When you go for a home or house loan, you might come across some unfamiliar terms that are important to understand.
One of these terms is the “effort rate.” This is just the percentage of your household income that goes towards paying off your existing credit installments. It helps to figure out how much money you have left for your everyday expenses, like food, transportation, education, and fun, after you’ve made your credit payments.
Keep in mind that this rate, the effort rate, shouldn’t go over 33%, which means one-third of your total income.
So, if you have any previous debts, don’t stress too much, but it’s a good idea to pay them off as soon as you can before applying for a credit pre-approval for a housing loan!
By the way, if you need any assistance, we have an external department that can help you at no cost to get the best possible deal. Feel free to send me a private message, and we can chat!
Isabel Romano | + 351 933263788 text me via WhatsApp and and I’ll be more than happy to assist you!
