The duration of repayment of a home loan is chosen according to certain factors. Is the choice of bank decisive in this sense?
Are you eligible for a home loan?
If you have stable income; that is to say if you have a permanent contract or an equivalent, you are more likely to have a positive response from the bank, if you apply for a mortgage. Even a person at the minimum wage can satisfy the bank, as long as the income is stable.
But what is also important, for the banking establishment, is to look at the charges, with regard to these incomes, to see if the debt ratio makes it possible to add a monthly repayment and this, for 20 years.
According to the banks, you can repay over shorter or longer periods, depending on your age, in particular. If you choose a credit over 20 years; what are the advantages?
Why repay a home loan over 20 years?
The advantage of paying off a loan over 20 years is that it makes it possible to have lower monthly payments. This can be interesting, for a household which thus keeps more purchasing power and can devote the rest of its resources to other projects.
Even if 20 years may seem long, for a buyer who wants to own his property, this is considered by the bank to be a short repayment; knowing that some offer the possibility of repaying over 30 years; even if they tend to become scarce.
Repaying over 20 years is more advantageous than over 30, especially for interest, which is then high.
Such a duration also makes it possible to benefit from a more attractive rate. It is still necessary for that, to find the bank with the most attractive credit offer.
Which bank for your 20-year mortgage?
It is already important to find out which bank allows this type of loan, depending on your age. What the bank will look at to make the loan is the age you will be at the end of the loan. This is why some are more cautious than others, depending on the profile of the applicant.
Going through a comparator will allow you to find the establishment, which, for a repayment period of 20 years, will offer you the most attractive rate; that is to say the lowest, for your loan.
To have all the information and to help you in your research, you can also find in a mortgage broker, a person of choice. Feasibility of your project, calculation of monthly payments according to the proposed rates, you will have all the keys in hand to meet the bank, once you have chosen it.
The broker offers comprehensive support, ranging from studying the situation, comparing, but also negotiating with the banking establishment. Do not hesitate to call on him, if you want to find the best proposal to buy your future property.