A substantial percentage of our income goes to cover the cost of housing. You, therefore, should find ways to keep that figure low, for you to be left with something on the side for your other expenses. You get to manage that when you arrange for a better deal for our mortgage. This is done when you lower your loan to value ratio. Here is more info on the idea, and the ways to make it a reality.
A loan to value ratio is what a bank relies on to find out the relationship between the amount you are asking for, and the value of the property in question. This shall be a percentage that tells them what amount of risk level they are getting themselves into. The higher the percentage, the riskier it is lending you the amount you are asking for. When the property holds only a small equity, the risks involved shall automatically be high. Even if they were to take the property to settle the loan amount, it would not fetch the amount they gave you. If the percentage is low, then you can even access much lower interest rates. Do check this company for info.
The loan to value ratio is a division of the mortgage amount by the sale price of the house. You can expect a figure less than zero. You will then look at the numbers to the right of the decimal point and use those as the percentage. For those who find that to be too much calculating, there is an LVR calculator that keeps things simple. You can have a look at it on this site.
You should always aim to keep your loan to value ratio lower than 80%. This shall have most lenders viewing you as someone with a low risk to give money to. With such a lowered percentage, you shall manage to make your monthly payments much lower. These much mower figures shall allow room for you to find money for other expenses in your life. There are several ways you shall manage such a feat. The first thing to do would be to give a larger down payment. You may also try and see if you can get the selling price of the house to be taken down. It is by lowering the price that you shall get ratio down once the calculations are made. You’ll want to click for more info.
You need to know what happens when the loan o value ratio is worked out, and how to influence those calculations. It is best to have a lowered interest rate on the mortgage no matter what budget is in question. You can check out his blog for such advice. You will thus discover more ways to keep the costs low, and thus to have more money open for spending.