Overseas loans (whilst in Oz)
 

I was wondering if anyone has risked an overseas loan? I am looking to buy a house soon and was wondering whether it is possible to borrow money from overseas eg Singapore at low percentage rates rather than have to borrow from the Aus Banks at over 7%?

flying free

Re: Overseas loans (whilst in Oz)
 

As far as Australia is concerned, it's legal, but:

The percentage rate won't be so low if the Australian dollar suddenly drops against the Singapore dollar (which the interest rate differential suggests will happen).

Lots of people have been badly stung financially by trying this out. Bad idea. And in any case, unless you were earning money in Singapore dollars, many banks would not want to lend to you this way.

Re: Overseas loans (whilst in Oz)
 

I had a yen loan, set up before we left Tokyo. Being paid in yen was one of the conditions.

Interest rate was 1.5% initially, so well worth doing. It's now gone up to about 2.4%. The Aussie strengthened a lot after we took out the loan, so effectively your loan becomes smaller against the equity in your house valued in AUD. The negative side is that my income also declines that way, so the overall effect was fairly neutral. But it meant I could borrow on my credit record in Japan and have very small monthly repayments relative to borrowing locally.

Re: Overseas loans (whilst in Oz)
 

hanks for the advice

Re: Overseas loans (whilst in Oz)
 

If you are looking to borrow money to buy a property in Oz then you may find you will not be able to get a loan in another country. Generally the lender will use the property you are buying as security against the loan. SO unless you have another form of security in the country you want to borrow from you may find you wont get the loan.

Re: Overseas loans (whilst in Oz)
 

Thanks for this info - I think overall it is not looking like such a good idea and we will have to go with an aussie lender.