York etc etc.
A mars bar has a different price from a train station outlet to your local high street. The retail price of a product is determined by retailers, unless the company sets a recommended price which they are then obliged to follow (many of them anyway).
The euro's purpose was nothing like what you described, nor were its consequences envisaged anywhere near that.