Maturity Life of a Mortgage
A mortgage loan is usually amortized over an agreed period, sometimes as long as thirty years, and generally covers a fixed repayment amount. If you can manage a shorter period, by making higher monthly payments, then you will realize savings on interest and payout the mortgage much
Currently on the market there are mortgages of thirty years, twenty years, and ten years.
Elements of a Mortgage Loan The mortgage payments are made up of: -
Interest, which is the cost of borrowing the money;
Principal, which is the amount of money borrowed.
In the early years of the mortgage loan, a greater part of the monthly payment is applied towards the interest payments, while a smaller amount is applied towards the principal repayments. In the latter years, the reverse situation takes place; a greater portion of the repayment is applied towards the principal and a smaller amount is applied towards the interest.
What is the Downpayment and Why is it Required?
Most institutions will require a minimum downpayment, which is generally estimated at about 10 per cent of the
overall cent. time to
mortgage loan. Sometimes, it is as low as 5 per Some institutions may vary that requirement from time. The financial institution requires customers to