Questions and Answers on Home Financing - Simply Explained

Questions and Answers on Home Financing - Simply Explained

As has already been extensively reported on this portal, homebuyers not only accept all the positive aspects, but also those risks for which homeowners naturally have to pay. According to a recent analysis, the reasons for a late failure of mortgage lending are that insufficient reserves have been set up and at low times a low interest rate with equally low repayment has been chosen. The loan installment should therefore also include those eventualities that naturally occur due to the structure and construction of the property.

This and other topics will be dealt with in detail in the following article and described from the point of view of a private buyer.

The question of required equity

In the question of the amount of equity , a significant characteristic in the calculation of mortgage lending, the ghosts differ. On the one hand, banks set certain minimum rates, on the other hand, buyers are too much misled - only if your investment scope is not significantly limited by mortgage lending, you have chosen the right balance between equity, income and purchase price. Here is also the principle that a higher equity reduces the burden during financing, because the interest portion is automatically smaller. However, a very important point is another, namely the possibility of being able to make reunited arrangements over and over again. By taking this option and thus paying off an extra share each year, you take away the whole thing Tension and can be in the absence of bonuses, holiday money and Co. on the safe side. Furthermore, the maturity of funding

will be more or less reduced, which will reduce the additional risk of interest rate hike just at the time when follow-up funding needs to be recognized. The so-called forward loan, a kind of security on the interest rate of the subsequent follow-up financing, can be chosen up to four years before the expiry of the mortgage. With regard to the above statements, it must be carefully considered whether this type of construction loan really makes sense for your purpose and your financial background. More about this at, the specialist for all matters relating to mortgage lending and its legal components. Mortgage, Rank Certification and Co. In the course of the loan application, the word is always about collateral, because only this one It really counts for a bank, giving you some leeway in early stages of negotiation. We explain the most common requirements and procedures in the course of applying for mortgage lending.

The mortgage is a kind of deed for the bank to be able to execute the residual assets of the debtor in an emergency. To reduce the risk of being one of many creditors and receiving only a small part of the sum, a senior mortgage is often required. This enforceable land charge means that the bank is entitled, if certain conditions are met, to use the assets and to realize the property. It is entered in the amount of the total of the mortgage lending and can only be deleted after repayment.

In this context, the so-called rank certificate states that nothing stands in the way of registration in accordance with the respective rank. Such a note is confirmed by the respective notary and is a condition for the final disbursement of the loan amount, so that no registration can take place without this notification.

  • The notary's account assumes the important role of mediator, which is held vicariously and in trust by the appointed notary. Before no mortgage has been registered or its rank is known, but you still want to continue with further planning, you benefit from a suitable value date of the payout. Basically, this measure should ensure that the seller receives his money and the buyer the appropriate rights (including land register entry) to the property, which otherwise would be consuming to execute.
  • Artikelbild: © kurhan / Shutterstock