A roof over your head is better than lying in the streets and under the bridge. People consider buying a house a great deal; why not? A house is a significant financial decision as it is a long-term investment. Not everyone has the funds in hard cash to purchase a home, but specific measures can be taken to make that dream come true. As the saying goes, “Closed mouths don’t get fed”.If you are still hesitant about buying a house, this is for you. Let us take a look into what goes into purchasing a home.
What Is A Home Loan
In simple terms, a home loan is a mortgage for explicitly purchasing a home.
4 Types Of Home Loans Explained
1. Fixed Rate Home Loans- These home loans provide a specific interest rate for approximately 1 to 5 years, and the interest rate will remain consistent for that particular time, with no fluctuations.
2. Principal and Interest Loans- This is the most preferred type of home loan because it covers the loan and the Interest simultaneously. Principal and Interest Loans help get the loan settled even faster.
3. Redraw Facility Loan allows you to claim or access the money paid as a mortgage for any personal needs or emergency.
4. Construction Home Loan-this loan provides finances for constructing houses or renovating them, and it releases funds upon finishing a particular stage of building or renovation
Home Loan Calculator And Home Loan Interest
For a home loan, one needs to know how to calculate the Interest they are supposed to pay. You can calculate it by applying the standard formula I=PxRxT/100, where Interest equals Principal multiplied by the Rate and divided by 100. There are also some applications to use to help you calculate the home loan interest rates.
What Is A Mortgage
A mortgage is usually used to construct, renovate or build a home. The property being financed will serve as collateral. Mortgage varies upon fixed and variable rates. It is made up of two things: Principal and Interest.
3 Types of Mortgages Explained
1. Fixed Rate Mortgage- This type of mortgage allows constant and stable interest rates.
2. Adjustable Rate Mortgage is based on market fluctuations and can change over time.
3. Equitable Mortgage- this type of mortgage allows the borrower to submit title deeds to the lender.
Mortgage Loan Repayment Calculator
Mortgage repayment is calculated by dividing the mortgage amount and total Interest to be paid by the number of months you would like to settle the mortgage.
K Financial Solution will be your helping hand in making tough decisions like this. Make a significant investment without any doubt, and we will step in to make your dreams come true. We have the proper expertise when it comes to financial solutions. Take your first step into your journey of being a homeowner, and do not hesitate to reach out to us.
