Mortgage as a Mortgage: What's Behind it.
Mortgage was a popular form of home financing. What exactly is this, what species exist and what is the difference in the cost of land: we will explain in this article!
What is a mortgage?
A mortgage is a real estate franchise. For example, if a bank grants a mortgage to a customer, the customer in return leaves the basic rights to the property to the bank that deals with it. It serves as a guarantee in the event that the client is unable to repay the loan. Like a land fee for an annual loan, a mortgage is entered into the Land Registry.
Nowadays, it is common to use installment loans to finance real estate not with a mortgage, but with a land fee.
Often visited by him
What is special about a mortgage?
The mortgage is always tied to the claim. This means that the mortgage exists as a mortgage as long as there is also a claim. In technical terms, these bonds are called the extension. If you borrow money from the bank in the form of a mortgage loan, the bank will require a monthly installment until the loan is repaid in full.
The requirement to obtain a mortgage is decreasing over time. With each installment payment, the demand becomes less. If the remaining debt is paid with the last installment, then there is no longer any claim.
Where is mortgage still used today?
Nowadays, the mortgage is no longer used to secure home financing. Instead, security through land fees has cemented his presence in the finance arena. Thus, mortgage and land fees are two fees that are levied on the property used to secure the loan. They are not considered separate forms of credit. However, the term "mortgage" is used colloquially as a synonym for a home loan.
What does "take out a mortgage" mean?
When you take out a mortgage, it means that you are handing over your equity to the lender, usually the bank. In return, you will receive money from the bank. You can obtain a mortgage in the following cases:
Real Estate Finance: Usually intended to finance real estate. Capital increase: If you need money, for example for a renovation or a modernization, you can also get a mortgage.
When obtaining a mortgage, it is documented and entered in the Land Registry. Then the land registry issues a document, called a mortgage letter. Once your loan is paid off, the mortgage no longer exists and will be converted into landlord-occupied fees.
What types of mortgage are there?
A mortgage loan can be secured in two ways:
Mortgage book of mortgage
Mortgage is the most common form.
Pawn letter
A mortgage is used when the land registry issues a mortgage letter. All information provided by the registration is recorded in the Land Registry. A letter mortgage has the advantage that the letter should be delivered to the new lender only in the event of a debt rescheduling or other change of creditor. For this purpose, the ex-creditor must write an assignment declaration. A new entry in the land registry is not necessary. This saves time and money.
The book is mortgaged
Book mortgage means to record the mortgage in the Land Registry. This means that the lender, which is often the bank, is registered with the Land Registry and can confirm claims in the event of a default. However, if there is a change in the creditor, for example in the case of rescheduling or proceeding with financing, then the new entry in the Land Registry relates to the costs paid by the borrower. The costs depend on the debt remaining on the loan. About 0.2 percent of the remaining debt is due. For example, if the remaining debt is 150,000 euros, then costs of 300 euros arise.
Calculate a mortgage loan
The amount of the loan
190,000 €
Fixing the nominal interest rate in years
5 eighth 10 twelfth 15 twentieth 2530
Calculate personal interest and installments
When does a mortgage expire?
Generally, a mortgage expires as soon as there is no claim. This is the case in the following cases:
The mortgage loan is repaid in full: The mortgage passes to the owner and is converted into the owner's land fee The creditor (usually the bank) waives the mortgage: In this case, the mortgage passes to the owner and is transferred to the owner's land fee. This requires written acknowledgment of the cancellation by the obligee and the consent of the owner. Deletion is required in the Land Registry. Creditors are satisfied with the proceeds of foreclosure: In the event of defaults, the bank can place an auction to close the foreclosure. Proceeds are used to settle outstanding payments.
In the event of writing off the mortgage from the Land Registry, a notary public is required. He sends the required documents to the Land Registry. There is a notary and land registry fee for this.
What are the costs of registering a mortgage?
There are fees for registering a foreclosure in the Land Registry. The fee is not paid to the bank, but to the notary and land registry. The invoice will be sent to you after completing the property purchase contract. As a general rule, you can expect costs between 1.5 and 2 percent of the loan amount. With a loan amount of € 320,000, for example, there are costs of € 4,800 to register a mortgage. Use our land registration calculator to determine the exact cost of your loan.
Why is the interest on land higher than the interest on borrowing?
What are the costs of a land rental?
If there is foreclosure due to default, the bank will bear additional costs for implementation. In order to cover these costs as well, an additional interest rate is often agreed upon in addition to the interest rate of the loan: the land fee. This is about 15 percent of the remaining debt. It is at the discretion of the bank whether the land fee is actually used in the end.
What role does a mortgage arrangement play in the land registry?
The arrangement of the mortgage in the Land Registry indicates which bank will be provided first of the proceeds in the event of a mortgage sale. The principle is: "First come, first served". With a first class or 1A mortgage, the bank has the best chance of getting its money. If the returns are not sufficient for the subsidiary banks or creditors, they will go empty-handed. So a Class 1B or sub-prime mortgage is worse off. Since 1a mortgages are so common, banks usually offer them lower mortgage rates than 1 billion mortgages.
Banks only loan real estate up to a fixed limit. The lending value of the 1A mortgage is around 60 percent of the property's market value. If the financing requirements are not sufficient, you will need another mortgage. It is then entered into the land registry as a 1b mortgage and is often associated with higher interest rates, as the risk to the bank is higher. If you obtain more loans, they will also be entered secondarily into the Land Registry.
If there is no longer any claim on a mortgage, it can be removed from the Land Registry. Then the sub-prime mortgages rise in the land registry and thus get a better ranking. The automatic conversion of the owner's mortgage to the owner's land fee plays a role for the owner. It secures the mattress and thus acts as a placeholder and can be used in the event of an subsequent financial burden.
What is the difference between a mortgage and a land fee?
The land fee as well as the mortgage must be entered into the Land Registry as a mortgage when purchasing a property for it to be legally effective. But here the similarities end. Our table shows the differences.
Debt Mortgage Advance. Once the loan is paid off, there is no longer any claim. Land fees are not dependent on the claim. It remains in place even if there is no condition. A change of creditor If there is an electronic mortgage, it can be delivered to a new creditor at no additional cost. A change of creditor is often associated with the costs of a new entry in the Land Registry. Repayment of a mortgage only exists for the amount in which there are payments for your loan The land fee is always the full amount of the loan - regardless of how much you've actually paid off. So the Earth's charge does not decrease over time.
Table: The difference between the mortgage fee and the land
A land fee gives the landlord more flexibility than a mortgage. It can be transferred to other creditors and new loans. Assuming you have already paid off a large portion of your remaining debt or even paid it off in full, you now want to lend the house again, for example for a retrofit loan. You can now take out a new loan with the amount of remaining debt that has already been paid off without having to request a new land fee again. This is not possible with a mortgage.
Everything at a glance: the mortgage
A mortgage is a real estate liability and is used to secure a property. With a mortgage, you can enable the bank to sell your property in the event of a default. Let's summarize the most important points:
A mortgage is linked to a claim, which means that it is an extension. There is no mortgage without claim. As a general rule, a distinction is made between a mortgage and a book mortgage. In practice, a mortgage is a common occurrence. Once the claim is paid, the mortgage turns into the owner's land fee. As a general rule, the mortgage as a mortgage on a mortgage is no longer used today. The reason is the quality of their attachments. The cost of registering a mortgage ranges between 1.5 and 2 percent of the loan amount.
As an heir, you might be dealing with a mortgage. For example, if the deceased obtained a mortgage on his property with the bank. Industry experts currently assume that about 20 percent of loans are mortgage-based.
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What is a 2nd mortgage?
The second mortgage is the mortgage that you cannot mortgage your home with, but you must mortgage something else from your real estate from your cars or your restaurant ..
mortgage ltv meaning?
It is the mortgage that is made between two parties only, and there is no guarantee or bond for this bet.
mortgage meaning latin?
There is a close connection between mortgage and Latin, as the mortgage in Latin was established and was circulated in all countries of the world.
mortgage refinance meaning?
Mortgage refinancing means that the person who took out a mortgage has refinanced it, meaning that he has fully paid all the payments due on it.
mortgage house meaning?
In short, the mortgage is that you put your house in the hands of someone else in exchange for giving you an amount of money, and you must pay the money with interest within a period of time to be agreed upon.
What is a first mortgage?
The first mortgage is the mortgage that you make for the first time, and you must comply with all of its conditions that were specified in the obligation of the mortgage. For more information
You can see the terms of the mortgage.
mortgage forbearance meaning?
Loading the mortgage, meaning that you add something to the main mortgage, for example; If you have mortgaged your home and want a larger amount, you can mortgage your car to the same person to whom you have mortgaged your home under certain conditions.
what is mortgage definition?
You can get a full understanding of the definition of a mortgage here.
What does it mean to mortgage your house?
Home mortgage is for you to go to a person and put your house in his registry. He will give you a sum of money and you will return the amount with the interest within a certain period of time, and if you cannot return the amount, your house will be seized.
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