If you need to contract a mortgage for more than 15 years to be able to pay the monthly payment, it means that you are buying a house out of your possibilities. In general, a mortgage loan over 15 years is not convenient.
Some recommendations on the mortgage
Let’s analyze this simulation in the case of a loan with Banorte,
credit for $ 850,000 pesos, at a fixed rate of 10.41%:
As we can see in the table, the total amount that we will end up paying if we contract the loan for a period of 20 years is almost half a million pesos more than in a 15-year mortgage.
Let’s look at another example,
This time with Good Finance bank. With a loan also for $ 850,000 pesos under a fixed rate of 10.25% in terms of 15 and 20 years, we obtain the following results:
For less than a thousand pesos more, in this case, we save a very significant amount of interest. We save 5 years term. That is why we reiterate: if you need to contract a mortgage for more than 15 years to be able to pay the monthly payment, it means that you are buying a house out of your possibilities.
The most convenient mortgage loans are those that have the following attributes
- Equal fixed payments throughout the life of the credit. Schemes with increasing payments are more expensive. The initial monthly payment is lower but increases year by year.
- Term no longer than 15 years.
- Fixed rate as low as possible. If you can get a fixed rate at low levels, and also reductions for timely payments, even better.
- Competitive insurance cost.
- No penalty for advance payments.
- Engage at least 20% plus notarial expenses. If you don’t have at least 20% of what the house you want to buy is worth, you can’t and shouldn’t buy it.
- If you quote to Infonavit, take advantage of the Infonavit credit. The fees that your employer pays to Infonavit go directly as prepayment to your mortgage credit.