A mortgage is, as the name suggests, money borrowed from a financial institution to buy or renovate a house.
Of course, it would be nice if they could just pay for it themselves, but there aren't many people who can cover all the costs of a house that costs tens of millions of yen with the money they have on hand.
When buying a house, most people take out a mortgage and make monthly payments.

A loan is a loan from a financial institution, so there will be interest.
The interest amount is calculated by multiplying the borrowed money = the principal amount and the annual interest rate = interest rate (%).
However, since interest is the percentage of interest paid over the year, it must be divided by 12 months to calculate the amount of interest paid each month.

For example, if you borrow 30 million yen at an interest rate of 3%, the first repayment will cost 30 million x 0.03 ÷ 12 = 75,000 yen.
In addition, interest will be charged on the second and subsequent repayments according to the balance of the principal.
Calculating in this way, if you repay it in 30 years, the interest will be about 15.53 million yen, and the total payment amount will be about 45.53 million yen.
(* Calculated by the equal principal and interest method, which is often used in loan repayments)

Your monthly loan repayments will include not only the principal repayment, but also these interest payments.

Interest increases with the length of the loan, so the longer the repayment period, the higher the total payment.
On the other hand, if the repayment period is shortened, the total repayment amount will be less, but the monthly payment will increase, which will increase the burden on the household budget.
Therefore, when taking out a mortgage, it is important to consider the balance of your life cycle and life, such as the stability of your job, whether you have children, the timing of retirement, etc., and decide the loan amount and repayment period.

Can I use any property?

Mortgages can be used for basically any property as long as it is the purchase of a house to live in.
Mortgage loans can be used not only for new construction, but also for second-hand condominiums, second-hand houses, and land purchases for building houses.

However, the terms and conditions of the housing loan differ depending on the property.
For example, when taking out a loan on a second-hand home, the durability of the building is considered, so the loan period is limited to a short period.
Also, when using a loan for a house with a store, such as a store on the first floor and a residence on the second floor, most of the time there are restrictions on the area of ​​the store and the residential area.

Rate this post

Leave a Reply