subject: 3 Important Home Loan Questions To Ask [print this page] 3 Important Home Loan Questions To Ask 3 Important Home Loan Questions To Ask
We have been searching for our dream property for more than a year now. We are currently residing in a rental house and even though we're entirely content there, we do realise that it makes far more sense to be paying off our own little investment monthly, instead of putting cash in another person's wallet. We are on the other hand not in any rush to make the massive move; for that reason we've had the opportunity of taking our time to hunt for the best home at the best price and also to monitor the interest rate to identify the best time to purchase.
We're now pretty much ready to make the big purchase, but have a couple of questions pertaining to an ABSA home loan that we would like to ask their skilled staff. merely to make certain that we're indeed ready for this important move.
Should we choose a fixed interest rate or not? If we select to obtain our ABSA home loan at a fixed interest rate, this means that we will always know precisely what our month-to-month home loan installment will be. If there's a cut in the interest rate we would lose out a bit, but if there is a sudden hike in the interest rate we will be safe as our monthly repayment will remain unchanged. A fixed interest rate is typically a percentage or 2 higher than the actual interest rate at the time of your property purchase. For that reason fixing your property bank loan if the current interest rate is reasonably high is maybe not such a great idea.
Will we be offered a repayment holiday and how will this work? Many banks and other bond institutions will allow for a couple of months where you won't be forced to pay your month to month home bank loan payment. They allow for this without asking any questions and this is specifically advantageous in a period where you merely need some breathing space or in case you have unforeseen expenses and just cannot pay all your bills and accounts. Always keep in mind that after the repayment holiday you have to settle the payments that you missed, so ensure that you know just how this will expected from you. Will your month-to-month payment increase a lttle bit in order to cover these skipped repayments, or will you simply be able to prolong your payment period?
Exactly what will happen if I want to settle my ABSA home loan before the allocated time frame is finished? Whenever we borrow money, we repay it with interest. This interest is in effect for the privilege of being in a position to borrow the money and is calculated on the amount of money that you still owe plus the time that you'll still be paying back this funds. Thus in the event that you want to pay back the funds sooner, the mortgage lender might lose a lot of possible interest in the process and will typically charge a penalty fee to look after their interests in such a case.
The moment we have assurance on all the above queries, we'll be signing our first offer to purchase. how exhilarating!
