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Originally Posted by Peter Mitry
Many Brits looking to invest in emerging markets are often stretched at home on the lending criteria and prefer to look for mortgage finance in the country they are buying in.
Although the mortgage rate on Stuarts example looks high at 8% am I right in thinking that as this is an Egyptian pounds mortgage the borrower would benefit from the strength of the pound when transfering funds?
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From what I've been told the criteria for lending in Egypt will not be very different from other countries in that the whole financial circumstances of the potential borrower will be taken into account so being strectched at home (UK) will cause problems in other countries.
The only value that I can see in taking a mortgage in Egypt is to get a lower rate of interest than you can get anywhere else, by using the new property as security - if this is not possible then there is no point even going down this route.
Most mortgages around the world will only offer to lend of something that exists, which is no good for buying off-plan. If the property is just about complete AND has been registered then it may be worth the effort, or if it's the only way to raise a large amount of cash (maybe over £50k).
If a potential buyer thinks that getting in early (say 18 months before completion) is worth doing by borrowing, then a mortagage is a non-starter.
A UK personal loan, or re-mortgage on other property is the only option if cash is not to hand.
Payment profiles from the developer often only cover a period of say 18 months so the payments are relatively large.
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