Understand everything about mortgages





The mortgage loan is an unassigned credit for which the borrower’s property (land, house, apartment, etc.) serves as collateral. It occupies a specific place in the family of real estate loans and allows you to obtain a cash loan. The point about these features.

What is a mortgage loan?

the mortgage it is granted by a bank to a borrower. If he is unable to ensure the payment of his debts and when no amicable agreement has been found, the credit institution will seize the property and sell it. This loan is intended for property owners and allows them to buy a primary or secondary residence, make rental investments, acquire old or new properties, obtain cash (or cash credit),… One of the peculiarities of the loan mortgage is its long repayment period (from 20 to 30 years). However, the last monthly installment must have been paid before the borrower turns 90.

When should I apply for a mortgage loan?

The mortgage loan is particularly interesting in the following cases:

  • for the purchase of property abroad: the loan establishment cannot contract a guarantee on a property located in another country, it will have to mortgage a home in France;
  • benefit from a credit buyback: the credit institution can propose a grouping of mortgage credit to guarantee this operation;
  • when an elderly person wants to do a real estate project: loans are difficult to grant to the elderly. To take advantage of this, they will be asked to mortgage one of their assets.

What are the advantages and disadvantages of the mortgage loan?

Advantages

The advantages of the mortgage loan are numerous:

  • gives better borrowing capacity to the borrower;
  • it is granted regardless of the types of goods to be financed;
  • repayment can be made in advance (sometimes without penalty);
  • a long repayment period (from 20 to 30 years).

In case of full repayment of the mortgage loan, the creditor releases and thus ends the mortgage.

Disadvantages

Like all financing formulas, the mortgage loan also has drawbacks:

  • the mortgage loan is expensive: it entails expenses such as the curator’s remuneration, the property registration tax, the notary’s fees, etc.
  • if the borrower is not current in his payments, the creditor will take the property, seize it and sell it;
  • in case of release, the costs are borne by the borrower.

The rate of a mortgage loan

The mortgage loan can benefit from a fixed or variable rate. Depending on the cases, the aforementioned rhythm is more or less significant and evolves according to the files. It can also be subject to review and depends on the needs of the borrower and the value of the property.

The mortgage loan reassures the lender and allows the borrower to easily obtain cash to finance other projects. It is one of the safest mortgages and offers considerable advantages. But before you ask, have a professional accompany you.

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