Even if the rules vary from one bank to another and from one lending institution to another, be it a loan to build or a loan to buy a house or an apartment or any real estate project, in general, banks ask you to limit your monthly mortgage payments to one third of your net income (be careful not to be confused with your net salary).
By net income, financial organizations mean, all of your professional income or replacement (unemployment, cpas …) minus any other credits and alimony
So if you do not have other credits in progress (personal loan, car loan …) you can borrow a larger amount.
Texas construction loans
Some organizations sometimes allow prospective homeowners to borrow up to 35% or 40% of monthly net household income. In their calculation of a household’s borrowing possibilities, lenders also take into account their lifestyle, so that sometimes even larger amounts can be granted.
Check Out The: Construction Loan Requirements
Conversely, in some cases, you will be advised to reduce the amount of your monthly payments by starting with a lower amount or a larger number of monthly payments. Do not forget that a mortgage allows you in some cases to benefit from a tax reduction.
How much can I borrow for the purchase or construction of a house based on the value of the property?
The maximum amount for a mortgage (capacity of mortgage) that you may be granted will depend largely on the estimated market value of the goods you offer as collateral for your credit.
In the case of a credit to build a new home, it is simply, the market value will be equal to the sum of the value of the land and the costs incurred to build your home.
In the case of a renovation it is a little more difficult since other factors will have to be taken into account depending on the complexity of the renovation. This will include the value of the purchase of the land and the property, the cost of materials, the cost of renovations, etc.
The same is true if you are wondering how much you can borrow for a rental investment.
The market value does not include, notary fees, architect fees and registration fees.
In the context of a mortgage, the market value of a building (provisional or not) will be defined by an expert from the financial institution. To learn more and to know the interest rates in force you can perform a mortgage simulation.
Finally, know that the Walloon region offers low-rate credit – no zero rate loan unfortunately – for people in financial difficulty, to learn more.
How much can I borrow for a personal loan
As with any type of credit, granting a personal loan requires you to repay it within the time frame that you set with the lender. To avoid late payments, credit agencies analyze your borrowing capacity to find out how much you can borrow before you give them credit.
The one-third rule will obviously apply in the case of a personal credit and it is strongly recommended to have a work contract if you want to benefit from the best rates. However, in some cases a personal loan can also be granted to an unemployed person depending on the amount he wants to borrow and his ability to repay. To go further, you can do a credit simulation and apply for a loan in advance of your choice.
How much can I borrow for work?
Work or renovation to be done in your house or apartment? It is often expensive, so how much can I borrow for my work is probably the question you ask yourself.
Unfortunately, we still do not have a specific answer to give you because it depends once again on your financial situation and your debt situation.
However, what we can tell you is that in Belgium, credit agencies offering loans work allow you to finance between 2500 and 150000 Dollars at a much cheaper rate than for a personal loan. So, if your financial situation allows you, the answer to the question how much I can borrow for my work is 2500 to 150000 Dollars.