Foreign currency

Foreign currency mortgages are not just for those buying overseas. As well as arranging mortgages on overseas property, in Sterling or a foreign currency, SPF can also arrange multi-currency lending (in Euro, US Dollars, Swiss Francs, or even Japanese Yen) against your UK home.

Why would you opt for a foreign currency mortgage rather than one in Sterling? Clients opt for such deals because it generally means a lower rate of interest than they would have got with Sterling. Or they may have earnings in that foreign currency.

Instead of lending in Sterling, the bank will advance your money in another mainstream currency. The cost of the debt is then converted to Sterling, and you use this to buy your property. The debt is paid off in the foreign currency but you make appropriate monthly payments in Sterling, which are then converted into the currency your mortgage is in.

Alternatively, you can opt for a managed currency mortgage. With this, a manager moves your mortgage in and out of various currencies when he judges that it is prudent to do so. For example, if your mortgage is in Euro but this strengthens against Sterling, the manager will move your mortgage into a relatively weaker currency, such as US Dollars, for instance.

Foreign currency mortgages are not for everyone but aimed at our more adventurous clients who are well aware of the risks involved. You should always be aware that if Sterling takes a tumble, your monthly payments could increase significantly, which is why it is so important you take expert advice. 

SPF can provide guidance on foreign currency lending and managed currency mortgages, putting you in touch with those lenders who offer the most competitive deals.