China’s home loans and UK home loans, there are very big differences in terms of bank interest rates, loan procedures, procedures, money-saving skills and so on. However, investors who came to Britain from within China often miss the opportunity to invest properly because they do not understand the British loan policy. So what are the similarities and differences between home and abroad loans?
1.many banks, large choice.
Buying home loans in the country is basically just several major state-owned banks. In addition to state-owned banks, others such as Fujian Bank and China CITIC Bank also exist, but after all, they are not the mainstream. In contrast, the British banks are very large, with more than 200 mortgage-backed qualifications. When consulting with Independent Loan Consultants, sometimes they can suddenly find more than a thousand loan products for you to choose from. Really dazzling, impeccable ah. Sometimes, they will recommend to you a few little-known small banks that can get bigger offers than the big ones. Supermarkets such as Tesco have their own banks that can provide homeowners with home loans.
2. intense competition.
In the UK shopping street bank, you can go into the appointment to talk about mortgage loans. Loan specialists will carefully ask you to buy the details of the total housing, down payment, family annual income, and finally give you a loan amount and interest standards. When you allow, you can also credit you directly, if passed, you can get a loan letter of intent. They just want to hear that you want to buy a home loan, and each one will actively contact you and win customers. Some banks also launched the “You pay for my house tax” move, promised within a certain price (250,000 pounds), will be for buyers to pay 1% of the purchase sharp. Open the newspaper, you can often see the bank’s substantial loan ads.
Of course, if you choose an independent loan broker (certified and regulated by the UK Financial Services Authority), they are obliged to recommend to homebuyers the loan scheme that best suits the interests of their clients, eliminating the need for homebuyer-by-bank ownership and not necessarily The best cost of the loan program.
In general, there are two restrictions on bank loans in the UK. That is, the total loan amount is within 4-5 times of the annual income before the family tax. At the same time, the loan ratio can not exceed a certain percentage of the house price. For self-housing, the ratio can reach up to 90-95%; for rental housing up to 85%. (For overseas investors, however, both should be reduced accordingly.)
3. housing inspection and loan insurance.
With China a little different, in the UK, before getting a loan, real estate inspection is also essential. When applying for a home loan, buyers will be told to do two surveys: one on the property rights of the house and its surroundings, and the other on the house itself. For buyers, in fact, also need this inspection. To ensure that the property rights are clear and that the quality of the property is good. The first is checked by your attorney, the second by your loan advisors, brokers and banks.
There may be buyers worried about such a house assessment company will go through the scene, in fact, do not have to worry about the companies here are to bear the legal responsibility, if not detected or what happened, they also receive heavy penalties And take responsibility.
Each test is about 300 pounds or more, depending on the size and value of the house. If you want to test in more detail, but also upgrade to more complex assessment, such as structural assessment, of course, it means that will pay a higher fee. At the same time as applying for a loan, the applicant will also be told to buy two types of insurance: property insurance and life insurance. Housing property insurance is to prevent damage in the event of a major disaster and damage to the home; personal insurance is to prevent the purchaser in the purchase of housing after personal injury and death resulting from the payment. For example, a Chinese nationality customer purchased a joint-stock house worth 370,000 pounds in five districts of northwestern London and paid a monthly fee of about 50 pounds. Of course, it depends on the specific insurance requirements. The more content-rich insurance, the higher the amount of compensation, it means higher costs. To the bank, with such insurance, it can ensure that bank loans will not lose their bank interests in the event of a natural disaster or personal injury to buyers. In terms of home buyers, also increased the family life and property risk prevention capabilities.
4. bank loans will be directly to the lawyer.
And domestic banks to sell directly to different sellers, where the mortgage will be directly to the purchaser’s lawyer, by lawyers and then pay the seller’s lawyer. There is less risk in trading between two lawyers who know the relevant laws and regulations.
Another feature of the UK mortgage is the choice of large, flexible and strong. For example, you can choose a fixed interest rate or floating interest rate. The advantage of a fixed interest rate is that interest rates remain unchanged for a certain period of time, with the downside often being slightly higher than the floating rate. You can also choose to only interest, or principal and interest together also. If you elect to pay interest only once a month, you will need to pay off all your borrowings once the loan expires. This benefit is that it helps to ease the pressure on the current capital, the downside is that you put the pressure to the end.
As another example, if you sign a two-year contract, two years later, if the bank is not priced properly, you can always find another bank and change your loan elsewhere. At home, there is very little impression of changing banks.
Compared to China, the British banks have a stronger sense of crisis. If the service is not good or interest is high, consumers will change banks. This is a bit like consumers holding a remote control panel watching TV, not good, I can replace you at any time. These characteristics of children, determines the initiative in the hands of consumers larger.