A Home Mortgage is a loan given by a Mortgage company/ bank or other financial institutions for the purchase for a residential property .Usually, home mortgage will either have a fixed or floating rate, as well as lifespan of 3 to 30 years.
In a nutshell, mortgages are used by individuals &businesses to make huge real estate purchase without making one off payment. Over a specified of years, the borrower repays the housing loan, plus interest, until payment is cleared.
In today’s blog posts, we will highlight all you need to before you proceed to apply for home mortgage here in Rwanda and abroad.
- Research where you can afford
Research the area you want to live in. Look into the local shops and restaurants, your commute to work, and travelling distance to family. Try to estimate your affordability.
Create a list must have potential compromises. Decide how many years you want to pay for. It could be cheaper per month to spread repayments over a long period, but you will end up in debt for longer and paying more interest in the long run.
2. Read the terms very carefully
The lending company most likely has legal documents containing terms of the housing loan. Importantly, read the terms carefully and make certain fully understand the terms before securing a loan. Is the interest rate killing?
In fact, try to see if you can possibly get a better interest offer elsewhere? If you have trouble understanding the contents of the fine print, get legal assistance from lawyer.
3. Save enough money
In addition, you will need to make some deposit to put down on any home you are looking to buy. Initial deposit varies. It can be as little as 05% to over 50%. The deposit is dependent on the property owners and the financing institution, so you would do well to ask around some of these mortgage banks to get an idea of requirements.
This is because the lower your mortgage is, the less likely your property falls into negative equity. This is where the value of your property falls below the amount you owe on the mortgage. The lender will feel more comfortable that they’ll receive their money back if you have more savings to put down and own a portion of equity.
4. Find affordable house
After looking view all term from mortgage provider, you need to find a property in preferable place that matches with your budget. There are so many street brokers who will promise you to find good house for and they will not. I recommend you eMall Property, a professional and repeatable real estate company will help you to all property aspects you need from beginning to the end.
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5. Make sure you can afford a mortgage
Knowing that you can afford a mortgage loan is essential. Mortgages are not short term commitments. A mortgage is something that you will need to be committed to for a number of years ahead, so you need make sure you do your research properly in order to get best results. Simply subtract your monthly expenses from your income to see how much towards mortgage each month.
6. Final note
You may be eligible for getting a mortgage if you are formally employed, on a full time and permanent basis. You are also required to have saved a sufficient deposit and not have any bad outstanding loans or history of such.
eMall Property links and offer full support to all people who need loan for house or affordable housing from primary mortgage lenders such as banks, microfinance in order to increase availability of home loans in Rwanda.