Real estate financing can be tackled in very different ways. It is not mandatory to go the classic way and to take out an annuity loan at the house bank. The choice of alternatives is huge – and access is becoming easier. This also applies to the inclusion of foreign currency loans, which are now heavily advertised on the Internet.
The advantage of financing in foreign currency may be that lower interest rates are available
The concept of such financing is simple: the account of the real estate loan is not in euros but in a foreign currency. For the most part, it is based on Swiss francs, but depending on the provider, financing may also be denominated in pounds sterling, US dollars or yen.
The advantage of financing in foreign currency may be that lower interest rates are available and may also provide an opportunity to benefit from currency developments. If the foreign currency depreciates against the euro, the financial burden is reduced.
Foreign currency loans are being intensively advertised again
Currently, foreign currency loans are being intensively advertised again. Above all, the strongly fluctuating euro is responsible for this. Many consultants play with the fear of the customers, the euro could fall apart or lose much value – a foreign currency loan should help here.
But if you are clever, you prefer to opt for such a loan. Because if the euro depreciates sharply, the financing or its financial burden becomes even more expensive.
Foreign currency loans are considered extremely risky
In the end, foreign currency loans are considered extremely risky. Although supplementary insurance can provide more security, but they drive the costs in the air. Especially the average consumer, who has to spend a large part of his income to stiffen the financing, should therefore better keep away from it.