MORTGAGE FINANCING

A mortgage is a legally binding document used by banks or other creditors to lend you money on interest to help in the purchase of a property. The mortgage agreement gives the lender the right to take ownership of your property if you fail to repay the money you’ve borrowed plus interest or to transfer full ownership upon the payment of the debt.

PROCESS OF MORTGAGE FINANCING

Approval and Appraisal

At this stage, you should know if you qualify for the loan and the amount you qualify for. When sending an application to a mortgage financier, the application is weighed using various parameters such as length of the contract, how much your expenses are, details of the property, your income, credit score, and your age, depending on these parameters, the application is either approved or rejected.

Processing

You should provide the required documents to the bank. General documents include a copy of the title deed of the property/the lease certificate, the sales agreement, rates & rent clearance certificate. For a couple applying jointly, a copy of the marriage certificate

Offer

You are provided with an offer letter that contains the terms and conditions of the loan. As a borrower, you are to accept to preceede the next stage.

Instruments Perfection

The Mortgage financier acquires the legal documents of the property they include, the original title certificate and transfers among other documents. Once the lender has the documents, a charge is registered against the title for the amount borrowed. A charge means that a lender has rights to the property.

Payment.

Depending on the nature of the transaction, the lender pays the amount borrowed to the borrower or the seller. This is done only when the registration of the charge is successful. Payment usually takes between 90 to 180 days.