Decided to buy a house or apartment, but not enough finance? Or do you want to spend them on something else? No problem! There are banks in this case. There you can take the missing amount and pay it in equal parts. For the period that is convenient for you. But the question arises, what is better to take: a loan or a mortgage? Let's figure it out!
Mortgage
So, what exactly is it and what are its features? Which is better - mortgage or loan? A mortgage is a loan that you are given to buy a home or home. The main advantage is a low interest rate. In addition, many young parents are currently taking a mortgage. So, they can make a down payment for the apartment with parent capital and thereby significantly reduce the payment and the amount of overpayment! With a regular loan, this is not possible. In addition, if a child is born during the payment of the mortgage, part of the square meters is paid by the state. This is a great financial support for families with a baby. And if three babies are born in your family during the payment of the mortgage, the state will fully pay the full amount of the mortgage for you. Under this program, there are restrictions on the cost of housing and the number of meters, but in general the conditions are excellent.
But the mortgage is taken not only by young families, but also by military and other categories of citizens. More than 70% of apartments in our time are bought using this program. And for each category of citizens there are programs that are convenient for them.
The main advantage of a mortgage, in addition to a low interest rate, is a long loan term. BUT this is important because apartments are not cheap. And if the mortgage term was 2, 3, or 5 years, as with a regular loan, many people would not be able to cope with such financial responsibility and make a delay. And this would not end in anything good. Because it is very difficult to get out of delinquency, since the size of the forfeits is very large, and in addition to the forfeits, you still have to pay a monthly payment. In addition, you ruin your credit history, and in the future, when you need another loan, you will have difficulty obtaining it, because the borrower’s reputation is very important to banks. After all, if the borrower does not pay, the bank will not make a profit, and perhaps its money back. So pay on time, take care of your credit history from a young age. From the first loan!
About the merits, everything is clear. But what about the flaws? They are not?
Mortgage Disadvantages
Disadvantages and mortgages are present, but the advantages prevail. But let's nevertheless examine in more detail the disadvantages:
- Encumbrance. That is, the full ownership of the apartment will pass to you only after the full payment of the mortgage.
- A large overpayment arising with very long loan periods! So carefully consider how much overpayment and how much payment will be nnumber of years. As a rule, if you consider the mortgage term of 15 and 20 years, the difference in payment is not noticeable, but the loan term increases for as long as 5 years!
Credit and its features
A loan, like a mortgage, has a number of advantages and disadvantages. Let's take them apart. So what are the main disadvantages of a loan?
- A large interest rate, it is 100% more than the interest rate on the mortgage, which means that the amount of the overpayment is greater. You need it?
- A short loan period, which means large loan payments, which takes most of the salary.
- There is no state support, which means that there are no special preferential programs.
- Not a very large loan amount.
Advantages of a loan
- No encumbrance on the mortgage, which means that the whole apartment is in your full ownership.
- You can sell the apartment, even if you have not yet closed a loan. If you had a mortgage, it would be much more difficult. I would have to go to the bank and relevant institutions and remove the burden. And it takes a lot of time. And not all buyers want to mess with this because they fear fraud.
- Lending is possible even for a minimum amount.
In which cases to choose a loan, and in which mortgage?
What is better to take: a loan or a mortgage? In fact, each situation is individual and it is necessary to calculate all the options. And ultimately, using a financial result, determine which lending method to choose. But it is worthwhile to understand that a mortgage is given from a certain amount. And if you do not have enough to buy an apartment, then it is better to take a loan. On it, as a rule, you need to collect not such a large package of documents. And also you can get a loan in a few hours. Very comfortably.
If you evaluate from a practical point of view, you can think about a loan only on the condition that you have a minimum of жилья to buy a home and only 25% are missing. In other cases, a loan is a financially losing operation. You need it?
Sometimes there are situations when it is urgent to purchase an apartment, there is almost the entire amount, but there is no time to wait. Otherwise, someone else will buy it, and you will miss the profitable option. In this case, it is better to choose a loan, you will get it faster, because you will not need to collect a huge package of documents and wait for a bunch of references. Many banks give loans during the day according to two documents.
It is important to understand that if you take a mortgage in a marriage, then one spouse may be the main borrower, and the other co-borrower. When a divorce, the apartment will automatically be divided in half, even if one of the spouses has not made a single payment. If one of the spouses took a loan for an apartment before marriage, he can sue her for a divorce.
Making money on a mortgage - how?
A very big advantage of a mortgage is the ability to earn money on it. With a loan there is no such possibility. How can I do that? According to the legislation of our country, each person can return the tax on personal income when buying an apartment. How to do it? It is necessary to contact the district tax office, take a list of documents that need to be collected. And within 3 months, your account will receive the entire amount of taxes that you transferred to the state for the year. Good salary increase? We think so too!
That is, you will be refunded not only for the purchase of an apartment, but also for the interest that you pay for the mortgage. The only drawback of this system is the restriction on the amount of return. Every year this amount changes. Currently, you can return 260,000 rubles for the purchase of an apartment, no matter the mortgage or not, as well as the full amount of interest paid! If you issued a mortgage after 2016, then the maximum amount of return is 390,000 thousand.
Additional services
So, you have decided which is better - a loan or a mortgage. However, when contacting the bank, you may be offered additional services. With a mortgage - this is apartment insurance, and with a loan - your life insurance. What is the jar for? Thus, the Bank insures itself against financial losses, that is, if something happens to you (1st degree disability or death), the bank will still receive the money. He will be paid by the insurance company and he will not call your relatives. Whether this service is needed or not, you decide. She is voluntary. However, many banks make it mandatory for their customers, refusing to issue without insurance loan or mortgage for housing. What is better to do in this case? Call the bank hotline and leave a claim. Do it directly with a bank employee, and the result will not be long in coming. You will get what you need!
Want to pay off ahead of time - which is better: mortgage or consumer credit?
In this case, you need to contact the creditor bank and find out how the early repayment occurs, whether additional borrower applications are needed for this. What is the procedure for early repayment? Do the number of payments or their amount decrease? Or both are possible. Be sure to ask these questions to the bank employee and, based on his answers, make a decision about which is better - a mortgage or a loan.
When looking for the answer to the question "Which is better - a loan or a mortgage?" reviews do not play an important role. Many speak out in favor of the loan, but it should be borne in mind that they all closed it in less than a year. Realistically evaluate your capabilities!
Conclusion
If you have a question, which is better: a mortgage or a loan for an apartment, do not rush to make a decision. Be sure to "weigh all the products", calculate the financial results. And only then can you make the right decision, because based on theory only, it is impossible to do it! Each situation is individual, and it is necessary to make a calculation depending on the specific case. Make the right decision so you don’t have to regret the lost profit.