Banks That Provide Land Loans

Credit facilities for purchasing land are a service offered to customers who want to invest by banks. Banks may have different conditions for their own land loans, but generally, loans that can be matured up to 120 months are available to customers.

Today, many banks give land loans and wait for their customers to be understood about the conditions.

Land Loan Offer Offered by Good Finance

Land Loan Offer Offered by Good Finance

Good Finance land loan is a relatively low-interest loan package that takes care of the needs of its customers. There are some conditions in Good Finance’s land loan offers. To mention these conditions:

  • The loan to be taken can be termed for a maximum of 60 months.
  • The person who wants to apply for a land loan can apply for a land loan up to half of the land he wants to buy.
  • In order to obtain a loan, the plot applied for must be zoned and included within the boundaries of any municipality.
  • Good Finance has the right to mortgage the lands where the loan application is made for purchase until the loan payment is completed.
  • In case of need, Good Finance reserves the right to demand additional collateral in the loan application.
  • Good Finance requests that the customer take life insurance during the repayment period of the loan if it gives land credit to its customer. This ensures that the bank protects itself against misfortunes that may occur.

Honest Bank Land Loan Offers

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Honest Bank land loan is a type of loan offered by Honest Bank to the customers who want to own a land for investment or other reasons.

There are some conditions that must be known before applying for land loan to Honest Bank. These conditions are:

  • Honest Bank only gives the land loan in USD.
  • Honest Bank land loan is a non-commercial loan service offered to individual users.
  • Honest Bank land loan can be extended up to 120 months and can be repaid.
  • If the plot on which the loan will be used is zoned, this plot will be put under mortgage until the loan payment has ended by Honest Bank. In cases where the land is not zoned, the person who will apply for a land loan must show another guarantee to Honest Bank.
  • Honest Bank has determined that the loan application that can be made for the plot to be purchased is not more than 50% of the plot.

Thrift Bank Housing Loan Offer

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The loan is at the service of retail customers who want to buy land and need credit for it. Many other banks such as Bank of Thrift Bank loan in the amount of land that can be referenced, have determined not to exceed half of the amount planned for land purchase.

Turkey customers to be fully informed about their nearest Cole Bank loans to have detailed information about the plot and conditions Turkey would be enough to visit the Cole Bank branch.

Other Banks That Provide Land Loans

Across lender land loan and GFI land loan can be counted among other major banks that people who need a loan can apply to buy land.

It offers Across lender’s 50,000 USD land loan offer up to 60 months to its customers. Across lender’s land loan interest rate is 1.59%. Like almost all of the other banks, Across lender requests that a guarantee be shown in order to apply for a land loan.

In order to apply for a Across lender land loan and have more detailed information, it will be sufficient to visit any Across lender Branch and meet with the customer representative.

In addition, GFI provides its customers with land loan offers, where they can mortgage their home and have up to 60% of their homes.

GFI land loan can be matured up to 60 months and the interest rate of the land loan remains constant throughout the process. The closest GFI branch can be visited in order to apply for a GFI land loan and find answers to the questions about the land loan.

How to properly make a free loan to a family member.

How to make a loan to a relative correctly for the Treasury

How to make a loan to a relative correctly for the Treasury

If you are thinking of borrowing money from a close friend or family member, you should bear in mind that the Treasury also controls this type of operations. The reason is that the administration wants to avoid covert donations at all costs. If the operation is carried out correctly you will not have any problem, since formalizing a loan between individuals – for example, from parents to children – is a very easy way to leave money to a person without taking fiscal pressure.

Step One: Sign a Contract

Step One: Sign a Contract

It is very important to sign a contract and write down the operation that we are going to carry out. In this way we will be protected against the Treasury in the event that they ask us about the origin of the loan. It is not necessary to publicly write the contract, so we can save notary fees.

In any case, we do recommend that you register it and that the Administration seal it. If we are not sure about how to write the contract we can go to a specialized lawyer to take care of it. If we are going to do it ourselves we must pay attention and write down all the information that is relevant to the operation. Although it is obvious, we must not forget to write down the personal details of the lender and borrower, the amount, the term, the date, etc.

Second: Free or almost

Second: Free or almost

Typically, when a private loan agreement is concluded between relatives or acquaintances, it is signed for free, that is, without interest or benefit from the lender. However, it is very important to state explicitly in the contract that the loan is free, otherwise, and in the absence of such information, the Treasury may assume that the loan is constituted with an interest equal to the legal price of money, -currently in 3 %. This characteristic is specified in article 40 of the Personal Income Tax Law. Likewise, if we choose to sign the loan subject to interest, this must also be written in the contract.

Advantages: Exempt from taxation

Advantages: Exempt from taxation

Non-profit loans between individuals and provided that they are made between natural persons (not companies), are subject to personal income tax but at the same time exempt from taxation. This basically means that these types of loans must pay the expenses of patrimonial transmissions – they must appear and be reflected in your personal income tax – but you do not have to pay any amount since these types of operations are exempt from taxation.

To carry out this operation, the borrower (the person who leaves the money) must pay the tax at the corresponding tax settlement office and the self-assessment will be done on form 600. It is mandatory to present the original contract, whether it is a private document as if notarial deeds have been written for your signature.

Calculation of borrowing capacity to obtain a loan repurchase

For any loan repurchase request, the borrower must know his borrowing capacity; this corresponds to the maximum loan amount that you can obtain over a certain period. The amount of his income and the amounts of his monthly loan payments, as well as these charges such as rent, determines the financial situation. 

It is from this financial situation that we can determine borrowing capacity. Expenses such as gas, electricity and the telephone are not taken into account in the calculation of debt. We will explain how you can get a loan buy-back while respecting your borrowing capacity and how to calculate it.

What is borrowing capacity for?

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This term is mainly used for borrowers who wish to access the property and therefore make a home loan. But it is also valid for all new projects. You want a car for your trips to work, but does your daily budget allow you to borrow? Do you have to pay rent or a mortgage? Do you have dependent credits? So many questions to ask yourself to find out what your borrowing capacity is.

You already have credits and your borrowing capacity is too high for the real estate project you are looking for. You have to review the repayment period and the amount of your monthly payments to find out the repayment capacity you can have.

Borrowing capacity is the maximum amount of credit that a borrower can borrow from his bank or a broker to finance a real estate project or a new project or a repurchase of credit.

How to determine and calculate your borrowing capacity to buy back credits

  • Borrowers must calculate their income in a reasonable manner.
  • Calculate all of your expenses.

Through this example we will explain how to determine your borrowing capacity:

Determine revenues:

Michel and Laetitia are both 35 years old, they have 2 dependent young children. Michel is an employee in the private sector, he has a net income of $ 1,800 per month and he receives the 13th month. He also received exceptional bonuses for a total amount of $ 3,000 over this year and last year he did not receive any premiums so his premiums will not be used in the calculation of future income.

However, you have to add your thirteenth month to your monthly income, so $ 1,800 * 13 = $ 23,400 / 12 = $ 1,950. The amount retained for Michel’s total income is, therefore, $ 1,950 per month. Laetitia co-borrower is a civil servant, she receives $ 1,750. The family allowance pays them $ 131.50 per month.

Taking into account that the children are young one will take into account his income. The total amount received for all of their income is $ 1,950 + $ 1,750 + $ 131.50 = $ 3,831.50 . Borrowing capacity is determined from the total income.

Calculate your credit charges or rent:

Michel and Laetitia are tenants and they have a rent of 800 $ per month. But they have a car loan on which they pay back $ 370 per month. They also have and a personal loan they took to get married last year and the monthly payment is $ 450, they have 6 years to repay.

The total of all their loan charges represents $ 800 to which the rent is added, giving a total charge of $ 1,620 per month. They have a debt ratio of 42.28% (the calculation of the debt ratio is the total amount of expenses divided by the total amount of income, ie 1620 / 3831.50 = 0.42 * 100 = 42.28%).

They have a real estate project of 210,000 $ but their borrowing capacity does not allow them to acquire their property.

The debt ratio is too high; it exceeds 33% of the debt to be eligible for a mortgage. Suddenly, the borrowing capacity is lower than the repayment of their rent which means that if they want to buy with their current loans, the new monthly payment of the mortgage should not exceed one-third of their income (calculation 3831/3 = $ 1,277 – $ 800 =) $ 477. This repayment amount with a 1.5% rate allows them to borrow $ 119,500 over 25 years.

How to increase borrowing capacity?

Borrowers find themselves in an impasse, their financial situation does not allow them to buy the property they covet. The solution to reducing the monthly payments of current credits is to redeem these credits over a longer period in order to reduce the monthly payments and consolidate them into a single loan.

Let’s take our example again: Michel and Laetitia have a total amount of outstanding capital of $ 30,000. If we make a simulation of credit repurchase over 10 years with a rate at 3% this brings the new monthly payment to 310 $ including fees (the new monthly payment is calculated excluding insurance). The new monthly payment of $ 310 against $ 820 before gives a latitude of $ 510.

In this problem and this is the case for many borrowers, the repurchase of credits makes it possible to reduce its monthly payments by lengthening the duration. This operation of grouping loans has the effect of lowering the monthly payment of existing credits and therefore increasing repayment capacity at the level of the future project or the future home loan.

Take out a loan to increase your borrowing capacity

Take out a loan to increase your borrowing capacity

Suddenly borrowers recover borrowing capacity. The borrowers have a real estate project of 210,000 $ with a fixed interest rate of 1.50% and over a repayment period of 25 years. The monthly mortgage loan will, therefore, be $ 839 per month.

If we add the new monthly repayment of the loan plus the monthly payment of the mortgage, this gives the total monthly payment of the credits which is payable. Or 310 $ + 839 $ = 1149 $ monthly. If we divide this new monthly payment by the income amounts, this will give their debt ratio. Or $ 1,149 / $ 3,831 = 30%.In this example, the monthly payments of the two loans are calculated excluding insurance.