When buying a house or apartment, the seller often asks you to pay a down payment at the time of signing the compromise. Is it a legal obligation? What precautions should be taken?
Why pay a deposit before the work? Is this normal?
Yes, it’s normal. The down payment makes it possible to commit you financially to the company that will carry out the works. By paying this deposit, you validate the contract up to the specifications mentioned in your quote with the mortgage provider. Finally, paying the down payment allows the company to not incur any costs for the purchase of materials upstream from the site.
There are two types of down payment on works:
Down payment upon signature of works- Between 10 and 20% down payment on the total amount of the estimate that allows you to block the contractor’s agenda. It results in the signing of a “work voucher”.
Down payment at the start of work- Deposit on the order of equipment on site: this corresponds to 30-40% down payment on the total amount of the quote you will have to pay.
How much is down payment useful?
Depending on the financing model you do not have to pay anything or an amount between 10% and 25% of the purchase price. This does not mean you should not pay more. The cost of a loan depends on various factors. As a rule, the banks take account of your creditworthiness and your liquidity when calculating the interest rate.
Your credit rating counts by the previous payment morale, your income, and other factors. The down payment calculator calculates your score value from different data. The better this is, the more favorable the interest rates on your loans. Liquidity is the amount of money they have “liquid.” As a measure of your, this applies among other things, the amount of the deposit. If you have poor liquidity, you need to pay more for your loan.
For down payments, the more you pay, the lower the interest rates will be. Also, you can have fewer kills if you only have a smaller loan. In times with low-cost spas, you should try to pay as much as possible to save financing costs.
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