Buying a property with a mortgage is a popular option for those who want to make their dream of owning their own home come true. Especially for those who do not yet have the full value of the house.

But even so, there are still many doubts about how real estate credit works. As well as its differences in relation to financing. Basically, both work in the same way.

In this article, we will explain more about how buying a property with a mortgage works. You will also understand what the possibilities are when taking out this financing.

Continue reading and find out!

In short, the words real estate credit and real estate financing appear separately. However, we can say that they have the same meaning. This is because they both work in the same way.

But credit is like a type of real estate financing. In this way, it is a type of financing that uses savings resources. Therefore, it can have lower interest rates and a larger down payment.

In this sense, real estate credit can also appear as real estate refinancing or credit secured by real estate. In both cases, part of the loan is already guaranteed.

In other words, you need a loan to finance the part that still needs to be raised. Some loans finance 50%, 60% and even 80% of the properties. And you can apply for this loan to buy new or used properties.

Finally, analyzing the types of real estate credit offered in Brazil, we can say that credit financing is common in financial institutions. In fact, there are some types in which it is possible to obtain this financing. Take a look:

Below we list the types of real estate financing that you can apply for to buy your dream home.

The Housing Finance System, or SFH, is one of the most famous types of financing. And it fits into real estate credit, as you can use the FGTS balance, for example.

Therefore, this makes the financing amount lower. In other words, you can get longer terms and lower interest rates with this modality. In fact, regarding the financing amount, it depends a lot on the credit analysis.

In general, the Housing Finance System usually covers financing amounts lower than R$1,900,750. It is worth checking with the institution you chose to take out your real estate loan.

The Real Estate Financial System, or SFI, accepts higher financing amounts than the Housing Financial System, or SFH. Furthermore, those who want to buy commercial properties must use the SFI financing method.

In fact, real estate credit here also has no limit on the amount that can be financed. In other words, you can finance up to 90% of the value of your property. Even if your credit value is not that high, you can still get a loan.

On the other hand, the interest rates of the SFI are much higher than those of the SFH. However, in terms of payment terms, the two modalities are similar. Therefore, the time to finish paying is around 30 to 35 years.

Now that you understand a little about how real estate credit works and its types, the question remains: how do you buy a property with real estate credit?

Read on to find out!

In short, to take out a mortgage loan, you must meet certain prerequisites. Although these requirements may vary depending on the financial institution, some are more general.

For example, most banks do not accept financing from people with bad credit. Therefore, you need to regularize your situation and pay off your debts before taking out a loan.

Furthermore, there are essential documents when purchasing a property with a mortgage. They may vary depending on the bank, but there is a general list. See the full list:

First, it is important to know which property you want to buy, whether it is residential or commercial. Once you have decided on this, it is time to choose some financial institutions. In fact, it is important to have more than one bank option.

After that, you can contact the institution to simulate your mortgage loan. In some cases, this simulation can be done online. This way, in just a few minutes you will have an idea of the financeable amount and interest rates.

It is worth remembering that used properties usually have different financing conditions than new properties. Or properties that are off-plan, which may also have different conditions. This happens due to the conditions of each home and what the bank can offer.

Finally, after running the simulation and choosing which financial institution you will use to apply for your mortgage, it is time to start applying for a loan. In this regard, the bank will ask for specific documentation.

This documentation is essential to understand which installments you will pay. In fact, it is important to note that most mortgage loans do not accept people with bad credit. Therefore, it is important to regularize your situation.

Finally, the bank draws up its contract and the letter of credit can be released within a few days. This period of time depends greatly on each financial institution. In other words, there are some details that are important to pay attention to when signing the contract.

In fact, for those who want to make their dream of owning their own home come true, the federal government offers a financing program. Casa Verde e Amarela was created to guarantee housing for low-income populations.

In this other article, we show you everything about the Casa Verde e Amarela Program. Keep reading and find out more!