Sometimes we are unforeseen and see illiquid to meet them, whether at home or enterprise level, if we are autonomous or business owners. One of the ways with which we have in these cases to deal with this lack of liquidity is an extension of the mortgage or, in technical terms, a novation of it.
If we decide to do it, knowing what method should we choose to be most suitable for our situation.
The extension of the mortgage can be done two ways:
Expanding the amount, ie, increasing the amount of money that the bank lends us to change the extension. According to experts, this modality is that we must choose whether we are looking to fill a capital shortfall.
Extending the term. Thus, what we achieve is a reduction of the monthly mortgage, so this option is more convenient if you have suffered a reduction in income due to unemployment, wage cuts, etc..
Often if banks consider too risky to grant an extension of our mortgage, because our credit history is not very good, tend to use an alternative, such as a mortgage complementary.
In this case, we beautifully well and good with numbers, since the interest rate at which we offer this new mortgage are usually much higher than those of the first, so that we can share out pretty high. That is why this method is the least chosen.
Finally, it is also appropriate to consider whether, in these cases, we would more advantageous to the mortgage subrogation, ie sign it with another entity and on more favorable terms, which we also can lead to higher liquidity to month