All of us who think that it is better to pay a fee for a loan to throw money at renting a third-party apartment, we are seduced by mortgage loans to buy our own home. Now, knowing what is the best term for my mortgage loan is one of the two or three most important questions we ask ourselves at the beginning of everything. However, it is not a question of easy resolution, since the answer is not the same as for everyone.
What is the best term for my mortgage loan?
As we mentioned, this question is found among the first two or three that we ask ourselves when we evaluate ourselves in taking a mortgage loan. But it cannot be answered if it is not within the context of other inquiries, such as the value of the fee and our age, to give just two examples.
Banks offer a variety of term options to pay off a mortgage loan. It is important to note that a mortgage loan is a medium or long term loan, due to the generally bulky amounts that are handled. The terms, in this way, start from 5 years and can reach credits of up to 40 years to pay them.
What is the best term for my mortgage loan? Each person has a different answer to this question. For starters, it depends on the desire of the credit taker: there are people who do not feel comfortable with long-term loans, and others who do, who prefer to finance it as long as possible. The truth is that, in the longer term, higher interests are paid. But many times desire is not what drives this decision, but a series of variables that we will detail below.
The value of the dividend or monthly fee to be paid
The term will depend on the amount of fees we wish to pay. But the value of the fee has a maximum allowed in regards to the proportion with our monthly wages or income. It is very important to have an income compatible with the monthly dividend that you are going to pay, and it is recommended that the dividend does not exceed 25% of the available and stable family income. This proportion can be stretched up to 35% of the value of income, if all the credits taken are taken into account. It is not a case that, in the middle of the life of the credit, we must repay the mortgage loan , with the significant sum of interests that this action will entail.
The value of the home to buy
The value of the dividend or monthly installment will come out of the value of the house and the percentage of financing thereof. There are banks that offer to finance up to 100% of the property, but for better debt management it is recommended that this value does not exceed 75% or 80% of the value of the property. The greater the financing, the greater the monthly payment and the greater interest paid in the life of the loan.
In short, the best term of a mortgage loan is subject to these two variables: the value of the home and the value of the monthly dividend. The combination of these values together with the disposable income will give us a minimum amount of installments to pay for the Mortgage Credit. From that minimum number of fees begins to play our tastes and our personal decisions.
We are going to ask you some questions to help you make the best decision when choosing a card. We compare between more than 30 cards from 20 different banks. It is a free simulation without compromise. When it’s ready, we start!