Originally Posted by Kiwicat
When I made my recent purchase
I was able to get a Euro loan from my New Zealand
We just asked if the banks could lend us funding
in Euros and they were happy to setup the foreign exchange account for us..
When the NZ/Euro was at its peak we chose the moment to pay down the loan.
Not sure if US banks do the same but we managed to save .10c on the dollar this way and bought a few toys with the discount/savings achieved.
Great work on timing the NZD/EUR Kiwicat. The NZD has been hammered as of late, so you definitely should be celebrating.
Most international banks will offer this service
but I am unsure about US banks, as they are very old school
in their product offerings and ease of use. Most banks in America make you go into the branch to do an international transfer. They also still charge for domestic transfers to send and receive funds (very uncommon in the global banking industry where it is custom to be free to transfer to any domestic account).
If you ever take out a loan in another currency, it is critical to know the risks of foreign exchange movements have on your loan repayments.
It's always best to hedge your loan with a forward contact or option if you do not want to have any downside risk. this can usually be done with a 5-10% deposit. It guarantees you a fixed rate for the term of your loan.