Mortgage - its pros and cons

Everyone dreams of their own home. Some dream of moving out from their parents and living as a separate family, others rent a house all their lives, only dreaming of their own apartment. One of the options for solving the housing problem can be a mortgage. What are its pros and cons will be considered in this article.

Pros of a mortgage

The high cost of housing does not allow many families to decide to buy their own apartment. It is very difficult to find the required amount entirely, and people are afraid to take out a mortgage loan. Many people are stopped not by the loan itself, but by the high amount of interest on it and the too long repayment period of the loan to the bank. In this regard, doubts arise.

As you know, any loan, including a mortgage, has its positive and negative aspects. Let's take a look at all the pros first:

• If you rent a house, then you give a certain amount monthly to the owner of the rented space. Often, the monthly rent is almost the same as the monthly mortgage payment. But keep in mind that by paying the mortgage, you are giving money for their housing. Your every deposit in the bank brings you closer to owning your apartment. And by continuing to pay rent, you are still left with nothing, but at the same time enriching the owner of the living space.

• If you buy apartment in a new building, then over time the cost of housing will increase. This means that in a few years you will be able to get a good income from the sale of your apartment.
• Living in someone else's apartment for many years excludes the possibility of arranging everything in it to your liking. So you are forced to live within the same walls for many years. If you live in your apartment, then nothing will prevent you from making repairs the way you want.
• Another plus is the ability to exercise the right to tax deduction. In addition to the standard deduction for purchased housing, you can use tax breaks in the process of paying taxes. This can be a great way to get some of your mortgage back.

Cons of mortgages

But with all the good points, do not forget about the negative aspects of the mortgage:

In our country, the cost of any loan is very high. This fact has not been spared, and the mortgage. Although the interest on mortgages is constantly decreasing, our banks are still far from the size of mortgages of 3-4% as in European countries. Now, according to statistics, mortgage loans can be paid only to a few percent of the country's residents.

A mortgage loan is issued for a very long period, it usually reaches several decades. All these years it is necessary to make monthly contributions. This leads to the fact that the family is forced to constantly live in an economical mode in order to repay the loan to the banks faster.

Some of the borrowers regularly experience problems with payments. Mortgages are taken out in good times when the family has a steady income. But circumstances change, people lose their jobs or get sick. And then there is a risk of losing apartment.

Not every family can get a mortgage. Difficulties with collecting documents and numerous checks of solvency take a lot of time, financial expenses and moral and physical strength.

Is it worth taking a mortgage

Let's say you decide to take out a mortgage and have collected all the documents, and the bank has approved your application. But there is a crisis in the country now, and does it make sense in such conditions to burden yourself with a mortgage loan? In this situation, you need to assess the risk that flat will fall in price over time and the mortgage will become unprofitable.

Carefully assess all the risks and positive aspects of the loan. Take a sober approach to assessing your capabilities and think about whether you really need your own home right now. According to experts, it is necessary to take out a mortgage only as a last resort. If you have no other options, and there is a great need for your home, and apart from a mortgage, you have no other options. At the same time, payments on such a loan should be approximately equal to the rental cost, and, finally, you must be firmly confident that you will save your income for the duration of the mortgage. You must have a stable job and confidence in your tomorrow.