30 June 2008 - French Mortgage News | International Mortgage News | Partners News | Uncategorized |

Credit crunch update

How is the credit crunch affecting the overseas mortgage market?

There are stories in the press every day about UK mortgage products being withdrawn, rates rising and the effect this is having on the UK housing market. Most would therefore assume that mortgage markets across Western Europe are in a similar state, however this isn’t necessarily the case.

Here we give you an update on how the mortgage markets in the most popular countries for second home purchases are faring.


The non-resident mortgage market for individuals is France has seen very little change as a result of the credit crunch. If you are looking for a French mortgage it is currently possible to get short-term fixed rate mortgages starting at 4.3% and full term fixed rates from 4.6% – substantially lower than you can achieve in the UK market. Lenders are also currently increasing the range of products they offer.


Mortgage terms in Spain have been hit the hardest out of the most popular second home destinations. In line with the property market as a whole, Spanish lenders are reducing terms available, reducing the LTV (loan to value) available and in some cases increases the documentation required for individuals to apply for the mortgage.


Non resident Italian mortgage products have been broadly unaffected by the credit crunch with criteria and lending terms currently offered being very similar to those that were available this time last year.


As with France and Italy, if you are considering a mortgage in Portugal the terms you can currently negotiate will compare very favourably with those available before the credit crunch, with some lenders currently offering special offer products, such as introductory 0% margins and others expanding their product ranges.


As with the UK and Spain, Florida has seen some cuts by lenders of certain products for the non-resident market. It is still possible to arrange finance, however with large house price falls in the States banks are becoming more risk averse.

The differences in each market highlight the benefit of working with a good overseas mortgage broker such as International Private Finance when considering arranging finance overseas. Because IPF watch the market every day we will be able to guarantee you have access to the most suitable and competitive mortgage products available.

For further information contact one of IPF’s dedicated mortgage consultants on +44 (0)207 484 4600.

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