Are you thinking of buying a home and applying for a mortgage to finance your purchase? You should know that before applying for mortgages it is advisable to compare the ones available to choose the one that best suits your financial needs at this time and with the best interest rates , being able to choose between mortgages with fixed, mixed or variable rates .
Below we show you where to apply for cheap mortgages and the characteristics of the mortgages that you can choose, so that you can get the best possible conditions by meeting the fewest requirements.
Where to apply for a mortgage?
Below we show you where you can apply for cheap mortgages online easily , quickly and simply by filling out an application form.
Home equity loans vs mortgages
Home equity loans are a type of loan that is commonly confused with mortgages, the main difference being that mortgages are intended for the acquisition of a home and home equity loans offer financing to acquire anything, so that It is possible to obtain a loan without fulfilling requirements and simply offering an asset as collateral.
Home equity loans are often applied for when personal loan approval cannot be obtained and financing is required to purchase goods or services. They are also used to reunify debts and loans into one with lower interest rates.
Check this list of financial institutions with loans with home equity and debt reunification :
What do you have to look for before applying for mortgages online?
When comparing mortgages, it is necessary to know that a mortgage is a loan with the guarantee of a property, being the most used loan to hire it to finance its acquisition. Given their large amount of money and repayment period, it is necessary to pay special attention to the conditions that mortgages have so as not to spend several years or decades paying more.
The most important characteristics that you have to look at when applying for a mortgage are the following:
Amount to finance
The amount to finance the mortgages is the amount of money that you can request, being the normal thing to speak of a maximum percentage of the cost of the house, such as the 80% that some mortgages currently offer.
Mortgage repayment term
Mortgages are normally repaid in monthly installments over a repayment period, which can reach 35 or 40 years in some cases.
Type of interest
The interest rate of mortgages are normally referenced to the Euribor applying a differential over it, although there are some banks that offer mortgages with a fixed or mixed interest rate. Then we explain what they consist of.
The ideal is to take out a mortgage without commissions, but there are some that have them, with fixed-rate mortgages being the ones that have the most. Above all, you must avoid the opening commissions, so as not to pay more when formalizing the mortgage, and the commissions for early amortization or total cancellation of it, since in the event that you want to amortize you would have to pay more.
Resulting monthly fee to pay
The resulting monthly payment is usually offered in a mortgage amortization table, since many of the mortgages have a variable interest rate and the monthly payment will depend on it. In the event that the interest rate is referenced to a reference index such as the Euribor, it is reviewed from time to time, and can be a monthly, semi-annual or annual review in most cases.
Products linked to contract with the mortgage
More and more banks are demanding to contract linked products to approve their mortgages, offering in some cases lower interest rates by contracting more products. Among the linked products that are demanding the most are home insurance, life insurance, payment protection insurance, pension plans, bank accounts, credit cards, direct debit of payroll and direct debit of receipts.
Flexible payment of the fee
It is possible to contract mortgages that have flexible payment options, offering the possibility of paying more or less at certain times and even enjoying a grace period or payment deferrals. In addition, it is possible to make the amortization in most of them, being able to even make a total amortization of them.
Types of mortgages
There are basically 3 types of mortgages that you will be able to request based on their interest rates:
Variable rate mortgages
These types of mortgages have an interest rate that depends on a reference index, plus a fixed differential that is set at the time of signing the contract. The most widely used benchmark is the Euribor and it has been the most widely used type of mortgage in our country, as they offer competitive interest rates and higher repayment terms, although the mortgage payment will depend on the benchmark index.
Fixed rate mortgages
These types of mortgages have a fixed interest rate during their life, fixing it at the time of signing and not being modified by external indexes, so they have a fixed fee to pay every month during the years that the mortgage lasts . They tend to offer shorter durations than variable rate mortgages, but offer peace of mind because the mortgage payment does not go up.
Mixed mortgages usually offer a fixed interest rate during their first years of life and later a variable interest rate, so they are profitable when the benchmark is high and is expected to fall during the following years.
Necessary requirements to obtain mortgage approval
Depending on the bank where you are going to apply for a mortgage, it is necessary to meet a greater or lesser number of requirements to obtain approval. The most important requirement is to be able to show that you are a solvent person and you will be able to return the mortgage money in the established installments.
The main requirements necessary to meet to obtain approval for the mortgages you request are the following:
Entry or money contributed to the purchase of the home
Currently, in order to obtain approval for a mortgage, it is necessary to provide an entry, that is, to have saved a percentage of the value of the house that will have to be paid when contracting the mortgage. This is because banks do not usually offer mortgages with 100% of the value of the house, but normally offer at most 80% of this value. In addition, it must be taken into account that there are other expenses associated with contracting a mortgage, being 10% to 15% of the value of the home, so you have to contribute them as well.
It is necessary to have sufficient monthly income so that when carrying out the risk study, the bank accepts a mortgage. In this sense, according to the recommendations of the Bank of United States, the maximum installment of mortgages cannot be greater than 35% of monthly income. Keep in mind that the more people who own a mortgage, the greater the chances of getting approved, since their monthly salaries add up.
In addition to taking into account the monthly income that you have, the banking entities also check the job stability of the person or people who are going to be holders of their mortgages, so that the type of contract, the length of time and the sector where you work is important .
Have other loans contracted
The banks will check the debt that you are going to have when signing a mortgage, also taking into account other loans you have, so that the sum of your monthly payments and the mortgages you have cannot exceed a risk percentage.
Debts that you have
If you have debts or defaults on other loans or with companies, it is most likely that the bank will not grant the mortgage, since you will enter a profile of delinquent or poorly solvent. Check that you are not on delinquent lists such as Credit Checker, RAI or CIRBE before making the request.
Guarantees or guarantors
In the event that you do not have enough money to carry out a home entry or the calculated risks are greater than those that the bank can assume, they could ask you for an additional guarantor or guarantor to be able to obtain the approval of the mortgage. This is dangerous, since in case of non-payment the bank may seize said guarantee or the guarantor's assets, so it is advisable to look for other options.
Advantages of applying for mortgages online
The main advantages of applying for mortgages online is the simplicity and speed of making the application, since you simply have to fill out a form over the Internet and send the documentation that they request. You will have a quick response to it and you can apply for more than one mortgage at the same time without leaving your home.
Online mortgages offer competitive interest rates and exclusive conditions to customers who request them through the Internet, since most of them are based on offers from banks that operate through the Internet.
You can read the conditions of the mortgages online calmly from your own home and, in case of doubt, contact the customer service of the bank to resolve it.
In TheTourism Loan you have all kinds of financial products to get urgent financing for whatever you want. Thus, online mortgages offer financing for the purchase of a home. Check the list of urgent personal loans, fast loans or microcredits and request fast money through the Internet.