Pay off debts, have financial security and more tranquility in life. Who does not identify with these goals? To achieve them, however, it is necessary not only to dream, but to strive in order to put finances in order, make financial planning and, above all, get out of the red once and for all.
Dealing with very high interest rates, such as overdrafts, credit cards and various accumulated debts can be difficult. In order to change the scenario, it is essential to research loan alternatives that cover more competitive rates, have a better payment term and offer the opportunity to catch your breath and catch up on your finances.
In this sense, credit with property guarantee may be the solution you are looking for. According to what the name says, in this type of loan, your property (whether commercial or residential) is given as collateral for the financial institution.
Among the benefits of opting for secured home loans are not having to justify the destination of the money, lower fees and extended payment terms. In addition, it is possible to get up to 50% of the value of the asset as well as credit. You also do not need to give any additional guarantees and, even better: there is no need to leave the space during the process.
Discover 6 advantages of credit with property guarantee:
1. No need to justify the destination of the money
One of the benefits of opting for home equity loans is that there is no need to justify how you are going to use the money. This does not happen in modalities such as real estate or vehicle financing, for example, in which the amount granted by the bank must be used exclusively for the purchase of a property or car.
When applying for a secured home loan, you can use the money for what is most important at the moment: pay off your debts, take a family trip, renovate the house or invest in your own business.
Regardless of the destination you are going to give to the amount you borrowed, it is good to keep in mind that it should be used wisely and always with the aim of organizing your financial life.
2. Lower rates
Choosing a secured home loan instead of going overdraft or taking out a personal loan has another big advantage: rates are often much lower than those of other types. In general, the interest charged by financial institutions for loans that provide property as collateral is less than 2% per month.
To give you an idea, the average bank rate for an unsecured personal loan was 6.37% per month in May 2017, according to a survey by the Procon-SP Foundation. The study also points out that the average interest rate of overdraft banks surveyed reached 13.48% in the same period.
3. Extended payment term
The extended payment term is another benefit of opting for secured home loans. In general, this modality is offered with a minimum limit of 12 months. The maximum period can reach 180 months, varying according to the bank.
This feature allows you to pay your installments peacefully and have time to reorganize your financial life and get out of the red.
4. Up to half of the property’s value as credit
The secured home loan can be especially interesting for people who need a more substantial amount. With it, it is possible to have access to up to half the value of the asset – with a limit of R $ 2 million in financing.
Just a warning: even when giving your property as collateral, most financial institutions ask for proof of income to request this modality. Generally, banks require that the value of installments of credit secured by real estate does not compromise more than 30% of the monthly income of the borrower.
5. Property is the guarantee
Mortgage loan rates are more competitive for the consumer for one simple reason: the risk that the bank has of not receiving the amounts agreed on the loan is reduced.
Even if the customer is in default, the financial institution knows that it will receive what is due, since the property is given as collateral.
6. There is no need to vacate the property
Another advantage to be considered is that the applicant remains the owner of the property – which does not even need to be vacated during the term of the contract. In this sense, only commercial and residential properties that are in the name of the person applying for credit are accepted as collateral.
The asset must be valued between R $ 200 thousand and R $ 5 million, properly paid and free of charge. It must also be entirely built. Land with no buildings, for example, is not accepted in this modality.
The documents required to apply for a secured home loan may vary from bank to bank. But, in general, it is necessary to present ID, CPF, proof of marital status, residence and income. The documentation of the property (such as registration of the property, live and final deed) is also required and must be in order.
Property-backed credit is the tailor-made loan option for those who have a commercial or residential property properly paid and with all documents up to date. Lower rates, longer payment terms and the fact that you do not need to justify the destination of the money are some of the benefits of the modality, which is one of the most advantageous for the consumer.
The benefits of this type of resource for those who want to get out of the red are undeniable. However, in order to guarantee the security of the operation, look for a quality financial institution to make sure that everything will go well.