But are we always afraid of what can really happen? Perhaps we are simply driven by our negative imagination, which then becomes an unjustified fear factor.
Nothing for a bank’s customers causes such a fear as a mortgage. But why? The answer lies in two reasons, to be more precise, in the creditor’s terms: 1) the mortgage provides collateral for the real estate; 2) Mortgage loan with repayment term up to 30 years.
The second argument can be immediately explained
By the cosmic overpayment, because for 20-30 years you will essentially be paying more than just the value of the apartment.
But alongside a mortgage phobia, the opposite question arises: “How do you buy your home with the ability to pay for it over several decades?” The answer is simple: a mortgage often becomes the only option to buy your real estate.
But any fear can be overcome, to be precise, we can learn to manage it! Looking at this fear of financial risks can easily reduce it . Any economic risk can be managed, you just need to know “how” to do it. In this case, a mortgage is the ideal way to find out your options and, if necessary, to isolate yourself as much as possible from potential risks.
Potential mortgage borrowers do not stop at just the 2 fears mentioned above, the total number of such negative associations. And we will not only try to evade them, but also find the “antidote” to them.
Mortgage – It’s Too Expensive
Unfortunately, you won’t do anything for the high real estate prices. That’s why it’s a private business to get a mortgage or rent a home. But if you have enough money to make a down payment on a mortgage (about 30% of the property price itself), the rest of your monthly repayment will be like renting an apartment.
Payments will be the same throughout the repayment period and the interest rate will be fixed. On the other hand, the rent for an apartment will become more expensive each year . Then it turns out that it is more profitable to give money for your next apartment than to throw it in the wind.
Long repayment period
Of course, mortgage loans make borrowers cautious with their long repayment period. Many believe that by the time the credit is repaid, they themselves will have become middle-aged people. But mortgages can be drawn not for 25-30 years, but for 10-15, moreover, 15 years is the most optimal repayment period for such a loan.
Extending the repayment period to 20 years and more will only slightly reduce the payment, but the overpayment will obviously increase, so choose short repayment terms. In addition, you always have the option of paying off your mortgage early and saving on overpayment. You can’t repay your entire loan early, not in one installment (which will be difficult for you), but simply make more money each month as per the repayment schedule.
And don’t worry: for the first year, or even the first 2 years, you’ll have a hard time getting used to such expenses, but over time, given inflation, you’ll get used to paying off that amount of money every month for a mortgage. Each year, the payment will take up less and less of the family budget.