The Fine Bank mortgage is already a relatively well-known method of drawing a loan secured by real estate in Slovakia. Unlike a classic mortgage, in the case of a Fine Bank mortgage, it is so-called without a special-purpose consumer loan, which allows the applicant to use the borrowed amount for any purpose.
You can use the money, for example, to buy a car or furnish an apartment, and this information must be provided to the bank where you are taking out a Fine Bank mortgage.
If the amount to which the loan relates will not be used for housing or construction purposes, you can not deduct its interest from taxes or draw a state contribution to the interest on a mortgage loan.
As with all types of mortgages, the security of a real estate loan is a legal condition for a Fine Bank mortgage.
According to the Act on Bonds, this property must be located in the territory of the Member States of the European Union or other states forming the European Economic Area, but the vast majority of Slovak banks do not accept real estate located elsewhere than in the Slovak Republic. The mortgaged property must always be insured against natural disasters and other risks.
Fine Bank mortgage fees
However, there are, of course, far more conditions attached to real estate. Of course, the same agenda and bank fees as for any mortgage, whether it is an estimate of the price of real estate or fees for maintaining a credit account.
The set of these fees and the many confirmations you are required to provide is not negligible – for example: if the account management fees are on average USD 3 per month, in the case of a 20-year, maximum loan maturity, the management fees will reach USD 720.
A very big disadvantage of this form of loan is, above all, the fact that in the event of insolvency, you risk losing the property that you guarantee for the loan. The loan is drawn once, is non-cash and is transferred to the client’s bank account.
Maximum US mortgage amount
The amount of the drawn mortgage is then derived from the value of the mortgaged property. In most cases, the maximum possible amount is 70% of the value of the property, but it always depends on the specific bank from which you take out a US mortgage.
Most banks also have a maximum loan amount. In the event that 70% of the value of the mortgaged property significantly exceeds this maximum set amount, the bank will not provide you with a larger amount than the one you set in advance.
This amount is usually around USD 150 to USD 200,000. The amount of the Fine Bank mortgage is also limited by the applicant’s ability to repay, ie the amount of his demonstrable income.
Minimum Fine Bank mortgage payment
The minimum loan amount again depends on the specific bank from which you are taking out a Fine Bank mortgage. It usually ranges from 3,000 to 10,000 USD. Unlike a classic mortgage, a Fine Bank mortgage has a more favorable annual interest rate.
Interest rates are around five to nine percent and depend on the fixation of the interest rate. Almost the same principle applies here as for other mortgages. In the case of an annual fixation, interest rates start to fall to 5% and it is true that the longer the fixation period, the higher the interest rate.
In the case of a ten-year fixation, the annual interest rate can reach up to 9%. Some banks also offer a fixed, ie fixed interest rate, which applies throughout the loan repayment period.
Fine Bank Mortgage Terms and Maturity
The maturity of a Fine Bank mortgage usually ranges from one year to a maximum period of twenty years. However, unlike a classic mortgage, it provides the possibility of extraordinary repayment and early repayment of the loan at any time, without a contractual penalty.
A Fine Bank mortgage can generally be applied for by a person over the age of eighteen or twenty-one, but the maximum age of the applicant must not exceed seventy years, on the final maturity date of the mortgage. The applicant is obliged to prove income from dependent activity, business or other eligible income.
Along with the applicant, the lender can also apply for a Fine Bank mortgage. However, it is a condition that at least one of the applicants owns or becomes a loaned property as a result of the implementation of the investment plan.