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Mortgage availability

or even the agreed sales price. Most banks will be playing safe and under- valuing properties. One exception in Spain, however, is the Almanzora Group’s Harbour Lights development in Villarícos, Almería, where not only can buyers get 100 per cent mortgages on completed properties through the Bank of Andalucía, but the bank has valued the properties by up to 25 per cent more than the current sales prices, due to the developer’s recent price reductions. “Our developments were selected

as the fl agship for the launch of the bank’s new 100 per cent mortgage offer and it has been the catalyst which has accelerated demand,” says Simon Coaker at Almanzora. It’s not just in Spain that cash

buyers are dominating the picture. About 55 per cent of all purchases in Florida, according to Patricia Tan from Prudential Palms Realty, are with cash and the higher the price, the higher the percentage of cash deals. Property-hunters in Florida will fi nd no 100 per cent mortgage deals – and far fewer products available compared with two years ago. “Signifi cantly fewer lenders – and

no large institutions – are offering fi nancing to foreign nationals as there is no secondary market after closing the loans to sell them to other investors,” says Matthew J Arcari, a broker for SRQ Mortgages. “Foreign buyers in the US are typically being offered adjustable rate mortgages (ARMs) rather than fi xed rate and deposit requirements are usually 30 per cent,” he adds. Low bank valuations can also be an issue here. Patricia Tan advises buyers to add a contingency clause in their contract in case the bank values the property lower than the agreed sales price. “Then the buyer can pull out of the deal and get their deposit back,” she stresses. Unlike the US and Spain, Turkey

has more mortgage deals available to foreign buyers than a year ago, says Julian Walker from Turkish property agency Spot Blue, including more equity release products. As is the case in most of Europe at present, the typical loan to value a

bank will offer a buyer is around 70 per cent – based on whichever is lower out of the valuation or the purchase price. Similar caution is exercised in France, where banks were far more sensible with their lending than Spain or the UK during the boom years, avoiding the worst of the sub-prime catastrophe. Mortgage rates have changed little in the past year, but borrowers should tread carefully with mortgage “deals” that have attractive introductory rates, says Darren Hunt- Côte from Crédit Agricole Britline. “Technically you can change

mortgage provider every few years, as in the UK, but the costs of doing so in France – about 2.5 per cent of the mortgage value – are much higher than in Britain and most French people do not switch lenders because of this,” says Hunt-Côte. “That’s why it is essential to choose the right mortgage from the outset and compare rates by looking at the overall cost over the full mortgage term.”

Finding the best deals in any country, say local agents, is about pounding the high street, comparing what banks are offering and talking to them about your individual circumstances.

Given Greece has become

synonymous with triggering the possible downfall of the Euro, it is perhaps surprising to learn that Greek banks are not typically profl igate in their mortgage lending. “They didn’t follow the UK and

US into the sub-prime lending market and consequently avoided the fi nancial meltdown,” says Mike Saunders, MD of Snobby Homes in Crete, which sees 85 per cent of Greece’s overseas property buyers. Greek mortgages are traditionally simple repayment loans and available only from the big banks (Piraeus, Alpha, Emboriki and Eurobank are the most accessible to foreigners; small local banks will deal only with Greek nationals). Approvals

are made in Athens, not at a local level, and applicants much submit their last three years of P60s, a credit report and a UK utility bill. “The attractive thing about Greek

mortgages is there are no exorbitant fees for early redemption. You can also take an 18-month holiday before you start your payments, providing an attractive bridging loan facility,” adds Saunders. Finding the best deals in any

country, say local agents, is about pounding the high street, comparing what banks are offering and talking to them about your individual circumstances. In some cases, British buyers may fi nd it more reassuring to go with a familiar name, with English- speaking staff, such as Barclays in Spain (although Barclays recently announced it is closing many branches in Spain). “Or you could get an account with them in Gibraltar, where they have a foot in both camps,” suggests Peter Birkett. But one thing that is the same

everywhere is the need for a big deposit. So unless you are in the market for a Spanish repossession, start saving now.


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