Mortgages for Financing Real Estate Purchases Overseas
In an era of globalization and liberalization, changes in consumers’ and business managers’ way of thinking and mode of operation are inevitable. As part of these changes, the attention of many Israelis has been directed to the real estate industry outside of Israel. Recent times have been characterized by the increasing demand on the part of many Israelis (from private persons to public corporations) as far as buying real estate properties overseas. Whether they are buying in Europe, in the Far East or anywhere else, they all share one goal: to buy the most appealing property that would lead to the highest possible income, whether as fixed yields or as capital profit when selling the property.
The phenomenon is gradually increasing in scope, in light of the sense of having exhausted the potential of the Israeli real estate market, combined with the fact that international markets are being opened legally, politically (countries in Eastern Europe) and economically (the recession and dropped prices in the US). The number of buyers and transactions, and the properties’ geographic diversity, have reached a tremendous size, which can sometimes impart the idea that not a single Israeli has yet to buy a property overseas. Undoubtedly, not every transaction is a “bargain”, and so one must be very meticulous with the buying process, from locating the property to looking into the management and maintenance options. However, the international supply is so broad in scope, that if you are not in a hurry, you can definitely find a worthwhile investment.
One of the basic steps in the process of buying properties overseas is financing. Undoubtedly, obtaining the highest yield possible can be done with the aid of financial leverage, which is also necessary in light of limited resources and equity. In many countries, financing can only be provided to a limited extent. Additionally, Israeli consumers don’t always wish to become involved with foreign financing terms, and they feel more secure if they can obtain the mortgage for purchasing overseas properties – in Israel, whether fully or partially.
Seemingly, this is a simple matter, as anyone can make the calculations concerning the mortgage he requires for the buying property, and carry out whatever is needed to obtain the loan. However, a high level of discretion must be employed concerning the amount of the loan, the specific loan program, the monthly payments to be made, the loan period, tailoring the loan so as to suit one’s cash flow, and in short, all aspects relating to the mortgage.
Mortgage banks and insurance companies have always loved offering loans for any purpose, and buying a property overseas is definitely one such purpose. In exchange for mortgaging a property in Israel, they will gladly provide you with a loan. The ever-increasing competition can be highly beneficial to us as far as interest rates, and at times the terms we are offered are better than expected.
If you meet the customer profile sought by the mortgage institutions, you will be surprised with the results.