What is a mortgage loan or mortgage? The financial loan taken against the bank or the financial institution from which the loan is being taken is basically called a mortgage loan. And the legal document created for executing this mortgage is called mortgage deed or mortgage deed.
That is, the document through which the interest in certain tangible property is transferred as a guarantee of payment in advance as a loan or as a guarantee of payment of money payable in the future, (guarantee of payment of current or future debt) or as a pledge against any situation that may create a financial liability is called a mortgage deed.
When is a mortgage loan taken out?
Mortgage loans are usually taken for financial solvency in a new venture. For example, this loan can be taken in case of property purchase. Its biggest advantage is that the property against which the loan is taken does not have to be sold. Once the loan is repaid, ownership is restored. These loans can be taken for various purposes such as business development, construction or purchase of house, travel abroad for higher education etc.
Eligible properties to be mortgaged and amount of loan receivable:
A mortgage loan can be taken against any type of immovable property. Owned house, any land or plot, commercial or industrial property can also be mortgaged. Even an under construction property can be considered as a mortgaged property.
A very common question in this regard is how much loan is possible against the mortgaged property? It is generally possible to get a loan of 50% to 75% against the value of the mortgaged property. But roughly 50 to 60 percent is the industry standard.
The value of any immovable property is not predetermined. Therefore, the assets of banks and other financial institutions are constantly evaluated and verified. After this property valuation, the value of the property is determined and the loan is issued against that value.
Bangladesh’s only complete real estate solution provider BProperty also specializes in property valuation. According to a recent contract, BProperty will handle property valuation and validation for home loans of renowned financial institution IPDC.
Interest rate on mortgage loan:
Interest rates on mortgages typically range from 12% to 15%. However, mortgage loan interest rates are generally lower than any personal loan. That is why most of the customers prefer to take mortgage loan if possible. After home loans, the lowest interest rates are found in mortgage loans. You can calculate interest rates on mortgages and other information using Bproperty’s loan calculator.
What banks check before giving a mortgage loan:
In any loan processing, banks or lending institutions check many things. Documents that are usually checked before giving a mortgage loan
- Monthly and Annual Income
- Taxes paid in last 3 years and Tax Identification Number (TIN Number)
- work experience
- Current working organization
- Value of the mortgaged property
- Current or outstanding loans (if any)
- Besides, the age and income of the loan applicant (borrower) are also checked by the bank. Basically every bank approves the loan only after verifying these issues.