When buying property, the question of a mortgage quickly arises. In Senegal , financing options abound, and it can quickly become confusing. In this article, we'll help you gain clarity by providing our best advice on obtaining a mortgage in Senegal. We'll detail best practices regarding down payments, interest rates, choosing a bank, and more. Happy reading!
THE IMPORTANCE OF PERSONAL CONTRIBUTION
This is one of the most important points to consider when obtaining a mortgage in Senegal. Indeed, banks generally require a down payment of at least 10% of the total amount . This down payment demonstrates your credibility and your ability to save. It is typically used to cover notary fees and other loan-related expenses. The larger the down payment, the lower your monthly payments will be, reducing the impact on your disposable income.
THE CHOICE OF DURATION
This is another important factor. When your mortgage application in Senegal is approved by the bank, they will generally offer you several options, with varying loan terms (15 years, 20 years, 25 years, etc.). The longer the term, the higher the interest rate. However, the monthly payments will be lower. The question then becomes: do I prefer to pay for a shorter period with higher monthly payments, or pay for a longer period with lower monthly payments that will have less impact on my disposable income? Most experts will advise you to choose the second option and use the difference between the two monthly payments for another investment. This is known as leverage.
THE INTEREST RATE
The interest rate is the percentage added to the monthly payment that the borrower must make to the bank each month. It is, in a way, the price of the loan and the bank's compensation for this transaction. As we saw earlier, for the same amount borrowed, the interest rate and the monthly payment amount will vary depending on the loan term.
Two options are then possible: a fixed interest rate or a variable interest rate. The former has the advantage of being fixed over time, allowing the borrower to know in advance how their monthly payments will affect their disposable income. The latter, as its name suggests, can fluctuate from one period to another. It may therefore decrease, allowing the borrower to reduce their monthly payments.
THE EFFECTIVE RATE (APR)
This is the final interest rate of your loan, which includes, in addition to the borrowing rate, the various additional costs: credit insurance, processing fees… It is therefore on this APR that you must pay close attention because it represents the real cost of your loan.
COMPARE THE OFFERS!
All banks in Senegal offer mortgage services, but the offers vary depending on the institution. Most people are used to going directly to their bank because it's the easiest option. But it's not necessarily the most advantageous! We advise you to contact several institutions to compare their offers and select the one that best suits your needs. You can also contact a mortgage broker in Senegal , who will find the offer that's right for you.
If we had one piece of advice to give you, it would be to first confirm the amount you can borrow from the bank, and then begin your property search. Take advantage of our Senegalese real estate portal and find your property.
Take a look at all the real estate sales listings in Senegal .
Are you a tax resident in France and looking to obtain a loan for your property purchase in Senegal? Discover our loan solutions .