What is a Mortgage?
What is a mortgage? When a finance professional lends you money to purchase real estate, in most cases they will take a mortgage over the real estate to secure their loan. This means that if the borrower (Mortgagor) defaults on loan repayments during the term of the loan, the mortgage provider (Mortgagee), as a last resort, has a right to sell the property to recover the debt. They legally record their interest against the property by registering a mortgage on the title stating their legal rights.
How to source the best property loan The best time to source your loan is before you actually need it. If you go shopping for money once you are already committed on a property, you’ll face some definite time deadlines and this could influence access to the best possible loan deal. If you have paid a deposit on the property and you can't get your finance, you will be forced to lose your deposit and the house. Sourcing and organizing a loan before you buy is called pre-purchase approval. Speak with your finance professional about the length of time your pre-approval status remains valid.
In the current loan market, the customer is swamped with choices from many financial institutions and speaking to each lender can be time consuming. The banks have also tightened up the reigns with lendings and it is taking longer then 12 months ago to get approval. It might be prudent to consult an independent advisor who can guide you in the direction of the best possible loan to fit your circumstances.
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