One of your main concerns when buying a house is sure to be choosing a mortgage. It takes a lot of time and energy to look for and compare all the different products on offer. There’s no two ways about it, your mortgage will be with you for a long time and could change your life for better or worse. But taking out a mortgage is also a sign of something positive: buying a house is an important step forward in your life.
To avoid any regrets once the mortgage is signed and can no longer be changed, we’ve got some tips to help you choose the right loan for you. There’s no shortage of products on the market, but it's important to choose the best one for you and your needs rather than the one most recommended by other people.
1. Be realistic about your circumstances
Complications can arise if you’re not realistic about your circumstances and you behave like you’re better off than you really are. The best thing to do to avoid future problems is to keep your feet on the ground.
2. Analyse, search, compare...
Looking for a good mortgage is a task that requires time, energy and resources. Don’t stick with the first thing that shows up and make yourself a spreadsheet to record the different options.
3. Make sure you understand the product
Often, you can have a lengthy conversation with a bank clerk and go home none the wiser (that’s part of their training!). Ask as many questions as you need and don’t be afraid to ask them to speak in terms that you can understand. The most important thing is to make sure that you understand everything and that there’s no small print waiting to catch you out.
4. Identify your borrowing capacity
This is closely linked to the first tip, but it’s essential that you're aware of your borrowing capacity based on your financial circumstances. If you're not honest with yourself, you’ll get into more debt than you can handle and you might find yourself in trouble later on. There’s no need to let it get that far.
5. Take other expenses and fees into account
During the process of registering for a mortgage, other expenses can pop up that you hadn't banked on. Sometimes, these can turn your plans upside down. Take into account all other possible expenses like notary fees, administrative costs, etc.
6. Work in euros
Do you remember when it was fashionable to get a mortgage in another currency? Well, that’s in the past now and it caused a lot of problems. If you operate in euros, your mortgage should also be in euros.
7. Listen to opinions and experiences from people you know
Take other people’s opinions with a pinch of salt. It’s a great idea to ask the people around you about their mortgages and see what’s worked for them, but you should be aware of the differences between your circumstances and theirs.
If you’re planning to apply for a mortgage, you now know a little bit more about what you should consider during the first phase in your search. There’ll be other, more bureaucratic things to think about later, but for now, make a checklist and set to work looking for the right mortgage for you!