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From: Andrew Scott
I thought that the readers here may find this one interesting..
I know someone who is planning to buy a property in Australia, but will be working in Japan for the next little while. They can get a loan from the National Australia Bank (Japan Office) at a rate of around 2% to buy their property in Australia.
It is normal in Japan to get that kind of rate of interest (official gov rate is around 0%), and they will be earning in Yen and paying off the loan in Yen.
The only catch is that this loan is essentially a "margin loan", which means that if the nominal value of the property (in Yen) falls to the point where the loan is covering greater than 70% of the value, they will have to put in more funds of their own.
So.. they need to come up with a 30%+ deposit and there is a risk that they'll have to pay extra fees, but a 2% rate is less than a 1/3rd of what NAB would charge in interest in Australia. Even if they end up having to pay double the interest, they'll still be ahead.
Andrew Scott
I thought that the readers here may find this one interesting..
I know someone who is planning to buy a property in Australia, but will be working in Japan for the next little while. They can get a loan from the National Australia Bank (Japan Office) at a rate of around 2% to buy their property in Australia.
It is normal in Japan to get that kind of rate of interest (official gov rate is around 0%), and they will be earning in Yen and paying off the loan in Yen.
The only catch is that this loan is essentially a "margin loan", which means that if the nominal value of the property (in Yen) falls to the point where the loan is covering greater than 70% of the value, they will have to put in more funds of their own.
So.. they need to come up with a 30%+ deposit and there is a risk that they'll have to pay extra fees, but a 2% rate is less than a 1/3rd of what NAB would charge in interest in Australia. Even if they end up having to pay double the interest, they'll still be ahead.
Andrew Scott
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