Are you thinking of buying a flat or a house and are you going to take out a mortgage for the first time? Here are 3 things you should know before taking out a mortgage.

Fixed and variable rates: what is the difference?

A fixed rate guarantees you regular monthly payments throughout the term of your mortgage. The variable rate adapts to the reference rate, whether it goes up or down. So which should you choose?

The fixed rate

It is safer if you plan to borrow for the long term. On the other hand, if the borrowing rate is high when you take out your home loan, it may not be advantageous. But remember, if this is the case, you can always renegotiate your mortgage at a better rate.

The variable rate

Although risky in the long term, it can be interesting if the current borrowing rate is high. However, the known risks are: a significant or consequent increase in monthly loan payments. Be aware, however, that the difference between the fixed and variable rates is tending to narrow. It is up to you to judge whether it is worth taking the risk in this case.

What is the purpose of loan insurance?

Although not legally required, loan insurance can be demanded by a bank. This is often the case for a real estate loan.

Loan insurance covers different risks:

- The death
- Total and irreversible loss of autonomy
- Temporary incapacity to work
- Permanent disability (total or partial)
- The loss of one's job

In order to be insured, a medical questionnaire must be completed and often a medical examination is required. The price of loan insurance varies according to the age of the insured and the probability of the risks involved.

Compare several offers before signing

A home loan is often taken out for 20, 25 or 30 years, but it is a long-term commitment. Before signing, it is advisable to request several offers from different financial institutions. To make this easier, you can use a broker. He or she will make requests on your behalf to several banks and send you the most attractive offers. Brokers fromatHomeFinance have a large network and effective negotiating skills that enable them to obtain offers that are often better than those made directly between buyers and lenders.