Foreign currency mortgages do not always have to be in any single denomination. There are lenders who will allow you to spread your mortgage across a range of different currencies.

It is possible to take a portion of the loan in one currency and one or more other portions in currencies of a different denomination. Although this can be seen as a way of spreading the risk, as not all currencies will strengthen or weaken against the pound at the same time, it is a relatively inefficient way of doing this.

The option that is likely to be more effective in reducing risk and maximising the currency exchange effect, is to use a multi-currency switching facility. This means that you are able to switch the currency in which the debt is held and interest charged. Though you need to be aware that broker commissions may eat into the potential gains to be made, this facility does afford you the opportunity to keep moving your debt into the most advantageous currency, depending on the prevailing rates of interest and the direction in which exchange rates are moving.

Say you originally borrowed in Dollars, but they are climbing against Sterling rather quickly. This means that the amount you owe is actually growing in Sterling terms, as the same amount of Sterling buys less Dollars. At the same time, the Euro is tumbling against both currencies - a fact which would normally have no effect on your loan. If you have the facility to switch your debt to the weakening currency - Euros - then you are effectively acting to further reduce the balance of your loan, as Sterling is able to buy more Euros for each pound you have at your disposal.

While this system of debt management can be a really effective way of cutting your mortgage, you are exposing yourself to a risk that can end up costing you a lot on a monthly basis if it goes wrong. You are also committing yourself to a venture that really takes a lot of time, observation and good judgement to be effective - things that are not that easy to ensure as an amateur borrower. But if you are willing to pay the management charges on top of the other costs, there are a number of professional debt management firms that will undertake this sort of operation on your behalf, but then you will be adding management charges to your costs and there's still no guarantee that they will be successful.