After consulting the calculator that helps you to know first hand the expenses to be faced, you you have decided to take the plunge and to buy a home.
Having assets always brings a greater stability. While it is true that you have to have money saved and a stable job that allows you to be solvent to face a mortgage, the price of the monthly payments of this is usually lower than the rent. Therefore, even if a priori it involves a large outlay for you, You will achieve savings more quickly than if you lived as a tenant.. And when your mortgage is paid in full, you’ll be a full-fledged homeowner.
By owning a home, you’ll be able to modify it to your liking or make renovations. In addition, your children can inherit the property and thus ensure a roof over their heads for their future.
Expenses added to the purchase of a home
As a general rule, banks finance, as a maximum, 80% of the appraisal or purchase value of the property. Therefore, you will need to have the remaining 20% saved to be able to pay the entrance fee.
In addition to this, acquiring real estate means having to deal with. a number of expenses related to the purchase and mortgage, 10% approximately, such as the public deed at the notary’s office, taxes or registration in the Land Registry.
These are the requirements that you will have to fulfill to ask for a mortgage
In order to face the purchase of a home, you will have to apply for a mortgage loan.. The banks must ensure the payment of the installments of the mortgaged ones during the whole life of the loan and for that reason they do not usually approve all applications. There are a number of conditions that you must meet. for the bank to finance your home purchase.
Salary and stability are essential for granting a mortgage.. You must have an assured income so that the bank knows that it will be able to collect the loan installments every month without any problems, installments that may not exceed 35% of your net income.
To verify your employment status, you will be asked for your employment contract. In this sense, civil servants and employees with indefinite-term contracts will have an easier time of it. than those with temporary contracts, work and service contracts or who are unemployed. The self-employed, on the other hand, must have a stable business with demonstrable profits in at least the last two years prior to the mortgage application.
Seniority in your job and no outstanding debts are also requirements that banks will take into account.
Mortgage, fixed or variable rate?
The mortgage we apply for can be at a fixed or variable rate. With the fixed-rate mortgage, the instalment and the interest rate remain the same throughout the life of the mortgage loan. The amortization term is usually shorter and offers higher interest rates.
The variable rate mortgage involves changing the interest rate each period, so the installment may vary. With this type of mortgage, the repayment term is usually longer and the interest rates lower than fixed-rate mortgages.although they are subject to changes in the markets.
Is this a good time to buy a home?
Currently, we are in a situation of changes and variations. The war in Ukraine, interest rate hikes, the economic slowdown expected in the coming months … The Euribor is expected to close 2022 above 3% and everything points to the fact that it will continue to soar next year. Thus, the increase in the cost of mortgages and the tightening of requirements by the banks will most likely lead to an increase in the interest rate on mortgages, The demand for housing will most likely be reduced.
Many households may postpone their plans and put off the idea of purchasing a property until a later date. However, many analysts also agree that, after the first quarter of 2023there is a possibility of a good time to buy a home at affordable conditions.
The costs of buying a home, clarified thanks to this calculator.
We suggest you use this calculator which, in a quick and easy way, will allow you to see in a personalized way the expenses you will have to face if you decide to take this important step.