Home Mortgage Loan

 

Mortgage or real estate credit is a form of financing or loan where money is intended to be used for the purchase of a property. This type of credit works basically like a regular loan because credit approval is required and interest is charged for the loan.

However, there is something very important about this type of financing that is the type of system adopted for the realization of credit. There are currently two real estate credit options: the Housing Finance System and the Real Estate Finance System. Here’s how each of these home loan options works.

Housing Finance System

Housing Finance System

This system used by real estate credit, provides the use – Service Time Guarantee Fund – to purchase the property. In addition, its great attraction lies in lower interest rates than other types of financing. Although this type of system has a limit to the value of the property, it is still the second most used to make financing of this type.

Among the rules of this system are:

Limit of the property value of: USD 750 thousand in the states and the Federal District, and USD 650 thousand for the other states;

  • Limit to financing of 90% of value of property;
  • Installations may not exceed 30% of the buyer’s income;
  • Financing has a maximum term of up to 35 years or 420 months;
  • The financing can only be purchased by individual;
  • The interest rate for the financing is variable and is continuously adjusted by the Referential Rate.

Real Estate Financing System

Real Estate Financing System

SFI is also used by banks for real estate financing and is intended to meet more features than SFH. In it is possible to finance real estate in any price range, in addition to the purchase is allowed for both individuals and legal entities.

Among the rules of this system are:

  • No limit on the value of the property;
  • The financing may be from 80% to 90% of the property value;
  • There is no value limit per installment, even if it compromises the buyer’s income;
  • The interest rate for this system is more expensive than SFH.

How to contract mortgage

How to contract mortgage

Generally speaking, to hire a line of credit you need to pass a credit assessment. Some lines of credit can be simulated and evaluated over the internet, however, most credit options are only available from bank branches, so the best thing to do is to go to some bank branches and simulate funding.

However, you will be able to search the internet for options of financial institutions offering mortgage loans as well as the rules for joining financing. All institutions set a minimum income for hiring credit, so it is important to research so as not to waste time on a simulation that you know will not work because of your income.

After the credit assessment, the institution will evaluate the property and determine its commercial value for financing. Some rules may vary between banks, but in general, the bank will determine the percentage of funding and the installment amounts for the payment.

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