Home

Historical origins of the mortgage

The mortgage in the U.S.

Multi Mortgage

Non-payment mortgage

A type of mortgage where the loan or credit is requested in several currencies including the Country where you signed, in the case of Spain the Euro. Usually done in currencies that have a low interest rate compared to the local currency such as yen or Swiss franc, the contract can change their currency every certain period in order to take advantage of the favorable currency at all times . In this case the mortgage is usually referenced using the interest rate that is fixed in the London market for each of the currencies and is called LIBOR, as variables to calculate the monthly payment of the mortgage loan are used such called Libor interest rate and currency exchange between the local currency of your country and the currency chosen.

Upon entering the game rates between currencies, the monthly fee varies each month with movements that can be very aggressive, both the high and low, so this type of mortgages are considered somewhat risky, not so much may change monthly, but by the increase that total debt may suffer.

We can understand with an example: We signed a € 150,000 mortgage at a time when the euro is worth 162.3 yen. The mortgage is therefore 24,345,000 yen, and from that time is our loan or debt in yen. If after signing, the low value of the euro to 152.3 yen and had to settle our debt, the euro needed to cancel the debt would be 159,849 euros, meaning it would have increased debt in 9849 euros and it was the opposite, ie the euro exchange rate rises to 172.3 yen, the debt would be reduced to 141,294, or, what is the same, we would have a saving of 8705 euros without doing redemptions.