According to statistics, the number of citizens who want to take out a mortgage is constantly growing. A mortgage is a mutually beneficial transaction between the bank and the borrower.
Through cooperation with reliable and conscientious clients, the financial organization makes a profit. The borrower uses the loan money to purchase housing and pays interest to the bank.
Many of our clients take out a second round mortgage loan. Let's try to figure out how many times one person can take out a mortgage.
Bank restrictions
It should be noted right away that banks do not impose any restrictions on the number of mortgage loans taken. You can take out a loan once, twice, three times, or more.
The main requirement for a potential bank client is the solvency of the borrower. A mortgage is a fairly lengthy commitment. It is issued on the basis of Federal Law No. 102. Sometimes payments are made over many years, and monthly payments must be made throughout this period. Moreover, the required amount must be in the account within the prescribed period.
Only a citizen who receives a regular and stable income can comply with such requirements. That is why the financial company will definitely require that the client confirm his employment. There are several options for confirming income:
- a certificate confirming income if the citizen is employed;
- certificate of registered individual entrepreneur, if the citizen works for himself.
The length of service of a citizen is also of great importance, which must be at least a year.
Financial companies also do not forget that a citizen has other needs. Therefore, it is ideal that the contribution amount is no more than 30% of the borrower’s total monthly income. However, in practice, most financial companies approve a loan even if the payment is half of the total income.
Why are we afraid of long-term mortgages?
A mortgage is a long-term loan for housing.
The minimum mortgage period in Russian banks is 1 year, the maximum is 30 years. Like any loan, a mortgage is an overpayment. The bank lends money and charges interest for it. The longer a person uses these funds, the more interest he pays. In the case of a mortgage, it turns out that we use the bank’s money for 20–30 years, so overpayment is catastrophic. For example, let’s take the amount of 2.4 million rubles. The interest rate is 9.2%.
| Mortgage term | 5 years | 10 years | 15 years | 20 years | 25 years | 30 years |
| Monthly payment, in rubles | 50 054 | 30 663 | 24 629 | 21 904 | 20 471 | 19 658 |
| Total cost of the loan, in rubles | 3 003 240 | 3 679 560 | 4 433 220 | 5 256 960 | 6 141 300 | 7 076 880 |
| Overpayment, in rubles | 603 240 | 1 279 560 | 2 033 220 | 2 856 960 | 3 741 000 | 4 676 880 |
With a 20-year mortgage, the payment will be 21,904 rubles, and the overpayment will be 2 million 856 thousand rubles, that is, more than the amount that we initially borrowed.
Plug your numbers into the table to see how long it is best to take out a mortgage for. You can calculate the amount of payments in any mortgage calculator - for example, here.
In our case, the payment on a mortgage for 20 years differs from the payment calculated for 30 years by only 2,246 rubles, and the overpayment is more by 2 million 643 thousand rubles. Over these 10 years, you will pay 264 thousand per year or 22 thousand per month - an unjustified price for the difference of 2,246 rubles.
How many times can one person take out a mortgage?
Alas, modern statistics are such that the salaries of the country’s citizens are not enough even for one mortgage. However, in this case, the potential client bank can invite a co-borrower - then the total income will be taken into account when issuing a mortgage.
Of course, under such circumstances, a citizen can successfully pay off several loans. However, do not forget that if the borrower stops paying the loan, the co-borrower will have to do the same.
Therefore, if you decide to take out several mortgages, think about where you will get funds in the event of a financial crisis in the family.
Why is everything not as scary as it seems?
At first glance, a long-term mortgage is bondage for life. For the sake of your own square meters, you need to deduct a significant part of your salary every month - and do this for 20–30 years. And in the end, the bank will receive two to three times more than it initially issued. However, if you look at it, everything is not so scary.
You choose comfortable payments
A long-term mortgage allows you to maintain your usual lifestyle and not switch to austerity mode. Due to the fact that you take out a loan for 20–30 years, the monthly payment will not be very large. For residents of large cities, the amount will be even less than the cost of renting an apartment.
For example, you bought an apartment in a new building for 3 million rubles. The down payment is 600 thousand, the rest was taken out on a mortgage at 9.2% per annum. If you take a loan for 10 years, the payment will be 30,663 rubles, and if for 20 years - 21,904 rubles. It turns out almost 9 thousand less.
Reduced risk of late payment
The most terrible question for those who take out a mortgage is: “Will I have enough money to pay it off?” Many live in the hope that in a couple of months it will become easier, but the situation in the country is such that prices are rising, but wages are not. And if it is difficult to pay today, then tomorrow it will be even more difficult. Therefore, if you are not initially sure that you will be able to handle large payments, it is better to play it safe.
With a long-term mortgage, you don’t take that risk: it’s easier to pay 20 thousand than 30 thousand. In the event of force majeure, it will be easier for you to find money.
And if the salary is increased, the payment will be even less stressful. For example, you received 40 thousand rubles, but paid 21,900 for the mortgage - more than half of your salary. A year later, you gained experience and began to receive 55 thousand, but the loan payment remained the same - 21,900 rubles.
You can pay off your mortgage early
A relatively small monthly payment leaves room for maneuver: when free money appears, you can pay off the mortgage early. For example, if you received a bonus, found a part-time job, or your salary was increased. Early payments go towards repaying the debt, not interest on it, so you will repay the loan faster and overpay the bank less.
There are two strategies for early repayment: reducing the term or payment. In the first case, you will pay off the debt faster, in the second, you will give less to the bank every month. It is impossible to say exactly which strategy is more profitable: you need to do calculations for a specific loan and see which option is preferable for you.
Let's see how the overpayment will decrease if we choose a strategy of reducing the term. For example, let’s take the same 2.4 million rubles for 20 years. Here's what happens if you make early payments:
- One early payment. At the end of the year you are given your thirteenth salary - 40 thousand rubles. You use this money to pay off your mortgage. Such a payment will save you 187 thousand in overpayment and reduce the loan term by 11 months.
- 10 payments of 20 thousand for 5 years. From time to time you have free money. You make 10 early payments of 20 thousand rubles each in the first 5 years of the mortgage. This will save you 635 thousand rubles and reduce the loan term by more than 3 years.
- 10 payments of 40 thousand for 10 years. For 10 years in a row, you invest your thirteenth salary - 40 thousand rubles - into early repayment. This will save 884 thousand rubles and reduce the loan term by 5 years.
You can calculate how much you will save on early repayments here. Also, be sure to read our article about which strategy to choose in order to repay a bank loan faster.
Inflation devalues your debt.
Speaking about the huge overpayment, we should not forget about inflation - the depreciation of money. 20 years ago, a loaf of bread could be bought for 7 Average consumer prices for goods and services - Federal State Statistics Service rubles, now - for 27, and after 10 years - for a conditional 47 rubles.
There is nothing good about inflation, but in the case of a mortgage, it only benefits you: prices rise, salaries are indexed, your apartment becomes more expensive on the real estate market, but the mortgage payment does not change.
In 2029, you will repay the debt to the bank at 2021 prices, even if this money depreciates so much that you can only buy bread with it.
No one can say exactly what inflation will be in 5–10 years. From 2010 to 2021 it amounted to 64.3% Inflation rate in the Russian Federation. If this pace continues, then in 10 years your apartment for 3 million will cost almost 5 million, in 15 years - 6.6 million rubles, and in 20 years - more than 10 million.
And if the inflation rate decreases, the Central Bank announced the conditions for reducing the mortgage rate to 8% and loans. In such a situation, you can refinance your mortgage - the bank will reduce your interest rate.
Make sure in advance that the mortgage agreement does not contain a ban or penalty on refinancing. Then you can easily switch to more favorable conditions if they appear.
David Sharkovsky
Manager of the Russian branch of Financer.com
What programs can you use to get a second mortgage?
Banks do not provide special programs for obtaining additional mortgages. However, borrowers can receive an additional loan on similar preferential terms:
- A loan for housing in a new building accredited by a specific lender. In a similar way, banks support developers and attract potential clients. It is possible to obtain a mortgage at a preferential rate for housing in a new building as many times as the client can pay.
- Mortgages for the military. For this category of employees, favorable conditions for an additional mortgage remain unchanged if the military man was transferred under a contract to another region.
There are state support programs that provide for single mortgage lending. Young families are invited to apply for a mortgage under the “Young Family” program only once, and take out further mortgages on a general basis.
How to increase your chances of getting a mortgage approved
Loan managers indicate that each client can increase their chances of getting approved for a mortgage application if they follow these recommendations:
- If you don’t have a credit history, you need to take care of creating one by taking out a small consumer loan. If the client’s credit status is not impeccable, then it is advisable to pay all current overdue payments.
- To increase the chances of approval, it is recommended to collect a large number of documents confirming financial stability and solvency.
- The bank may require the client to prove the existence of collateral property, the sale of which will provide sufficient funds to cover debts to the credit institution.
- The client must take care of providing himself with reliable, from the point of view of financial stability, guarantors and co-borrowers.
- To increase the likelihood, it is recommended to apply to several credit institutions at once. From among several banks, there may be one that will approve the client’s application for a home loan.
Important! If there is a need to apply for two mortgage loans at once, the likelihood of approval will be higher if you send applications to several credit institutions at once.
How to reapply for a loan
Here the registration procedure is no different from the initial application. The requirements for borrowers are also no different; the borrower will also have to collect a full package of documents and provide a down payment, unless otherwise provided by the terms of the mortgage lending program.
You must submit an application to the bank and wait for the lender's response. If it is positive, then you can provide documents and formalize the deal. And thus, you can do this an unlimited number of times, the main thing is that the income allows you to pay off the loans.
How willing are banks to approve re-mortgages?
A bank is a lending institution that receives income from interest paid by borrowers after receiving a loan. The bank's interests lie in receiving stable payments from the client and returning the principal along with accrued interest. If the borrower has successfully paid off the first mortgage, the bank will be happy to issue a new loan, provided that the client confirms that he meets the lender’s criteria and follows the rules for selecting housing and preparing the transaction.
Buying a second or third apartment at Sberbank can be complicated if the borrower:
- made significant delays and ruined the credit file;
- not ready to pay the minimum down payment;
- is unable to confirm income, or its amount does not meet the requirements (payment no more than 40% of income);
- the new apartment does not meet the criteria for liquid property from the bank’s point of view.
If, when repaying a previous loan, the client committed gross violations, including illegal redevelopment, which led to damage to his own and other people’s property, if the owner used the housing for rent without the approval of the bank, the latter has the right to include him in the list of unwanted clients who will not be able to agree on the receipt of a large housing loan
Limitations on tax deductions
People who bought real estate may temporarily not pay income taxes (13%). Thus, you can return up to 260 thousand rubles.
In 2014, the law was amended, so the return conditions before this year and after are different:
- if apartments were purchased before 2014 and their total cost is no more than 2 million rubles, then you can count on a tax deduction for only one property of your choice;
- if the living space was purchased later, the deduction can be applied to several objects.
Important: in any case, the total refund amount should not exceed 260 thousand rubles.
Responsibilities of Borrowers
After purchasing real estate, the client is obliged to transfer it to the bank as collateral. For this reason, the client has the main obligation to pay monthly the principal debt, as well as accrued interest for using the loan.
The bank presents the client with a repayment schedule, which clearly indicates the terms and amount of the monthly mortgage payment. The repayment schedule is the main appendix to the loan agreement. It is necessary to transfer funds by non-cash method or pay them through the bank's cash desk before the date specified in the payment schedule. Moreover, by this date the money must be transferred to the organization’s current account.
If there is a delay, the bank has the right to charge penalties. As a fine, the lender allows the accrual of interest in the amount established by the loan agreement.
When overdue debt accumulates, the acquired apartment with a mortgage will be put up for sale at public auction. The proceeds will be used to pay off the loan debt to the bank. Mortgage property is required to be insured against various damages.
Several borrowers per apartment
Paying off a mortgage is not easy. These are financial obligations that last for more than a dozen years. Not every person can cope with this. In this case, he has every right to attract co-borrowers.
Banks, as a rule, agree to this transaction option without any problems. And then the financial capabilities of not just one person, but of everyone in the aggregate, will be considered.
Important! It is impossible not to take into account the possibility of one of the co-borrowers refusing to fulfill their obligations. In this case, repayment of the debt will fall entirely on the shoulders of the one who remains.
Who can take out a family mortgage
The program has been expanded since July 2021. Now, to qualify for a family mortgage, it is enough to have a child born between January 1, 2021 and December 31, 2022. In this case, the baby can be either the first or any subsequent one. You must apply for the loan before March 1, 2023.
An exception is made for families raising a child with a disability. Firstly, there are fewer age requirements. The son or daughter must be born before January 1, 2023 and be under 18 years of age. Secondly, you can apply for a loan until the end of 2027.
Both the parent-borrower and the child must be citizens of the Russian Federation.
Any of the child’s natural parents is allowed to apply for a loan. However, they do not have to be married to each other.
Relevance of the appeal
Credit is called both bondage and slavery, but for most citizens this is the only opportunity to buy an apartment or build a house. Individual borrowers specify how many times one person can take out a mortgage, even before repaying the first loan. There are several reasons:
- income and age allow you to think about another purchase;
- the appearance of a co-borrower (marriage) expanded opportunities;
- the previous acquisition is used for commercial purposes and generates profit;
- the second apartment will be used for rent and income generation.
Such situations are rare: a large burden on the budget becomes unbearable. More often, banks consider a request for a second mortgage after the first one has been repaid. But there really are no restrictions, other than financial ones, on re-applying, even if the first one is not repaid. The answer to the question whether it is possible to take out a mortgage twice if the first loan is closed and your age and income level meet the bank’s requirements is a resounding “yes”.
Exceptions are programs for those in need of housing. The “Young Family” offer is valid once, since the first apartment deprives the family of the status of those in need.
You can read more about preferential mortgages for young families here.
