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Keys to Choosing a Mortgage Loan

By CHECK MATE In Business & Finance Posted On December 29,2018 0 Comments

Having a home of your own is one of the most important goals in the life plan of many people; However, the investment required is generally high, so in order to add this important asset to an estate, it is necessary to resort to the hiring of a mortgage loan. Therefore, you must consider several variables before making a decision.


Monthly payment


The best tool you have to know your ability to pay is the budget. If once you count your income and expenses determines that you can allocate 15,000 pesos a month to pay a mortgage, you can hardly buy a house with commercial value of 3 million pesos because according to the simulator of mortgage loans of the Conduce, in that case I would have to pay a monthly amount of over 25,000 pesos.

Capacity and coupling

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The greater the previous saving that is hard for the hiring of the property to be acquired, the lower the percentage of financing that must be requested and the lower the monthly payment to be made. In the previous case, if only a down payment of 10% of the value of the property (300,000 pesos) had been provided, the required monthly payment would rise above 30,000 pesos. There are financial entities that provide a greater capacity (percentage of the value of the house to be financed) registration loans in Glendale and request a lower down payment. This makes it easier for many people to buy their house because it requires a lower initial outlay; however, it translates into a higher financial cost.

Term

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Government housing agencies offer terms of up to 30 years. Banks and other financial institutions that handle this product have different financing programs and contemplate terms ranging from 5 to 20 years.


The shorter the term of the loan, the higher the monthly payment will be, but the amount of interest paid is reduced, that is, the total cost of the home is lower.


Following the previous example, for a loan of 3 million pesos with 30% down payment (900,000 pesos) and a term of 10 years, the total payment of the lowest home market (according to the mortgage credit simulator of the Conduce) would be 3,380,860. If the down payment is reduced to 20% and the term is extended to 19 years, the total cost rises to 5,900,148 pesos. A difference of 75%!


Interest rate


Taking into account the level of interest rate charged by a financial institution registration loans in its schemes is important, but it is also important to analyze the type of rate chosen or to be paid.


Generally, three types of rate are used: fixed, variable and adjustable or mixed.

In long-term financial obligations - a mortgage loan is by definition - it is necessary to have certainty of how much it is going to pay rain, thunder or lightning in the financial markets and regardless of whether the interest rate goes up or down. Certainty can only be obtained by contracting a loan with fixed interest rates.

 



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