From 1996 to 2007, house prices across Europe rose sharply, by over 200% in some areas. We all know that the property market peaked in 2007-8 and we are all painfully aware of the resulting crash. During this time thousands of foreign investors and those wanting a home in the sun were lured by an interest-only mortgage and false promises of rental income.

It seemed a no brainer at the time as repayments were extremely low and affordable. These were also for a fixed period of 10 to 15 years at a time.

This reckless approach from the banks then encouraged large volumes of UK and Irish citizens to buy abroad. Some were taking equity out of their own homes, to commit to a dream foreign property.

We are now in a period where borrowers who were on a ten to fifteen-year interest-only mortgage, are seeing the end of this ‘honeymoon’ period.

When the mortgage goes to repayment, you will see huge spikes in the monthly instalments. A recent client saw their monthly payments rising from €342 up to c€3,000.

These increased monthly payments, coupled with other costs such as IBI Tax Payments and Community Fees, could result in your property costs becoming unsustainable.

Additionally, a rapid decline in values since 2008 has left many borrowers trapped in negative equity. This means that they can’t sell the property, but also can’t afford to keep paying the mortgage.

EU Property Solutions have been helping clients with interest-only and negative equity issues for over a decade. We can offer solutions for any foreign property issues.

All enquiries to EU Property Solutions are offered an initial full review by us and our legal team. We would advise we never take on a case that we cannot win.

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