Currency mortgages in Spain
A standard Spanish mortgage will be in Euros and repaid in Euros.
However, there are banks who offer different currencies for Spanish mortgages such as the Swiss Franc for example.
These are Offshore lenders who will provide the funds and take repayments in any major currency of your choice. The interest rate on these mortgages will be linked to the base rate of the currency you select. Buyers need to be aware of the risks in multi-currency mortgages.
If you have a Swiss-franc mortgage you have to effectively “buy” Swiss-francs to pay your mortgage every month. This is fine if the pound is strong against the Swiss-franc. But what happens if the pound devalues against the Swiss-franc??? Your mortgage payments go up!!!
Worse still, if the Swiss-franc gains against the pound and the pound gains against the Euro then your mortgage payments go up and the value of your Spanish property goes down!
There are situations where a currency mortgage will suit a particular client but in our experience they are usually pushed by unqualified brokers who neither understand nor can explain the advantages and disadvantages of them. Ultimately its the client who loses out.
If you are interested in a Currency mortgage, then please ask us and we will tell you if we believe they are suitable for your circumstances rather than trying to use them as a sales gimmick in the local press!
To find out more about Currency Mortgages Contact us now for further information
