Disadvantages of buying your home with mortgage loans
Getting approved for a mortgage loan has to be among the toughest things to happen. Before buying your ideal home, ensure you know the mortgage deal that you sign up for. A lot of homeowners have had to live with regrets after their mortgage loan repayment goes south. You may end up facing dire repercussions including losing your biggest investment, a home. When doing your research, make sure you choose the right mortgage rates canada graph that will not stress you in future. Here are some of the ways a mortgage loan can be stressful to you and your finances.
Be a debtor for most of your life
It is not a pleasing idea to be a debtor for several years of your life into the future. Using mortgages to buy your home will do exactly that to you as you enjoy the benefits of owning a home. The loan is usually large and cannot be paid off within a year or two; you may have to settle for over 20 years of life as a debtor. There are not many home owners who desire this to be their way of life, it is better you find a way to buy a house in its full price with one payment and be free for the rest of your life.
Home is not yours until fully paid for
The truth you will be told is to assume ownership of your home once you have started paying off the installments to your mortgage loan. Ownership will however remain yours for as long as you adhere to the repayment terms and conditions. You should not skip paying these installments because then your possession of the premises could be threatened. The threats can be actualized if you persistently fail to pay the amount required of you per installment. Having settled into the home, it could be devastating to have to uproot your family from the home due to repossession by your financier after a failed mortgage loan repayment.
Suffer from interest rates increment
You should be sure that changes in the interest rates for your mortgage loan will come. This happens with changing economy in various parts of the world. A decrease in the interest rates is definitely something to smile upon, you should however know the vice versa can really harm you financially. You will start paying increased monthly minimums depending on how far the interest rates may have risen. For many people this becomes disadvantageous because it disrupts your financial planning.
Use more money than you would have
Assuming the price of a home is $250,000, you are better off clearing the amount at once than settling for installment payments. With mortgage loans, you are advanced the entire $250,000 and could even move into your home after clearing off the first huge deposit needed. Adding the interest rates to the calculation of your monthly minimums will leave you with a huge figure to deal with. Ultimately, you have to settle for overspending to get into your dream home.