 Mortgage Loan
 Mortgage loan and credit
A mortgage loan
A mortgage loan is an amount made available to one or more persons who undertake to repay within a delay and with a repayment manner specified in the contract. In return, a mortgage is taken on one or more buildings to ensure proper payment of the amount originally loaned.
The mortgage credit
It is not directly and fully paid to the benefit of the borrower. The latter, receiving a credit line, can take slices of money to fund his work (construction, renovation, transformation) as and when they progress. Interests are then paid on amounts withdrawn and not on the entire capital made available.
Repayment methods
Monthly installments
Same amount every month (an increasing fraction of the capital borrowed and a declining share of interest) until the end of the credit.
Ex.: 65.000€ borrowed over 20 years at 6.00% = 459.76€ in monthly installments
Constant amortization of capital
Equal share of capital (capital / duration in months) and a share of dwindling interest over the months.
Ex.: 65.000€ borrowed over 20 years at 6.00% = 587.25€ in monthly installments (1st year) and 462.00€ in monthly installments (after 8 years)
Fixed Term
Constant monthly rate consisting only of interests. At the end of the duration you repay the capital at once. To combine with a group insurance or life insurance. Advised to purchase a second home.
Mortgage Tax
The tax advantages that a mortgage loan or credit give you are tripled:
- the standard deduction of interest
 click for more information
- the additional deduction of interest click for more information
- reduction of taxes on all or part of capital repayments click for more information
|
Mortgage Loan
