Minimum requirements to mortgage a house: what you need to know
Are you thinking of buying a home and is it the first time that you are going to do it? In this case, it is very likely that you need to access a bank loan or a mortgage.
However, you should know that there are a series of conditions and requirements to request a mortgage that you must meet for your bank to approve it. And it is that anyone cannot access these financing plans.
Do you need to know how to get a mortgage? From Sky Marketing we provide you with the general requirements to mortgage a house for most banks.
Requirements to obtain a mortgage
Your savings should equal 35% of the value of your future home
Having sufficient savings will be one of the basic conditions to be able to access a mortgage. And is that banks do not finance 100% of the value of the home, but provide 80% of the appraisal.
That is why it is important that we bear in mind that we must have the remaining 20%. However, to this amount we must also add the expenses that derive from the purchase of the house, as well as the expenses of establishing the mortgage. The amount of these can be approximately 15% of the total price of the house. Therefore, before trying to access a mortgage, we must have a minimum savings that cover that 35% of the total value, since you must assume it as a mortgage.
What is your degree of economic stability? And your minimum wage?
One of the most important factors in order to obtain a favorable result when accessing a mortgage is the economy.
The source of our income is a requirement to request a mortgage that will play a fundamental factor, since the first requirement that the bank will demand is that we have a permanent job and in which we have a minimum seniority. This is the best guarantee you have to make sure that, as a mortgaged person, you will be able to cover the expenses derived from the purchase of a property.
There is a minimum monthly amount of income that banks usually require as a requirement to request a mortgage. This is around 2,000 euros per month.
There is a possibility that the interested party’s payroll does not cover that amount. In these cases, what is usually done is to apply for a mortgage jointly with another joint owner. In this way, the income of both can be added to cover the minimum monthly amount required.
We must bear in mind that the type of debts that we have as holders can also be a determining factor. According to the Bank of Spain, it is not advisable to allocate more than 35% of our income on financial debts (including those derived from a mortgage agreement).
The bank guarantee: an alternative to the denial of your application
The bank may consider that our profile does not meet the requirements to request a minimum mortgage. In these cases, it is where the figure of the bank guarantee acquires special prominence.
The endorsement can be the extra guarantee that a bank needs to approve a mortgage loan. And it is that in case the holder cannot afford the monthly fee; the guarantor must do so.
We must bear in mind that the bank guarantee contains a series of risks. In this case, the guarantor becomes jointly and severally liable for the debt contracted and must assume a series of legal obligations. He must assume the amount owed in case the holder cannot do so, and he will do so with all his assets and assets, both present and future. In the event that the guarantor dies, this obligation will be acquired by his heirs.
It is an alternative that requires a serious and responsible assessment, since the guarantor runs a very high risk.
What to do if you don’t qualify for mortgage approval?
But what happens if we do not meet the requirements that are required to access a mortgage? The best thing to do is to be cautious and responsible.
If we are aware that we do not have the appropriate profile to access a loan of this size, we must abandon the idea of applying for a mortgage. Although the most normal thing is that a bank rejects the request, there is a possibility that they will approve it.
We only have to observe what happened in the real estate crisis of 2008. The consequences that can be derived from this type of commitment can be serious, so in these cases it is better to give up and wait to meet the conditions.
It is important that we know in depth what are the requirements that can be demanded from any entity. Although those that we have explained are general to any of them, it is likely that there are nuances depending on each other. The most recommended thing is that you go to your bank and request more information.
If you want to buy a home, do not live with the uncertainty of how to know if I will be granted a mortgage. Contact our team to receive personalized advice. At Deplace we offer feasibility studies and services for the management and negotiation of conditions.