99.9% of mortgage borrowers raise the cash they need to buy their house in pounds sterling and pay the prevailing UK based interest rate. But it does not have to be that way……..

Whilst by its' own historical standards, the UK's domestic interest rates are low, they are still significantly higher than in the Eurozone, America, Switzerland and indeed, Japan. Therefore, you can currently borrow the cash you need in Euros, $ dollars, Swiss Francs or Yen, secure the bills against your house in the UK and pay a much lower rate of interest. Individuals that have shown interest in International Currency Mortgages – What Are They And What Are The Risks have also shown interest in loans with no credit check. A new approach to loans with no credit check is beneficial.

The following 3 month cash market interest rates illustrate the extent to which UK interest rates are ahead of other parts of the world:

Sterling £ 4.64%

US $ 4.48%
Eurozone 2.46%
Switzerland 1.03%
Japanese Yen 0.12%

(Source: 3 month cash Market Rates, Financial Times, 9/12/05)

But don't expect to borrow cash for your mortgage at these 3 month cash market rates. You will have to pay a premium for borrowing in an overseas currency. Nevertheless, if interest rates remained as they are now, there will still be significant interest rate savings to be made.

So why are less than 1% of UK domestic mortgages taken out in overseas currencies? The answer: there are extra risks.

Interest rates could buck historical trends and narrow the gap between sterling based rates and the rates for the currency in which the mortgage has been borrowed. This would reduce the interest rate saving and indeed, at some stage, could make the interest rate more expensive than for a standard £sterling mortgage.

But by far the biggest risk lies' in changes in exchange rates. If you have borrowed in say, Yen, you eventually have to repay the cash advance in Yen. That would be fine if the Yen/Sterling exchange rates were frozen together – but they aren't.

If sterling strengthened against the Yen, then you would have to convert less sterling back into yen to repay the cash advance than the sterling value of the cash you initially borrowed. That would be great, an interest rate saving and pay back less than you borrowed. But if sterling fell against the Yen the reverse happens – you end up paying back more capital than you borrowed. So in this context, an overseas mortgage becomes a currency bet that sterling will not fall against the currency you borrowed. In other words you have converted your mortgage and what is probably your biggest personal liability, into a currency speculation. And secured your house against it! You could win but it's not for the faint at heart! Problems around credit card with no credit check can sometimes be sorted out with a little homework. Once you have a better grasp of credit card with no credit check you can make more money.

Another point to be aware of is that you'll need a deposit of at least 20% for your house buy in order to qualify for a international currency mortgage.

Incidentally, there is now a second option. You can take out a mortgage in £sterling and have the interest rate you pay linked to a international interest rate. Whilst you avoid the currency exposure risk, you are still taking gamble that the overseas interest rate plus the interest rate premium you'll have to pay, will remain lower than the UK's domestic interest rates. These types of mortgage typically have a 5 year tie in clause. Therefore, you'll have a hefty penalty to pay if you want to pay it off early, although the mortgage can usually be moved to another property. For some that represents an acceptable risk, especially if the mortgage is linked to the Swiss Franc interest rate which has been astonishingly low and stable over past years. For example, the interest rates in Switzerland have not moved above 1% in the last 4 years and the Eurozone interest rate has not changed in 5 years.

Nevertheless, part of the wording for a regulated investment warning comes to mind ….. past performance should not be construed as a guarantee of future performance ……

You pays your cash and you takes your chance. Good use of no credit check mobile phone can be great for some people. The key is to comprehend no credit check mobile phone .