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Finding Tips For Best Mortgage Lender in Winston Salem

A mortgage loan or mortgage is a bank financing product with which an entity lends money to a natural or legal person, generally to buy a home, agreeing on a term and certain repayment conditions. … Read More

A mortgage loan or mortgage is a bank financing product with which an entity lends money to a natural or legal person, generally to buy a home, agreeing on a term and certain repayment conditions.

The main characteristic of a mortgage, unlike other loans, is that it has two payment guarantees: the mortgage (the asset acquired with the money) and the personal (the rest of the present and future assets of the owner). This implies that if we do not meet our payment obligations, the bank can keep the home. And if its value does not pay off the debt, you can seize our other assets. However, If you want a mortgage, you can try MortgagesbyJill.com for the best mortgage lender in Winston Salem.

Before, we have said that a mortgage loan or mortgage is used, mainly, to finance the purchase of a home. However, this is not the only purpose of this product, as it can also meet other needs. Let’s see what we can use these credits for:

  • To buy a home or other type of property. The main purpose of mortgage loans is to finance real estate acquisition: a first or second home, premises, a garage …
  • To build a house. We can also hire one of these products to build our future home. In these cases, banks offer a specific loan called a self-promotion mortgage.
  • To reform a property. If we need money to do a reform, we can mortgage the house to get it.

The mortgage conditions may vary depending on its purpose and on other aspects such as the client’s profile or the risk associated with the operation.

In general, when we talk about financing to acquire a home, the terms “mortgage loans” and “mortgage loans” are used interchangeably. However, despite being used synonymously, there are important differences between these two concepts :

  • Mortgage loans: in these cases, a loan amount is agreed with the bank, a term to return the money, the interest rate, and the repayment method
  • Mortgage loans: unlike mortgage loans, these allow us to have the money already paid. That is, they are open lines of credit or mortgages with which, if we need financing for other projects, we can withdraw amounts without having to request a new loan. In this way, we can have a lower interest than with consumer credit.

In addition to mortgage loans, the banks’ product catalog also includes so-called personal loans. Now, although both are credits, there are important differences between their characteristics and their purpose. We explain it in more detail below:

  • The guarantee of personal loans is exclusively unique (present and future assets). On the other hand, the mortgage credit guarantee is both personal and mortgage (financed housing).
  • The purpose is also usually different. A mortgage loan is generally requested to acquire a habitual residence or a second home. In contrast, a personal loan is asked to obtain consumer goods or services (to buy a car, renovations, etc.).
  • The repayment term of a mortgage is longer than that of a personal loan.
  • The interest rate of a mortgage loan is lower than that of a personal loan.
  • Additional expenses are not so present in personal loans (notary, appraisal, taxes …).

Also, given the difference between the amount of both products, the personal loan can be obtained in a maximum of days, while granting a mortgage can take up to two months.

Author: admin