How To Buy An Apartment Competently: Is It Worth Taking Out A Mortgage?

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How To Buy An Apartment Competently: Is It Worth Taking Out A Mortgage?
How To Buy An Apartment Competently: Is It Worth Taking Out A Mortgage?
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Buying an apartment is a crucial step for any person, so it is important to approach this issue correctly and decide which is better: to save up or use mortgage lending.

How to buy an apartment competently: is it worth taking a mortgage?
How to buy an apartment competently: is it worth taking a mortgage?

Mortgage: Benefit or Financial Slavery?

When it comes to buying your own home, and funds are sorely lacking, many people have a question, what is right: to save up or take an apartment on a mortgage? The question is quite difficult, since both options have their pros and cons, and only time will tell which one is correct. Those who are inclined towards a mortgage are guided by the main attraction factor - the quick acquisition of an apartment even before they already have the required amount on hand.

The advantages of mortgage lending are not only the speed of moving into a new apartment. There are low interest rates in comparison with a regular consumer loan, and the ability to defer payments in the event of a child's birth or other unforeseen circumstances. Each bank has its own conditions, but all mortgage programs are aimed at simplifying the conditions for buying your own apartment.

However, whatever the minimum mortgage interest rate, you still have to overpay, and in most cases you will pay twice the loan amount. This factor, for the most part, scares off consumers. However, if you rent a house, there is reason to think about which is better: pay "nowhere" or overpay by investing in your own real estate? In addition, real estate prices are growing inexorably, and it is highly likely that, even if you overpay twice, you will buy an apartment, which by the time the mortgage is paid in full, will cost much more than at the time of the loan.

It should also be borne in mind that you will not be able to sell or donate your new "mortgage" apartment until you fully buy it out from the bank. Formally, it will be in your ownership, but such apartments are a pledge guarantee for banks in case you lose your solvency.

If not a mortgage, then what?

Those who are afraid of financial dependence on banks and at the same time strive to buy an apartment prefer to save. On the one hand, this option is good because there is no need to overpay the bank, no need to think about what to do if there is not enough money for the next installment. On the other hand, you will have to wait several years before acquiring your own home, and it is not a fact that you will save up the required amount in the planned time, because real estate prices are growing like mushrooms after rain. Therefore, savings do not guarantee that you will have an apartment in a few years. So, if there is an opportunity to take out a mortgage, then perhaps it is worth taking the risk.

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