What is the difference a Dollar/Sterling/Euro Denominated and Peso Denominated Contract?
A Foreign Currency denominated contract is paid in US$ or Sterling or Euro and carry a lower interest rate than a Peso contract. The company (IHC) carries the financing of the contract and will require an authority to have an automatic payment arrangement with a foreign bank for the buyer’s monthly payments. A Dollar /Sterling/Euro denominated contract is paid in dollar, Pound Sterling, or Euro and carry a 10% interest for 5 years and 12% interest for 10 years. A Peso denominated contract is paid in Pesos and carries a 19% interest for 5 years and 21% interest for 10 years. Once contract is signed, buyer cannot change from a dollar to a peso contract or vice versa. This protects IHC from any fluctuations of the currencies and other inflationary factors.
