A mortgage is the only way for an average person to buy his own property. Although the loan agreement has been with the bank for at least 30 years, many people choose this step. What do you need to do to get a mortgage?
At the beginning – own contribution
Without a down payment, don’t move, so before we start applying for a mortgage, we must put aside some of our own cash. The loan will not cover all costs related to the purchase of a house or flat, which is why we must have savings. The minimum amount of own contribution is 20% of the property value. Of course, the higher the own contribution, the better. A high own contribution will help reduce the credit margin.
How much will we get from the bank?
The amount of the mortgage granted depends on the value of the property you want to purchase, as well as our creditworthiness. Creditworthiness is influenced by factors such as the amount of income received, the type of contract with the employer, marital status, age, family size and of course other loans held. Banks obtain information from the Credit Information Bureau. The credit history of each borrower is included there.
The mortgage interest rate depends on the Wibor interest rate and the bank’s margin. The bank decides on the level of its margin, while the Wibor interest rate is not directly dependent on the bank. The margin is the same throughout the loan period, the interest rate is variable. In addition to the margin, the bank also charges a commission for granting the loan, which is usually charged once, although it can also be included in the repaid installments. The cost of credit is also the need to take out insurance. Both the loan and the real estate as collateral for the loan must be insured. The bank also has the right to request the borrower’s life insurance.
Before we sign the contract
After receiving a positive credit decision, we have 30 days to sign the contract with the bank. This is a time that you can still spend thinking about, because after signing the contract we can not break it. However, if we do not decide to sign a loan agreement, the bank may charge us with preparation costs.