Mortgage currency
Posted: 25 Oct 2010 17:21
Is it possible to change currency on your mortgage - ours is in swiss francs - and it has almost doubled
Regards Quinta
Regards Quinta
Hi Quinta,
A lot of people ask this question. Here is a reply from a mortgage specialist at the Eastern end of the island.
"Now is really not a good time to change your loan from CHF to another currency. The CHF is extremely strong at the moment and if you change currency you will crystallise your loss. Also if you took anything more than a 60% loan at the time of purchase it is unlikely that you will be able to change currency without an injection of capital to reduce the current loan to value to less than 70%.
I am afraid that the only option at present is to sit tight and do your best to make the payments. You can ask your bank for a reduction to interest only for a year if the payments are causing you distress. The banks are quite willing to work with their clients to reduce the monthly burden for a short period at least.
A large majority of people who purchased or mortgaged since 2006 have loans in CHF. The interest rate was significantly lower than that of the local currency (CYP or EURO depending on the time of purchase) but the financial crisis has made the Swiss Franc a very attractive currency."
You will also find an article on how to deal with this issue at 'Help - I cannot pay the mortgage'.
Regards,