My Mortgage Experience

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A decade ago, I was employed by one of the housing finance companies. I just recall how people would come to me without even knowing about mortgage. The access to information was restricted and the choices are limited.

What is Mortgage?
It is the method of using property as security to borrow money from a money-lending organization such as a bank or housing finance company or building society. By mortgaging, you are giving that organization the right to take possession of property if the loan is not repaid.

About five years ago, when I bought my first home, it was much easier. Now, the mortgage industry has revamped completely and people have too many choices. There have probably never been more household mortgage options available than there are in the present time. You need to make the right decision in choosing your mortgage plan and the lending organization. Here is where a Mortgage Broker can help you.

Who is a Mortgage Broker?
Mortgage broker is a person or an organization specializing in finding mortgages for those wishing to buy a property. A mortgage broker can search the market and find out which mortgage is the most appropriate, given your preferences.

Before you accept a mortgage plan, do your homework. Some of the items that you need to check:

• Tenure of loan


• Interest of loan


• Fixed rate or Variable rate?


• Is your principal adjusted monthly, quarterly or annually?


• Do you need to produce any additional security?


• Administrative, Technical or Legal fees to be paid


• Will the organization impose penalty for early repayment?

Finally, ensure that the loan repayment terms fall within your budget. Do not bite off more than you can chew. The normal industry practice is to restrict your monthly instalment to about one-third of your take-home pay, if you do not have any other commitments. Choose the right plan and you will have a peaceful future in your sweet home.

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