Taking advantage of this time of year where scares appear in the least thought of places, I share with you three terror mistakes that people make when selecting a mortgage, largely because they are not adequately advised by an objective mortgage asset adviser, and above all independent, with your heritage formation as a priority. Let’s see:

ERROR 1

Select a mortgage of propertynews with your bank “of a lifetime” because “they know you better and take care of you.”

CONSEQUENCES

  1. By not comparing in detail the various mortgage credit options on the market, it is highly feasible that you contract the one that the bank wants to offer you because financially it is better for the institution and not for you. This can cost you a lot of money, from hundreds of thousands to several million pesos, depending on the amount of the contracted credit.
  2. This loan, which they tell you is the cheapest, is regularly offered at 20 years because the monthly payment is lower than the 15-year loans, but what they do not tell you is that with each monthly payment you pay off or pay much less capital, which means that , unlike a 15-year loan , in the 20-year loan you are less the owner of your house each month.

SOLUTIONS 

  1. Before hiring your mortgage loan, consult with an independent specialist who explains in detail various options that may be appropriate to your profile as a client and justifies why you should hire “x” or “y” as a product of a specific bank or SOFOM and not the one they offered you as a “lifelong” customer.

If you already contracted the wrong mortgage loan, you can substitute it with another one in better conditions with another bank or Blue World City Islamabad that can give you the correct credit, even if you are not a “lifelong” customer.

 ERROR 2

Contract a mortgage loan in Times Minimum Wages (VSM), Investment Units (UDIS) or Units of Measure and Update (UMAS).

CONSEQUENCES

  1. Your debt and monthly payments are not in pesos, which means that they are not fixed and that is why every time the VSM increases (annually), UDIS (daily) or UMAS (daily), your debt and your monthly payment will grow, so it is very likely that you will have unpleasant surprises every time you check your account statement, because you will see that you owe more, that you pay more every year and that all your payments made during the year have almost not been reduced or even not They have reduced nothing your debt.
  2. You will not build your wealth because every year you will owe more despite all the payments you made in the year.

SOLUTION 

Immediately replace that terrible mortgage loan denominated in VSM, UDIS or UMAS by one in pesos with a bank, always advised by an impartial and objective expert who will take you by the hand throughout the process for one in pesos, fixed rate and for 15 years or less.

ERROR 3 

Buy your house or apartment with a mortgage loan that is beyond your family’s financial possibilities since you have not previously saved at least 25% of the value of the property you want to buy.

Remember that buying a property is a process of heritage formation that takes time and is gradually being achieved responsibly

CONSEQUENCES 

  1. By not saving previously, you are making an irresponsible financial decision, since you are not in the habit of allocating an important part of your monthly income – of at least 30% – to pay your mortgage credit and this will surely create an imbalance.
  2. Of the previous savings, at least 5% will be used to pay the deed expenses that, in some states and depending on the amount of the property’s value, can represent up to 10%. If you do not have the full savings, you may be able to buy the house or the apartment but not pay the deed expenses that are essential to have legal certainty .
  3. The more percentage of the price of your property you contract in mortgage credit, the financial conditions will be less attractive and the costs over time will be higher. The ideal is to hire 70% or less of the price of the house or apartment. If you definitely can’t save that much, try to make it at least 20% plus your writing expenses.

SOLUTIONS 

  1. Save before buying and take advantage of the schemes that allow you to use the Balance of your Housing Sub-Account to pay part of the price of your house or apartment, that is in the event that you are listed on the IMSS or FOVISSSTE to receive your income via payroll .
  2. Get advice to invest your savings in institutional instruments, not in the mattress or in batches with acquaintances or relatives. It is your assets that will be part of a more important asset and you should not put it at risk.
  3. Hire the mortgage loan appropriate to your financial, family and personal profile through the advice of a mortgage loan expert.

As you can see, all the terror mistakes you can have when contracting a mortgage – including these 3-, you can avoid by spending time on this important process of your life in which you are building your most important assets. Get advice and ensure that your most important assets grow together with you.

The opinions expressed in this column are exclusive to their author.