A loan is a contract between a subject and an intermediary, generally a bank, which involves the transfer of a sum of money from one subject (called the lender) to another subject (called the borrower), with assumption by the latter the obligation to repay the lender.
Being a loan for consideration, whoever has borrowed a sum of money must pay interest. Anyone can apply for a mortgage, as long as they can demonstrate that they can repay the loaned amount over time. In general, the bank grants an amount based on the value of the property to be purchased, which does not exceed 80% established based on the appraisal carried out by an independent technician.
Sometimes intermediaries grant mortgages that go even beyond 80% of the value of the property, but in these cases they require more guarantees and often apply less favorable conditions for the customer.
Before applying for a mortgage, it is advisable to carefully evaluate your income and determine your monthly availability once the ordinary expenses have been subtracted. It is reasonable that the installment does not exceed one third of one’s disposable income, to meet current expenses, unforeseen ones and possible income reductions caused, for example, by illness, accident, dismissal. You should visit reviewsbird.co.uk to learn more.
Apply for a mortgage: Watch out for interest rates
One of the first steps to take when deciding to take out a mortgage to buy a house is to understand which rate is right for you.
The rates and conditions offered by best loan companies and other intermediaries can vary, even considerably. Which rate to choose? There are search engines on the internet that offer guides and suggest the most suitable mortgages for everyone’s needs.
Of course, it is always possible to request information documents directly from the intermediary, for example at the bank counter.
It is important to evaluate the advantages and disadvantages of the rate type in the light of one’s economic situation and market conditions, considering their possible development over time. For this reason, it is useful to ask the bank for the sheet containing the general information in which each intermediary must illustrate all the characteristics of the mortgages it offers.
Apply for a mortgage: how soon is it granted
When it comes to the purchase of a property with a mortgage, it is good to know that the times to obtain it, i.e. those between the presentation of the documentation and the actual disbursement of the sum, vary from bank to bank are indicated in the sheet containing the general information.
The loan is usually not paid on the day the contract is signed but only after a few days, when according to the law the mortgage has normally reached a greater degree of security. So in the case of a loan taken out to pay the price of a real estate sale, the seller will consequently have to wait several days to be paid.
Therefore, it is necessary to inquire at the bank and at the notary on the times of effective availability of the money. To avoid this waiting, some banks immediately make available the sum borrowed under a contract other than the mortgage, called pre-financing: in this case it is advisable to check what are the interest and any other charges that the bank requires. As an alternative to pre-financing, it is necessary to agree in advance with the seller who, if he sells before collecting all the price, must be suitably guaranteed.
What to do in a state of confusion
Ask a good lawyer for advice to make sure you understand your rights and responsibilities and make the best possible choices to stay safe for your future. It will help you if:
- Wondering which bank to take a mortgage from – he will carefully review the offers made to you and will explain in detail the advantages and disadvantages of each, but will not force you to decide which bank to choose for a mortgage – you decide after by understanding the conditions of each;
- you need expert preparation and analysis of documents, preliminary contract for purchase and sale of property, contract for purchase and sale of property, mortgage loan agreement and any others;
- you need advice on refinancing a mortgage loan or its early repayment;
- you need help getting mortgage approval;
- you have financial or other difficulties;
- regarding non-payment of a mortgage loan;
- and for any other questions, advice, personal or business current needs.
Taking out a mortgage loan, for whatever purpose – be it personal (new home) or business – is an important decision that needs to be well considered.
You need to be aware of what documents are required for a mortgage loan, as well as how long it takes to grant a mortgage loan.
At first glance, the whole process seems complicated, but it is possible to finalize within a few weeks. The main thing is to pay enough attention to all aspects and make the best decision. That is why turning to a professional is highly recommended.
A good lawyer will immediately be able to point out the relevant mortgage tricks to look out for, make an expert comparison between different offers, prepare contracts, review all documentation and give valuable advice.