3 Vital Home Loan Questions You Should Ask
We have been searching for our dream property for more than a year now. We are at the moment residing in a rental house and even though we are entirely content there, we do understand that it makes a lot more sense to be paying off our own personal little investment every month, instead of putting money in someone else’s wallet. We’re however not in any kind of rush to make the important move; therefore we’ve had the opportunity of taking our time to look for the perfect home at the best price and also to monitor the interest rate in order to identify the ideal time to purchase.
We’re now pretty much ready to make the big purchase, but have a handful of questions pertaining to an ABSA home loan that we wish to ask their experienced staff. just to be sure that we are without a doubt ready for this important move.
Should we select a set interest rate or not? If we choose to acquire our ABSA home loan at a preset interest rate, it means that we will at all times know precisely just what our monthly mortgage installment will be. If there’s a cut in the interest rate we might lose out a little, but if there is a rapid hike in the interest rate we will be safe since our monthly repayment will remain unaffected. A fixed interest rate is typically a percentage or two higher than the actual interest rate at the time of your property purchase. Thus fixing your property bank loan if the current interest rate is fairly high is probably not such a good idea.
Will we be offered a repayment holiday and how will this work? Several banks and other bond institutions allows a couple of months where you won’t have to pay your month-to-month house loan payment. They allow for this without asking any questions and this is particularly valuable in a period of time where you simply need some breathing space or in case you have unanticipated expenses and merely cannot pay all your bills and accounts. Always keep in mind that after the payment holiday you have to settle the installments that you missed, so ensure that you understand exactly how this will expected from you. Will your monthly installment increase somewhat to cover these missed payments, or will you simply be able to extend your loan repayment period?
Exactly what will happen if I would like to settle my ABSA home loan prior to when the allocated time period is finished? Whenever we take a loan, we repay it with interest. This interest is in effect for the privilege of being in a position to borrow the funds and is worked out on the amount of money that you still owe together with the time that you’ll still be paying back this money. For that reason if 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 when this happens.
As soon as we have certainty on all the above queries, we will be signing our very first offer to purchase. how exhilarating!
For more information about the Absa home loan visit the website http://www.isureins.co.za
Processing your request, Please wait....
