Whats a mortgage?

A mortgage is a type of loan that the Bank provides for the purchase, repair or construction of real estate. Mortgage loans must be secured by a lien on the property. One of the most important criteria by which a person decides is the interest rate of the loan. Another important parameter is so called fixation that determines how long you cannot change the bank interest rate. The Bank will contact you in about 4-5 weeks before the end of fixation and offer you a new interest rate. Due date of the mortgage ranges from 5 to 40 years. Repayment usually runs 1x per month, but it is possible to repay a total sum at once.Usually, banks provide loans at 60-80% of the property value, but you can also obtain also 100% mortgage.

Mortgages in the world
A special type of mortgage is so-called home equity loan, which allows the provision of credit for other things (cars, electronics, etc.), But must be secured by property. In Spain, it quite often encounter the term “variable mortgage” - the type of mortgage that does not fix a rate change every month. Generally some of the lowest mortgage interest rates in Western Europe and namely in Switzerland. Specific market is also Italy where the banks grant mortgages only about 50% of the property price. 

When to refinance home mortgage?
In case that you are not satisfied with the interest rate of the loan at your, you can apply for so called refinancing. Refinancing means transfering your current mortgage to another bank and will change whole financing conditions of your mortgage. Right refinancing can save you thousand dollars.

Annual homeowners insurance cost
When using mortgages the property must be insured. Insurance usually concerns the property itself and things related to it as land, garage, etc. Insurance covers mainly damage caused by natural disaster or theft. Common avarage annual costs are approximately 500 - 1000 USD.

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