Buying a home is one of the most important financial decisions anyone will make. Invest in your new home wisely. A mortgage can be a great way to achieve this, but before taking that step, it's essential to consider several factors that will impact your finances in the short, medium, and long term.
1. Know your ability to pay
Before going to a bank or financial institution, analyze how much you can afford without jeopardizing your financial stability. It is recommended that your monthly mortgage payment not exceed 30% of your net monthly income.
2. Compare interest rates and the Annual Percentage Rate (APR)
Choosing the lowest rate isn't enough. The APR includes fees, insurance, and other associated costs, making it the best indicator for comparing loan options across different financial institutions.
3. Choose the right timeframe
In Mexico, mortgage loans are typically offered with terms of 10, 15, 20, and even 30 years. Longer terms mean lower monthly payments… but also higher total interest payments. Evaluate which option best suits your stage of life and job stability.
4. Save for the down payment
Most banks require between 101% and 201% of the property value as a down payment. Having substantial savings beforehand not only improves your chances of approval, but also reduces the loan amount and the total interest you'll pay.
5. Consider the included insurance.
All mortgage loans include mandatory insurance that protects both the buyer and the financial institution. It's important to know how much it costs, what it covers, and if possible, opt for external insurers with better terms.
Taking out a mortgage will define your finances for many years, and at Proyectos 253 we help you make the best decision. Contact us for financial advice to help you make an informed and successful investment.
