Are you planning to buy the property of your dreams? Far from being trivial, this operation very often requires a financial contribution from a bank. Find out all the questions you need to ask yourself in order to take out the most suitable property loan for your project.

How much to borrow and what rate to choose?

Before buying a property, it is important to know your borrowing capacity, i.e. the total amount you can borrow from the bank.

What is my borrowing capacity?

To find out your borrowing capacity, it is advisable to ask your financial adviser, a mortgage broker or use a online simulator. This will give you an idea of the maximum amount you can borrow over a given period of time.
You should also find out the maximum amount of your monthly loan payments. This figure will allow you to adjust the number of monthly payments and thus fit the property of your choice into your budget.

While banks often require between 10 and 20 % of the loan amount as collateral, financing a property without a deposit is quite possible. Some banks will require money to cover notary fees and application fees, while others may give you a loan at 110%. However, this depends on your borrowing profile.

What is the difference between fixed and variable rates?

Currently, property rates are at their lowest level, which increases the purchasing power of borrowers. However, the question of the type of rate remains! A quick reminder of the different existing bank rates:

The fixed rate It is the same throughout the term of the loan. You know in advance how much you have to pay in monthly instalments.

The variable rate It fluctuates up and down over the life of the loan.

The mixed rate This is a mixture of a fixed and a variable rate. The first years of the loan are characterised by a fixed rate, which is then replaced by a variable rate until the end of the repayment period.

Note that the duration of the loan is usually long. Financial difficulties may arise and disrupt the monthly payments. In this case, the best solution is to opt for a flexible loan. This allows you to reduce or suspend your monthly payments for a specific period. If, on the other hand, your finances are in good shape, you can increase them to pay off your loan more quickly or ask to buy your loan back.

What are the advantages of a mortgage broker?

The real estate loan broker is a precious help in the success of your real estate project. Integrated into the heart of the banking world, his role is to negotiate with the institutions to obtain the most interesting rates on the market.

He is a privileged player, available to provide you with appropriate advice and to accompany you throughout the process. He negotiates your loan for you at the best rates with partner banks. You will thus benefit from a solid file that is totally adapted to your profile. The mortgage broker can also guide you in choosing the best loan insurance. Thanks to him, your procedures are simplified and you save precious time.

For your real estate project, contact one of our brokers atHomeFinance !