A mortgage is a loan from a bank or other financial institution used to help a borrower purchase a home. In other terms, When a borrower borrows money from a lender (bank loans) and then signs an agreement to exchange a real estate property with the lender as a guarantee until the loan is repaid in full, it’s called a mortgage.

Finding the answers to your mortgage questions can assist you in making smart decisions, whether you’re looking to purchase or refinance your first home. Hence, we did our homework and compiled answers to the most frequently asked questions about mortgages.

 

How Do I Start The Process Of Getting A Mortgage?

One of the first steps in purchasing a home is starting the mortgage process, and you need to find the best bank or mortgage lender for the job.

Despite the complexity of the mortgage process, it can be divided into several steps, including pre-approval, house shopping, mortgage application, loan processing, underwriting, and closing.

Before you begin looking for a home, getting pre-approved for a mortgage can help you determine what you can afford.

If you find a suitable property and submit an offer, the loan closing process can take up to several weeks.

Make sure all of your paperwork is accurate. Mortgage payments can be long and expensive, so reading the fine print is essential.

 

Which type of mortgage is right for me?

Choosing the right type of mortgage is one of the most frequently asked questions regarding mortgages. Since there are many types of mortgages available to potential buyers, understanding which is the best is imperative prior to signing on the dotted line. You need to research your mortgage options in order to choose a home loan that fits your needs.

The following are some of the most common types of mortgages available to home buyers wondering which type is best for them.

 

• Conventional home loan
• Government-insured home loan
• Adjustable-rate mortgage
• Construction home loan

 

WHAT DOCUMENTATION IS REQUIRED TO GET A MORTGAGE?

Getting a home loan in Bangladesh requires a different set of documentation depending on the buyer. The documents required to obtain a mortgage are usually pretty similar. You will need some initial paperwork when applying for a mortgage. Below is the list of documents that you might need to submit while applying for a mortgage.

 

COMMON DOCUMENTS FOR EVERYONE

• Most recent personal bank statement for the last one year
• Recent Tax Clearance Certificate
• Guarantor credentials
• Copy  of National ID/ Passport (applicant’s and guarantors)
• Utility bill copy
• Copies of Savings Instrument (if any)

Addition to these, you need to submit documents as per your criteria.

SALARIED PERSON

• Letter of Introduction (LOI)
• Latest salary statement for one year

 

BUSINESS PERSON

• Trade License for last three years
• Most recent bank statement of the company for one year
• Registered partnership deed for Partnership Company
• IMOA and Certificate of Incorporation

SELF EMPLOYED (DOCTOR, ARCHITECT AND LIKEWISE)

• Certificate of membership of the respective professional association     
• Declaration on self-pad along with the seal
• Certification of a professional degree

PROPERTY RELATED DOCUMENTS

• Deed of Agreement
• RAJUK Approved Plan
• Apartment Booking Documents
• Copy of Registration (if applicable)
• All relevant legal documents of the property as per need

 

HOW LONG DOES IT TAKE TO GET A MORTGAGE?

 

Mortgages are vital to the purchase of a home. It involves several steps. It is recommended that a mortgage lender can fund a loan within one to two weeks of receiving an application. However, if  the lender discovers financial issues in your record this could delay and complicate the homebuying process.

Getting a mortgage takes time, depending on many factors. These can include your :

• Credit rating
• Results of a mortgage valuation assessment
• Income and affordability review
• Size of deposit

 

Final Thoughts

These are just a few of the most common questions regarding mortgages. No matter what stage of the home buying or selling process you’re in, it’s essential that you have a solid understanding of these frequently asked questions. If you are looking for mortgage information, remember that no question is too dumb.