Any form of financial loan or assistance does not come without its disadvantages. When it comes to a mortgage loan, the biggest and most important aspect to be aware of is collateral loss. This means that if a borrower is unable to make the payments in time and loses score over a certain period he would lose the property against which the loan was approved. Having the house listed as collateral is part of the agreement between the borrower and the lender. This is the only way a lender could have a guarantee for the safe return of their money. Since the clause is clearly stated in the mortgage loan agreement, the lender has the right to reclaim the house if the mortgage payments stop due to any given reason over the course of time.
This implies that anyone who has made payments to a certain amount and is unable to pay further will not be reimbursed and would lose the amount already paid in mortgage payments in addition to losing the house as well. Another disadvantage is that, over the course of time, the price of the property may increase or go down which could further impact your payment plan or strategy. While this factor along with several others may impact the total value of your investment, it would not change the mortgage loan in any way, this situation is termed as being underwater where the value of your property goes lower than the amount due for the mortgage balance. Some lenders offer jumbo home loans Bend, however, it is always better to consider your financial situation before committing to any form of financial assistance program.
While this is an important factor and a substantial risk that should be looked at seriously. There are several benefits of a mortgage loan that cannot be ignored.