Sale of Mortgage Debt: The option to get a better rate


Have you ever wondered what is the sale of mortgage debt, or debt transfer? Many people do not know that they can use for their financial benefit the transfer of the debt they contracted with their bank when they signed the mortgage on their homes.

You may wonder:

Why would anyone want to sell their mortgage debt?

Why would anyone want to sell their mortgage debt?

Well, there are several reasons why a person would like to sell their mortgage debt. And it is that, many times, as the years pass from the first installment of the mortgage, many things change: the policies of the banks, the situation of the country, the conditions of the mortgage market, your goals and personal priorities, among others.

In this way, the debtor of a mortgage loan can agree to sell his debt to another bank, without commission payments and with savings benefit in the monthly installment. Clearly, no one would agree to pass their debt to another bank if there was no benefit involved.

There are certain expenses within a mortgage loan, some seem obvious to us, but others perhaps not so much, and it is always preferable to know well about it. Many times, we are not really aware of the expenses involved in contracting a mortgage loan and after signing the contract with the bank we realize that it implied a greater
sacrifice that we initially believed, which leads us to want to lower the monthly payment fee.

What immediate benefits can we get when applying for a mortgage debt sale?

What immediate benefits can we get when applying for a mortgage debt sale?

For the most part, the benefit is found in the variation of the interest rate or the improvement of insurance contracting. When we pass the mortgage debt to another bank, which we do is improve the conditions of the interest rate, which is lower than the original. In many cases, the property is already paid in a medium or high percentage, so the risk to the bank is lower. This leads to the interest rate being reduced.

Likewise, the financial entity reassesses the insurance situation, and in many cases, the mortgage payment is already advanced, the cost of the mortgage can be cut. Banks normally offer two types of insurance. The lien insurance, used in case of death of the owner, accident or disability, and property insurance.

Getting a restructuring of your mortgage credit

Getting a restructuring of your mortgage credit

From the hand of another bank can be very beneficial for the home economy, allowing you to save or invest the surplus.

In case you want to carry out this operation, you must take into account the amount of fees you have to pay and the expenses associated with the transfer of the debt, which, although they are not high, it is not good not to deepen them .

If you are worried about knowing if you qualify for this type of operation, don’t worry! The requirements are usually the same as what you need to take out a mortgage loan.  

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