Expat mortgages

Hi,

I have a question - its difficult but fair.

Can I mortgage my house in Australia, through an English bank where I now live?

Brad

For some reason my gut feeling is don't do it. Maybe has something to do with the Westpac situation where Australians borrowed in Swiss francs to fund various things including homes and then the exchange rate (over which you have no control unless you take out - at probably a high cost - a hedging contract) went against them. $A200k loans blew out to over $A700k.

Same thing could happen with pounds v dollars or any other variation.

Here is a synopsis of the sorry saga

"Between 1983 and 1986 over 3000 loans were made in foreign currencies to unsuspecting borrowers. The attraction of borrowing in Swiss francs, for example, was that the interest rate in Switzerland was of the order of 7%; in Australia it was double that. But the Australian dollar plummeted against the franc in 1985 and someone who borrowed a Swiss franc loan to the equivalent of $1m in Australian currency was soon owing over $2m in local currency."

Thanks Judd,

Did really think about the currency factor - oops. Was mainly thinking about the interest rate.

Cheers
Brad

In HK and Singapore you can borrow in $A at much cheaper rates than you can at home. No currency risk.

CB

Coach B said:

In HK and Singapore you can borrow in $A at much cheaper rates than you can at home. No currency risk.

CB

Click to expand...

That's interesting. Do they guarantee this somehow?

ASX.G