Organising Finances, Turkish Mortgages & Currency Exchange
Before you start looking at properties, you need to know what your budget is. Some people find their ideal dream house first and then look for ways to fund the purchase. However, this generally ends up with the buyer overstretching themselves financially for many years to come, or disappointment when they realize that gorgeous villa with infinity pool and sea views is simply out of their reach.
To start, make a list of all sources of finance. Also, note whether the money is readily available or when you are likely to receive it. Most foreigners buying property in Turkey use one or more of three sources that are savings, inheritance, or re-mortgaging their UK property. It is important to know when the money is readily available because house sales in Turkey generally happen quite quickly, and the whole process can be completed from as little as 6 weeks to 3 months.
About Turkish Mortgages for Foreigners
In 2007, Turkey’s banks started offering mortgages to foreigners. Naturally, terms and conditions vary according to the bank but generally, 50 to 65% of the purchase is financed leaving the buyer to source funding for the rest of the acquisition. Please contact us if you would like to receive a list of banks offering mortgages to foreigners, but at this point, it is worth pointing out that repayment rates tend to be higher than that for Turkish citizens.
About Currency Exchange
Although you are working your budget out in the currency of your home country, remember that the value of the property is tied to the Turkish lira house index. Should you choose to sell your property later, its value will be determined in Turkish lira. Over many years, currency exchange rates can fluctuate either way, so it is worth getting into the habit now of watching the exchange rate so you are aware of how your property investment is performing.
The currency exchange rate at the actual time of handing over the money is also significant. Naturally since, property purchases involve thousands of pounds, a slight difference in the exchange rate can make or lose quite a bit of money. Moneycorp is an international payment specialist that can help you to save money, by getting you the best rate and to save on high transfer fees typically applied by banks.
Another important aspect of your budgeting is the cost of buying the property and we discuss that next.
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