A mortgage loan, occurs when a financial entity makes a loan to an applicant to acquire a house, under the modality of construction, rehabilitation or expansion, through a contract that agrees payment in installments, with a certain percentage of interest. Keep reading!
What is a mortgage
A home loan or home equity loan it is a credit for the acquisition, rehabilitation or refinancing of a home. Many dollars will be saved by choosing the most suitable mortgage for your needs.
In other words, the house acts as warranty While the mortgage is the loan granted by the bank (lender) to the interested person (buyer), who grants them a sum of money, which must be repaid within a specified period with interest included.
When you buy a home through a mortgage, the lender can take action against the buyer, taking possession of the mortgaged house, if the payments of the installments agreed in the contract are not met.
If you are a foreigner and you want to have the option of a mortgage loan, the first thing that person should have is be visa, either as a tourist or for work.
In the event that the purchase is made in the name of a company, the mortgage will come out in the name of the person, or of several people in the case of being the owners of the company.
Requirements for mortgage credit in the United States
The requirements for the mortgage credit are:
- The applicant must comply with the last twelve (12) contributions successively.
- To have thirty-six (36) contributions.
- Have no pending obligations if you are legal representative of a company.
- Cover the required age, maximum 75 years of age.
- Do not have any delinquent mortgage credit with BIES or IESS.
- Nor should you have a current mortgage loan, acquired under the same modalities mentioned above.
- In the same order, it should not have a mortgage credit pending for completed housing, for expansion or rehabilitation, nor for housing under construction.
- Not having applied for a loan or mortgage credit for housing replacement, or acquisition of land, or construction of land, or a property, not for a finished mortgaged home.
- You shouldn’t even have obligations as guarantor in force for Voluntary Mortgage Credits.
- Owe no interest in arrears of credits with BIESS or IESS.
- Nor should you be registered in IESS with a degenerative disease.
- Finally, the applicant must approve the financial evaluation of BIESS.
With respect to the documents that must deliver the applicant, will need:
- 1 copy of appraisal request (completed online)
- 2 color copies of the identification card and ballot of the holder.
- 3 copies of the mortgage loan application, through the internet.
- Original and copy of a receipt for a service (electricity, water, telephone) from the last month.
- Append the Proof of marriage.
Recommendations for acquiring a mortgage loan
We recommend the following before applying for a mortgage loan:
- Know the current interest rates, verifying on the internet, searching and expanding the information in different banking entities.
- Check rates that are mortgages of 15, 20 and 30 years. You can save many dollars if you choose the mortgage with the shortest term according to your needs.
- Request information to different banking entities. By doing this you will be able to verify and check the credits and the deadlines.
- Inquire about whether the rate is adjustable or fixed. If the rate is adjustable, it will vary greatly during the mortgaged period. Increasing the percentage points will automatically increase the amount of the monthly installments.
- Ask for How much is the amount which is given as initial.
- In case you require a mortgage insurance. Find out about the total amount of the insurance, how long you will have to keep it and how much is the extra amount that you will have to pay at the periodic fee.
- Make sure and if you are interested in paying in advance you can.
Types of mortgages
There are many types of mortgages. The mortgages that are considered the main ones are: adjustable rate mortgage and fixed rate mortgage.
1.- Adjustable rate mortgage, as its very word indicates, it is variable, it can go up or down.
- Advantage: Mostly, it has the lowest initial rate compared to a fixed-rate mortgage.
- Disadvantage: After the initial installment, the rates fluctuate, they can go down but also go up and with it the amounts of the monthly installments.
2.- Fixed rate mortgage: in this case the rate is fixed and does not change.
- Advantage: the initially averaged amount is maintained, and the interest rate does not change.
- Disadvantage: If in the market the rate falls, then the amount of the interest rate could be a higher one.
3.- Other types of mortgages: You can find much more information in the Consumer Financial Protection Office, regarding the different types of mortgages apart from those already mentioned.
Refinement is intended pay off a debt through another loan, in different terms. It is commonly used among homeowners.
In other words, you pay one existing mortgage with another that is acquired for it.
exist reasons to refinance:
- Minimize the Monthly amount to turn off.
- Use the net total of the house.
- Reduce the amount to be paid monthly and the percentage rate of interest.
- Strengthen other debts.
Of the types of mortgage existing in the market, and between the fixed and adjustable mortgage, you should consider the following before making the decision:
- The estimated time you want stay with the house.
- Reasons to refinance.
- The income you have and the current state of credit.
- The amount of the new mortgage (refinancing).
- The total net of the house.
- Any modification that can be given in payment of the private mortgage insurance, with the value of the home.
- The percentage points between both mortgages, that is, the difference between the interest rate of the current mortgage and the new one to be acquired.
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