Expat Investment Loans

[ailartsua]

Hi

I have a home loan back in Australia an have heard of people transferring their loans to Singapore to take advantage of the interest rates. Has anyone managed this and what are the benefits and pit falls?

Thanks

[rattlesnake]

It depends where the asset is. If your Australian loan is for a house in Australia then refinancing to a Singapore introduces interest and currency risk. Currency risk in the big one, suppose you are saving 3% p.a. by switching to Singapore. This can be wiped out if the currency fluctuates which it will. Remember SGD to AUD was 1.3 to 1 a few months ago. You can of course benefit big time but the reverse is also true.

There is a specialist company in Singapore - SMATS who deal with Australian financing and taxation issues. I haven't used them but they have some stuff on their site that might help (www.smats.net).