Among the guarantees compatible with obtaining a mortgage , the conventional mortgage appears to be the most frequently chosen solution. It takes the form of an agreement between the borrower and the credit institution . If the buyer can no longer assume the repayments of the loan, a seizure of the property becomes possible: as long as the contract is not terminated, the owner can be dispossessed of his home.
HOW TO REALIZE A CONVENTIONAL MORTGAGE?
In order to set up a conventional mortgage, it is essential to have recourse to a notarial deed : this document validates the procedure and allows, in the event of non-repayment of monthly payments, to provide for a seizure of the property. During this process, the notary must inform and advise the purchaser, specifying that as soon as he no longer meets his monthly payments, he may be exposed to a risk of eviction . The mortgage is confirmed by an agreement serving as a contract between the debtor and the creditor, with the assistance of a notary. On this document, we find three essential data
-The nature of the property
-The amount of the guaranteed sum
-The deadline for repayment of the debt.
WHAT ARE THE ADVANTAGES OF THIS GUARANTEE?
For the lender, the possibility of considering a conventional mortgage is an argument in favor of accepting the credit file . Indeed, banking establishments always examine the guarantees of the borrower before formulating an agreement and, when this possibility of agreement exists, they are more easily confident.
Moreover, this process is useful for securely guaranteeing one and the same new debt . In the event of impossibility to pay or of unforeseen circumstances, the realization of such a contract makes it possible to eliminate the debt.
WHAT DRAWBACKS TO KNOW?
If the mortgage is presented as safe and reliable for bankers as for borrowers, the latter are still embarking on a potentially risky dynamic . Thus, the non-payment of the monthly payments leads to a dispossession of the property and, therefore, a problematic situation for the purchaser – who can lose his home in extreme cases.
In addition, since this is a very formalized process, the obligation to go to the notary adds additional constraints to the purchasing process.
THE COSTS TO EXPECT FOR A CONVENTIONAL MORTGAGE
In the case of a conventional mortgage, the purchaser must provide an envelope dedicated to the financing of the various modalities directly related to this decision. To obtain this guarantee, you have to think of several expense items:
-The emoluments of the notary . They are equivalent to 0.3289% of the amount including tax of the loan, a price to which is systematically added the sum of € 131,062.
-The land registration tax (TPF) . It corresponds to 0.715% of the amount of the loan, sometimes with an increase in accessories. In some cases, this tax is not due – especially for PTZ or PEL.
-The curator’s salary . It represents 0.05% of the amount of the loan, plus any accessories.
-The ancillary costs of around € 500 to finance mortgage slips, enforceable copies and all that is invoiced by the notary.
Finally, the release charges apply in the event of a sale before full repayment of the creditor when the sale takes place less than a year after the last repayment deadline. To calculate these fees, we use the loan amount plus 20%. Subsequently, you should know that 0.3 to 0.6% of this amount will be due by the owner to pay the release costs. They are not payable for any sale made more than one year after the last maturity of the loan.