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Different types of mortgages

The conviction of banks with high profitability of mortgage loans means that they are constantly expanding the range of loan types. Loans of a specific nature are being granted more and more often, e.g. for the construction of a garage or the purchase of a flat. Most of these loans are subject to the rules governing consumer loans. For banks, the big problem with loans is the weakness of collateral, which of course also affects the amount of the loan. Banks usually offer loans in USD, often – loans with a fixed interest rate.

 

Tenant loans

Many customers apply for various types of so-called tenant loans, including to finance the purchase of a tenant cooperative right to housing, financing the so-called participatory contribution in the society of social housing and for finishing the apartment. A characteristic feature of these loans is that they do not allow the acquisition of normal ownership of the premises . The maximum loan period is usually 10 years, the formalities are simplified, the loan application processing period is very short. The banks’ requirements for collateral are small, but also because of the impossibility of establishing a mortgage for these types of loans, the amount of loans granted is small.

Pursuant to the provisions, a mortgage can be established on your own cooperative apartment, which is why the client can get a loan to transform the tenant’s right to property into a right to separate ownership, and then to establish a mortgage on the flat. The cost of transforming a condominium into a private one is currently low, the problem is the practices of the management boards of many cooperatives hindering such transformations.

 

Loans for the purchase of a recreational plot

Loans for the purchase of a recreational plot

Recently, the number of loans for the purchase of a recreational plot, construction of a house and other recreational investments has been growing. In practice, they have all the characteristics of loans for building a house . Usually the amount of such a loan is several times smaller than for a residential house, and the repayment time is shorter. Not every bank is willing to grant this type of loan; the reason for abstinence is a security problem. The sale of a recreational plot , which is the basic collateral for such a loan, is difficult, which increases the banking risk. There are no problems with getting a loan if the collateral is our mortgage -owned apartment or our home . It is similar with a loan for the construction of a garage or other building (the formalities are simplified here, however, you do not have to submit numerous documents needed for a home loan).

 

Loan for a construction plot

Loan for a construction plot

In the period of deteriorating economic situation, some people thinking about building their own house divide the investment into installments, first buys a construction plot, and only after some time begins to build a house . Banks are quite willing to grant loans for the purchase of a construction plot, provided that the borrower meets certain conditions. Namely, they would like: the plot to have a land and mortgage register,

• she was not charged with a mortgage,

• according to the local spatial development plan, a house could be built on such a plot.

If there is no local development plan , the plot should meet general standards (e.g. it cannot be too narrow, because the house cannot stand closer than 4 meters from the neighboring plot). A plot of land can be bought with significant credit collateral. The cost of loan for the purchase of a construction plot is similar to the cost of a loan for a house, in many banks you can get a loan in both USD and EUR. The loan period was relatively short until recently , but now some banks give loans for this purpose for the same period as the house loan – so we can pay it back, e.g. for 30 years (if different conditions allow). As a result, apart from areas where construction plots are very expensive, credit installments are relatively low, which allows you to take a second loan at a later date – for building a house.

 

Credit

Credit

In order to obtain a loan , you usually need to submit a purchase intent statement to the bank (indicating the address, price and plot size) and a preliminary contract.

The information presented above proves that we can obtain a loan for any purpose related to housing. The banks offer is very rich. The costs and requirements set by banks vary, which prompts customers to familiarize themselves with the offer of various banks.