1.. Did you know that if you borrow $10M the difference between 7% and 8 % interest for a 30 year loan will translate to an additional $2.4 million paid in interest? Your mortgage interest rate matters.
Check out the mortgage calculator I created here: bit.ly/2YD518c
Check out the mortgage calculator I created here: bit.ly/2YD518c
2.. Five years ago I simultaneously bought my own home and was selling my parents home on their behalf. Buying a home can seem complicated and in my search there has been no central place to explain the process in JA so here is somewhere for you to start.
3.. Disclaimer: I am not a lawyer so seek legal advice on any important transaction.
Here are some questions you may be asking:
1. What is the down payment required?
2. Can I afford it?
3. What does the process entail?
4. What do I do first?
Here are some questions you may be asking:
1. What is the down payment required?
2. Can I afford it?
3. What does the process entail?
4. What do I do first?
4..Here are some questions for you to think about 1st:
Do you have access to a NHT Benefit? If so you can qualify for up to J$6.5 M (or $13 M for joint applicants) towards the purchase of your home at a rate of 5% (for new properties). If not, the market rate is around 8%
Do you have access to a NHT Benefit? If so you can qualify for up to J$6.5 M (or $13 M for joint applicants) towards the purchase of your home at a rate of 5% (for new properties). If not, the market rate is around 8%
5..Do you know what real estate prices are for the area you wish to live in?
If not I suggest you start doing some research on house prices by accessing the Sunday Gleaner Classifieds or contacting a Real Estate Agent from a reputable company to assist you in figuring out prices
If not I suggest you start doing some research on house prices by accessing the Sunday Gleaner Classifieds or contacting a Real Estate Agent from a reputable company to assist you in figuring out prices
6.. Cash or Mortgage? Will you be financing the purchase with your own funds or will you require some financial assistance from a Bank or Building Society? If it is the latter then great keep going ..
7.. Downpayment:
To show that you are committed to the purchase and that you have some interest in the property, a bank will require you to make a payment to the seller (Typically done through a lawyer). This can range from 5 - 10% but banks like JN now have a 110% mortgage.
To show that you are committed to the purchase and that you have some interest in the property, a bank will require you to make a payment to the seller (Typically done through a lawyer). This can range from 5 - 10% but banks like JN now have a 110% mortgage.
8.. The 110% mortgage is an unsecured loan + a loan secured by the property, which essentially means you don't have a downpayment. Your income will have to be high enough to sustain the pmt for financing 110% of the property price. This rate will likely be higher than market rate
9..When making a downpayment to a seller, contact a reputable law firm to do a Sales Agreement, which will dictate the terms of the transaction and what will happen, if for any reason, you have to be refunded your deposit.
THIS IS IMPORTANT
THIS IS IMPORTANT
10..Next question: Can you afford a mortgage?
If you are buying cash this question is a little easier to answer. You simply have to know the value of the house and budget about 15% of that value for additional fees and charges, not including the cost of doing any repairs.
If you are buying cash this question is a little easier to answer. You simply have to know the value of the house and budget about 15% of that value for additional fees and charges, not including the cost of doing any repairs.
11..If you are getting a mortgage, affordability means your ability to find the down payment, fees, closing costs etc. AND your ability to have enough money for the monthly mortgage payment, the insurance and to have enough left over to live comfortably and pay for incidentals.
12.. A phrase you may hear your bank reference is your debt-service-ratio. This means the % of your salary you have available to pay for your everyday expenses, after you pay your debt obligations (mortgage, car loan etc.).
13.. A simple way to assess what the monthly mortgage will be is to use an amortization calculator like the one I created here: bit.ly/2YD518c. Download the sheet and input the amount you wish to borrow and the yellow line will tell you your monthly payment.
14.. After you calculate the Monthly Payment, compare that to your gross monthly salary. If the payment (plus any other loans you may have) divided by your salary is less than about 50%, you should be able to afford the mortgage and to live comfortably as a new homeowner.
15.. Some general rules about how a mortgage is calculated:
1) The longer the repayment period, the lower the monthly payment
2) The lower the interest rate, the lower the monthly payment and
3) The larger the initial down payment made, the lower the monthly payments.
1) The longer the repayment period, the lower the monthly payment
2) The lower the interest rate, the lower the monthly payment and
3) The larger the initial down payment made, the lower the monthly payments.
16.. The Mortgage Amortization Schedule (also located in the Mortgage Calculator bit.ly/2YD518c) will tell you what the expected loan balance will be for each month of the loan. I use the schedule to compare to my mortgage statements so I can know if things look correct
I wrote some more information to answer the other questions on my site here:
gillianajackson.com/the-first-time…
If you're interested in calculating the other fees and understanding what to do first (getting a pre-approval letter etc.) visit the link above.
gillianajackson.com/the-first-time…
If you're interested in calculating the other fees and understanding what to do first (getting a pre-approval letter etc.) visit the link above.
Here's my thread on the NHT ..
Check out the NHT thread here:
This is the thread on the house purchase fees which has an updated fee calculator:
