Majorca Property News

Mortgages with no equity

The building, home financing or home equity without (full) are becoming an increasingly popular funding model. The advantage of a mortgage without equity is obvious. The client or purchaser retains its liquidity and can, despite their dream of home ownership a reality. What is known is the financing without equity as 100%, 105% or 110% financing - depending on whether only the purchase price or the transaction costs will be financed.

What disadvantages are there?

The funding without equity is much more expensive. This naturally has a direct effect on the amount of monthly loan installments to be provided. This effect is also due to higher borrowing requirements.

Basically, nothing on the full suspension. Nevertheless, we strongly advise from a real estate finance, where no reserves are available. Property must be maintained and kept up, unexpected unemployment or disability can be a family in distress quickly bring. Is it still on top of the car or the washing machine is broken, there are serious problems quickly into the house.

Compare worthwhile

Whether with or without equity, it should always be sharp with the pencil is to be expected. This means, among other things, a comparison to be made and bill on alternative forms of repayment or equity investment forms replace it. The important thing is just what the bottom line comes out is best for you and calculates your life is planning. And if everything fits, then you can make your dream of home ownership a reality, even without equity.

Here we give you now answer the key questions on finance without equity:

What and how much can be financed with no equity?

Self condominiums (ETW)

Detached houses (EFH) with and without flat

Investment objects

Free capital construction financing for purchase and construction financing, or debt rescheduling possible.

The funding level is dependent on the value of the mortgaged property. Financially, in addition to the purchase price of the property and the incurring transaction costs.

Mortgages without equity: what repayment options are available?

Possible options are as follows:

Unless the rate is not changed (note rate period), the monthly payment remains the same. However, to move within the term of the shares and interest repayment. The repayment percentage is steadily rising, at the same time falling interest portion.

Fixed loans with repayment compensation
In this form of loan, you pay only the monthly interest to the bank in the form of a constant rate if the rate is not altered (fixed-rate period observed). The eradication percentage you pay, for example, in a life insurance policy, which at the end of the loan term by the payment of which is the eradication makes.

You get complete flexibility and can already low monthly rates of your desired home realize.