Real estate credit: how to negotiate well with your online bank?

Successfully negotiating a mortgage is a perfect mastery of certain financing parameters. What are the essential points to consider for optimizing the cost of a mortgage?

Credit rate

Compare the offers of credit in order to appreciate the advantage you have in accepting the offer of credit if the rate is fixed. If the rate is variable, it is essential to know its index and the margin of online banking. From this moment, the sum of these two parameters determines the real rate. It should be remembered that the more profitable the loan, the lower the bank’s margin. However, check in the loan offer, the effectiveness or not of a security relating to a maximum rate.

Credit insurance

Credit insurance

You have more to gain by effectively negotiating loan insurance than focusing on the interest rate. Insurance is generally required by banking institutions and represents almost 20% of the total cost of credit. It is important to understand that a specialized insurance institution is likely to lower the rate to 0.14% for example for the benefit of a young borrower. On the other hand, insurance companies which are under the supervision of banking establishments are less flexible. They do not integrate certain considerations such as age, lifestyle etc.

They have a rate of around 0.40%. Then ask your online bank for the possibility of taking out external “delegation of insurance” insurance. Rest assured, you have the right to do so and moreover, if the bank had another proposal, it is obliged to justify its choice to you.

Early repayment and penalties

Early repayment and penalties

You should remember and make the request for the cancellation of penalties on the anticipation of reimbursement to your online bank. This must be done at the time of credit negotiation. Indeed, it may happen that you have other ambitions during the reimbursement period. So you can decide to sell the property and focus on something else. If the nullity of penalty clause is not clearly defined when requesting the offer, you will be obliged to pay it. It is also equivalent to 3% of the amount owed with six months of interest cap.

File study and brokerage fees

The current competition leads the majority of financial establishments to the abolition of brokerage fees or case study. In addition, these costs are less significant compared to other products and services. Suppose that an online bank offers you a rate of 4% for a credit of 100,000 USD to be repaid over a period of 20 years.

If the cost of studying the file comes back to 1,000 USD for example, the initial rate will tacitly drop to 4.08%. A bank which would offer for the same loan a rate of 4.04% with the free of charge of said administrative and brokerage fees would be more beneficial.

Credit Break

Credit Break

Negotiating a credit break allows you to relieve yourself in times of financial constraint. Indeed, this break favors the postponement of certain deadlines. A good negotiation can give you the right to make 4 breaks of around 3 months. This is equivalent to a period of 1 year for the termination of payment of installments. As a result, such negotiation is more economical for you than “loss of employment” insurance, which will be very expensive for you.

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