Whether to buy an apartment in installments is a concern for families with limited finances. According to real estate experts, buying a house in installments using monthly salary is one of the reasonable and safe investment options.
Advantages of buying an apartment in installments
One of the biggest advantages of buying an apartment in installments is that you do not need to pay 100% of the value of the house at the time of purchase. The bank or credit institution will lend the buyer about 70% of the value of the house by mortgaging the house to be purchased or using the mortgaged property to secure the loan. Accordingly, customers can own their own apartment and pay monthly installments.
Customers can choose to pay in installments for 15 - 20 years or longer. The longer the installment period, the lower the monthly payment.
In addition, the bank supporting the loan package will disburse in installments to the investor based on the project progress. Buyers do not have difficulty in managing cash flow and financial pressure.
During the installment payment period, customers can still use their own house instead of having to pay extra to rent a house.
Buying an apartment in installments is suitable for families with average income . (Illustration photo)
Therefore, buying a house in installments is suitable for people with average income. For young couples who do not have their own house, do not have enough money to pay for the house but have a stable monthly income, taking out a bank loan to buy an apartment in installments is a feasible and suitable financial solution.
Things to remember when buying an apartment on installments
According to real estate experts, customers who want to buy an apartment in installments need to consider carefully, based on their income, current and future stability to make the most appropriate decision. Below are some issues that buyers need to pay special attention to to avoid risks:
Legal risks
Legal risks occur when the investor or seller lacks necessary documents such as land use right certificates, pink books or construction drawings, drawings in accordance with planning. At that time, the buyer may lose all assets because the apartment project is not legal. To avoid risks, customers need to ask the seller to show the documents related to the apartment. Check carefully for traces of erasure or patchwork, along with some other documents such as mortgages, loans (if any). Conduct cross-checking by going to the home ownership certification agency to check the original information, determine whether the house is in the cleared land or is planned to build public works.
Customers need to carefully research legal issues to avoid risks. (Illustration photo)
Financial risk
In transactions, the buyer deposits no more than 10% of the property value to the apartment seller and pays in installments according to the construction schedule. In reality, many people buy houses in "theory" because the investor then does not build the house or runs away with the money, causing great losses to the customer.
In addition, to buy an apartment on installments, the first thing is to have a certain amount of money as a foundation and documents proving monthly income. However, the risk here is that many people want to buy a big house but have limited finances or lack of knowledge and pay in installments for a short period of time. This is very dangerous because not only the principal but also the interest becomes a monthly burden. To limit the risk, you should not borrow more than 50% of the value of the house or apartment. This helps ensure both enough finance to maintain life and enough finance to repay the loan on time.
Interest rate risk
Interest rates are also an issue that installment apartment buyers need to pay special attention to. Buyers need to be alert when looking at attractive numbers such as 7%/year or 8.5%/year. This attractive interest rate has a "validity period" of only 1 year or the first few months, after which the interest rate can increase to 3, 4%. Therefore, customers need to be alert to carefully study the specific interest rates applied.
In addition, installment apartment buyers also need to learn and survey the market more; Learn about the loan policies of banks, compare the advantages and disadvantages of each party, the accompanying benefits to have the most suitable choice.
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