Dreaming Of A Holiday Home? Then Learn How A Remortgage Could Help

Over recent years, more and more Brits have invested in overseas property. As new air routes have opened up across the world and information about buying abroad has become more readily available, increasing numbers of people have bought foreign flats and apartments to use as a holiday home or to let out to holidaymakers.

These days many British citizens own a property in another country, with warm countries being the most popular destinations to buy, such as Greece and Spain due to the consistently poor weather conditions in the UK driving people to a sunnier part of the world.

With more and more low cost airlines now flying to previously out of the way destinations, many Brits are also snapping up properties in emerging countries. Portugal, Malta and Cyprus have all been popular with buyers over recent years and many have even bought in locations further away such as Dubai or Brazil. And, conversely, many Brits have also bought holiday homes in rural or coastal locations in the UK.

If you're considering buying a holiday home either in the UK or overseas, finding the cash that you need for the purchase is likely to be your main concern. So, investigating your remortgage options is likely to be high on your agenda.

These days, it is possible to raise a mortgage in the country where you are buying. Many lenders across the globe will now consider a foreign currency mortgage secured on the property for Brits buying real estate in that country. So, you can take out a Euro mortgage, a dollar mortgage or a mortgage in many other currencies depending on where you are buying.

Foreign currency mortgages are far more complex than standard UK mortgages, and so the process can be slow and drawn out, which puts many buyers off using them and also adds potential risk, as you may not fully understand what the contract entails.

It is therefore a far more popular option to remortgage your home, and borrow additional funds in order to purchase a second home abroad. This option is no different to any other remortgage, however as you will be using the additional funds to secure property the acceptance rate is far higher than for instance remortgaging to pay unsecured debts.

If you want to remortgage to fund your overseas property purchase, there are two main things to bear in mind. Firstly, your remortgage will have to be affordable to you and you will have to prove that your income is sufficient to cover the higher loan amount. Secondly, you must have sufficient equity in your home to allow you to increase your mortgage by the amount that you need.

Once the remortgage transaction has been finalised, you will receive the additional funds that you have borrowed. You can then use these to complete the purchase of your holiday home in the UK or abroad. Your remortgage will typically involve one monthly payment based on the total amount of your borrowing.

If you want a piece of the dream, owning a home abroad, and a chance to join the one million Brits that already have an overseas property, a remortgage could be the ideal way for you to access the cash. It is no way near as high a risk undertaking as taking out a foreign mortgage, and you won't have to worry about the fluctuating exchange rate risk. You will also have fewer headaches with foreign language and cultural difficulties when arranging finance.