All Topics / Overseas Deals / U.S finance for Oz property?
Quite simply, is it possible? Are there lenders in the U.S right now that will give you a mortgage secured on a property in Australia? I know that in this scenario there are dangers with the exchange rates between currencies, but the difference in interest rates would surely negate these? Just a thought, and I'd appreciate your feedback.
Thanks….There are Aussie banks in Japan that lend for Australian properties in Japanese yen -with various conditions. NAB do it and ANZ too I believe. So it is likely USA branches of the Aussie banks will do the same.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Not as optimistic as Terry.
There none that i am aware of.
I agree with Asia and the like but not the US or UK.
Richard Taylor | Australia's leading private lender
yea, asia is pretty easy to do that. Note sure about the US.
Just a quick question
What's wrong with the OZ Market? there are deals everywhere
Also have a look at Steve McKnights post on a similar subject, he makes some salient points
Warm Regards
SueMIT | Owen Real Estate
Email MeI have looked into this.
The requirement of NAB or ANZ is that you must be a tax resident and earning an income in the offshore jurisdiction (ie Japan or USA) where the mortgage is taken out. I am not aware of any financiers that will allow you to take out a multicurrency mortgage (ie a loan denominated in USD and using a US rate of interest but secured against an Australian property) if you are an Australian tax resident.
Things can get a bit scary pretty fast if the Australian dollar declines. The lenders require you to maintain a minimum LVR of 25% and recommend an initial deposit of 30%. So if the Aussie dollar drops by 10% and you are on the wrong side of your LVR you will face a margin call for the difference (ie 5% of your property value). A 20% drop would be a 15% margin call. So this is not a product for the faint hearted and you have to be pretty confident about Australian inflation remaining a threat to prop up interest rates and therefore supporting the dollar.
All that being said you can get some pretty amazing rates offshore. I would be interested in talking to anyone that has been able to work a way through the tax residency issue – because if you use a foreign national to hold the property you will never get through the Foreign Investment Review Board.
The St.George Foreign Currency Home Loan offers customers who may be residing either within Australia or offshore the ability to borrow funds in a foreign currency, provided their main source of income is denominated in the same foreign currency, creating a natural hedge for loan repayments.
Foreign currencies available are:
- Hong Kong dollar (HKD)
- United States dollar (USD)
- Singapore dollar (SGD)
- British Pound Sterling (GBP)
- New Zealand dollar (NZD)
- Euro (EUR)
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
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