Sometimes in life, we will make a decision as important as the purchase of a home, so it is more than advisable not to rush and follow certain steps when hiring. According to Get Me My Mortgage, we offer you some guidelines based on advice, consultation, and planning, which we should take into account before hiring a mortgage loan:
- Advice: A fundamental step
Make no mistake, hiring a mortgage is exhausting, so the first step we must take is to seek professional advice, to be informed of the advantages we can obtain and what aspects of the mortgage can negotiate to get the best conditions according to our profile, saving us turn to time and money. On the other hand, it is essential to understand what we commit to when signing the contract, as it is probably one of the biggest investments we make throughout our lives.
This is where the figure of the financial advisor becomes especially important, and we must inform in a transparent and clear way of all the conditions, not only at the beginning but throughout the entire process. Finding a qualified advisor is one of the best decisions we can make if we want to take out a mortgage.
- The more entities we consult, the better
Once advised, and with a clear idea of the real conditions to which we can choose, it is time to consult the offers of each entity. According to the financial entity we go to, the conditions may vary, being able to adjust to a greater or lesser extent to our requirements. In this case, the more banks we visit, the greater will be our range of offers to choose from and at the same time negotiating.
On the other hand, although it is a good idea to consult online comparators that allow us to get an idea of the panorama of bank offers, it is always advisable to go to the branch in person so that the bank’s advisors inform us in detail about any questions and make a personalized assessment of our financial status.
- Take stock of the conditions
With the offers of the different entities on the table, it is time to take stock. Obviously, an important aspect that we must take into account will be the differential that they offer us, however, we should not be guided by this indicator alone. Some offers with spreads, in principle attractive, can carry several associated expenses such as bindings or commissions. It is, therefore, time to use the calculator and take into account each aspect of the offer, including these linked expenses.
In addition to all this, we must add the expenses of deeds and taxes that usually hover between 10% and 15% of the value of the property.
- Fixed or variable term?
Another key decision is whether we prefer a fixed or variable term mortgage, both options have advantages and disadvantages that we should value.
In the case of the variables, the interest rate is revised every certain period of time, so quotas will be unstable and it will be more difficult for us to plan our finances in the following years. However, their commissions are lower and the initial fee is cheaper, allowing us to extend the mortgage years. As for the fixed mortgage, unlike the variables, they are more stable and allow us to predict what we are going to pay a mortgage each year in course. The fixed-rate tends to be cheaper since the number of years is reduced and therefore we pay less interest, although this is not always the case. Despite this, the monthly fee and commissions tend to be more expensive.
Therefore, the best option is always to assess an expert’s hand which is the best alternative that adapts to our personal circumstances.
- Calculate your installments and the term according to your needs
Finally, it is advisable to plan the payments and the years in which we want to repay our loan. Although unfortunately we still cannot predict the future to know what our economic situation will be in the coming years, it is optimal that we get a realistic idea of how the state of our finances will be during the years in which we will face the mortgage. The greater the number of years, the lower the monthly payment, however, the higher the final payment of interest to the bank, hence the importance of adjusting our mortgage payment plan.