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Expat Investor : November 2008
EXPATRIATE MORTGAGES Lender Bank of Scotland International Barclays Bank Halifax Irish Permanent International NatWest International NatWest Mtg Service Royal Bank of Scotland Royal Bank of Scotland Int Woolwich PROPERTY INVESTMENT EURO MORTGAGES Rate % Max. % Fee 7.35 7.14 7 65 7.19 7.19 7.19 7.19 7.14 Notes Fast Facts 80 0.5-1% Lifetime tracker and fixed rates available 99519 80 75 75 Varies Varies - 80 0.5-1% Fixed, tracker and SVR Fixed and tracker rates No products currently available Fixed and tracker rates. Min £50k 99500 Barclays Bank 99502 99503 99507 95 £0-£1499 Standard mortgage range available 99507 95 £0-£1499 Standard mortgage range available 99510 80 0.5-1% 80 Varies Fixed and tracker rates available 99510 Standard mortgage range available 99512 Figures compiled: 3/10/08. Source: MoneyFacts www.moneyfacts.co.uk Expatriate = UK residents working abroad short-term and buying a property in the UK. Lender may allow property to be let. OVERSEAS PROPERTIES Banco Halifax Hispania Barclays Bank HSBC Investec Private Bank Leeds BS Lloyds TSB Source: MoneyFacts Spain Spain Portugal, Italy & France France, Spain, Malta Euro Euro 99520 99500 Euro, Maltese lira or selected major currency 99503 France, Italy, Spain, Portugal, Sterling, euro, US$, Swiss Franc, Japanese yen, 99517 Monaco & Guernsey Gibraltar, Spain, France Australian $, Canadian $, Hong Kong $ Sterling, euro Newcastle Building Society Norwich & Peterborough BS France, Spain, Portugal, Australia, NZ, Canada, US, Dubai, Currency of choice Hong Kong, Singapore & UK Gibraltar Royal Bank of Scotland International International Private Finance Source: MoneyFacts Mortgagees finding ‘spare cash’ for overpayments Despite economic woes, Abbey Mortgages research shows that more than one in 10 (12%) say they are planning to make an overpayment on their mortgage.This is three times the number (4%) who are planning to take a payment holiday or make underpayments. The research suggests that paying off the mortgage remains a top financial priority for people and despite a tough economic environment, only a very small number of people are taking a payment holiday (3%) and even fewer are planning to free up extra cash and make an underpayment (1%). The Abbey study also found that one in 10 mortgagees will be looking to change their mortgage over the next six months. Phil Cliff, Director., comments: “A large proportion of mortgages offer borrowers flexibility and the research shows that many people are planning to take advantage of these benefits. 22 EXPAT INVESTOR ? “ It’s great to see that people are quite rightly prioritising their mortgage payments ahead of other financial commitments – having a smaller mortgage can mean you get a better deal when you remortgage and of course reduces future monthly outgoings.” Other key findings: ? in the South East of England where mortgage debt is likely to be highest, almost one in five people with a mortgage are planning to make an overpayment (17%). This is more than eight times the number planning to make an underpayment (2%). ? eight per cent of people in Wales and the South West are planning to take a payment holiday over the next six months – the most of any region. ? 13% of mortgagees in the North of England will be shopping around for a new deal over the next six months. Fast Facts 99370 November 2008 Gibraltar & Southern Spain Spain France, Spain, Portugal, Italy, Florida, South Africa, Bulgaria Sterling Sterling Euro, sterling Euro, sterling, US dollar 99505 99506 99516 99500 99510 99518 FOREIGN CURRENCY LOANS Lender Location Bank of Scotland International UK property Barclays Bank UK property MOVING RATES Fast Facts 99519 99500 Investec Private Bank UK & selected European property 99517 Irish Permanent International UK property 99504 NatWest International UK property Royal Bank of Scotland InternationalUK property Currency switching allowed on all major currencies Source: MoneyFacts Keep a cool mind when investing in property When investing in property abroad most people buy in an area they know and love in order to completely relax under the sun. However, this romanticised view of an overseas property purchase often leads investors to ignore the rules they would normally abide by when buying property in the UK. Getting carried away by failing to comprehend the financial, legal, and practical implications of buying property abroad can lead to some nasty surprises. Currencies Direct says common mistakes made by Brits when investing in property overseas include failing to seek professional advice, falling foul to development scams, not planning efficiently, and even buying blind (buying a property before seeing it). “It’s easy to trust a developer with a deal that sounds too good to be true, but you should never be afraid to take time in making decisions and asking for recommendations,” says Currencies Direct. David Kennedy, a Currencies Direct customer, didn’t barter with developers in Portugal having been told that it was considered impolite and a ‘foreign faux pas’. This meant he paid over the odds for his apartment and was left without basic items he had been promised (although not in writing) such as air conditioning. David ended up waiting almost two years for the completion of the property, which led him to finally take control and set up an online pressure group amongst buyers, which enticed local suppliers to get involved and offer cheaper goods and services to the entire group. Hidden fees charged by banks when moving money from the UK to an overseas account may also leave investors having to shuffle their budget, particularly when it comes to exchange rates. expatinvestor.com High street banks are the first port of call for many, forgetting that foreign exchange is not their specialist area and that they will be receiving what is essentially a tourist rate. This means buyers could be losing out on thousands. Currencies Direct holds Yvonne Warwick up as an example of how buying property abroad should be done. A self-confessed expert on foreign exchange she is able to report the worth of the euro on any given day. By being savvy about exchange rates, she is firmly in control of her finances, and always knows the best time to transfer money from her UK bank account – which is why Yvonne managed to save thousands when she used Currencies Direct to transfer funds to cover the cost of her Finca in Spain. Fast Facts 99371 99507 99510 All the information on interest rates published in Expat Investor is checked regularly and to the best of our ability. However, rates do change on all accounts sometimes frequently and we advise readers to double check those interest rates which they find appealing before beginning any transactions with the deposit-takers concerned. Investec Private Bank Fast Facts 99517 Irish Permanent International Fast Facts 99504 Leeds Building Society Fast Facts 99501 NatWest International Fast Facts 99507 Fast Facts 99500 Lender Notes Bank of Scotland International Fast Facts 99519 Rate linked to EURO LIBOR + 1.20% with option to set rate for 3, 6, 12 months. Max 70% LTV. Interest only or capital repayment. Min £400k. Max term 20 years. Arrangement fee up to 1%.Redemption charge applies. Rates also available on same terms in US dollars, Swiss Francs and HK dollars. Rate linked to Barclays Bank 3 month LIBOR rate applicable for a 90 day interest period. For house purchase only. On an interest only basis, max 65% LTV, advance £500k, term 5 to 20 yrs and fee 0.5%. Redemption charge applies. Barclays Euro Current Account required. Rates also available on same terms in dollars, Yen, Swiss Francs and Hong Kong dollars. Rate is based on EURIBOR +1.25% to 2%. Max 70% LTV. Upfront fee of up to 1%. Min adv of £1m in euro equivalent. No redemption fee penalty. Also available on same basis in US$, Swiss Franc, Japanese Yen. Managed multi-currency also available. Rate is based on EURIBOR + 1.24%. Max 75% purchase & remortgage. No redemption fee payable. Fee 1% (min €1.5k) Irish € product. Rate based on EURIBOR + 1.45%. Max 75% LTV. No fee. No redepemption penalty payable. Rate is based on 3 month LIBOR + margin. Max 60% purchase & remortgage, on repay ment or endowment basis, max term 30 years. Income multiples 3.75 x joint plus 1 x 2nd or 2.75 joint. Minimum advance £100k in euro equivalent. No redemption penalty payable. Fee - refer. Mortgages for borrowers who are paid in euros to purchase or remortgage their main UK property