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Swiss Francs Mortgages in Poland


spiritus 67 | 663
16 Jan 2015  #1
Anyone else suffering with the Swiss Franc issue ?
Swiss guy
16 Jan 2015  #2
No, we're all more than happy!
johnny reb 17 | 3,646
17 Jan 2015  #3
Anyone else suffering with the Swiss Franc issue ?

Not much chance for cheer in Poland where more than 1.5 million are exposed
to higher interest repayments on Swiss loans.
hhickmott - | 2
17 Jan 2015  #4
I have 3 properties purchased in 2007. All with CHF mortgages. All rented but now moved from £600 to £1200 cash negative each month.

Now facing an issue in that they are £100k negative equity due to the dramatic change in the CHF SNB policy on rates this week so don't feel I can get out as I don't have these funds. But I cannot continue as cash outgoing needed to keep it going have also risen by 30% and I was struggling already with the monthly payments.

Feeling really stuck so wondered if anyone has been through the same situation or had resolved it. Any practical experience would be much appreciated.
johnny reb 17 | 3,646
17 Jan 2015  #5
Sure google freddie max.
bing.com/search?q=freddie+may+foreclousers&form=PRUSML&mkt=en-us&refig=0a3796cca5dd4e5592dafc7f3c2720d1&pq=null&sc=0-0&sp=-1&qs=n&sk=

Not quite the same scenario but you may get some idea's on how to cut your losses.
The banks DON'T want the property back, they want to collect the interest on it.
There soon will be much realestate for sale cheap in Poland just like America.
cms 9 | 1,272
17 Jan 2015  #6
Ring your bank and explain - they might give you a few months breathing space. If so then use those few months to work as much overtimevas you can and try and get level while the franc falls back a bit. In the meantime put one of them on the market if it has positive equity. If all 3 are negative then tough titty
weeg
17 Jan 2015  #7
Sure google freddie max.

Dont waste your time looking at US sites as the information is worthless. EU law is very different.
Wroclaw Boy
17 Jan 2015  #8
they might give you a few months breathing space

Never

If all 3 are negative then tough titty

They are, on PLN value but even worse in the FX rate between whats owed to the bank in CHF. Essentially he borrowed x amount of CHF but now has to pay back x amount + 30%, its a double whammy.

If so then use those few months to work as much overtimevas you can and try and get level while the franc falls back a bit.

I don't think you're comprehending the situation here, this guys is locked into negative equity on all three properties and paying mortgages which have virtually doubled. I don't think a few months overtime will fix it.

great being a bank......isn't it?
McFly 1 | 14
17 Jan 2015  #9
Anybody struggling move to the UK for 6 months then declare bankruptcy all debt gone in about 2 mins but they will come after assets although if in negative equity you might get to keep it. The Irish do it all the time some guy wrote tens of millions off in about 2 mins.
Wroclaw Boy
17 Jan 2015  #10
Oh yeah just go bankrupt
McFly 1 | 14
17 Jan 2015  #11
Well its better than dying from stress it is a option for people who have no way out. As I said the UK has one of the lightest consequences for declaring bankruptcy 1 year unlike Ireland's 12 not sure what it is in Poland.
weeg
17 Jan 2015  #12
locked into negative equity

Hes not locked into it, thats the point its exchange rate dependant
Wroclaw Boy
17 Jan 2015  #13
humm and for 5 years its been heavily against virtually everybody who took a CHF mortgage from 2007-2008..... just before the bubble popped. He's locked into negative equity anyway, even if he had a PLN mortgage. The CHF is just insult to injury.
johnny reb 17 | 3,646
18 Jan 2015  #14
Not quite the same scenario but you may get some idea's on how to cut your losses

Dont waste your time looking at US sites as the information is worthless

How authorative weeg.

Anybody struggling move to the UK for 6 months then declare bankruptcy

Oh, kind of like what people did with Freddie May so the U.S. sites information wasn't so worthless.

Feeling really stuck so wondered if anyone has been through the same situation or had resolved it. Any practical experience would be much appreciated.

The only difference is that I think it is seven years to get a clean record again in the U.S.
So may the laws be different, some of the options/idea's are the same as you can see.
f stop 25 | 2,513
18 Jan 2015  #15
Here we go.
As of November 2014, 46% of total home loans in Poland are in Swiss-frank.
That seriously sucks.
johnny reb 17 | 3,646
18 Jan 2015  #16
Yeah I goggled that article too.
They were saying that it was a wash and for Poland not to worry.
ftalphaville.ft.com/2015/01/15/2091082/stop-worrying-about-swiss-franc-mortgages-in-poland
weeg
18 Jan 2015  #17
How authorative weeg.

Part of my job is to check loans like these.
Firstly, he's UK based because he's using GBP. So US law and websites is a complete waste of time, all it can tell you is what you can or cannot do depending on the country or state you are in.

Secondly, these will be unregulated loans as three properties is obviously an investment not a primary residence.
As such the lender can do whatever it likes according to the contract and the country laws it's based upon.
I would definitely talk to the lender, hiding away will guarantee they take the worst action from the borrowers point of view.
I would also suggest getting proper legal advice from a Polish lawyer, possibly one who has negotiation experience.

As of November 2014, 46% of total home loans in Poland are in Swiss-frank.

120 billion Zloty. Not a huge number in banking terms.
Wroclaw Boy
18 Jan 2015  #18
120 billion Zloty. Not a huge number in banking terms.

Who cares about the banks, its the people we should be concerned with.
Shaman
18 Jan 2015  #19
Why should I care about him? He bought 3 properties. Something I could never afford. He chose that currency thinking he's smart. It's simply time to pay his debt. I feel sorry for his situation but I won't pretend he's a victim here.
InWroclaw 89 | 1,915
18 Jan 2015  #20
It'll be interesting to see if asking prices accelerate their price falls. Not really seen much downward movement in the last month or two, and yet the properties I check are still plodding on and for sale at the prices no one wants - for a year or two now.
weeg
18 Jan 2015  #21
Right. Didn't you flog Polish property to British buyers? So leave out the sympathy, lovey dovey crap.

Investing is not a win win harmless persuit. Someone else pays for your gain, even if you can't see it directly.

They made an investment decision which means they actually have paid far less interest than local currency loans to date. In the not too distant future the situation could change again.

My Last post was addressed to WB.

I don't see it making any difference to prices as there is very little borrowed money in property as most is 100% debt free - which is why they can afford to wait for ever before selling.
1172ftj 6 | 17
19 Jan 2015  #22
I am not an expert economist but to think if %46 of loans are swiss bank loans and say 1/2 of these will default their loan payments it would be %20 of the properties to get forclosed.

I would think if 1:5 homes are lost it would have a negative effect?

Even if 1/4 of those swiss loans default, 1:10 lost properties is bad, no?
weeg
19 Jan 2015  #23
1/10 of 5% of properties is 0.5%. The loss to the bank maybe 20%.. Maybe nothing if they wait a year.
johnny reb 17 | 3,646
19 Jan 2015  #24
So US law and websites is a complete waste of time, all it can tell you is what you can or cannot do depending on the country or state you are in.

Then I wouldn't think it would be a waste of time if it could tell you such.
pigsy 7 | 305
19 Jan 2015  #25
Not really seen much downward movement in the last month or two, and yet the properties I check are still plodding on and for sale at the prices no one wants - for a year or two now.

I would say some have started to.I just negotiated a commercial on ul ken(on the side of the building) 135 sq m restaurant for 790k.People who want to sell seriously are bringing the prices down,And in Poland ROI can be still 8/9 % kind of hard to find but you can.Some bad properties still can yield even 10%.
Wroclaw Boy
19 Jan 2015  #26
Right. Didn't you flog Polish property to British buyers? So leave out the sympathy, lovey dovey crap.

By that logic youre implying that i wanted them to get well and truly shafted. By that logic does it mean that a soldier cannot be anti war? or a person who used to be obese be thin. Because Weg would say something like "hey didn't you used to be 25 stone, so leave out the diet advice"

Why should I care about him? He bought 3 properties. Something I could never afford. He chose that currency thinking he's smart. It's simply time to pay his debt.

So, if you could afford it and went ahead and did it would you expect no sympathy from your fellow man. He is and you would be, just a person playing the Monopoly game of life along with the rules they provided.

They made an investment decision which means they actually have paid far less interest than local currency loans to date.

Mortgage repayments have gone from 2000 PLN / month up to 4000 PLN / month on many properties, this is paid by the owners, what part of that do you not understand?

In the not too distant future the situation could change again.

Obviously the CHF - PLN FX rate was high when they took the loans, it could swing the other way but thats highly unlikely. It has only gone one way, and we know that banks have a habit of keeping investors/share holders happy, artificially inflating currencies is one of the oldest tricks in the book. The CHF will not come down anytime soon.

Investing is not a win win harmless persuit. Someone else pays for your gain, even if you can't see it directly.

and who might that be Weg...who gets harmed? i want to see if you actually know the answer to this.
gosc112
19 Jan 2015  #27
Buying a property is a risk and so is currency speculation. People who do both open themselves up to these risks. You take the good times and the bad. They benefitted from low interest rates when others who had loans in PLN had to buy higher. If you take loans in PLN you have some protection from the government in that they can take steps to protect homeowners and these steps can be focussed on ONLY homeowners. They can't do much if you suffer from a strong or weak currency. People are talking about state aid but why should other tax payers and the rest of those who have mortgages in PLN subsidise those who have taken a currency gamble? This would only push house prices higher. I think this may help the housing market correct itself and push prices down.
pigsy 7 | 305
19 Jan 2015  #28
Buying a property is a risk

What are you suggesting here? I have been doing this in Poland and states for over 25 years.Only when a duffer guy buys it without calculating risks then it is a risk.Plus buying for long term is never a risk,and then how much credit one takes is also to be considered.I always bought when I can afford outright if i cant I wait cpl years,until its a real deal which doesnt happen.Even in states buying from banks is not a deal forget poland.

buying for flipping is a risk I agree.
Harry
19 Jan 2015  #29
Not really seen much downward movement in the last month or two, and yet the properties I check are still plodding on and for sale at the prices no one wants - for a year or two now.

Yes, and they aren't selling at those prices, which is why you keep seeing them. I was wondering whether prices are going to take another dive, but then I remembered that Poles generally loath lowering the price they want for something and loath it so much that they prefer not to sell than to drop their price.

I just negotiated a commercial on ul ken(on the side of the building) 135 sq m restaurant for 790k.

That is very simply impossible.
pigsy 7 | 305
19 Jan 2015  #30
That is very simply impossible.

here we go,that was the origanal price
domy.pl/komercyjne-sprzedaz-warszawa+ursynow-pl/dol1708530000?ts=1&utm_medium=pierwsze&utm_campaign=oferty-pierwsze-ostatnie-ogloszenie&utm_source=oferty-net

Since I dont like the location as it is on the last end of the side of the building, you can buy it if you can afford it.


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