Mortgage for overseas property

Hi,

If someone who is living and working in the UK would like to buy a property abroad (outside the EU), which is the better option - to raise a mortgage from a UK lender or to get a mortgage from a bank in that foreign country?

Thanks!

Comments

  • Graeme7777
    Graeme7777 Posts: 255 Forumite
    Part of the Furniture 100 Posts Combo Breaker
    Any ideas?

    Thanks
  • bonytony_2
    bonytony_2 Posts: 36 Forumite
    I would like to know too as i would like to buy property in Sydney but work in the UK.



    .
  • furndire
    furndire Posts: 7,308 Forumite
    Part of the Furniture 1,000 Posts Combo Breaker
    Graeme7777 wrote: »
    Hi,

    If someone who is living and working in the UK would like to buy a property abroad (outside the EU), which is the better option - to raise a mortgage from a UK lender or to get a mortgage from a bank in that foreign country?

    Thanks!
    I would think that one thing to bear in mind with a foreign mortgage is the exchange rate every time you need to make a payment.
    Don't know anything about which way to get the mortgage though :confused:
  • drrobert
    drrobert Posts: 35 Forumite
    If you want to avoid currency risk, take out a mortgage in the currency you are paid (or receive rent) in. So:

    - If you're paid in Sterling, it might be sensible to take out a mortgage in Sterling, so your mortgage repayments do not change with changes in the Sterling/Currency X exchange rate.
    - If you're paid in Currency X, a Currency X mortgage would be more sensible for the same reason.

    Some people might have strong views about the future direction of interest rates/exchange rates, and play the market by doing the opposite. This is more risky, however.
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