Buying your first home involves a lot of consideration. Here are answers to some of the most common questions.
Garantia’s partner banks and more information about the mortgage guarantee: Asuntolainatakaus.fi
When to Start Loan Negotiations?
Home searching can start with a loan consultation with the bank and the subsequent loan offer. Once you have a loan offer, you can react more quickly when you find a suitable home and focus your search on homes that fit your budget. Loan offers are usually valid for several months, giving you ample time to search for a suitable home.
Can You Request Offers from Multiple Banks?
A loan offer does not bind the applicant to anything, so you can request offers from multiple banks if you wish. This way, you can compare the solutions offered by different banks.
Additional Collateral for a Mortgage
In addition to a mortgage on the home you are about to purchase, additional collateral may be required. Garantia’s additional collateral is only available from Garantia’s partner banks. You can find the partner banks here.
How to Prepare for Loan Negotiations?
You don’t necessarily need to go to the bank’s branch office for a loan consultation, as they can usually be done over the phone or online. You can find mortgage application forms on banks’ websites, which you can then fill out before the loan consultation. The consultation will go smoothly if the bank already gets your basic information from the application before the actual meeting. If you plan to buy a home with your partner, you should include both of your details on the application.
When filling out the mortgage application, you will also receive information about the documents or additional information the bank wants you to bring to the loan negotiation.
You can ask about Garantia’s mortgage guarantee during the mortgage negotiation with the bank.
What to Do When You Find a Suitable Home?
After the loan consultation, you should know what to do when you find a suitable home. Make sure you can answer at least the following questions:
- When can I make a binding offer on my dream home?
- Does the purchased home need to be approved by the bank?
- How long is the loan offer valid, and how can it be renewed?
If something is unclear, make sure to check with the bank.
Can I Influence the Quality of My Loan Offer?
When applying for a mortgage, it is beneficial if you can show that your expenses have historically been lower than your income, meaning you have managed to put aside at least some your income. Even if the amounts saved are small, regular savings show the bank that you can keep your finances balanced.
It is also important to ensure that your student loans or credit card bills, for example, are paid on time. When granting a mortgage, banks assess the applicant’s payment behavior, and diligent management of personal finances helps in building trust with the bank. Balanced personal finances also ensure that you get the best possible offer when applying for a loan.
Is It Bad If I Ask the Bank for Advice?
Absolutely not. Most first-time home buyers are not familiar with the terms and concepts of home buying, and it is advisable to take advantage of the expertise of your bank’s specialists. You can also get advice on mortgages from friends and relatives, but there is also a lot of misinformation about many aspects of home buying.
What is the difference between a Maintenance Charge and a Financing Charge? What is the difference between the debt-free price and the selling price of an apartment? How can I find out about the upcoming renovation needs of the housing company? Which interest rate should I choose for my loan? In a mortgage loan consultation, you can freely ask about things that concern you, and you can also return to these questions after the initial consultation. For most people, buying a home is one of the biggest investments in their lives, and it is worth preparing for it carefully. There’s absolutely no reason to be embarrassed about asking the same questions twice.
Ville Korte
SVP, Mortgage Guarantees
The author works as a Senior Vice President at Garantia and has over 20 years of work experience in mortgage lending at Garantia and the banking sector.