With Saudis increasingly buying real estate through real estate financing programs, the importance of financial awareness stands out as the first line of defense to protect individuals from financial default and ensure their family stability. As part of the campaign to raise awareness in real estate buying and financing, real estate and investment consultant Matar Al Shammari provided a set of tips in a video posted on his Twitter account, focusing on how to smartly manage monthly deductions and the importance of life insurance as an essential part of a safe financing plan.
Financial planning is the first line of defense to protect individuals from financial faltering and ensure family stability.
Financial planning before financing. The key to stability
He stressed that the choice of financing product should be based on a comparative study between the offers available from banks and real estate finance companies, focusing on details such as interest or profit rates, administrative fees, and repayment periods, to ensure the best possible terms according to the borrower's financial ability. He stressed that the choice of financing product should be based on a comparative study between the offers available from banks and real estate finance companies.
In a related context, Al-Shammari warned against ignoring the cumulative interest on financing, especially in the presence of products based on variable profit rates, as this leads to the total cost of the property rising significantly compared to the original price, leaving some borrowers facing additional unaccounted for financial burdens in the long run. To ensure stability, it is important to focus on details such as interest or profit rates, administrative fees, and repayment periods, ensuring the best terms according to the borrower's financial ability.
To ensure that the family's financial stability is maintained, Al-Shammari recommended managing the monthly budget wisely, allocating part of the income for emergencies, and not relying on real estate financing as the only means of building future assets or improving the financial situation.
Life Insurance. A safety net for family and real estate
He explained that having a life insurance policy accompanying the mortgage contributes to covering the remaining premiums in full, which lifts the burden on the family and protects them from the risk of losing the property due to default. Life insurance is also important to ensure that the family remains financially stable in case the borrower is exposed to any emergency circumstance, such as death or total disability.
<Life insurance also ensures that the real estate investment continues without sudden fluctuations that threaten to lose the property or enter into legal disputes with the financing authorities. Al-Shammari recommended choosing an insurance policy carefully, making sure that the coverage includes all potential risks, and that it is free from hidden costs that may increase the future burden on the borrower or his heirs.
Promoting a culture of financial awareness in real estate finance
Al-Shammari emphasized that proper financial planning should precede any financing commitment, explaining that the monthly salary deduction should not exceed 30% to 40% of the total family income, to ensure the maintenance of a balanced standard of living, away from monthly liquidity crises or falling into the trap of additional loans to cover basic expenses.
In addition to financial planning, Al-Shammari emphasized the importance of life insurance as one of the essential tools in real estate financing, to ensure the continued financial stability of the family in case the borrower experiences any emergency circumstance, such as death or total disability.
These recommendations come within the framework of a broader trend towards raising the level of financial and investment awareness among citizens, especially with the remarkable growth in the demand for real estate financing in recent years. Experts emphasize that owning a property does not only depend on signing a financing contract, but begins with proper planning and smart financial management, ensuring a balance between home ownership and achieving financial stability for the family in the long term.
