Interested in a 3% Home Loan? – Conditions Definitely Apply
For a very select few, it can happen. An article in the weekend papers caught my eye regarding Foreign Currency Home Loans. HSBC have a product called just that.
Its target client is a Kiwi who has a home loan here, but who ventures overseas for a new job in say, London, Hong Kong, Singapore, Los Angeles, Melbourne or Osaka.
In such a case, and if they qualify, instead of your NZ home loan being paid in NZD$, the bank, HSBC in this example, will convert the payments into the home currency of the employees new locale. In some cases, like if the property is rented out, then only a proportional payment may apply.
And the same loan is applicable for a foreigner who has moved to NZ, buys a property but retains an existing income stream from their overseas location.
These interest rates are on a revolving 90 day timeframe, and are re-adjusted every 90 days to reflect any rate changes in those locales.
- You may qualify if you are earning your income offshore in a foreign currency and are purchasing a property in New Zealand.
- The loan must be in the same currency as your main offshore income.
- Home buyer loans are currently available in US dollars, Hong Kong dollars, Euros, Japanese Yen, Australian dollars, and Singapore Dollars.
- Available for owner-occupied and investment properties.1
It’s a way to take advantage of that 5.89% rate in the UK or how about 3% in Japan?
I wouldn’t be surprised if some other banks offer a similar product.
If you’re an ex-pat in London, and have saved those last 3 years bonuses into a sizable deposit for a home purchase in NZ, it appears these loans don’t apply, but the article states the bank “will do a deal.” So it certainly wouldn’t hurt to pick up the phone.
Advantages with this above mentioned product are things like no currency conversion margins & if also using an HSBC account overseas, no electronic international transfer fees too.
However the piece in the weekend’s Sunday Star Times highlights a big plus….
If an ex-pat Kiwi returns home with before said sizable deposit, and isn’t happy with the current NZ interest rate, he/she could opt to leave the $$$ in a Foreign Currency account. In HSBC’s case, this security could be utilized for a NZ home loan, and only converted back into NZD$ to pay the loan, when the rate is more attractive.
And, no I don’t have any interest in HSBC, just want to pass on, what might be for some buyers / current mortgage holders, be some relevant information they might not be aware of.
DISCLAIMER – before proceeding with any such large dollar amount application you’re advised to see your financial professional to confirm & discuss your individual circumstances.
*** in certain cases, may be subject to OIO approval
December 09 2008 | General and Mortgages Finance Money | No Comments »
.jpg)
