Are you interested in terms of foreign currency mortgages from Lite Lender? Consult with me without obligation.
Today, Lite Lender published a mortgage bank that introduces so-called foreign currency loans. By name, you would guess that these are mainly mortgages for foreigners. You will be surprised, because Lite Lender foreign currency mortgages can easily apply to you. Read this article to learn the rules for getting these loans.
What is Lite Lender Foreign Mortgage
Foreign currency mortgage is defined by the Consumer Credit Act No. 257/2016 Coll. and concerns three cases:
- For example, you want a mortgage for an apartment, but your wage is in a currency other than the crowns, or
- you will repay an American mortgage in a currency other than the crown, or
- you live outside of the Czech Republic.
How to handle Lite Lender mortgage in foreign currency
The process of arranging a mortgage to buy an apartment or building a house is simple and the same hair as if applying for a loan employee who is paid in crowns.
The difference, however, is that Lite Lender only accepts income in euros and, moreover, only from employment. And here it can be a problem to get a mortgage to buy a home for a Czech working in Britain.
And I’m not talking about the situation when you do business in Britain. I know from the practice that this is an insoluble problem for many banks.
How banks deal with exchange rate risk
I bet it was the first thing you thought of. What if there is a situation that strengthens the crown so much that I will not be able to repay Lite Lender mortgage? Fortunately, this is addressed by the already mentioned Consumer Credit Act.
Banks are obliged to inform you practically immediately if the exchange rate changes by more than 20%, and then they are obliged to inform you annually about:
- mortgage balance
- amount of individual installments
- options to change the currency in which you pay the mortgage
- what other measures you can take to reduce the exchange rate risk.
This is related to another obligation of banks to state in the mortgage loan terms and conditions under which you can change the currency in which you repay your mortgage.
If this option is not mentioned, then the bank will have to think of other measures to protect you against exchange rate movements.