If you are given the alternative of buying a house or apartment for thirty years, should you accept it?
Many mortgage loans have a maximum term of 25 or 30 years
This means that it will take you more than two decades to cancel the loan you requested to buy a home.
Many people consider this the ideal option because it allows them to obtain the most comfortable monthly fee, allowing them to maintain a comfortable style. However, is that all that should be considered? Such a large term, favors finances?
When it comes to credit deadlines, you should consider a key point
The longer you take to cancel it, the more interest you will have to pay. Although it may seem that you “save” by paying a lower fee, more interest is being produced, paying insurance and commissions that you could save.
On the other hand, there is considerable emotional wear. Knowing that you will be in debt for more than twenty years makes it seem as if the payments were in vain and can even demotivate the customer.
While home prices can be high, experts say that if the total payment will take more than fifteen years, it is likely that you are buying a property that is out of your reach. So what should you do?
The main recommendation is to evaluate the maximum monthly fee you can pay without threatening your budget. Taking that fee into account, the financial institution will tell you what the term is.
Another thing you can do to reduce it is to review the initial fee you are giving.
The lower the amount to be financed, you can cancel it in less years
Finally, remember that, if you get a very good interest rate, you can consider a longer-term. All elements are part of your credit and must be in harmony. Before choosing it, it is ideal that you compare the different alternatives.