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August 4, 2022
In the choice of first home loan, there are various aspects to be evaluated with extreme attention in finding the best solution: some are personal, others depend on the financial institution and others on external factors, imposed by the State (tax deductions) or by the ECB. Let’s see together what they are several factors to take seriously into consideration when intending to buy a house and open a mortgage.
What are APR and TAN?
The APRi.e. the Global Effective Annual Ratealso known as ISC, is a useful indicator for choosing the best first home loan. The underlying reason lies in the fact that it serves a report the total and real cost of the loansince all the costs that the borrower has to bear are included: preliminary investigation, appraisal costs, substitute tax and stamp duty, insurance policy and costs relating to ordinary and extraordinary communications.
Ultimately, the APR allows you to immediately know the total amount of the cost of the loan. It is necessary to make sure that the rate proposed by the financial institution is fully operational. What does it mean? In a nutshell, its validity must cover the entire duration of the loan and not just the first installments.
The TAN (Nominal Annual Rate), is included in the APR. It’s about the portion of interest that the borrower will have to pay to the financial institution which provides the necessary liquidity for thefirst home purchase. This parameter is the result of the sum of the contracted spread and the mortgage index.
Fixed, variable or mixed interest rate: which one to choose?
Even during thefirst home purchasebefore taking out the loan, it is good that the borrower has very clear ideas on the matter fixed rate mortgage, variable rate mortgage or mixed. With the support of the credit institution, it is possible to choose the safer and at the same time advantageous financial producttaking into account the rate established at the time of the contract.
Based on what was signed in the loan agreementThe fixed rate remains the same until extinction and is characterized by a monthly installment of a higher amount than that variable which, over time, may face increases or decreases, taking into account the changes relating to the value of the Euribor index. The initial expenses with the adjustable rate mortgage are lower.
Also, regarding the mixed rate mortgage it allows to change the interest rate with the transition from the fixed to the variable variant.
Installment amount and loan term
L’installment amount and the duration of the loan they are two variables that depend on income at the end of the month and on the borrower’s equity and financial situation. Against an excellent salary, some liquidity in the current account and owned properties, the applicant can opt for a short-term mortgage.
The monthly payment will certainly be higher, but the savings on interest are guaranteed. In any case, in order to avoid unnecessary risks of non-coverage of the payment, as far as the first home loanthe best solution is to opt for monthly installments that do not exceed the threshold of 35% or at most 40% in relation to the monthly income.
Pay less interest on a first home loan
Reduce the monthly payment for the first home loanSometimes, it can prove to be a convenient decision for both the borrower and the lender. After contacting the entity that disbursed the extra liquidity for the purchase of the property, an appointment can be made at the branch, requesting renegotiate the conditions in order to lower the interest rate.
This brings benefits to the person concerned who with a lower monthly payment can meet commitments and deadlines, as well as improve his standard of living. The financial institution also takes advantage of this, extending the duration of the repayment plan. The lower installment and the cheaper interest rate entail a higher cost for what concerns the loan.
First home loan tax benefits
In relation to first home loan, the legislation currently in force provides for a series of really interesting tax deductions. Any borrower should thoroughly inquire about this because le deductions allow you to significantly reduce the costs for the mortgage. However, it is important to ascertain the necessary requirements: if in possession of the applicant, the right to tax breaks means that you spend less.
ask for a free estimate to PrestitiFaidate.it regarding the best solution on the subject of first home loan, it certainly proves to be a wise decision. The many years of experience acquired over the years by the consultants will be fundamental in guiding you by hand in the choice of mortgage more in line with your actual needs.