You have heard the term “mortgage loan” and are wondering what exactly is going on? Are you wondering what rules apply to this product and what is the mortgage loan interest rate possible? Do you want to know who the mortgage is actually intended for and in which bank you can get it?
You don’t know what income you have to achieve to be able to take advantage of the mortgage loan solution and to what amount it is granted? We invite you to read our article! We will try to give you a handful of knowledge on this subject and present the most important features of a mortgage loan!
What is the mortgage loan?
Let’s start with the basics: what is the definition of a mortgage? What is worth seeing about it? What is a mortgage? First of all: let’s not forget that a mortgage is not the same as a mortgage! Be aware of this and distinguish between these two products.
Mortgage loan: what is that? A mortgage is a type of loan with real estate as collateral for repayment. This property should be the property of the borrower, but some banks exceptionally allow a situation where the owner of the property is a close person who agrees to use his property as a pledge. Typically, the property should not be mortgaged, although some banks have exceptions to this rule.
We have already explained the basic concepts, but in the context of a mortgage you have to remember one more thing: you can use the funds borrowed under a mortgage for any purpose. The lender will not get into this. There is one catch – you cannot take out a loan to finance a business.
Who can take out a mortgage?
Are you looking for information on what are the conditions for obtaining a mortgage? Are you wondering if a solution such as a mortgage in a bank is a good solution in your situation? Who can get a similar loan? As mentioned before, you can apply for a mortgage if you own a property that can be collateral.
The real estate must meet several conditions: be recognized by the bank as a form of collateral, be the property of the borrower or a loved one who agrees that his real estate should constitute the collateral for the loan, as well as be located in Poland. Typically, the property may not be mortgaged, although some banks allow the mortgage to be pledged as long as the mortgage contract is in the same bank where you are applying for the mortgage and the sum of the loans and credits specified by bank for the percentage limit of property value.
What earnings do you have to make to reach your mortgage? The requirements that will be set by the lender when it comes to the product, which is a mortgage loan is an individual matter, so you should keep in mind the conditions for granting the loan.
What are the conditions for obtaining a mortgage?
Want to know what a step-by-step mortgage looks like? Are you interested in the minimum loan amount or, on the contrary, the maximum amount of mortgage loan you sleep on? First of all, remember that the amount of the mortgage depends on, among other things, the value of the property that will be its collateral. What else should you know? How many years can a mortgage be granted? The loan repayment time is much longer, it can be even 20 years. The mortgage interest rate is also lower than for cash loans. You can arrange with the bank fixed installments or decreasing installments.
What documents are required for a mortgage?
Let’s move on to the important question: what formalities can a mortgage loan generate? What documents may the lender require? The answer, unfortunately, cannot be unambiguous, because formal requirements are an individual matter, largely dependent on the offer of the lender. It is possible that when applying for a mortgage, you will need to provide, for example, an income certificate and property deed to be used as security.
How much is waiting for a mortgage?
Are you waiting for a mortgage loan? How long do you have to wait for the borrower’s decision? It depends! You have to be prepared that the lender will have to analyze a large number of documents, so it is difficult to determine the exact time frame. Ask the lender for all the details.
Is it worth taking a mortgage?
Is it worth deciding on a mortgage loan commitment? Does the mortgage loan pay off in practice? First of all, before you make your final decision, think about the pros and cons of this solution. A mortgage can be a legitimate option if the potential borrower needs a larger amount for a longer period of time. However, try not to think in categories: where is the easiest way to get a mortgage, but where is the best to take it in your case. Pay attention, among other things, to the cost of a particular mortgage for any purpose etc. Remember: never make financial decisions on the spur of the moment!
Let’s sum up: a mortgage loan is a loan secured by real estate owned by the borrower (usually), located in Poland, not encumbered by a mortgage and accepted by the lender as a collateral. A mortgage loan is usually granted for a longer period, and the funds received can be used for any purpose, but you cannot finance your business with it.