How will you finance your home purchase?
There are many different options for financing a home purchase. Consider the type of loan that best suits your needs. It is also a good idea to be ahead of a loan so that you are ready to act once you find your dream home.
Before talking to the bank or loan companies, consider the following:
Most types of loans can be converted. When you convert your loans, you take up some new loans at a better interest rate and meet the old ones.
Can you consider whether it is important for you to have the opportunity to change your monthly repayment and balance once you become a homeowner? Are you willing to run an increased risk of repayment to be able to make favorable changes to the loan? Or do you emphasize the importance of knowing what your rent is far into the future?
Savings for home purchases
If you want a traditional loan with interest and repayment, loans are reduced – and therefore save you – in line with the monthly benefits? Or do you want a mortgage-free loan, where you pay interest only for a period, but later repayment on the loan?
Your future monthly expenses are also determined by the tax consequences of the funds you choose. The interest rate on the loan gives a deduction on the tax return and thus reduces taxes. Is there something in your situation that makes you want to choose a particular type of loan for tax reasons?
New housing expenses on the home purchase
You must make sure that you earmark funds or money for maintenance, for property insurance and for general housing expenses such as electricity and water, heating and maintenance.
Do you want to build a new bathroom or kitchen – or to extend the mortgage? Have you considered that it should be financed – and that you need to have room for it in the new housing economy?