The decision to rent or buy a home

The pace of life can be so quick that we have a tendency to blow by important decisions. One such decision is the decision to rent or buy a home.

The Decision to Rent or Buy A Home

One of the biggest decisions people come to is the issue of renting versus buying. Really, it is an extremely tough choice to choose between the two. However, I once had an economics teacher who put it extremely well and puts the whole thing in perspective. His motto was, “Rent when you have to, buy when you can.” This statement is only too true, and here is why.

Renting can be a big plus for certain people. People who are on the move, people who get relocated with their jobs and need to stay mobile, and also for people who just moved out of the house and have low income and no credit. In any of these situations, renting is definitely a good choice. Renting allows people who need to stay mobile the opportunity to do just that. They go month by month and aren’t committed anywhere. Also, the paperwork required for renting is minute in comparison to that of buying and selling. In addition, those with low income and credit scores should also consider renting. Looking for a mortgage with low credit scores will be very difficult and even if you find one the interest will be unreasonable, not to mention the fact that even making the monthly payments can be unmanageable.

However, the benefits of buying, when able to, far outweigh those of renting. Sure, buying a house takes tons of paperwork and involves commitment to that house. But in the long run, owning a home is extremely important since your home is one of the biggest investments you can make. The key to this is home equity. Equity is essentially the value of the home. This equity almost always increases over time and can sometimes take huge leaps such as the recent price hikes of homes in California. These huge spikes drastically increase the price of the home and leave the homeowners with a lot of money right beneath their feet that is always available. Also, equity enables homeowners to pull out home equity loans that are based on the value of their homes and generally have reasonable interest rates.

Of course, this all depends on ability to buy. Having a good credit score, a good amount of money put away, and a good income are all incredibly important. A good credit score allows the person to obtain lower interest rates on mortgages, a good amount of savings allows a higher down payment, and a good income allows the person to make the payments. When this can be done, buying is definitely advised. Renting has its benefits, but buying is always better.

Mortgage refinance

When it’s time to think about your mortgage refinance options, what should you know and how do you make the correct decisions? It’s more than guesswork and you can greatly increase the odds that you’ll refinance (or not) at the right time if you take time to consider some specific points.

Start by knowing your current mortgage interest rate. You can find this listed on your loan papers or your lender should be able to tell you. If you have a variable rate mortgage, you won’t have a set interest rate, but that’s also an important piece of information.

Next, find out the rate you’ll be offered if you get your mortgage refinanced. A word of caution – don’t simply take a look at the interest rates being offered and assume you’re going to get those rates. Ask about your specific situation. Lock a lender into a particular rate before you start the process. Many lenders advertise a very low rate, but you may find that you don’t qualify for that rate. Be especially careful if you’re being asked for any fees up front.

Compare the rate of your current mortgage with that you’re being offered, but also consider the terms of the loan. For example, if you have a variable rate loan, you may find the benefits of having a fixed rate mortgage are sufficient to warrant a mortgage refinance, even if the rates you’re paying aren’t that much different from what you’re being offered.

Most financial people recommend that you save at least one and a half full points on your interest rate before you consider a mortgage refinance. Why? You’re likely going to be paying closing costs, appraisal fees and other costs associated with the refinance loan. If you’re not saving at least one and a half full points, it will take you several years to save the amount of money you’re spending on the closing. Again, this doesn’t apply if you’re getting significantly better terms that in themselves warrant following through with a new loan.

As a final point, consider your future plans. Are you expecting to move in the next few years? Are you looking for a change in job status that could create the need to change your location? Is your family growing and in need of more space? If you aren’t going to stay in your current house at least two more years, a mortgage refinance probably isn’t a good option because of the time it takes to recover the cost of the closing.

Mortgage

: A mortgage is a practice by which the ownership of the property is passed from the mortgagor, to the mortgagee, in return for the loan of the money, the mortgagee is the lender and the mortgagor is the borrower. The mortgagee has limited rights on the property until the loan is paid off. Most probably the mortgage loan is taken for home improvements, or financing college education. The interest rate for mortgage loan varies depending on the type of the loan Mortgage banks and Mortgage brokers are the best options for reviewing of mortgage loan applications. For Mortgage banks, the staff of the bank will process the loan application, as most of the banks are controlled by the government agencies, the borrower can be assured that the mortgage loan will be approved and granted by reliable sources and there will be no discontinuation in the loan. The bank will provide a range of mortgage service providers for a particular loan application, and the borrower should select the best available option from them. The borrower should deal with the service providers, compare each of the interest rates and select the best option. The loan application will be processed much faster by bank staff. Mortgage brokers will present the best available option for a particular loan; the brokers will provide the best option for a loan application that meets the borrowers' needs. If the loan product is selected, then the borrower should deal directly with the service provider to finish the formalities. Most of the information on loan products of mortgage service providers will be available with the mortgage brokers. The borrower before using the services of the brokers should verify whether the mortgage broker is registered with any reliable company or service. Mortgage loan types There are many types of mortgage loans available in the mortgage industry, but the two most common types of loans are Fixed Rate Mortgage (FRM) and Adjustable Rate Mortgage (ARM). For fixed rate mortgage, the interest rates are fixed and are high, the rates will not change during the life of the loan, the repayment time ranges from 10 to 20 years. For adjustable rate mortgage, the interest rate fluctuates with respect to a standard market index, it will increase or decrease with respect to the index, the borrower cannot predict the interest rate for the next interest period before hand, if the interest rate increases, the borrower has to pay the extra cost, to avoid this, some lenders offer interest lock, using this, the borrower will repay the debt on a fixed interest rate for a particular period, the lender will charge extra money for this service. The repayment time ranges from 5-10 years. The borrowers who borrow fixed rate mortgage loans are more financially secure than who borrows adjustable rate mortgage loans. The proceeds from adjustable rate mortgage negates any risk and most of the borrowers' uses this loan as repayment mode. Presently the mortgage markets in Asia are growing mush fast than the developed countries. In Asia, India has the second highest interest rate of 7%.In UK, interest rate for a 15-year fixed rate mortgage loan (FRM) is 12% and for 30-year adjustable rate mortgage is 15%.For a 1-year adjustable rate mortgage loan (ARM) is 4.05%.

Raleigh mortgage options

Situated in north central North Carolina, Raleigh is the capital of the Tarheel state and is a booming city that has witnessed many changes over the past several decades. Gone are the days when Raleigh was little more than a sleepy, southern city in a chiefly agricultural state. Today, Raleigh has more than 320,000 residents and is part of a exploding metropolitan area that 1.3 million residents now call “home.” Duke, UNC, and NC State are three highly regarded universities serving the area and the Research Triangle Park is world renowned for its many technological innovations. For good reason, thousands of families are relocating to the Raleigh area every month; you can too and a Raleigh mortgage can give you what you need to successfully make your move.

Purchasing a house in Raleigh is so much like buying a home in any recognized American city: you make a down payment, get in touch with many lenders for competing bids, and you select a lender based on the information given. Your Raleigh mortgage is ready and your move is certain, right? Well, it isn’t always that simple! Let’s examine some web sites that can give you useful and significant information as you shop for a mortgage:

1. Bankrate. com – this site lists mortgage rates from all across the nation. Narrow down your search to Raleigh and local mortgage rates will turn up in your search results. The rate given should be a good point of reference for you as contact lenders.

2. Interest. com – works much the same way as Bankrate; enter your Raleigh mortgage information and the rate will emerge.

Other useful sites of note include:

3. ChaseHomeMortgage. com

4. LendingTree. com

5. Amerisave. com

6. ING Direct. com

While the list isn’t comprehensive, it is a good beginning point. Additionally, you can check your local phone book for a record of Raleigh mortgage companies. Sometimes smaller, local companies are more willing to help out, particularly if your have other circumstances present, including if you are self employed, possess bad credit, have suffered a drop in income, or have experienced other important changes.

Your Raleigh residence is waiting for you – get in touch with a Raleigh mortgage broker right now to learn about your mortgage choices.

Helpful information on reverse mortgages

A popular method of borrowing against your home is the reverse mortgage. The reverse mortgage is becoming increasingly popular among senior citizens who wish to pay off their debts and increase their retirement income. It is expected that as the Baby Boom generation moves towards retirement, use of the reverse mortgage will become more and more frequent.

Reverse mortgages differ from a traditional mortgage in that there are no monthly payments.

The funds can be paid out as a monthly income, taken as a lump sum or withdrawn as needed. Interest is charged each month and deducted from the home equity balance.

The most common reverse mortgage is the federally insured Home Equity Conversion Mortgage. This mortgage guarantees a retiree can remain in his or her home until he or she passes away or moves out. Any remaining equity in the home is the retiree's or his or her heirs. The lender gets none.

One advantage of reverse mortgages is that your ability to obtain one is not tied to your income. In fact, you can get one without any income at all!

You must, however, repay the loan upon your death or when the home is sold.

Reverse mortgages are not without their drawbacks, and they are not for everyone. While interest rates are comparable to conventional mortgages, there are high startup fees. Part of this is to insure the loan, which tends to be riskier than conventional mortgages, as the borrowers must be at least 62 years of age.

In addition, as the reverse mortgage draws upon the equity of the home, you could find yourself with no equity remaining if the value of your home should drop over time.

Reverse mortgages may become more popular in Texas and reverse mortgages will soon allow line of credit paymentsThose seeking a reverse mortgage or home equity loan in Texas were long disappointed, as Texas was one of the last states to allow such lending. Mortgage laws dating to the nineteenth century prohibited such lending, as the state’s founders feared that lenders would take advantage of people and intentionally seize their homes through foreclosure. This made it virtually impossible for Texans to use their home equity for purposes of debt consolidation, home improvement, or other legitimate uses, as citizens of other states may do. In 1997, the Texas legislature finally amended the state constitution to allow home equity loans, but did so in an awkward, poorly worded way that left many questions unanswered. The new laws did allow for traditional term loans and lines of credit for home equity loans, and also allowed for lump sum payouts for reverse mortgages. The law did not allow for a line of credit for reverse mortgages, however, and that has created a problem. A reverse mortgage allows homeowners who are at least 62 years of age to borrow against the equity of their home by agreeing to pay back the money when the homeowner dies, sells the home, or moves. Reverse mortgages have been quite popular in recent years, particularly in areas such as California, where high real estate prices have left many homeowners short of cash but “equity rich.” These people have been able to fund their retirements using the equity in their homes, purchasing vacation homes, recreational vehicles, or taking long-desired vacations. Nationally, nearly 90% of those who take out a reverse mortgage do so by utilizing a line of credit. This allows them to use the money when and how they see fit, and no interest accrues unless the money is actually used. It’s a very convenient product, and it costs the homeowner much less in interest than a lump sum payment. Unfortunately for citizens of Texas, a lump sum payment is the only option, and as a result, very few reverse mortgages have been offered to date. This may soon change, however. The Texas Legislature has recently approved an amendment to the state constitution that will allow homeowners who take out a reverse mortgage to accept payment in the form of a line of credit. Texas law requires that this change be placed on the ballot for a referendum, and it is expected to be voted upon this fall. Those who work in the lending industry expect the vote to pass, and say that it will lead to a tremendous increase in the number of reverse mortgages offered in the state. With more than twenty million people, Texas ranks second only to California in population, and there are many people in Texas who would qualify for a reverse mortgage. By eliminating laws that have been on the books for more than one hundred and fifty years, Texas may soon join the rest of the states in having fair and equitable home lending laws. This might be of interest to those concerned about California adjustable pay mortgagemastersonline. com and that is why we have included this information.

Subprime mortgages

Subprime Mortgages

It sounds terrible. Subprime Mortgage. But in reality it

has many different benefits that other loans do not.

A subprime loan typically has a higher interest rate than

other loans because the people who need it usually have a

poor credit history or very low credit score.

These high interest loans do make people pay a lot more for

a house they want but actually have some benefits.

There are many financial institutions that specifically

deal with subprime lenders. This means they know how to

help those with poor credit.

Some banks also offer prime and subprime mortgages because

they know their community well and some areas just don't

have the types of jobs that prime mortgages will need to

ensure their monthly payments.

It can be embarrassing to go to a local bank if you live in

a relatively small town so you may want to choose a

subprime only lender.

A good benefit of a subprime mortgage is that you don't

have to take the time to raise your credit score. This can

take years of payments and credit building and many people

just don't have the time for all of that.

They realize they made some late payments here and there

but are past that and want to own a home. Not everyone with

bad credit got it by not paying their bills on time.

Many times, wives and husbands who are irresponsible can

annihilate their significant other's credit and even after

divorce, it's still bad.

A subprime mortgage to many people is a chance for a new

beginning.

Free seminars reveals how any homeowner can pay off their home mortgage in as little as 7 years

: ...With Little To No Change To Income or Spending Habits!
Little known mortgage concept pioneered in Australia that US banks don't want homeowners to know about will be revealed in seminars presented by Money Principal Group


Portland, OR (MP 02/17/06) - Utilizing the flexible mortgage account concept pioneered in Australia, mortgage education and loan company Money Principal Group of Utah has produced a patent-pending mortgage home loan program entitled "The MPG Mortgage Eliminator."

Homeowners and future first-time homebuyers can learn about The MPG Mortgage Eliminator through a series of seminars from Money Principal Group, presented live as well as through web-based andtelephone-based seminars. Webinars and teleseminars are available to those that aren't able to attend the live seminars in their area.

"We are conducting these seminars and presentations to reveal to homeowners the closely guarded knowledge on how to 'be their own bank.' Homeowners can 'be their own bank' through combining their home mortgage and bank account into ONE account and can see TREMENDOUS savings over the life of their mortgage," says Ed Bisquera, representative for Money Principal Group. "It's a simple concept based on mortgage cycling and simple time-tested cash flow principles. Really what this accomplishes, is reduce the effects of compound interest and returns the interest spread banks normally earn, back into the pockets of homeowners."

The basis of the program is to show homeowners how to use their mortgage as an all-in-one bank account, which can help them to pay off their home in as little as 7 years, with very little change to current household income or spending habits.

This concept has helped over sixty percent of homeowners in Australia achieve this where it was originally pioneered by Citibank over 30 years ago. The flexible mortgage account is now a widely popular mortgage concept in Australia, New Zealand, Great Britain, South Africa and Canada.

People interested in these seminars should call or visit the website to reserve a spot, as the seminars fillup quickly due to its' popularity and are limited to a small attendance.

A schedule of future seminars and a reservation can be requested by calling a free recorded message hotline at 1-800-862-0784 ext. 12 or by visiting their website at http://www. PDXLoan. com/12/.

Factors of mortgage approval

Factors of Mortgage Approval

When applying for a mortgage, the lender you have chosen

will take many factors into account. These factors not only

influence what type of loans you can qualify for but also

what your monthly payments will be and how many years you

will take to pay the loan off completely.

Knowing these factors and doing what you can to improve

them all can make a tremendous difference when you go and

see your lender and start the process that will get you

your new property.

Some of the basic factors apply for just about any loan but

are especially important if you are trying to get a

mortgage. The big one is, yep, credit.

How good is your credit? Get copies of all of your credit

reports from the 3 major consumer reporting companies and

check each one for errors.

Many times they have errors that can be corrected in just a

few weeks and that helps boost your score. If you have

credit cards, pay them off as well as any other outstanding

bills.

A nice large down payment will always improve your chances

of being approved. If your credit isn't completely top

notch, the bigger the down payment, the more likely you

will get improved.

If your credit is great, you can still put down as much as

possible to lower the monthly payments or decrease the

total loan time.

Above all else, don't lie to your lender. If you tell them

you are a supervisor of a power plant and they find out you

are a UPS man who has only had the job for 6 months, you

will be totally screwed. Be honest and your lender will do

their best to work with you.

How to avoid mortgage scams

With record numbers of individuals seeking home loans these days, it’s no surprise that scam artists have developed new ways to separate borrowers from their money. Mortgage scams are on the rise and typically target people who are overextended, have bad credit, or are in need of financial relief. These scams can cost a lot – in fact, they can result in the loss of your home. Guard yourself against con artists with a little background on common mortgage scams:

Slight-of-Hand Signings

There are documented cases of homeowners who unwittingly signed away the title to their homes because they were confused by paperwork. With any decision involving your finances, get everything in writing and insist on reading the documents carefully before signing. Ask questions and make sure you understand the answers. Be sure you never sign paperwork with blank spaces or allow someone to rush you through the process.

High-Priced Home-Buying Seminars

You’ve seen ads in the newspaper (and on bus benches) for those home-buying seminars or programs catering to people with less-than-perfect credit. If you’re considering such services, check out their fee structure first, and make sure you’re not buying into a scam. If you’re required to pay large fees in advance, chances are the service is not legitimate. Consult the Better Business Bureau before taking action.

The Reconveyance Racket

Say you’re struggling with mortgage payments or in foreclosure. A business or individual offers to buy the property and sell it back to you, once you get your finances back in shape. The process is called “reconveyance,” and there are legitimate companies offering these services. If you encounter a scammer, however, you could find yourself unable to repurchase your home.

Target: Reverse Mortgages

If a member of your family is considering a reverse mortgage, they should protect themselves against scams specifically targeting reverse mortgages and speak with a HUD-approved counselor first. Make sure they get at least three separate offers in writing, and that they understand the terms and conditions before signing. Remember, borrowers generally have up to three business days in which they can cancel a loan document.

Home Equity Hard Knocks

In this type of scan, the homeowner is approached by a contractor offering home renovations at an affordable price. When the homeowner protests that they can’t afford the work, the contractor suggests he arrange financing through a lender acquaintance. The homeowner agrees, the contractor commences work, and then presents the homeowner with a bunch of paperwork. Some of the papers may be blank or incomplete and the contractor threatens to walk off the job unless they are signed immediately. After the fact, the homeowner discovers they’ve applied for a home equity loan with high rates and accompanying fees. At this point, the contractor has all the leverage because the work is underway and he’s probably received a kick-back from the unscrupulous lender.

House prices set for greater regional variation

The growth of English house prices is slowing. In contrast, both Scottish and Northern Irish house prices are heading for boom periods, according to new figures.

Nationwide predicts that house prices in Scotland and Northern Ireland are set to become increasingly dislocated from trends in England and Wales, as the countries have witnessed far faster house price growth over the year, increasing the need for larger mortgages.

House prices in Northern Ireland rose five times faster than the UK average for the past 12 months, while the last quarter saw house price inflation in Northern Ireland outpace the UK average ten fold. Scotland has also seen house price growth above the UK average.

The Northern Irish and Scottish housing markets are booming and, like their governments, have become increasingly devolved from the UK, concluded Fionnuala Earley, Nationwide's group economist.

Meanwhile, within England, the south has resumed its position as the focus of house price growth.

House price inflation in the south of England has now outpaced the north for the third successive quarter. This follows an extended period when the south lagged behind as buyers appeared to reach the limits of affordability.

London is also once again the city with the fastest house price growth, with inflation dampening in northern cities. Nationwide reports that this is also having a knock-on effect on the areas surrounding the capital.

There is a clear pattern of acceleration in house price growth in the south in the regions closest to London, compared with last year. At the same time there is clear deceleration in all of the regions in the north, concluded Ms Earley.

According to Nationwide's quarterly house price index, prices across the UK fell back sharply in the second quarter of the year from 2.2 per cent to 0.9 per cent. However, annual growth has remained stable.

© Adfero Ltd

The ins and outs of bad credit home loans

Owning a home is part of the American dream. It’s also the biggest purchase that most of us will ever make, and because of that, almost everyone will be borrowing money to do it. Unfortunately, for many people that means a bad credit home loan, and that might be hard to get.

It’s simple. Imagine going to a bank and asking for $200,000. And then imagine that you have bad credit. You’re always behind on your bills, your credit cards are stretched to the limit – or you have no credit cards – and you have no collateral. Now try and imagine what the bank will say.

Having a home is a big part of the American dream, but having bad credit is a big part of the American reality. There are a lot of people with bad credit who want to buy homes, but how can they convince a bank or other lender to give them money if it’s clear they’ve never been able to pay their bills on time?

The first thing to do if you’re contemplating buying a home and you have bad credit is to try and establish good credit. Make sure you pay your bills promptly. If you don’t have a major credit card, get one, use it and pay the bills promptly. You’re trying to convince a lender that you can be trusted to pay back money you’ve borrowed. Next, you want to carefully check your credit score.

Your credit score is a history of all of your financial activity as it pertains to credit; in other words, how much and how often you have borrowed and how promptly you’ve paid it back. Credit scores are generated by three companies:Experian; Equifax and TransUnion, and you’re allowed one free credit report a year from each of these companies. If you’re thinking of borrowing for a house, check your credit report; it’s entirely possible that there are mistakes that could lower your score.

Now assume that you’re on your way to establishing credit (but you’re not quite there yet) and your credit report is accurate. The next step is to find someone who is willing to lend you money, and that is probably the easiest step of all. With so many Americans have bad credit, mortgage companies have responded by loosening restrictions on loans and almost all of them have special bad credit programs. Of course, these people aren’t giving the money away. You’ll still have to go through the application process and there are some criteria – loan-to-value ratio, debt-to-income ratio, and monthly income – that they will use to determine whether or not you are a good risk. However, don’t forget that if you have bad credit and a mortgage company is willing to talk to you, they want your business, so don’t be afraid to negotiate.

But what if the private mortgage companies and the banks turn you down? Are you out of options? Not at all. There are a lot of different ways you can get money for a house if you have bad credit. A good place to check is the Federal Housing Authority (FHA.) FHA loans have very generous conditions (the down payment can be as low as 3% or less), they are willing to help people with bad credit and they have various programs that offer excellent deals to professional people – police officers, teachers – to encourage them to become homeowners in the community where they work. Another good choice is Fannie Mae. This private company can make home loans easily available – even if you have bad credit – through their Expanded Approval Program.

Getting a bad credit home loan can take extra time, but it’s worth the effort. Interest rates are low and there are a lot of options. Don’t delay your dream.

First time home buyer mortgage programs designed just for you

So you are thinking of buying your first home? Congratulations! You are taking a big step that will help you realize the dream of many as well as build personal wealth. As a first time home buyer you should know that there are several programs available out there to help you get you into the house you deserve at mortgage terms that you can afford. Before you begin your search for your first home be sure you understand these programs and work with your mortgage lender to take advantage of them!

The biggest resource for first time home buyers is the Federal Housing Administration (FHA). They work by providing private mortgage lenders with guarantees (insurance) against the loan that you take out with them. They help home ownership become a reality for many who don't have perfect credit or have the finances available to otherwise afford the hefty up-front payment sometimes required to buy a home. It is important to realize that they are not there to help you buy a home you cannot afford; they are there to help you to buy a home you can afford by providing guarantees and assistance up front. It is up to you to make sure that you are not buying a home that you cannot afford over the life of the mortgage note. Never get yourself into more debt than you can handle!

The process of applying for an FHA loan is pretty much the same as applying for a conventional mortgage. You will need to provide verified proof of your income over the past three years - yet what qualifies as income is relaxed a bit. Social security, alimony, rent paid by other family members and such qualify as income under the FHA program. In addition, short-term debt doesn't count against you (short-term is defined as being able to be paid off in less than 10 months).

You are allowed to use up to 29% of your total income towards housing costs and up to 41% towards housing expenses and other long-term debt obligations. Again, it is up to the homeowner to make sure they can afford the home they want to buy. Just because the FHA relaxes the restrictions doesn't mean you should buy a home that you have to struggle to afford each month.

Through the FHA they will help you get started on owning the home of your dreams - but remember, it is a cooperative process. You should still shop around at various mortgage lenders and try and negotiate the best rates possible no matter if you are a first time home buyer or a seasoned pro.

There is a wealth of information available about the FHA programs. Your mortgage lender should be able to provide you with extensive information and guide you through the process. You can also read up on it yourself at www. fha. gov.

In addition to the FHA, there may be state and local programs available to you to help offset some of the costs of purchasing your first home. Check with your lender to find out if such programs exist.

Getting a mortgage for your dream home

Owning a home is the American Dream. Of course, this requires you to first get a mortgage unless you have won the lottery or have a very wealthy uncle!

Getting a Mortgage for Your Dream Home

Once your mind has been made up that you want to buy a house and you will need a mortgage for that house, the next thing is to follow the steps of obtaining a mortgage. Obviously, the first step is to calculate the amount you will need from the mortgage. Figure out how much the desired house will cost and how much you are willing to put down on the house. These must be done first.

Next is to know which type of mortgage you want to go with. You can choose to go with either fixed or variable rate mortgages. Each of these mortgage types has its own advantages and disadvantages and you should look into the details of each type to pick out the one that will suit your needs best.

Once you know how much you will need and what sort of mortgage you are looking for, shop around. Set aside plenty of time for this. Shop around with as many banks and other lenders as possible. Try to get the best interest rate possible. Also, keep in mind your monthly income. Figure out how much in payments you will be able to handle. If you can handle higher payments every month, look for a shorter mortgage length. This will save you a lot of money in interest. Go for the shortest length possible no matter what based on what payments you can afford.

When you have everything sorted out and know what your payment plan will be, what the length of the loan will be, what the interest rate is, and what sort of loan you’re getting, then you will want to figure out the equity division. Based on how much you’ve put down on the house, that figure is the amount in equity you own versus the total value of the house. For now, the bank owns the rest of the equity. Over time, as the value of the home rises and you pay off the loan, your stake in the equity will rise, allowing you more options with that equity.

Getting a mortgage must be a careful, determined, and well thought out process. It takes time and patience, but you’ll thank yourself when you’ve gotten the right mortgage.

Finding a bad credit mortgage

If you are looking to purchase a home or refinance the one you are currently living in, but believe this may not be a possibility for you because you have bad credit, think again.

Just because you have bad credit does not mean you will not be able to receive a mortgage. In fact there are many lenders out there across the United States that are know as wholesale lenders that specialize in lending money to people with bad credit.

The names of these wholesale lenders may not ring familiar to you because they are not the typical lending institutions you see on the street corners of your town, otherwise know as banks.

The first thing you will need to do is locate a few of these wholesale lenders and shop around for a deal you believe to be fair. If you do not have success finding these lenders on your own, you may want to consider using a broker and have them shop around for you.

A broker is not a lender. What they do is assess your situation, than shop around for a lender that deals with bad credit mortgages.

Brokers have access to hundreds of lenders across the country and they can usually find one that has a program that may fit your needs.

Using a broker may not be such a bad idea, they are usually very experienced in their field and will not only find a bad credit mortgage lender for you, they will also council and educate you along the way.

Keep in mind, just because your credit may be less than perfect, does not mean that you are at the mercy of the mortgage companies, you are not.

Mortgage companies are very competitive, especially among the wholesale lenders, so be sure to shop around. Don’t limit yourself to contacting only one broker, say no more than four. Allow for each to assess your situation, than base your consideration of which one you will use on the rate and program that they offer you. Good luck.

Refinance mortgage lenders tips for refinancing online

Save even more on your refinancing by going online for your next mortgage lender. By searching for refinancing quotes online, you can tap into a larger pool of lenders.

Online financing companies also offer special deals to remain competitive, so you could potentially save thousands with a better offer. While online lenders can save you time and money, follow these tips to be sure you are getting the best deal.

1. Compare Many Lenders

It may be tempting to simply look at your favorite financing company. But to get the best rate, you need to look at many lenders, even ones that aren’t nationally known.

To make the process a little bit easier, start with a mortgage broker site. They bring together dozens of lenders for the most competitive financing packages. They will give you multiple bids that you can compare side by side. The other option is to start your search with recommended lenders.

2. Look At All The Numbers – Not Just The Rate

Many different numbers make a loan a good deal, not just the interest rate. Closing costs and fees can sometimes make a cheap loan very expensive. For a general idea of a loan’s cost, compare the APR, which includes both the closing costs and interest rates.

Also look at the fees, which can add up to hundreds. There may be annual, cash out, or early payment fees. With a typical mortgage, you shouldn’t have these fees. It is only with a home equity loan or subprime mortgage where you may run into these. And in most cases you can get them removed.

3. Give Yourself Plenty Of Time

Searching for a refinance lender isn’t a process that should be rushed. With so much money on the line, give yourself plenty of time to sort through all the numbers. By searching online, you can keep your search to just a couple of hours.

When you are actually ready to apply for your refinancing, the application takes less than fifteen minutes to complete. In a couple of days, you’ll receive your loan contract. And in two weeks you can be enjoying lower rates on your new mortgage.

The current mortgage rate

The Current Mortgage Rate

So you are looking to purchase a home or refinance the one you are currently living in. If this is the case, not only do you want to obtain the best mortgage rate out there, you want to obtain the current mortgage rate and not a percentage point higher.

Before you begin to track down a lender who can get you going with a current mortgage rate, take some time to do a little research to find out what the current mortgage rate is on your own. Don’t just take the lenders word for it.

You can find out information on the current mortgage rate, and rates in general from many resources. To name a few, the internet or the business section of your local newspaper is a good place to start and will give you a very good idea of what rates are doing.

The current mortgage rate can be easily obtained if you have excellent credit, or what lenders call “A” credit.

However, if your credit is challenged in any way, you will still be able to get a mortgage. Except the rate you receive may not be the current mortgage rate, but a little bit higher because the lender sees you as a slight risk because of your payment history.

Wether you have excellent credit or challenged credit, or you need someone to help you out with a unique situation, shop around.

By shopping around, you allow for a few to several mortgage brokers or loan officers to assess your situation.

Once each loan officer is finished assessing your situation, they will get back to you with what they have to offer rate wise.

Once you have a number of offers, base your decision on what you believe to be the best loan scenario for you.

Remember, the mortgage industry is a very competitive one, and these lenders do not want you to take your business to their competitor, so they will do their best to get you the best deal out there.

Loan officers and mortgage brokers also get paid on commission, so getting the mortgage to the closing table is just as important to them as it is to you.

Repaying your mortgage home loans the basics

With the raging hot real estate market of the last five years, mortgages have evolved wide spread options. The different home loans can be confusing, so lets look at the basic repayment options.

Repaying Your Mortgage Home Loans – The Basics

Jumbo loans, variable rates, fixed, interest only – the variety of mortgage home loans seems almost endless. One way to bring a little clarity to the situation is to look at the basic issue of how you have to repay the loan. Doing so can give you a better idea of what it is going to honestly cost you and whether you can realistically meet the obligation.

The traditional and most common mortgage repayment is one that combines capital and interest over time. The most basic of these loans has been the 30-year repayment mortgage with a fixed interest rate. You typically make a payment each month with part of the payment reducing the principal on the loan and the rest going to interest. At the outset of the loan, the amount applied to the principal debt is usually very small. It will grow over time as the years pass.

A variety of mortgage options have come into existence that focus on interest payments. Although they have a variety of names, the basic game is the exclusion of principal from the repayment process. When you make monthly payments, the total is applied only to the interest on the loan. Payments are never applied to the principal. The advantage of these loans is you can often qualify for a slightly larger loan, and your monthly payment is significantly reduced. Keep in mind, however, that this loan only works in the long run if the home appreciates significantly. If it doesn’t, you aren’t going to create much wealth.

A fairly common, but risky proposition, is a balloon loan. A balloon loan combines the interest only option mentioned in the previous paragraph with a principal call. In practical terms, you are given a loan for a fixed period of five years for example. During the five-year period, you make interest only monthly payments. At the end of the five-year period, however, the loan is called and the full amount is due. The way to get around this call is to sell or refinance the home as the loan comes due. The potential problem, however, is the loan may not have appreciated. If it hasn’t, you could be stuck with a bad deal or even lose the property.

At the end of the day, figuring out the modern mortgage home loans isn’t that confusing. The key is simply to ascertain what you have to pay back, how it will be applied to the loan and for what period of years.

Basic mortgage terms

If it is your first time applying for a mortgage, there are a number of terms you should know. Educating yourself on the various mortgage terms you will run into will help you make better decisions when deciding which home you want to purchase. When you sign a mortgage contract, your home is used for collateral and it is your responsibility to make sure your payments are made on time each month.

The first term you should know is principal. The principal is basically defined as the amount of money you borrow for your home. Before the principal is provided you will need to make a down payment. A down payment is the percentage you will put towards the principal. The amount of the down payment will often depend on the cost of the home. Once you pay off the principal, the home is yours.

The next term you will need to know is interest. Interest is a percentage that you are charged to borrow a certain amount of money. Along with the interest rate, lenders may also charge you points. A point is a portion of the total funds financed. The principal and interest makes up the majority of your monthly payments, and this is a method that is called amortization. Amortization is the method by which your loan is reduced over a given period of time. Your payments for the first few years will cover the interest, while payments made later will be applied towards the principal.

A portion of your mortgage payments can be placed in an escrow account in order to go towards insurance, taxes, or other expenses. The next term you will hear a lot is taxes. Taxes are the amount of money that you have to pay to your state or government. When it comes to your home, these are known as property taxes. These taxes are used to build roads, schools, and other public projects. All homeowners must pay property taxes.

Insurance is another important term that you will hear in the real estate community. You will not be allowed to close on your mortgage if you don't have insurance for your home. Home insurance covers your home against floods, fire, theft, or other problems. Unless you can afford to repair your home if it is damaged, it is usually a good idea to get insurance for your home. If your home is located within a zone that is known for having floods, federal laws may require you to have flood insurance.

If the down payment you put towards your home is less than 20% of the total value, you will often be charged additional premiums on your insurance by the lender. This is done to protect you in the event that you default on your loans and fail to make payments. Without this, many people would not be able to afford a house. Once you have paid off about 78% of the home, the lender will stop charging you insurance premiums.

These are the basic terms you will need to know before your purchase a home. Understanding these things will allow you to avoid many of the pitfalls that exist in the real estate field. You want an interest rate that is low, and you should always try to get a fixed interest rate if possible. This will allow you to focus your income on making payments towards the principal, and this will help you pay off the loan faster. A mortgage is an important part of your financial picture, and you want to make sure you pick a home that you can afford. If you fail to make your payments, you may lose your house.

Reasons to refinance when rates are moving up

: Interest rates have enjoyed record lows during the last few years allowing many people to refinance and enjoy lower mortgage payments. Now, interest rates are moving in the other direction. The average 30 year fixed rate, according to mortgage giant, Freddie Mac, was 6.31% last week. Still, during this same period, refinancing accounted for 43.6% of mortgage applications. Why would anyone refinance when rates are going up? With cash-out refinancing, you refinance your mortgage for more than you owe and keep the difference. Freddie Mac is predicting, by year end, homeowners will convert $204 billion of home equity into cash, up from $142 billion in 2004. 1. Pay off home equity credit lines. The average rate for a HELOC (Home Equity Line of Credit) rose to 6.97% last week, up from 5.09% from a year ago. Most HELOC loans have variable rates that go up when the Federal Reserve raises short term interest rates. Recently, the Federal Reserve announced its12th consecutive rate increase and they sent out a strong message they will continue the short term interest rate increase. Using a refinance to pay off a HELOC not only will lower your existing HELOC interest rate, but you can stop worrying about the Fed …for your second mortgage at least. 2. Consolidate your mortgages. Unless you put 20% or more down on your home, there is a good chance you did a combination (or piggyback second mortgage) loan to avoid PMI (Private Mortgage Insurance) which is required on loans with less than a 20% down payment. Second mortgages typically carry higher interest rates and a cash-out refinance may allow you to consolidate these loans into one lower monthly payment. 3. Secure A Fixed Rate Mortgage. Rates for adjustable mortgages, which are sensitive to Fed moves, have been rising faster than fixed rate mortgages. Borrowers with loans close to a rate adjustment are facing an increase in monthly payments and the possibility of even higher rates down the road. Many borrowers who plan to stay in their homes are fending off the higher rates and potential future increases by refinancing into fixed rate mortgages. 4. Improve Your Home. Home Equity Lines of Credit and fixed rate second mortgage rates have been rising. A cash-out refinance can prove to be a cheaper way to finance your home improvement, especially as the cost of the improvement increases. Properties refinanced during the 3rd quarter of 2005(?) saw 23% appreciation since the original loan was taken out. Improvements made after the refinance may lead to even greater increases. While many people will no longer be interested in refinancing for a lower rate, there are many reasons to consider refinancing even as interest rates increase. If you have an existing second mortgage, need cash to consolidate credit card debt, or want to do some home improvements, refinancing your current home mortgage may be the best financial move for you. For more information regarding current rates, you can visit our website at http://www. greenwoodloans. com/.

Mortgage leads jump start your activity

As loan officers and mortgage brokers there are many avenues to go down in order to obtain mortgage leads for potential loan customers.

Activity is the key to obtaining leads in any sales industry. Sitting idle will get you no where except hungry and out of a job.

For instance, if you have a one o’clock appointment with a customer, don’t spend your day waiting around to leave for the appointment, build appointments in and around the vicinity of your one o’clock appointment.

This can be accomplished in the following way. Cold calling.

The day before your appointment, spend a couple of hours making some calls to potential customers in the neighborhood of your appointment.

Let them know that you will be in the area and you would like to stop by to introduce yourself and drop off some brochures. Keep it short and sweet.

In the mortgage industry your activities consist of many things to obtain leads. Such as chambers, rotaries, customer referrals, family, friends, community involvement, etc.

That being said, it is always nice to have a back up plan for slow times such as summer months and the holiday season.

This is where mortgage lead companies come in.

But just don’t go and invest with any old lead company, you want to make sure you get your money’s worth, so do your research.

Check out the mortgage lead company’s web site and speak with someone in their customer service department. Find out how they obtain their leads and what the quality of their leads is.

If the mortgage lead company is not obtaining their leads from web sites they own and operate on their own, than most likely they are recycling old leads and will be selling you old junk.

Remember, if you are not happy with the information you gather on their web site or through their customer service department, chances are you won’t be happy with the leads either.

Tips for mortgage refinancing and debt consolidation

Many people discover that their credit card debt is out of control when they get their monthly bank statement. Mortgage payment, everyday spending, services and occasionally getaways or dining out can bring your balance over-the-limit fees. It’s time to consider debt consolidation to save your money - credit card balance transfer, home equity loan or mortgage refinancing.

One of the best ways to obtain debt relief is by consolidating your debts with a mortgage refinancing if the timing is right. Refinanced mortgage is a form of debt help for the borrower, who will be able to pay down the old mortgage with the money of a new loan. The benefit of mortgage refinance is based in not only debt consolidation of other debt, but in getting a lower interest rate, lower pay off, and taking cash out of the home equity. Although every borrower may have their particular reason for applying for a new loan, all of them share the desire for debt relief by reducing their mortgages' interests’ rates and liquidating cash from their home equity when possible. Mortgage refinancing usually costs a couple of thousand dollars in closing cost besides the time you spend on research, application etc. Debt advice on home mortgage can easily be obtained through the mortgage lender, mortgage broker, financial institutions and Government Consumer Protection Offices.

Because secure loans and mortgages are backed up by collateral property or a guarantee for any other sort of asset, lowering the rates means more savings and debt relief. Mortgage refinancing could quickly reduce your debt if done properly. Mortgage refinancing lets you cash out your equity to be applied for debt relief purposes, and allow you to qualify for lower rates than a home equity loan. A single mortgage is often considered less risky than having two loans.

Taking a shorter term in your mortgage refinancing may further lower the interest rate. For instance, if your original mortgage is a 30-year loan, you may consider a 15-year mortgage while refinancing the loan. The monthly payment of a 15-year loan is about 20-30% higher than the one of a 30-year mortgage, not as high as out intuition tells us.

Genuine debt help comes when you weigh the pros and cons of debt consolidation. Obtaining a mortgage refinance may be the best option for debt relief, remembering that you will have to follow a similar process like the first time application so make sure to keep a good credit history before you apply. Be sure to get mortgage quotes from at least three mortgage lenders before you commit. Weight the pros and cons of your current mortgage, and compare the actual interest rates you are paying off in comparison to those resulting from your new debt management perspective, considering collateral involved in the debt and possible future risks as well. Your financial adviser can offer valuable advice for your debt relief.

Remortgages the helps and hazards

When you remortgage you home you, just as the name you imply, get a new mortgage that replaces the existing one. This is usually something that takes place when the market interest rates drop down below what you are paying. Most often this is something that is considered by homeowners who hold fixed rate mortgages.

The Helps

Remortgaging can be helpful in quite a few different ways. It is a good way to lower monthly payments, lower overall cost of the home, and consolidate debts.

Lower Monthly Payments

One option that you have with a remortgage is to take the existing remaining balance and extend the term of the mortgage. For instance, you are 15 years into a 30-year mortgage and you have paid off $40,000 of a $120,000 mortgage. You can extend the loan term back out to 30 years on the remaining $80,000 and, in doing so, cut your monthly payments by a sizable amount.

Lower the Cost of the Home

That heading is deceptive; you will not actually lower the cost of your home. You will, however, lower the amount of money that you pay for it. When you remortgage you can take the existing balance that you carry and simply replace the interest rate for something lower. You will not pay less principle but you can save a lot of money in interest payments.

Consolidate Outstanding Debts

Many times you can take your high interest loans, like a credit card, a car payment, or even a school loan (although many school loans tend to have pretty good interest rates) and lump them in with your home loan. This will mean that you will pay more per month on your mortgage but, overall, you will be paying considerably less due to the fact that you are no longer separating all the loans. It can also, if handled properly, result in less money being paid out in interest as well, but this is a rarity.

So, should you do it?

There are a few things to consider before you go remortgage. Remortgaging is a very big deal that should be taken lightly or flippantly.

Interest Rates Fluctuate

Many people will remortgage at a lower interest rate only to see those rates plummet even further. Try to keep a close eye on what interest rates are doing and where they are heading. Consulting a professional at this time would be very helpful as they will have insight into what will happen next. It is nice to drop your interest by 1% but it is better to wait and drop it by 2%.

Re-mortgaging Costs Money

There is a cost associated with the remortgaging of a house. You might have to pay for things like a new loan application fee, a fee to get the house appraised again, or a fee to pay off your existing mortgage early. Make sure that you investigate all the costs involved before you set out on this venture.

You may be in debt longer

When you consolidate all of your debts it could very well keep you in debt longer, thus paying more interest, than you otherwise would. Many loans are not set up to be paid back in 30 years. In fact, most are set up on a 5 to 10 year schedule. The earlier mentioned consolidation of high interest loans will definitely lower your monthly payments but it also has the potential to cost more in interest rates. Think about it, if you were going to pay off $5000 over 3 years but now you have consolidated it into a 30-year mortgage, you will unquestionably pay much more money in interest on that loan.

The Re-mortgage Results

I think that it is safe to say that remortgaging has great results. It is also safe to say that it has some negatives. But doesn’t everything? These kind of decisions are important decisions that you must weigh for yourself. Perhaps you need lower monthly payments, remortgaging can help. Perhaps you want to lower your overall interest payments, remortgaging can also help. But it can also cause your total interest to increase and it can put a very taxing amount of fees on you in order to accomplish the remortgage. You have to consider all sides of the box before you decide to open it. Good luck and happy savings!

Using your mortgage to generate credit

If you need money for home improvements or a business, then you could use your mortgage to generate the credit you need. Although using your mortgage to generate credit shouldn’t be your first choice, if other lines of credit are closed to you then releasing equity from your home is a good way to generate a line of credit.

When should you release equity?

Releasing equity should definitely not be your first choice for generating credit. If you need money over a short period, then try using credit cards or save up the money. You could also get a personal loan. However, if you have a lot of equity paid for in your property and you need a large sum of money, then equity release could be helpful. Also, if other lines of funding are not open to you because of poor credit or other reasons, then equity release might be for you.

Remortgaging

One way to release equity in your property is to remortgage. You simply have to get a new mortgage, borrowing more than you currently owe on your property. This way you can make use of some of the capital you have already paid back into your home to consolidate debt or make home improvements.

Mortgage for life

Another way to release equity using your mortgage is to change your mortgage to a lifetime mortgage. This means that you take out a mortgage that will allow you to get a lump sum that you can spend as you choose. The interest rates on the loan will be high, and will be allowed to accumulate for your lifetime. When you die, the loan is repaid through the sale of the house. If the value of the loan and interest is more than the house is worth, the lender absorbs the loss. If the loan amount is less then the extra money is distributed to heirs according to your will.

Home reversion

Home reversion is another method of equity release. Home reversion means that you sell a proportion of your house to a company, who will give you a lump sum in return. When the house is eventually sold after death then the company receives the proportion of the house that they paid for, whether that is more or less than the loan that was given out.

Problems with equity release

Although equity release can free up much needed funds, there are a number of flaws with the concept. The major problem is the risk involved. You might be giving up a lot of home equity that has taken you years to build up for a relatively small loan amount. Equity release should be looked at as a last resort, but if you know what you are getting into then using your mortgage to generate credit can help you pay for items that you need or to consolidate high interest debts.

Prepaying your mortgage the pros and cons

If you have looked into wealth building strategies, you have undoubtedly stumbled upon the raging debate over prepaying one’s mortgage. Here is the objective scoop.

Prepaying Your Mortgage – The Pros and Cons

When paying a mortgage, one is in the unique and unfortunate position of having to pay a lot of interest over a long period of time. Depending on the value of your home, you can easily expect to pay hundreds of thousands of dollars over the life of a 30 year loan.

Advocates on one side of the isle suggest that paying even a few extra hundred dollars a month against your principal will save you tons of money over the life of the loan. Others feel this is lunacy as the money can be used for other purposes. As is often the case, both parties are partially right and partially wrong.

If you purchase a home with a 30 year loan and live in the home for 30 years, you will pay a draconian amount in interest. In such a situation, paying a few hundred dollars more in principle each month will save you tens or hundreds of thousands of dollars in interest over the 30 years. The question, however, is whether this makes sense for you in the real world.

The first issue to consider is how long you intend to live in the home. In our modern transitory society, most people don’t plop down for long periods. If you are going to sell your home in five or seven years, the extra payments on the balance of your mortgage are not going to make much of a difference. On the other hand, making such payments makes sense if you are definitely in it for the long haul.

The second issue is the mortgage interest deduction. Many people fall in love with the deduction. Obviously, yours will fall if you start paying off your loan ahead of time. Typically, you will not see a big drop off for at least five years, but it is something to keep in mind.

The third issue is alternative money usage. Specifically, would you be better off using the money in another way. Historically, the stock market has returned a little less than a 10 percent rate of gain. While each year brings different results, some believe you are better off to invest this money in the market since you will be earning more at 10 percent versus paying off a 7 percent loan. This argument tends to forget one small thing, to wit, capital gains tax you will have to pay on any stock market gains. There is no correct answer, so make sure to analyze your situation.

All and all, the decision to prepay a mortgage is a personal one. Take a stark look at your life and determine if it makes sense in your situation.

Getting the best mortgage rates in florida with a poor credit history

Florida is a lovely place to have a house in; unfortunately the real estate prices are rather forbidding for most. And for someone with a bad credit past, it gets tougher. However, if Florida real estate has is in your dreams, you can still get a mortgage loan, even with a bad credit if you know how to look for it.

Before we get into shopping for the best mortgage rates, let us understand how the credit score of a borrower determines the scope of his search. Most lenders will willingly lend to a person with ‘A’ credit score but someone with a ‘C’ or a ‘D’ grade won’t get so lucky.

Fortunately, recent entries into the Florida lending industry have led the industry into being more liberal when approving loans. For instance, if there are more than 4 late mortgage payments in a period of 12 months, it calls for a B score, however if these delays have a plausible explanation the lender may excuse the default and consider a score of A.

There are companies who specialize in giving loans to high-risk borrowers and they are known as Sub-Prime lenders. Even though loans from the Sub-Prime source continue to dominate the high-risk borrowers segment, the government-sponsored agency, Fannie Mae too is beginning to acknowledge the potential in this category. With the availability of more options, a borrower with bad credit can afford to get choosy and not jump at the first approval he gets for the fear of not getting another chance.

The Internet is a good place to look for multiple mortgage options and even for specifically Florida Mortgage Loans, without the borrower having to reveal his credit status. One may even go to a mortgage broker in order to locate the best quotes, but they can be expensive. Ask for reference from friends and colleagues for a good mortgage lender, since a recommendation is always assuring.

Once you narrow down your choice, here is a checklist that you must go through.

1. First analyze your financial status, if you find you have come out of your past credit blues and can commit more you can consider an Adjustable Rate Mortgage (ARM). An ARM allows for a lower rate of interest in the initial years with an option to refinance at a lower, fixed rate after the first couple of years. However, if you find yourself financially burdened, a fixed rate payment would be more appropriate. Search, negotiate and settle for a rate of interest and for terms and conditions that suit your financial status.

2. Find out how much penalties are imposed for pre-payment. Heavy penalties will take away the advantage of any timely payments that you may be able to make and that may get you a refinance on better terms in the next few months.

3. Most Sub-Prime lenders exploit the vulnerability of high-risk borrowers and slap on high closing costs at the end of the loan. There are more lenders out there willing to do business than one would have you believe and a little negotiation can always add to some cost shaving.

4. Avoid paying any upfront or processing fees; the only fee acceptable should the one you pay for your credit application.

5. Ensure that everything goes on paper in writing, from the rate of interest, to the closing costs to the pre-payment penalties and that nothing comes as a surprise after you have signed the contract.

Mortgage refinancing basics

Your mortgage may have a 30-year term, but not many homeowners stay with the same loan for that long. In fact, the average American refinances his or her mortgage every four years, according to the Mortgage Bankers Association. That’s because paying off your present mortgage and taking out a new one can mean big savings over several years. However, refinancing comes with a price in the short term, so it’s important to consider both the costs and benefits before making your decision.

Why refinance?

Here are some reasons to consider refinancing your mortgage:

1. To obtain a lower fixed rate. If you took out a fixed-rate mortgage several years ago and interest rates have since dropped, refinancing may lower your payments considerably. A $150,000 mortgage with a 30-year term and a rate of 8 percent, for example, carries a monthly payment of $1,100. The same mortgage at 6 percent will have a payment of less than $900 a month.

2. To switch to a fixed rate or an adjustable rate mortgage. Adjustable-rate mortgages (ARMs) offer lower interest rates initially, but some homeowners find the fluctuations stressful. If rates are on the way up, you might consider locking in at a fixed rate and consistent monthly payment. On the other hand, if you want to reduce your monthly payments and are comfortable with the interest rate changes of an ARM, it could save you money to refinance to an ARM.

3. To reduce your monthly payments. Refinancing for a longer term will lower the amount you have to pay each month. You will end up paying more in interest charges over the life of your loan, but if you’re having difficulty making your current payments, this strategy could provide some relief.

4. To turn home equity into cash. You may want to take out a new mortgage with a larger principal, in order to turn some of your home equity into cash for a major expense. This is called cash-out refinancing. The advantage of taking out a loan secured by your home is that you can get a lower rate of interest than you can with an unsecured loan or credit card. However, if the interest rate offered for your refinanced mortgage is higher than your current rate, a home equity loan or line of credit might be a better choice.

Is refinancing right for you?

If you’re refinancing in order to pay less interest, you won’t usually see the savings right away. That’s because lenders typically charge fees when you take out a new mortgage, and you may also have to pay a penalty for getting out of your old one. To determine whether refinancing makes financial sense for you, consider these issues:

1. How long you plan to be in your home. If you expect to move in a year or two, you may never realize the potential savings you’d get from refinancing. As a rule of thumb, the longer you plan to stay in your current home, the more sense it makes to refinance.

2. The prepayment penalty on your current mortgage. Many mortgages carry a penalty if you pay them off early. The amount varies, but it is usually a small percentage of the outstanding balance, or several months’ worth of interest payments.

3. The costs of the new mortgage. When you take out a new loan, your lender may charge a number of fees including application, appraisal, origination and insurance fees, plus title search, insurance and legal costs that can add up to thousands of dollars. Lenders may also charge discount points, which are paid upfront to secure a lower interest rate. As a guideline, expect fees to eat up any potential savings unless your new interest rate is at least a half a percentage point lower than your current one.

To learn more about mortgage refinancing and when it makes sense, visit http://www. lendingtree. com/cec/yourhome/yourmortgage/mortgage-refinance. asp

Mortgage leads for new loan officers

If you are a loan officer and you are new to the business, one thing you may be short on is leads.

Leads can be obtained in many ways. Through customer referrals, networking groups, family members, friends, etc.

However, for a new loan officer, you may need to jump start your business, and investing with a mortgage lead company may be the way to go.

You probably haven’t heard many good things about mortgage lead companies. However, there are some good ones out there. And if you take your time and do your research, you may just find the right one for you.

Here are a few things to avoid:

Avoid the mortgage lead companies that recycle their leads. Recycling means they sell them over and over again.

So, most likely these leads have gone through the hands of dozens of loan officers before reaching your desk, so steer clear.

Stay away from lead companies that buy their leads from third party companies than sell them to loan officers at a profit.

You never know how many times those third party companies sold those leads to other mortgage lead companies.

In the beginning, your budget may be a little bit tight, so look for lead companies that allow for a low minimum deposit.

Also, look for lead companies that obtain their leads through sites they own and operate on their own. This is always a good indication that the lead is of good quality.

And look for lead companies that sell real time mortgage leads, and/or sell them exclusively. When you buy your leads exclusively you can cut out your competition.

Real time leads are also known as fresh leads, so they are hot off the press once you receive them. With real time leads your closure ratio will be much higher and the return on your investment will be that much better. And why shouldn’t it be? You work hard for your money.

California mortgage company

Mortgaging your house is a big project. It might as well be one of the biggest investments that you are supposed to make. If you are in California and you want to invest in real estate you should spare some time for a California mortgage company. The right mortgage company will help you acquire the right deal. A reputed company will go through your profile, check your qualification and give you the option which will suit your financial situation best.

The basic objective of opting for a professional is guidance. While we want to own our homes and have healthy savings as well, the entire process of going about it could be confusing and cumbersome since we are not experts. And following the wrong advice could be disaster. There are many reputable California Mortgage Companies out there whose primary objective is to fulfill the customer's demand. They value every customer need and idiosyncrasies and provide solutions which match their myriad dreams of a home.

The more professional California mortgage company will be able to provide you with the best of the deal by analyzing your personal profile. This would of course include your financial profile which is the biggest asset or curse for a borrower depending on his or her spending habits. The deal would be consisting of terms, rates and closing costs. Self-employed people can also get loans from a reputed company.

There are many loans on offer for your special needs. For example, some California mortgage company might be giving no documentation loans, Debt Consolidation Cash Out, Borrower programs for self-employed, challenged credit loans, loans based on low FICO score. One of the main criteria of finalizing a good deal is to have a high FICO score. A low FICO score means chances of getting a best rates are low.

Before you search for a California mortgage company you need to know about some basic terminologies and become familiar with the procedure.

Adjustment period: It is the frequency of adjusting the rate of an adjustable rate mortgage with the base rate.

Annual Percentage Rate: This one is the annual rate, which is the effective interest rate to be paid on a loan.

Base rate: In the mortgage industry, an underlying rate of interest is taken as an index. This is the base rate.

Cost analysis: It is the subtraction of homeownership benefits from homeownership costs taking all the factors like mortgage interest, closing costs, homeowner's interest & property taxes and PMI.

Equity: It is the difference between the market value of a home and the total amount of debt.

Term: The loan is taken for the time, which is referred to as the term. General period of a home mortgage loan is about 15-30 years.

Before you look for your suitable California mortgage company, just have a glance on the terminology and look out for the professional company that is offering you the best of the term. There are a number of ways to check your FICO rating also. You can improve your transaction history by paying all your credits on time.

Buying a home after bankruptcy

If you're planning on buying a home after bankruptcy you'll want to read this article carefully.

Buying a home is probably the biggest purchase you will ever make. Having a bankruptcy on your credit report adds an extra challenge.

If you've read my book After Bankruptcy Credit Solutions, then know that many people who have had a bankruptcy apply for credit and loans the wrong way.

Mistakes in this arena can cost you $10,000s in extra interest and other finance charges. Let's look at an example:

You finally find the home you've been looking and the seller's asking price is reasonable. So you apply for a $250,000 thirty year loan to purchase the home.

You fill out a mountain of paperwork... sign here, initial here, sign here, etc. Then not to long after that the lender call you with great news - you've been approved!

But don't pop the cork on the champagne bottle just yet. Sure, you were approved but at what cost?

You were able to get a $250,000 thirty year loan at 8%. That means that over the life of the loan you'll pay $410,388.12 in interest.

What if you had been able to take specific steps to increase your credit score and shop loans - and, as a result, reduced interest rate by 1%. In that case you would end up paying $348,772.12 in interest.

The 1% difference comes out to $61,615.87! If you were able to achieve that by taking some very specific steps that would have been EXTRA money in your pocket!

What's the point of this example? You simply can't afford to get it wrong when it comes to buying a home.

Let's look at the RIGHT way:

First, if there was ever a time where it's critical that you've increased your credit score before shopping for a loan this is probably going to be it.

So you want to increase your credit score. By the way, if you're trying to qualify for a loan and time is of the essence there's a way to increase your score in as little as 72 hours!

Next, you want to have mortgage broker on your team. If you've had a bankruptcy they can be invaluable. But you don't want just any mortgage broker.

You need to interview a few and ask them some very specific questions. It's really important that you have the RIGHT mortgage broker in your corner.

A good mortgage broker will have access to several lenders and know which one is appropriate for your situation. They will also be able to walk you through the entire loan approval process.

Only after you have lined up financing should you begin to look for a home. Of course, you'll want to interview a number of real estate agents.

But what if you can't get approved for a conventional loan? Don't worry! There are a number of strategies you can use to purchase if you can't qualify for a traditional mortgage.

In fact with one of the strategies it doesn't matter if you have terrible credit or even if you are unemployed... you can still qualify!

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Copyright © 2005 Innovative Solutions Publishing, Inc. All rights reserved.

DISCLAIMER:

This information is designed to provide only a general overview of the subject matter herein.

This information is provided with the understanding that neither the publisher nor author is engaged in rendering legal, accounting or other professional advice. If legal or other expert assistance is required, the services of a professional should be sought.

Neither the publisher nor author shall be liable for any loss or damages, including but not limited to special, consequential, incidental or other damages, caused by the information contained herein.

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