Financing property refurb in France - borrowing in Euro
Discussion
Hi Guys
borrowing Euros to do a French project at circa 2% interest (or whatever their current rate is!) sounds to be a better idea to me than borrowing in the UK at 7.25% and not being able to use the French property as security on the loan.
Anyone got any contacts for French borrowing? It will be circa 400k Euros against a finished developed value of 600k euros approx.
borrowing Euros to do a French project at circa 2% interest (or whatever their current rate is!) sounds to be a better idea to me than borrowing in the UK at 7.25% and not being able to use the French property as security on the loan.
Anyone got any contacts for French borrowing? It will be circa 400k Euros against a finished developed value of 600k euros approx.
I've used these people to help me source a mortgage locally. www.fidentiagroup.com
As for currency fluctuations if I'm purchasing in Euros, renting in Euros, and paying the mortgage in Euros where's the fluctuation? What am I missing?
As for currency fluctuations if I'm purchasing in Euros, renting in Euros, and paying the mortgage in Euros where's the fluctuation? What am I missing?
And living in the UK, I presume?
Obviously, if most of the financial aspoects of the enterprise are happening in a Euro Zone country, then the effect of currency fluctuations will be a lot less than if you are transferring funds to and from Sterling accounts.
Ultimately, though, if the individual resides in a country which has a different currency to where the investment and borrowings are based, then currency fluctuations HAVE to be taken into account.
Obviously, if most of the financial aspoects of the enterprise are happening in a Euro Zone country, then the effect of currency fluctuations will be a lot less than if you are transferring funds to and from Sterling accounts.
Ultimately, though, if the individual resides in a country which has a different currency to where the investment and borrowings are based, then currency fluctuations HAVE to be taken into account.
Eric Mc said:
And living in the UK, I presume?.
Yes I do.
I put Euro profits back into another Euro based country, I don't bring any back into the UK. I'm not talking large profits, my aim is to build a diverse property portfolio which my next of kin would inherit.
Should I come to sell up and bring the money back into the UK, assuming we've still got a different currency, then, yes, I'll have to consider currency fluctuations.
I intend having more than one 'base' though.
As we're not the pioneers, others will have been through the ball ache, they're fairly 'normal'. As you know people have been borrowing locally in France for years.
Whereas some other EU countries, Hungary for example, are a ball ache.
Have you tried going into a local bank out there? There's usually a branch happy to deal with you. Think there was a local Abbey National happy to lend to me when I last looked.
There isn't the variety of mortgages you get in the UK though.
ETA: Friend of mine was happy with Connect IFA www.connectoverseas.co.uk
Whereas some other EU countries, Hungary for example, are a ball ache.
Have you tried going into a local bank out there? There's usually a branch happy to deal with you. Think there was a local Abbey National happy to lend to me when I last looked.
There isn't the variety of mortgages you get in the UK though.
ETA: Friend of mine was happy with Connect IFA www.connectoverseas.co.uk
Edited by magic torch on Monday 8th January 14:38
johnfm said:
Hi Guys
borrowing Euros to do a French project at circa 2% interest (or whatever their current rate is!) sounds to be a better idea to me than borrowing in the UK at 7.25% and not being able to use the French property as security on the loan.
Anyone got any contacts for French borrowing? It will be circa 400k Euros against a finished developed value of 600k euros approx.
borrowing Euros to do a French project at circa 2% interest (or whatever their current rate is!) sounds to be a better idea to me than borrowing in the UK at 7.25% and not being able to use the French property as security on the loan.
Anyone got any contacts for French borrowing? It will be circa 400k Euros against a finished developed value of 600k euros approx.
Where in France John
My advice... register your business in England, not France and avoid paying ANY TAX in France at all cost.
Solution...
Why not borrow in the UK?
I know currency ect... but why not try to get paid in the UK? Rent it out to holiday makers or Brits working in France on contracts? Even if you do get rent in Euros, you will still save more with a strong pound by not paying French tax.
Solution...
Why not borrow in the UK?
I know currency ect... but why not try to get paid in the UK? Rent it out to holiday makers or Brits working in France on contracts? Even if you do get rent in Euros, you will still save more with a strong pound by not paying French tax.
Hi V8
the only reason I wouldn't borrow in £ is that my UK banker suggests that though they will lend on the project, they cannot use the propoerty as security. As a result, I may not be able to secure the borrowings as I am close to the level of security I wish to maintain.
Also, as jobs like this are known to go on and on sometimes, paying euro interest rates was attractive!
Anyway, I may not take the risk until I know more about the property - I know Leeds and Harrogate, have decent builders over here etc. I'm not sure I hsould stick my neck out with builders in a foreign country where I don't have any expereience.
Still, I like the idea of converting a barn into a 3000 ft2 chalet!
the only reason I wouldn't borrow in £ is that my UK banker suggests that though they will lend on the project, they cannot use the propoerty as security. As a result, I may not be able to secure the borrowings as I am close to the level of security I wish to maintain.
Also, as jobs like this are known to go on and on sometimes, paying euro interest rates was attractive!
Anyway, I may not take the risk until I know more about the property - I know Leeds and Harrogate, have decent builders over here etc. I'm not sure I hsould stick my neck out with builders in a foreign country where I don't have any expereience.
Still, I like the idea of converting a barn into a 3000 ft2 chalet!
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