Real estate credit: 5 details not to be overlooked when signing.
The signing of a mortgage is always an event rich in emotions! Like all important acts, it carries with it its small share of anxiety. How can you be sure you are making the right choice? How to avoid any unpleasant surprises as much as possible? To live this important stage as serenely as possible, here are 5 details not to be overlooked when signing a mortgage.
1. The early redemption indemnities
All home loan contracts contain an early repayment indemnity (IRA) clause. This applies when you sell the property before you have fully repaid your loan, or in case of repurchase of mortgage by the competition. These indemnities can amount to 3% of the capital remaining due. But by negotiating before signing, it is possible to lower the percentage, and sometimes even to cancel any indemnity in the event of resale beyond a certain number of years.
2. Application fees
When you take out a mortgage, banks charge administration fees which can vary between 300 and 1000 USD according to a survey by Capital magazine. It is always possible to negotiate these fees. To see them fall, you can take out home insurance with the lender but the best is often to go through a broker who will negotiate more effectively.
3. The domiciliation of income
When signing a home loan, the bank can oblige the borrower to domiciliate his income in the establishment for 10 years. For that, it must offer a counterpart. Alone or with your broker, check this clause and the counterparties before signing.
4. The modulation of monthly payments
At some banks, it is possible to adjust its monthly mortgage payments up or down. Depending on the contracts, the adjustments can range from 10 to 30% always depending on Capital, and the constraints may vary. To watch closely.
5. The monthly deferrals
In the same vein, some home loans allow you to suspend for a few months, and up to a year, the payment of monthly payments of the entire mortgage or simply the principal. The real estate rate is currently low (1.46% on average according to the Housing Credit Observatory / CSA of May 2018), and deferrals are more advantageous, because a lag generates interest on interest.
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