When hiring a mortgage, it is very important to compare the existing options in the market, in order to choose the one that best suits our financing interests, as well as to have the advice of experts such as those of Hipoteca100.es
Remember that there are mortgages of different modalities, fixed-rate and variable rates, using a mortgage simulator can help you choose the option that suits you best.
From El Economist we are in favor of a fixed rate because it allows you to know with certainty the monthly payment that you will pay in the total duration of the mortgage.
Also, today there are such cheap mortgages that the bank loses money by lending you money … literally! Did you know that if inflation is higher than the interest rate in a specific year, the bank loses money?
Inflation is an enemy not only for small savers (unless you invest, your savings are worth less every year) but also for large money lenders (if the price of things goes up faster than the interest on money, they will be having a loss in terms of purchasing power).
What Is A Mortgage Simulator?:
A mortgage simulator is a financial instrument that allows us to calculate the type of mortgage (fixed or variable interest), the monthly installments to be paid, the financing cost in terms of interest, and the total cost of the mortgage.
How Do Mortgage Simulators Work?:
The operation of mortgage simulators is very simple, they usually ask you to enter several variables, such as how much money you need to buy your home or how much money you are going to borrow to finance it, the duration of the mortgage (10, 15, 20 years …) as well as the installment that you would like to pay each month and if you prefer a fixed or variable rate mortgage.
Mortgage simulators also usually take into account other elements such as your savings or equity, the monthly income you have, if you have a stable or temporary job, if you live alone or as a couple and if you will participate alone in the mortgage payment or with another person.
How Much To Pay Upfront?:
Normally, when buying a home, there is usually an entry of 20% of the total cost. That is, if you want to buy a house of 200 thousand euros, 40 thousand euros would be paid as a down payment and the remaining amount (160 thousand euros) could be borrowed with the mortgage.
In addition to that 20%, you have to add the part related to the purchase/sale taxes that vary if they are for new construction or second-hand housing (in the case of new construction, the taxes are more expensive).
As you can see, paying for a ticket is not an easy task for many people, since the capital to have saved is high. However, there is another option in the market that is that of 100% financing mortgages.
These mortgages are designed so that you can finance the entire purchase of the home without having to provide an entry.
Is It Possible To Get 100% Financing?:
Despite the fact that in recent years, some banks reduced liquidity when granting loans, it is still possible to finance the purchase of a house in its entirety with 100% financing mortgages.
To get a 100% mortgage you have to meet a series of requirements at the level of minimum income, savings and probably have a co-owner or guarantor who responds in case of default.
This option is very popular among people who dream of owning a home and are tired of having to pay high rents, which sometimes exceed the monthly mortgage payment but do not have enough savings to pay a down payment.