Home Loan - New Financial Opportunity for Boston Citizens
When you decide to buy, improve or build a home and do not have the money you need, you must know the most effective financing program you can choose. You can choose a real estate loan or a home loan, depending on the amount of money you have, the bank's financing, or the guarantee required of you. Both real estate and mortgage loans have their advantages and disadvantages, which you need to know before deciding.
Types of Loans for Home
From a legal point of view, the two types of loans comply with distinct laws: the provisions applicable to the real estate loan are regulated by the Civil Code, and the home loan is subject to law no. 190/1999. Thus, the real estate loan is more strictly regulated in terms of granting and setting up collateral, while the home loan is more permissive, with banks being free to set lending conditions according to their own rules. However, this aspect can also be a disadvantage because the law does not require banks to determine the interest rate, leaving this to their choice.
The real estate loan is addressed especially to people who do not have a large amount of money for an advance but own another property or have relatives/acquaintances willing to guarantee their property. Banks do not require a significant advance in the real estate loan, the financing being higher than in the case of a home loan.
The home loan is the financing program according to the people who do not have a property to guarantee and who have a larger amount of money to pay the advance. This type of loan is a safer choice for people who want a long-term loan. The guarantee offered to the bank is represented by the real estate to be purchased or built, and the interest rates will not change following the policy changes of the banks because the credit provisions are regulated by a special law.
Also, there is a home equity loan and mortgage. To compare a home equity loan vs. a mortgage, you must identify the main differences. Think of a home equity loan like this: You've got a house and built some equity in it. Now, you want to use that to get a lump-sum loan and use it for different purposes. Also, the interest rate and repayment price stay the same throughout; you could look at five to 30 years. You get all the cash at once and then pay a bit back each month.
Then there's a mortgage. It is the big, long-term loan you use when buying a home. You can't pay for it all at once, right? So, spread it out, maybe 15 to 30 years. You've got two interest rates to choose from: fixed or adjustable. A mortgage lasts a long time, longer than most other loans. You're probably going to be making payments for decades. Each month, you pay the principal and the interest. It’s up to you what to choose: fixed or adjustable rate.
Get the Needed Information
In addition to the above, individuals can obtain several useful information of a legislative and administrative nature related to acquiring the property.
Our Center is dedicated to home lending, offers the client the opportunity to obtain the most professional advice made by people with experience in the field, and ensures a shorter time to complete purchasing your own home.
Also, within the Mortgage Center, you get opportunities to refinance a mortgage contracted with other banks at more advantageous interest rates.
It is not the right choice for a particular type of loan, but the right choice for your needs and resources at that time. And if you are still determined to choose, consult the offers of the lenders to decide which offers you more advantages.