Due to the banking crisis and the huge financial turmoil that has been around the world for many years, many countries have imposed restrictions to counter it from getting worse. One of the reasons for this financial crisis is considered to be that the banks lent money too easily and then with housing as collateral. Housing that could be 100% mortgaged. If the housing price then fell only one percent, it meant that the person was over-mortgaged, ie had loans over his assets.
To counteract this, a provision was introduced in Sweden which said that only mortgages up to 80% of the value of the housing can be taken. The remainder must be paid in cash. This would be a way to prevent people from over-lending. But at the same time, many have closed out the possibility of buying houses. Costing the house 1.2 million, you have to have 240,000 in cash. Instead of backing out of the house purchase, many solve this by taking a private loan from another loan institution to cover the last bit.
Those who intend to take a private loan should compare loans and consider the following before deciding where to take the loan.
It is usually possible to borrow up to $350,000, but some loan institutions have the limit of $200,000, which means that in this case they will not be relevant. Is it that interest and other factors make you still want to borrow from those who can only lend $200,000, then take out the loan there and search the rest from elsewhere.
Of course, interest rates are a very big factor when choosing a loan institution. Compare the effective interest rate as it is this that determines how much you will be paid per year. The effective interest rate is the interest rate including all possible fees.
Whether one needs a free amortization year or is not completely individual. But for many it is an advantage. You borrow money because you have none and then it can be nice to not have to pay off the first year. What you should definitely remember is to still budget because the monthly cost will increase after one year. Too many people take loan-free amortization and get used to the monthly expenditure level. Then it becomes difficult when the loan should then start repaying.