We can mention that we know the ways that exist to pay the remodeling your home through home equity loans in Mexico, so in this article we will explain the methods to make this possible, so we invite you to continue reading to obtain more information on the subject.
Home equity loans
It can be mentioned that it is a loan of a fixed amount of money that is guaranteed with your house, that is, you pay the installments in fixed monthly payments for a certain period, in the same way that you pay your original mortgage. However, if you don’t repay the loan as required, the lender can foreclose on your home.
Home equity lines of credit
In this way, it can be defined as a revolving line that looks a lot like a credit card, so you can borrow the amount you need, whenever you need it, by issuing a check or using any financial instrument linked to the account. .
Therefore, the person cannot exceed the limit amount, that is, as it is a line of credit, his payments are based only on the value he borrows and not on the total available.
We say that home equity lines of credit also give you certain tax advantages that some other loans don’t. Get to know them below!
Benefits of keeping a house in good condition through a liquidity loan
We mention that a liquidity mortgage loan allows us to keep a house in good condition without having to go into extra debt, in this way, you can extend the duration of each of its components.
That is why acquiring a mortgage loan to remodel will benefit you in:
1. Do not alter your personal finances, when we apply for a mortgage for the remodeling of your home, you will have the opportunity to better manage and plan your economy, since you will be maintaining liquidity.
2. You keep your investments, that is, this financing is an excellent alternative to obtain capital, without having to resort to your current payments, which can continue to increase your performance.
3. You have a longer term: the period to pay off this loan is between 5 to 20 years, this will depend on your needs, salary, or other factors that the banking institution will determine.
People who can request it
We say that a liquidity mortgage credit It can be requested by any natural person who can prove their income and who offers real estate as collateral.
Due to this, the bank will offer you a percentage somewhat lower than the value of the property proposed as collateral, obtaining all the desired economic capacity to invest in remodel your home.
Therefore, to obtain the approval of the bank, companies must offer full transparency about the financial situation of the applicant, since their balance sheets will be meticulously studied along with their client portfolio and the company’s credit history.
How can the financing be used?
It is significant to mention that we use these credits when planning the remodeling your home, and there are many options to modify or completely change any space or area:
1. Minor modifications such as: painting walls or changing some furniture, can be very fast to carry out and have a cost that will not be so high.
2. Major changes, that is, when remodeling the distribution of spaces, changing the doors, the floor or the lighting.
3. Comprehensive modifications. When we consider making structural changes, such as building a new room or adding HVAC systems, which can take more time and capital.
It can be indicated that there are two modalities in liquidity mortgage loans and they are the following:
1. Closed scheme: credits in a single installment, with a fixed term and fixed interest rate.
2. Open scheme: similar to a credit card, where the money is available as required and the interest rate is usually variable.
Therefore, these liquidity credits cannot be used in home redesign or buying a second home, for that there are remodeling and construction mortgage schemes, instead, they are used to:
1. Debt payment: With the amount delivered by the bank, pending payments such as credit cards, personal loans or any other short-term debt can be settled.
2. Education: they are an alternative that is used to cover the expenses of instruction of the borrower or their children, even to pay tuition in advance and get lower prices.
3. Unexpecteds: they are an excellent option to obtain financial resources in case of an emergency, for example health.
In conclusion, when establishing the ways to pay for the remodeling of your home, you must manage all the ways you have to do it and what financial instruments based on your income you can use.