Everything you need to know about the mortgage

Do you intend to own it in the coming months? This is great news because it is an ambitious project that will allow you to have your own accommodation. But beware, if you want to own a home, you will need to take out a mortgage. Indeed, it is the most used solution to finance the purchase of real estate in France. It is an important commitment that should not be taken lightly. Today we tell you all about the mortgage!

The home loan

The mortgage, also commonly called a mortgage, is granted by a specialized financial institution or a bank. It allows you to finance a primary residence or a secondary residence. The financial institution may ask you for a contribution equivalent to 10 to 20% of the total amount of your real estate project, but this is not always the case. Agency fees are included in the mortgage, so you don’t have to pay them yourself. However, as you can imagine, a mortgage is not accepted without respecting certain conditions required by the lender.

The financial arrangement of the mortgage

Before applying for a mortgage, you will need to make a complete application. The latter will allow you to do a real estate loan simulation with Cafpi for example. This simulation will give you the opportunity to know whether or not you are eligible for a mortgage and whether your project can be successful. You will need to report your income, your tax schedule, hand in your family booklet, do certain medical examinations. The simulations will provide you with information about the duration of the loan, the schedule, the monthly amount of the repayments or even the interest rates. Know that each situation is unique, and that a mortgage is fully customized to your situation. Hence the interest of the simulation even before the visits begin! Because you will know your situation and you will be able to consider whether or not to buy a property.

The release of funds

When the simulation is ready and you have found the apartment or house of your dreams, you can request the release of funds. This step occurs when the deed of sale is signed at the notary. He is the one who receives both the deed of sale and the deed of loan. You should know that the duration of a mortgage is not limited by law, but is generally between 20 and 25 years. It can sometimes reach 30, but this is still relatively rare. Remember that the longer the duration of the mortgage, the higher the cost for the borrower, because the interest rates will be higher. In fact, interest is calculated on the remaining outstanding capital: therefore, the larger the remaining capital, the higher the interest. If you can, negotiate a shorter duration!

As you may have guessed, the mortgage is an important commitment, so be careful and most importantly, take care of your simulation!

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