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Bank Finance - as a foreigner

Discussion in 'Property Finance' started by MTR, 11th Sep, 2015.

  1. MTR

    MTR Well-Known Member Premium Member

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    Has anyone sourced finance overseas, just curious.

    I am currently looking at this using my US properties as security.

    Perhaps someone has an avenue or a contact? Only interested in bank finance

    MTR:)
     
  2. Scott No Mates

    Scott No Mates Well-Known Member

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    Big rage back in the 1980's.

    It sent many to the wall.
     
  3. Richard Taylor

    Richard Taylor Mortgage Broker & Brisbane Buyers Agent

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    Hate to say No chance at all.

    Cheers


    Richard
     
  4. Peter_Tersteeg

    Peter_Tersteeg Finance broker and strategist Business Member

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    Any chance of releasing the equity via finance in the US, then bringing the money here?
     
  5. MTR

    MTR Well-Known Member Premium Member

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    Somehow I doubt it, unfortunately.
     
  6. Redwood

    Redwood Well-Known Member

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    Hi there MTR -

    Yes you can source finance in the USA. We have been doing it for the last 18-24 months successfully.

    From memory (from somersoft) you were investing in Atlanta, you can cash out or achieve up to 70% LTV. We have a relationship with a couple of lenders that will do a pre-approval based on zip code. Rates for cash out with one lender are around 8.25% - we do all the work from here, with relationships on the ground in the states. You can also set up bank accounts from here.

    Hope that helps.

    Cheers Ivan
     
  7. MTR

    MTR Well-Known Member Premium Member

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    Hi Richard
    Thanks
    Agree, wont be bank finance, but we currently have 2 lenders, one is looking promising.

    Higher interest rate but then the yields are much higher in US so this will help.

    MTR:)
     
  8. MTR

    MTR Well-Known Member Premium Member

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    Thanks, can you advise on the term of the loan?
     
  9. Blacky

    Blacky Well-Known Member

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    I think @Richard Taylor was confused with the question. Thinking you were looking for an Australian bank to lend to you against US security. Which like he said will be difficult.
    Some banks will secure Australian property to lend to you in USD - but not many.

    From memory you have a US company set up? I fail to see why it wouldnt be possible, but havent looked deeply into it. It would take some work, and probably a flight or two. But I think it would be worth the time.

    Blacky
     
  10. Peter_Tersteeg

    Peter_Tersteeg Finance broker and strategist Business Member

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    That was my interpretation as well.

    I haven't come across it in years, but prior to the GFC there were quite a few overseas lenders taking Australian property as security. The ones I was aware of were mostly based out of Hong Kong. They were generally funding at around 60% LVR.

    There's obviously a currency risk. If the AUD drops further, then the value of the property drops in the eyes of the lender. Regulation and consumer protection in these circumstances would be questionable.
     
  11. MTR

    MTR Well-Known Member Premium Member

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    Hi Blacky
    I have 3 companies in US, but US banks will not lend to foreign investors, I believe only a holiday home, something like this. We have researched it for some time now, not sure why, perhaps they see foreigners high risk?? not sure

    MTR:)
     
  12. MTR

    MTR Well-Known Member Premium Member

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    Agree.

    Also if using Au$ for buy US properties that's a negative to start with as Au$ at 70 today and trending down.
     
  13. Blacky

    Blacky Well-Known Member

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    Scott - I am sure this is true, and we continue to see it today just not in Australia.
    I think one of the major issues is when people borrow in a foreign currency to settle on local property.
    A lot of loans in Greece are domiciled in USD$. Same as Russia, Asia, Japan. Iceland crash was largely due to this as well.

    I think if you are borrowing USD to purchase USD property its ok. There is no currency risk. Not sure how it would work if using aus property as security (I would imagine the banks would have a fx call if it declined).

    Im pretty sure that NAB in SE Asia will leverage Australian property to buy SE asian property (loan in USD, JPY etc).

    Blacky
     
  14. Blacky

    Blacky Well-Known Member

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    If it is a US company not sure why they still consider it a foreign lend?

    But like I say, I dont know anything about it.
     
  15. MTR

    MTR Well-Known Member Premium Member

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    Because my Australian Trust owns it.
    It's complicated, but I am working it, just have to see whether it pans out