How to Find Wholesale Mortgage Lenders

Some mortgage bankers and portfolio lenders are also wholesale lenders that deal with mortgage brokers, sometimes exclusively.

Most mortgage lenders have both wholesale and retail departments. Mortgage brokers prefer to obtain wholesale rates and then mark up these rates by adding points, presenting the borrowers with quotes that are similar to what borrowers could obtain directly from a retail lender. Mortgage brokers are free to set whatever prices they want, and have different methods for marking up wholesale rates.

Wholesale mortgage lenders generate residential mortgages through a network that includes independent brokers and lenders, offering a wide variety of home financing options: conventional, home equity, government, alternative and jumbo loans. All of these may be purchased from the mortgage professionals, including lenders and brokers, who make up a wholesale mortgage lenders network. The goal of the network is to ensure that both borrowers and lenders benefit from the transaction.

Different types of Wholesale Mortgage Lenders

• Wholesale Mortgage Lenders Network

This is a network of professionals working together in order to find the best deals for those involved in the mortgage process, including homeowners, lenders and even independent mortgage brokers. Professional loan consultants work with the homeowner in order to understand their needs and assist them in choosing the best mortgage program. Even people with less than perfect credit may be able to obtain a mortgage that will help them repair their bad credit, reduce their monthly payments or buy a home.

• Second Wholesale Mortgage Lenders

These mortgage lenders offer a range of second mortgage finance programs to help homeowners choose the right option. A second mortgage lender offers competitive rates for different loans. There are different types of second mortgage programs, like a cash-out second mortgage that can be taken out for debt consolidation and home improvement. It can also be used to consolidate high interest credit card debt. It could mean a re-mortgage and be used to purchase another property.

The lending criteria set by second wholesale mortgage lenders are very strict, though the cost is similar to first mortgages. There are also potential tax consequences as the second home or property could be classified as providing the rental income to the owner.

• Online Wholesale Mortgage Lenders

There usually are no upfront costs or obligations when you apply with an online mortgage lender. It offers flexibility both in applying online as well as in obtaining information about various mortgage programs. Quotes are also available for free and the homebuyer is under no obligation to apply with the lender. Rates and costs are easy to compare, since there are many available materials online to help the home-buying process. For advice on which online lender to choose, a professional mortgage advisor may be of help.

• Sub-Prime Wholesale Mortgage Lenders

These are lenders specializing in loan programs for those with less than perfect credit history. Sub-prime mortgages are usually written at a higher interest rates compared to ordinary mortgages. Because of the high cost, it can help in establishing or re-establishing a good credit record. Sub-prime mortgage lenders help credit-impaired borrowers obtain a mortgage. A sub-prime mortgage is for a short period compared to other programs. In order for a borrower to qualify for a sub-prime mortgage, a significant deposit amount towards the home is expected.

Stu Pearson has an interest in Business and Finance related topics. To access more information on reverse mortgage lender or on mortgage lender network, please click on the links.
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Home Equity Loan - What Is It?

A home equitiy loan is a loan that you can take by keeping the equitiy that you hold in your home as collateral. To understand this we need to know what Home Equitiy is and what Collateral is.

Home Equity is nothing but how much of the value of the home actually belongs to you and for which you have paid. Let's take an example to understand this, suppose you buy a home giving a down payment for $20000 and the value of the house is $200000 today. The rest you will have to pay in mortgages. So your equity today is $20000. Now say after a year the house appreciates to $250000, you have been paying your monthly installments and the part of the principal (apart from interest) in your installments has been $5000 for the last year. So the value of your equitiy becomes the principal that you paid till now that is $25000 plus the appreciation of the home which is $50000 because that is also yours. So your total Home Equity is $75000.

Simply put that part of the house which you have paid for plus the appreciation. Collateral is the property that you pledge as a guarantee for the debt. This means that if you don't repay the debt the lender will take hold of the property and sell it to get his money back.
So to reinstate a Home Equitiy loan is a loan that you take keeping that part of your home as a security which you have already paid for and if you fail to repay the loan the lender will have the right to take possession of your home and sell it off to get his money.
Most of the time these loans have a repayment time of less than 15 years and is taken as one lump sum and once taken have to be paid off with a specified amount every month with a fixed rate of interest.

The interest that you pay on home equitiy loans may also be tax deductible but that depends on your current situation and you would have to take advice from your tax advisor to get an accurate picture of the same. Another benefit of course is that since this will be a secured debt you can get this for doing anything like buying a boat or taking a vacation and at competitive interest rates. This is because the loan is risk free for the lender as he has rights over your home and can sell it off to get his money back.

However buying a boat is hardly advisable!
The real benefit of this loan accrues from two facts – one is that it is risk free from the lender's point of view and so is got at a competitive rate. Another is that in today’s scenario the value of the houses of most people have gone up and because of that they can borrow significantly more (based on appreciation) than what they actually had paid for.

To take full advantage of this rise in prices the best way is to consolidate your other debt and pay it off using a Home Equitiy loan. Simply put take this low interest rate debt and pay off your higher interest debts and reduce your cash outflow on interest repayments, this would lead to a situation for you where you are paying lesser for the same amount of debt than you already are. However, you can spend this money in any way you wish be it home improvements or holidays. It is generally easy to get this loan and generally no appraisal is required.

Some companies are also offering Home Equitiy loans online and you can apply for them free online, get it approved online as well and get the cash in around 10 days or so.
While this is a good way to consolidate your debt and take advantage of the rise in prices in your home the lure of easy money is always dangerous and as such you should be careful what you are going to do with this money given that you are pledging your Home Equity which might well be the most valuable asset you own both financially as well as emotionally.

Author - Bill Darken - Oftn writes for and with loans-only which is as the name portrays. It has more relevant general loans assistance such as home, car, student and consolidation loans. There are highly informative eye opening articles and up-to-date loans news as well, you can see it at home equity loan or if the previous link is not working, you can paste this link in your browser - loans-only.com.
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Independent Mortgage Advice

When considering any independent mortgage advice, it is essential to understand the mechanism of Usufructuary Mortgage. Under this mortgage, the mortgagor gives possession of the property or binds himself, either expressly or by implication, to give such possession to the mortgagee. The mortgagee is authorized to retain his possession over the property until the payment of the mortgage money is made and to receive rents and profits accruing from the property and to appropriate the same in lieu of interest or in payment of the mortgage money or in both.

The chief characteristics of usufructuary mortgage is the transfer of the possession over the mortgaged property to the mortgagee, who is entitled to receive income accruing these from and to appropriate the same towards the payment of the mortgage money and/or interest thereon. The liability of the mortgagor is thus gradually reduced.

It is worth mentioning in this regard that it is not necessary that a deed of mortgage must always refer to a particular rate of interest. It is certainly open to the parties to agree that the income from the property accruing over a certain period will be sufficient to cover the principal as well as the interest. In the case of a usufructuary mortgage, the mortgagor and the mortgagee agree that the entire amount due by the mortgagor to the mortgagee should be recouped by the mortgagee by the enjoyment of the usufructs from the mortgaged property over a specified number of years.

The document may not refer to any interest payable on the principal, even though an element of interest and its rate and income from the property might have gone into their calculation, when the parties determined the number of years during which the mortgagee was authorized to remain in possession of the mortgaged property for the purpose of reimbursing himself.

Mortgage Advice provides detailed information on Mortgage Advice, Online Mortgage Advice, Independent Mortgage Advice, Adverse Credit Mortgage Advice and more. Mortgage Advice is affiliated with How To Become A Mortgage Broker.
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Mortgage Advice

When a customer offers immovable property like land and a building as security for a loan, charge thereon is created by means of mortgage. Theoretically speaking, mortgage can be defined as the transfer on an interest in specific immovable property for the purpose of securing the payment of money, advanced or to be advanced by way of loan, an existing or future debt, or the performance of an engagement which may give rise to a pecuniary liability. In the whole process, the transferor is called mortgagor; the transferee mortgagee; the principal money and interest thereon, the payment of which is secured are called the mortgage money and

instrument, if any, by which the transfer is effected is called a mortgage deed.
The proper understanding of the above-mentioned terms is very important when considering any kind of mortgage advice. On the basis of these terms, a mortgage is the transfer of an interest in the specific immovable property and differs from sale wherein the ownership of the property is transferred. Transfer on an interest in the property means that the owner transfers some of the rights of ownership to the mortgagee and retains the remaining rights with himself. For example, a mortgagor retains the right of redemption of the mortgaged property.

It is worth mentioning that if there is more than one co-owner of an immovable property, every co-owner is entitled to mortgage in his share in the property. The property intended to be mortgaged must be specific. In other words, it can be described and identified by its location, size and other factors. The object of transfer of interest in the property must be to secure a loan or to ensure the performance of an engagement that results in monetary obligation. Thus the property may be mortgaged to provide security to the creditor in respect of the loans already taken by the mortgagor or in respect of the loans which he intends to take in future.

Mortgage Advice provides detailed information on Mortgage Advice, Online Mortgage Advice, Independent Mortgage Advice, Adverse Credit Mortgage Advice and more. Mortgage Advice is affiliated with How To Become A Mortgage Broker.
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Mortgage Loan: PITI Explained

If you are shopping for a mortgage loan you have probably seen the acronym PITI in many of the loan offers you receive. PITI stands for principal, interest, taxes, and insurance. Here is what you need to know about PITI.

Principal

Mortgage principal is the total balance of your loan. When you make your monthly mortgage payments you are gradually paying down this balance along with the interest due for that month. Mortgage loans are front loaded with interest so in the early years of your mortgage you will find very little of your mortgage payment is being applied to the principal loan balance. The interest paid on any given month is based on the outstanding principal balance; as the years go by more of your payment is applied to the principal balance and less is paid to the lender as interest.

Interest

Interest is what you pay the lender for loaning you the money to pay for your home. The interest is a percentage of the principal balance due. Interest rates come in two flavors: fixed rates that do not change over the term of the loan, and adjustable interest rates that change at regular intervals set in your loan contract. If you have an adjustable rate mortgage your interest rate is tied to some financial index plus the lender's markup. When the lender periodically updates your interest rate the amount of your monthly mortgage payment will change with it.

Taxes

Property taxes are often included in your monthly payment amount. Lenders do this to protect their investment in your home; if you allow your property taxes to lapse, your State or local government could put a lien on your home. If this happens the lender would be unable to foreclose if you fall behind on your payments.

Insurance

Your homeowner’s insurance policy protects your home from damages. Insurance premiums can be rolled into your monthly payment like property taxes; again, lenders do this to protect their interest in your property. Most homeowner’s insurance policies only protect your home against fire, vandalism, and certain other damages. If you live in an area prone to flooding the mortgage lender could require you to purchase flood insurance in addition to your homeowner’s policy. Mortgage lenders may require borrowers with poor credit or low down payments to purchase Private Mortgage Insurance in addition to their homeowner’s policy. Private Mortgage Insurance protects the lender from loses in the event of foreclosure. This insurance does nothing to protect you, the homeowner.

To learn more about shopping for the right mortgage and avoiding common mistakes, register for a free mortgage guidebook using the links below.
To get your free mortgage guidebook visit RefiAdvisor.com using the link below.
Louie Latour specializes in showing homeowners how to avoid common mortgage mistakes and predatory lenders. For a free copy of "Mortgage Refinancing: What You Need to Know," which teaches strategies to find the best mortgage and save thousands of dollars in the process, visit Refiadvisor.com.
Claim your free guidebook today at: http://www.refiadvisor.com
Apex Mortgage Refinance
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Second Mortgage Loan Rates

Today, there are many competitors in the mortgage business, and predictably there are also so many offers for the borrowers. To woe the borrowers there are many loan programs available in the market. But what the borrower has to keep in mind is that he should never fall into these loan traps, and the important thing to note is the loan rate.

If you have bad credit, you may expect a higher interest rate. So it is better to compare offers from many lenders to secure a better rate. A better offer can be from the flexible mortgage lenders. These mortgages can include interest-only mortgage loans, balloon-payment mortgage loans, as well as mortgages for long periods and mortgages with low interest rates.

The interest payments on a mortgage depend upon many factors like the rate on which the loan is obtained, the number of years of the mortgage loan, the down payment, and the amount financed. Even a slight difference in the interest rates can save you a lot of your hard-earned money. So it is important to get the right and relevant information.

There are different sources to get this vital information. The most important among them are the mortgage websites and the local newspapers. You can check the rates with your bank; mortgage rates fluctuate frequently according to the market trends and never remain unchanged for long periods.

It is better to check for online assistance, as there are plenty of online mortgage brokers. Here, you can check your credit score and get advice on the interest rates and terms of the mortgage loan.
Second Mortgage Loans provides detailed information on Second Mortgage Loans, Second Mortgage Loans After Bankruptcy, Second Home Equity Mortgage Loans, Second Mortgage Loan Rates and more. Second Mortgage Loans is affiliated with Florida Mortgage Loan Calculators.
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Online Mortgage Advice

To understand online mortgage advice, it is essential to know the forms of mortgages. In case of a simple mortgage, the mortgagor binds himself personally to pay the mortgage money. He does not give possession of property but agrees, expressly or impliedly, that if he fails to pay according to his contract, the mortgagee shall have a right to cause the mortgaged property to be sold and the proceeds of sale to be applied in payment of the mortgage money to the extent necessary.

It is worth pointing that the words “cause the mortgaged property to be sold” mean that the mortgagee shall have to seek the intervention of law for selling the mortgaged property. He himself is not authorized to sell the property. As the possession over the property remains with the mortgagor, such mortgage is called non-possessory. The mortgagor takes upon himself a personal obligation to repay the amount failing which the mortgagee gets two options. Firstly, apply to the court for permission to sell the mortgaged property or to file a suit for recovery of the whole amount without selling the property.

Then there exist a mortgage by conditional sale. Under this form of mortgage, the mortgagor ostensibly sells the mortgaged property with certain conditions. Firstly, that the sale shall become absolute if the mortgagor fails to pay the mortgage money on a certain date. Secondly, that the sale shall become void if the mortgagor pays the mortgage money and finally that the buyer shall transfer the property to the seller if the latter makes payment of the mortgage money on a certain date.

From the above conditions, it can be noted that all the conditions imply the same thing, i.e., on default of payment of the mortgage money, the mortgaged property shall be treated as sold to the transferee. It is, however, essential that such condition must be embodied in the mortgage deed.

Mortgage Advice provides detailed information on Mortgage Advice, Online Mortgage Advice, Independent Mortgage Advice, Adverse Credit Mortgage Advice and more. Mortgage Advice is affiliated with How To Become A Mortgage Broker.
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Home Equity Loan Basics You Need to Know

If you are a homeowner considering a home equity loan for any reason, there are several things you need to know before applying. Doing your homework and researching mortgage lenders will help you avoid common mistakes that could cost thousands of dollars. Here is what you need to know to avoid these costly mistakes.

Home equity, when used correctly, is one of the most powerful financial tools available to homeowners today. When home equity is abused it has the potential to land you in serious financial hot water. Taking out a home equity loan is simply a second mortgage loan secured by your property. If you default on the home equity loan the lender will foreclose and take your home.

Types of Home Equity Loans

Home equity loans come in two flavors: home equity lines of credit and second mortgages. A second mortgage pays a lump sum similar to your primary mortgage at a fixed interest rate. Home equity lines of credit allow you to borrow by writing checks or using a debit card against your equity. Equity lines of credit come with variable interest rates and are typically more expensive than a second mortgage. Home equity lines of credit have the advantage of allowing you to borrow smaller amounts that you can repay quickly; this could save you money depending on your reasons for borrowing equity.

How Much Can You Borrow?

The amount of equity you will qualify to borrow depends on the appraised value of your home, the balance of your principal mortgage, and the amount of equity you have in your home. The mortgage lender will evaluate the loan to value ratio of your home, the appraised value of the property, and your credit rating when determining how much you can borrow.

Other Options

Refinancing your primary mortgage with cash back is another option that could save you money over a home equity loan. You will need to carefully consider the costs associated with taking out a second mortgage or refinancing. Both options have similar costs: application fees, lender fees, and closing costs are a part both of home equity loans and refinancing with cash back. To avoid overpaying for your home equity loan you need to do your homework and research home equity lenders.

To learn more about avoiding common mortgage mistakes that will cause you to overpay for your home equity loan, register for a free mortgage guidebook using the links below.
To get your free mortgage guidebook visit RefiAdvisor.com using the link below.
Louie Latour specializes in showing homeowners how to avoid common mortgage mistakes and predatory lenders. For a free copy of "Mortgage Refinancing: What You Need to Know," which teaches strategies to find the best mortgage and save thousands of dollars in the process, visit Refiadvisor.com.
Claim your free guidebook today at: http://www.refiadvisor.com
Apex Mortgage Refinance
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3 Ways to Get a Lower Interest Rate

As interest rates begin to creep forward, many people will not buy that next home or investment property because they can no longer afford the loan. Below are three methods that are quite common and can get a borrower a lower interest rate than the brand-new 30 year fixed mortgage loan. Of course, many negative side effects can crawl out of the wood work with these methods, so one should prepare themselves and be careful.

1.) ARMs - ARMs are adjustable rate mortgages, meaning that the interest rate on the loan periodically adjusts, usually every six or twelve months. Initially, these types of loans will get one a lower interest rate than the compared 30 year fixed mortgage, but be very careful. Detail will not be delved into, but be careful because if interest rates are rising and most likely will be in the future, the interest rate on the ARM will surely rise every time it is evaluated; thus making the monthly payments in the long run considerably higher than those of the compared 30 year fixed mortgage.

2.) Loan Assumptions - One can sometimes assume an ARM loan form the home seller, thus giving them the interest rate of the older loan. This is a crafty way to get an ARM that has a lower interest rate than the new ARM loans being offered. Of course, 30 year fixed loans are rarely assumable, so with assuming an ARM loan, the dangers mentioned above in method one may also apply to this method.

3.) Seller Financing - Some home owners actually own their home. Often, these people will offer attractive financing with lower-than-average interest rates. Seller financed property may initially cost more than comparable property. But, with the lower-than-average interest rate, the buyer can easily afford to pay more for the property because the low interest rate balances the cost out.

In addition to the above three loan types, there are additional methods that can be used to get lower interest rates, such as, raising the points on the loan, excellent credit, or a large down payment.
The author is the founder and owner of ManageYourRentals.com and LandLordDocuments.com
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A Few Tips for First Time Buyers

It cannot be denied that emotions and excitements are associated with house purchasing. So it is necessary for first time home buyers to collect themselves and take care of a few things seriously to be really happy after buying a house through mortgage. Otherwise your house purchasing may become a heavy burden on you. In this regard first time home buyers will find the following tips much helpful.

At first it is necessary to decide how much money you can afford to spend for your home purchase. First time home buyers can do so by making an assessment of their income, assets, expenditure, debt level etc. In addition to the cost of the house they should consider other expenditure like down payment, closing cost, property tax, homeowner’s insurance etc. Being informed of all this costs they can go for a suitable deal.

After that they should dedicate a little time to search for the house that suits the needs in the best possible manner. First time home buyers should give prime importance to the availability of essential facilities while choosing the house. It should be located in a congenial atmosphere with good transportation, parks, school etc.

It is advisable to choose a mortgage with suitable terms. Terms are important for first time home buyers because these should be followed for a long time. Once you chose the mortgage its time for closing or settlement to get the transaction over. You will have to pay a small percentage of the purchasing price towards closing cost. When all these steps are over the house is yours; you can take possession of it and live in it peacefully.

About The Author

The author is a business writer specializing in finance and credit products and has written authoritative articles on the finance industry. He has done his masters in Business Administration and is currently assisting Easy-Buy-To-Let-Mortgages as a finance specialist.
For more information please visit http://www.easy-buy-to-let-mortgages.co.uk
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Mortgage Loan: 40 Year Mortgage Loans

As the cost of real estate has risen significantly over the past years, many lenders have started offering new products to assist homeowners with their mortgage needs. One of these new mortgage offers is the 40 year home loan. Here are the pros and cons of this 40 year mortgage deal.

A 40 year mortgage is simply a mortgage with a 40 year amortization schedule. This means you will pay interest and loan principal to the mortgage lender for a 40 year period. The advantage of a 40 year mortgage is that the monthly payment will be much lower than a traditional 15 or 30 year mortgage. Suppose you borrowed $100,000 to purchase your home at 6.25% interest with a traditional 30 year mortgage; your monthly payment for this loan would be around $600. If you financed the same home with a 40 year mortgage you would pay a higher interest rate for the longer term; however, your monthly payment would be around $560. This might not seem like a lot, but if your monthly budget is stretched thin this could make a difference for you.

There are disadvantages to 40 year mortgage deals. Because the term is longer than a
traditional mortgage there is more risk for the mortgage lender; this risk is passed on to the borrower in the form of a higher interest rate. The interest rate you will receive for this loan is typically .25 or .375 points higher than a traditional mortgage depending on your credit rating. Another disadvantage of this 40 year mortgage is that you will make significantly more interest payments to the lender for that extra ten years of your mortgage. Mortgage loans are front loaded with interest; this means you pay most of the interest in the early years of the mortgage loan. This means you will build equity at a painfully slow rate with a 40 year mortgage deal.

Financing your home with a 40 year mortgage could tempt you to purchase more home than you can actually afford. This could lead to serious financial difficulties down the road. A 40 year mortgage could still be a good deal for homeowners that need low monthly mortgage payments. You can always refinance down the road when your financial picture improves; this will allow you to switch to a mortgage that builds equity in your home at a faster rate. To learn more about your options when it comes to your mortgage, register for a free mortgage guidebook using the links below.

To get your free mortgage guidebook visit RefiAdvisor.com using the link below.
Louie Latour specializes in showing homeowners how to avoid common mortgage mistakes and predatory lenders. For a free copy of "Mortgage Refinancing: What You Need to Know," which teaches strategies to find the best mortgage and save thousands of dollars in the process, visit Refiadvisor.com.
Claim your free guidebook today at: http://www.refiadvisor.com
Apex Mortgage Refinance
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How to Find a Home Mortgage Lender

Looking for a home loan? In searching for a home loan, there are three providers which you may choose from an officer at a bank, other lending institution or you may turn to a mortgage broker. Whichever provider you choose the end result is just the same and that is you get to have a new house.

Loan officers are actually employees working in a bank, a credit union or lending institution who work to sell and process mortgages and other loans. They offer a wide selection of loan types, but all originate from that specific lender. It is usually the job of the loan officer to take care of the client’s application and look for a specific loan product that would best suit their client’s needs. Once the client get credit approval, the loan officer will then start with the processing of the home purchase transaction.

On the other hand, mortgage brokers are people who match up lenders and borrowers. They are freelance agents, usually working with many different lenders. Mortgage brokers are the scouts of the mortgage industry since they are the ones that search and evaluate home buyers. They also analyze a client’s credit situation in order to find the best lender for that client. An expert mortgage broker is capable of finding various types of lenders to suit diverse types of credit.

A mortgage broker earns by securing a client’s loan and is paid according to the quality of the transaction. For your protection as the client it would be best not to offer any interest rate but rather wait for your mortgage broker to tell you what terms they can secure. And then try to shop around in order for you to make sure that the terms your mortgage broker has given you are reasonable. Also, try to be cautious when searching for mortgages advertised online since most of them are owned by mortgage brokers.

The advantage of hiring an online mortgage broker is that you make yourself available to lenders in other parts of the country who may have better rates than the ones in your hometown. However, there is a drawback to this, since most out of town lenders won’t be familiar with the peculiarities of where you live: local heating systems and septic systems, for example, or the jargon and classifications used by the appraisers in your area. All the above mentioned slows down loans made by an out of town lender.

Local banks are the most common mortgage lenders but not always the preferred choice. They have underwriters that basically understand the local properties and compared to a distant lender will not cause any delay on the processing of loan. Moreover, banks are always much better and faster in closing loans than any mortgage broker working with a lender. However, this is not generally applicable to all banks since there are some banks that really take a long time to process loans. On the other hand, mortgage brokers are capable of finding lenders who will grant loans that a bank would deny, which is especially ideal if ever you have a bad credit history.

Stu Pearson has an interest in Business and Finance related topics. To access more information on california mortgage lender or on home mortgage lender, please click on the links.
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Finding a Mortgage Broker Who Will Accept Bad Credit

Having a bad credit history is not ideal, especially if you're applying for a loan. If you're shopping for a mortgage, though, your chances of getting your loan approved are much better, and many mortgage brokers products designed for consumers with bad credit.

Why would loan providers disregard bad credit history when funding mortgages? Aren't loan providers afraid that the customer won't be able to pay off the loan? Even when clients have a good credit history it's impossible to predict if they'll make good on their loan, and borrowers with bad credit history have a record of falling behind on their payments.

Many astute mortgage loan providers agree to lend to people with bad credit, not out of charity but based on the FICO credit scores.

Borrowers with scores of 720 and above have loan providers chasing after them to take out mortgages, and borrowers who have credit scores ranging from 600 to 700 can also get good mortgage deals. Borrowers earning credit scores of 500 and below are considered to have bad credit. Most bad credit mortgages are used to purchase or build homes. If the buyer is a first-time homeowner, they may be eligible for a special first-time buyer mortgage.

For the protection of the lender, someone taking a bad credit mortgage cannot borrow as much as with other mortgages. This lowers the risk for lenders the borrower defaults on the loan. The borrower will have to make a deposit of greater size, too. Required deposits for regular mortgages are about 25%, but the deposit for bad credit mortgage may be much higher to cover the risk of lending.

Some unscrupulous loan providers claim that bad credit mortgages are rarely approved and that borrowers wouldn’t have been able to mortgage their house without the special assistance of their company's bad credit program, charging high interest rates and fees. Many borrowers with bad credit believe them and pay far more than they should for broker services – so shop around for a mortgage lender who won't take advantage of your bad credit history.

Stu Pearson has an interest in Business and Finance related topics. To access more information on mortgage lender or on bad credit mortgage lender, please click on the links.

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Choosing the Right Mortgage Lenders

One of the biggest questions that I have come across is “What is the difference between the mortgage lender and a mortgage broker?” Mortgage lenders provide money to the borrower at the closing table. Mortgage brokers do not lend money to anyone. A mortgage broker acts as a mediator between a lender and a borrower.

Choosing a mortgage lender is a very big step in buying or refinancing a home. Your initial thoughts in choosing a mortgage lender would be to find the lowest interest rates available. This is not always the best route to take as there has to be trust and you have to be able to work with the mortgage lender. You must take these into consideration just as much as rates afforded.
There are many different types of mortgage packages in the market today. A good mortgage lender’s responsibility is to make sure the mortgage product that you need is given to you.
Most mortgages do not differ in terms of loan rates (first time buyers sometimes get preferential rates).

The only differences in the various types of mortgages are the loan structures; the term of the mortgage, the deposit, and the processing costs.
Nearly all mortgage companies offer terms from between 15 to 30 years, there are other payment options that are available but 15 to 30 years are the most common. Always keep in mind that the shorter you term the less interest you will have to pay but the more your monthly payments will be. Affordability is always the biggest factor to take into consideration, don't go beyond your means.

How to choose the best mortgage broker…

When choosing a mortgage broker, first place to start would be your local area. Look in your local newspaper for companies that offer the service that you are looking for. Word of mouth is probably the best option to take as they are first hand experiences, always easier to go with a mortgage broker that your best friend trusts and has had experience with them.
Among other things, don't be afraid to play the different mortgage broker up against each other (they want your business as much as you want a lender). This way you might be able to get preferential rates…
Always keep in mind your price range when looking for a new house (sometimes things can get away from you when you see a specific house that you just cannot afford), this is called prequalification.

By providing you financial status the mortgage broker will be able to supply you with the mortgage plans that suit your price range and goals.

The mortgage broker will guide you through the application form; rather ask too many questions than too little as you do not want any surprises whatsoever. Once the application is finished, he or she will submit it to the respective department. Once the loan has been accepted, the application/package will be forwarded to the relevant title company for closing. It will be the title companies responsibility to transfer the property into your name, as well as collect and disperse all the funds to the relevant parties.

You will be given a choice to “lock in” a rate during the application process. In so doing, you will be guaranteed a fixed interest rate during the term of your mortgage. Once your rate is “locked in” it is wise to request a written interest rate agreement from your mortgage broker rather than that of just a verbal agreement.

Choosing a broker that is well-informed and easy to get into contact with can make the mortgage application process a satisfying experience.

Things to remember:

You should not base your decision solely on the interest rates provided. You should be comfortable and be able to trust your broker. Always ask as many questions as possible, this avoids confusion. This is one of the most important decisions you will ever have to make, so make sure your decision is the right one when it comes to choosing you mortgage broker.
A good lender can also assist you in making important decisions that will benefit you in the long run, so do not hesitate to ask questions about anything that needs clarification. As you can see, taking time to research the brokers may prove to be the most valuable investment you can make when applying for a home mortgage.

Byron Branfield http://www.mortgage-one-on-one.info
Article Source: http://EzineArticles.com/?expert=Byron_Branfield

The Good Faith Estimate

So, you've taken an application with a mortgage broker. He has told you your monthly payment and the total amount you will need at the time of closing. How do you know the charges on the loan are fair? How do you compare this loan to others you have been offered?

Check the GFE. The Good Faith Estimate can be your weapon to get the fairest price for your loan. If you don’t take a good long look at this infinitely important legal-sized piece of paper, you may just be throwing your money away.

This single document will detail every specific charge on your loan. Not only does it list your charges, but it also itemizes them to show whom these charges are being paid to. In addition to that, it breaks down all debits and credits on your loan. This will help you come to the final “bottom-line” figure. This is the dollar amount that you will either be paying to the escrow attorney, or that you will be paid by the proceeds of the loan.

This miraculous document also does one last thing. There is a section that breaks down your total housing payment. The payment includes your Principal, Interest, Taxes, and Insurance. If you have more than one loan on your property it will include the other loan for you as well. Mortgage Insurance and Housing Dues will be shown if they apply to you. This is the best way to show you your true combined housing expense.

That is a lot of information for one piece of paper. That information also happens to be almost every last detail of the mortgage loan being proposed to you. After realizing all of the information that is included in a Good Faith Estimate, the importance of this document is easily recognized.

My best suggestion to you is to hold on to the original signed copy of your GFE. You can compare this form to the final document that you will sign at closing. You will easily notice any changes between these forms because they are set up very similarly. You should realize that the numbers will change, that’s the nature of an estimate, however your broker should be able to explain any noticeably large changes.

Kevin Blasi has been originating loans for 4 years in Northeast PA. He also manages a blog as a free resource to educate consumers about the mortgage lending process at: http://explaintome.blogspot.com
Article Source: http://EzineArticles.com/?expert=Kevin_Blasi

What Is An Interest-Only 2nd Mortgage?

Interest-only second mortgages differ from traditional second mortgages in that they do not require fully-amortized payments for the entirety of their term. Interest-only second mortgages have a certain period of time when monthly payments are based solely on the interest accrued on the loan.

The period of time in which interest-only payments are allowed is established by either the borrower or the lender. The interest-only period is usually between one and five years.
However, after the period of interest-only payments, the loan converts to a traditional second mortgage. The borrower is then responsible for fully-amortized payments for the remainder of the loan’s term. This means that you would have to pay off your principal in a shorter amount of time.

Interest-only second mortgages can be beneficial to people who are planning to sell their home. They can take out a second mortgage, make necessary improvements to the home, then sell it and earn the money to pay back both of their mortgages. Often, home improvements will considerably raise the value of a home.

Borrowers who are considering entering into an interest-only second mortgage should keep in mind that their monthly payments will be higher after the interest-only term than it would be on a traditional second mortgage. It is advisable that borrowers not planning to sell their homes should choose short interest-only terms. Borrowers should be certain that they will be able to pay the monthly payments on both of their mortgages. Both first and second mortgages use your home as collateral. If you fail to make your payments on either, your lender could seize your home as payment.

Borrowers should also be certain that their interest-only second mortgage does later convert to a fully-amortized mortgage. Solely interest-only second mortgages will require a balloon payment at the end if its term – the entire principal amount originally borrowed.

Interest Only Mortgages are becoming more common as consumers find various ways to get into a home.

View our recommended Online Mortgage Financing providers.
Article Source: http://EzineArticles.com/?expert=Carrie_Reeder

How Interest-Only Mortgage Loans Work

In a traditional mortgage, a borrower pays a fully-amortized monthly payment. This means that they are paying the exact amount necessary in order to pay their mortgage off in full by the end of their term. Interest-only mortgage loans differ in that they do not require fully-amortized payments at the beginning of the mortgage term.

This article explains how interest-only mortgage loans work:

Interest-Only Payments

For a period of time established by your lender -- usually a few years -- interest-only mortgages only require that a borrower makes monthly payments on the interest accrued on their loan. This means that the borrower is not required to pay any amount on the principal. This makes for monthly payments that are considerably lower than fully-amortized payments.

Conversion to a Traditional Mortgage

After the term of interest-only payments, the loan converts to a traditional mortgage. This means that you will be responsible for fully-amortized payments for the remainder of the mortgage’s term. For example, if your mortgage term was 30 years with a five-year interest-only term, you would have to pay the principal off in 25 years rather than the traditional 30.

Benefits and Disadvantages

Interest-only mortgage loans can be very beneficial for borrowers who are temporarily unable to afford fully-amortized monthly payments. It is a way to rent your home from the mortgage company until you are able to start earning equity in it. However, borrowers should remember that making interest-only payments does not earn them equity in their home. Additionally, payments will be significantly higher after the period of interest-only payments than they would be if the borrower had paid fully-amortized payments for the entire term of the mortgage.

ABC Loan Guide has more information about Interest Only Mortgages or lists for Online Mortgage Brokers.
Article Source: http://EzineArticles.com/?expert=Carrie_Reeder

How Option One Mortgage Loans Work

In a regular mortgage, the borrower pays a specific amount each month in order to pay the mortgage off in full by the end of the mortgage term. This is called a fully-amortized mortgage. Option one mortgage loans differ from regular mortgages in many ways.

This article will explain how option one mortgages work:

Payment Options

Option one mortgage loans have three different payment options: fully-amortized payment, interest-only payment, and minimum payment. The fully-amortized payment is the same payment you would make on a traditional mortgage. An interest-only payment covers just the interest you’ve accrued that month and none of the principal. A minimum payment covers the principal amount for that month and a portion of interest based on a rate established by the lender. This rate is usually between one and two percent.

Conversion to Adjustable Rate Mortgage

After a certain period of time -- usually five years -- the payment options end and the mortgage converts to an adjustable rate mortgage. This means that the borrower would then be responsible for fully-amortized payments through the remainder of the life of the loan.

Benefits and Disadvantages

Option one mortgage loans are beneficial for people whose income is temporarily fluctuating. It may be a good mortgage for a college student who will be able to afford fully-amortized payments after they graduate and gain employment. However, it is not a good mortgage for people looking to earn equity in their home. Borrowers should understand that any unpaid portion of interest not covered by their monthly payment is added to the principal amount of the loan and charged interest. Five years of minimum payments could cause your principal to jump, causing the fully-amortized monthly payments to be considerably higher than they would be had you paid the fully-amortized payment from the beginning of the mortgage.

For more information about Option One Mortgage Loans, ABC Loan Guide can provide lists of honest and fair lenders. Also, see our resources for 100% Financing on a Poor Credit Mortgage.
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Mortgage Refinancing: Interest Only Mortgages

When used correctly interest only mortgages are a useful tool for a short-term financial need. When abused, interest only mortgages can quickly land a homeowner in financial hot water. Here is what you need to know about these risky mortgage loans.

Interest only mortgages offer payments that are based solely on the interest due for a given month. During the period of time that is interest only the mortgage payment will be much lower because there is no loan principal included in the payment. You should note that these loans are not interest only forever; at the end of the interest only period the lender will add principal into the mortgage payment and that amount will increase significantly. The duration of the interest only period is typically one to five years.

The danger in using an interest only mortgage is the temptation to purchase more home than you can actually afford. It is very easy to qualify for larger amounts with an interest only mortgage than you could qualify for with a traditional mortgage; as a result many homeowners find their budgets stretched to the limit when the interest only period ends. If you are unable to keep up on the payments once the interest only period ends you could lose your home to foreclosure.
If you are in the process of taking out an interest only mortgage, you need to make sure that at the end of the interest only period, the mortgage converts to a fully amortized loan and does not terminate with a balloon payment. If you take out an interest only mortgage that ends in a balloon payment and are unable to refinance or sell your home at the end of the interest only period, the lender will foreclose and take your home.

Interest only mortgage loans are a valuable financial tool when utilized correctly. To learn more about using interest only mortgages while minimizing the financial risk and avoiding common mortgage mistakes, register for a free mortgage guidebook.

To get your free mortgage guidebook visit RefiAdvisor.com using the link below.
Louie Latour specializes in showing homeowners how to avoid common mortgage mistakes and predatory lenders. For a free copy of "Mortgage Refinancing - What You Need to Know," which teaches strategies to find the best mortgage and save thousands of dollars in the process, visit Refiadvisor.com.
Claim your free guidebook today at: http://www.refiadvisor.com
Mc Lean Mortgage Refinance
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Second Home Equity Mortgage Loans

The people in the market today view a second home-equity mortgage loan as synonymous with a second mortgage. A second home equity mortgage loan is a loan that you take on your home in addition to the first mortgage loan. This helps you to get money without refinancing the first mortgage.

Second home-equity mortgage loans are good for reducing your debt, but you should be careful. The loan is a lump-sum-second loan that is taken against your home after the first mortgage you already have; if you fail to repay it, you will end up losing your home. The rates of the home equity loans are also higher than that of the first mortgage.

A home equity loan is a one-time loan and can be used for any purpose such as your child’s education, debt consolidation, emergency medical expenses, modifications of your home or for any other purchase. It is usually a fixed-rate loan. The cost of the loan depends upon many factors such as the amount you wish to borrow, the period in which you wish to repay the credit, and even the circumstances.

Home equity loans are ideal for people with low credit ratings, because the lender will not find any risk in lending out the amount as the home is being used as collateral. Today, people are even saving money on their interest rates. Second home equity mortgages are a good option, as most of them are tax deductible. But the most important aspect about the second mortgages is about the type of the mortgage and how it suits your pocket.

Second Mortgage Loans provides detailed information on Second Mortgage Loans, Second Mortgage Loans After Bankruptcy, Second Home Equity Mortgage Loans, Second Mortgage Loan Rates and more. Second Mortgage Loans is affiliated with Florida Mortgage Loan Calculators.
Article Source: http://EzineArticles.com/?expert=Max_Bellamy

Mortgage Lead Generation

The companies handling the mortgage lead generation process need to be very careful and systematic, as this is the most crucial step of the mortgage loan procedure. The mortgage lead generation process involves collecting and compiling mortgage loan applications. The mortgage loan seekers contact online mortgage lead generation companies for loans.

They submit their application by filling out a mortgage loan request form. They have to mention all the relevant details to facilitate the search. The completed loan requests are actually the leads. It’s the responsibility of mortgage lead generation companies to verify the authenticity of the leads. The screening is needed to select the genuine leads and get rid of the bogus ones. Mortgage leads are important to the mortgage lending forms. They make profits and expand business by exploiting those leads.

After selecting the best leads, mortgage lead generation companies send them to different mortgage companies. The companies in turn contact the applicants with their current rates and fees. So, mortgage lead generation has to be foolproof. Otherwise the whole process will go wrong. The mortgage lead generation technique has to be detailed. The lead generation companies should find out the type, purpose and the amount of the desired mortgage loan from the applicants. This will make the process more precise. The mortgage lending companies will be able to get more targeted leads.

Leads are not merely a compilation of contact addresses. The mortgage lead generation process should involve research on the background of every mortgage loan request. This way, the lead generation firms will be able to nullify all bad leads and offer only the genuine leads to the mortgage lending companies. mortgage lead generation companies should find the persons who are truly enthusiastic about getting mortgage loans. This is the recipe for a successful mortgage lead generation process.

Mortgage Leads provides detailed information on Mortgage Leads, Mortgage Lead Generation, Internet Mortgage Leads, Commercial Mortgage Leads and more. Mortgage Leads is affiliated with Mortgage Marketing Leads.
Article Source: http://EzineArticles.com/?expert=Max_Bellamy

Mortgage Refinancing: How to Qualify for the Best Interest Rate

Finding the lowest interest rate for your new mortgage can save you a large amount of cash. Knowing how to go about finding the right mortgage will save you many headaches. Here is what you need to know about qualifying for the best interest rate.

Know Your Credit Score

Cleaning up your credit is the first step in qualifying for a better mortgage interest rate. If you are a homeowner that pays your bills on time you will qualify for a better mortgage loan. Having an on time history of repayment will boost your credit score; make sure you have at least six months worth of on time payments under your belt before applying for a mortgage.

Reduce Your Debt to Income Ratio

Paying down the balances on your credit cards will improve your debt to income ratio and your credit score. If you are a homeowner with a low debt to income ratio, this represents responsible use of credit to mortgage lenders. This makes you less of a risk and will net you a better interest rate for your loan.

Get Your Interest Rate Guaranteed in Writing

If your mortgage lender will guarantee your interest rate, this guarantee is valid for a period of time to allow you to close. If you are unable to close before this lock period ends the lender could raise your interest rate. Make sure you get the interest rate lock in writing and the lender gives you ample time to close on the mortgage.

Save Money

Open a savings account and start saving money. Building your financial assets will improve your application and allow you to prepay points if necessary. Some lenders will require upfront points to qualify for the loan; others will reduce your interest rate in exchange for paying points.

Shop for the Best Mortgage Offer

You need to shop from a variety of mortgage lenders to find the best offer. When shopping carefully compare interest rates, fees, terms, and closing costs from each mortgage offer you receive. Don’t be afraid to negotiate for terms on your new mortgage. Most things on your loan contract are subject to negotiation; haggle with your mortgage lender to get what you want. To learn more about finding the best mortgage for your situation while avoiding common mortgage mistakes, register for a free mortgage guidebook.

To get your free mortgage guidebook visit RefiAdvisor.com using the link below.
Louie Latour specializes in showing homeowners how to avoid common mortgage mistakes and predatory lenders. For a free copy of "Mortgage Refinancing - What You Need to Know," which teaches strategies to find the best mortgage and save thousands of dollars in the process, visit Refiadvisor.com.
Claim your free guidebook today at: http://www.refiadvisor.com
Mc Lean Mortgage Refinance
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What is a Second Mortgage?

Looking to pay for your child’s college education, improve your home, or maybe you want to consolidate credit card bills or high interest loans? If so, you may be considering a home equity loan or line of credit. However, the terminology surrounding home equity loans can be confusing.
A second mortgage is a secured loan that is subordinate to your first mortgage against the same property. A lump sum of money is lent out up front and is then repaid over a fixed period of time.

In contrast, home equity line of credit (HELOC) is a form of revolving credit, where your home serves as collateral. You are approved for a specific amount of credit and then may borrow up to the maximum amount within a set time period. In many ways, it is similar to a credit card. Lenders set your credit limit based on your creditworthiness (income, credit rating, etc.) and the amount of your outstanding debt.

Lastly, there are also no equity loans, also referred to as 125 second mortgage loans, which allow homeowners with little or no equity to borrow up to 125% of the current appraised value of their home.

Second mortgages can have either a fixed interest rate (a set interest rate) or an adjustable rate (ARM). However, a HELOC is typically only available with a variable interest rate. A variable rate is based on a publicly available index, such as the published prime rate.

Be aware, when you take out a home equity line of credit, you may have to pay many of the same expenses as when you financed your original mortgage including a title search, appraisal fees, and points; which add to the overall cost of your loan. However, in many cases the interests on home equity loans is tax deductible.

Rebecca is a respected copywriter has created several helpful refinance loan articles directed towards homeowners from California to Maryland. You can read more mortgage related articles at Nationwide Second Mortgage and learn more about refinancing 2nd mortgages and lines of credit.
To get more free second mortgage loan tips, please visit Second Mortgage Loans.
Additional content source: The Federal Trade Commission http://www.ftc.gov/
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Home Equity Loans - Basics

Home equity loans have become increasingly popular in the past few years. With property values rising, more people have realized the benefits. They allow you to borrow a certain amount of money, using your home's equity as collateral. Collateral is property offered to a lender as security for the loan. It gives the lender a guarantee that you will repay the debt, because if you did not, the lender could sell your property to get the money they lent you back. Equity is the difference between how much the home is currently worth and how much is owed on your mortgage. Home equity loans may seem complicated but they are actually quite simple. You just need to understand a few terms and concepts.

What is a Home Equity Loan?

A home equity loan is a second loan on your property that gives you money based on the amount of equity in your property. You can spend it on anything you want. Most people use it for home improvements, debt consolidation, college educations, vacations or car purchases. The interest that you pay on your home equity loan is typically tax deductible–and that is a huge benefit to this loan. Consult your tax advisor regarding the deductibility of home equity loan interest.

What’s the difference between Home Equity Loans and Lines of Credit?

There are two ways a lender can loan you money based on your home’s equity. First is a home equity loan which is based on a set loan amount, and second is a home equity line of credit, also known as a HELOC, which is a revolving line of credit. Both are referred to as second mortgages, because they are secured by your property, behind your first mortgage. With home equity loans, you apply for a set loan amount and pay it down based on a fixed interest rate. The maximum amount of money that can be borrowed is determined by several variables such as your credit history (FICO score), income, first mortgage and the recent appraised value of the collateral property.

How much can they loan to me?

The relationship between your loan amount and your home's appraised value is called the "loan-to-value" ratio, or "LTV". As LTVs increase, the interest rate of the loan in question usually increases as well. (“Home Equity FAQs”). The maximum amount the lender loans is partially determined by this ratio. The maximum LTV varies per lender. Note that if the LTV is too high, it could affect your approval, interest rate or conditions due to the increased risk for the lender.

Can I get an equity loan on my rental property?

Home equity loans can be taken out on primary residences, second homes, investment properties and vacation homes. However, each property has individual conditions for approval. It is also more difficult to qualify. This is due to the increased likelihood of defaulting. Underwriters prefer applicants with better credit and more assets than they do with applicants purchasing their primary residence.

What if my income is too difficult to determine?

If you have difficulty providing all the income documents necessary for the loan, you can apply under special loan programs such as stated income, “no doc” or “low-doc.” Applicants who are self-employed or commission-based use them often. People who do not want to share their financial history and complicated tax returns with a lender fall into this category as well.

Can you refinance your mortgage with a home equity loan?

If the interest rate or mortgage payment on any property is too high, a home equity loan is also a good way to refinance your existing mortgage loan, take some additional cash and make one easy monthly payment (“Home Equity FAQs”). Refinancing is the process of adding a new first mortgage to replace an existing first mortgage and any other liens you may have. There are two ways to refinance: no cash-out and cash back. No Cash-Out refinancing reduces your monthly mortgage payment and the remaining term of your loan. It can help you save thousands of dollars in interest.

Cash back refinancing allows you to borrow money in excess of what you currently owed on your mortgage. You still reduce your interest rate and term, but you also get a hold of the money you earned when your property’s value increased. Cash back refinancing is a smart decision if you have future expenses that will need financing. If you need a new car, you could take an additional $30,000 and add that amount to your loan. The interest rates will likely be lower than your credit cards or car loan, and again, the interest you pay can be tax-deductible.
Refinancing with a home equity loan is similar to refinancing with a traditional mortgage. The main difference is that equity loans are typically repaid in a shorter time than first mortgages. Traditional mortgages are usually repaid over 30 years. Equity loans often have a 15-year repayment period, although it might be as short as five or as long as 30 years (“Home Equity Credit Lines”).

Now that you are familiar with some basic home equity loan terms and concepts, the process should seem straightforward. When you need money, obtaining a home equity loan not only simplifies your life, it also saves you money. It gives you piece of mind through the fixed low interest rate and low monthly payments. The process only takes several days and the funds are transferred into your bank account upon the loan’s closing. It is as easy as pie.

Mona is a respected free-lance writer who enjoys creating helpful articles about mortgage loans. To learn more about cash out 2nd mortgage loans, or to get a free Home Equity Rate Quote please visit the loan resources online at BD Nationwide Mortgage.com.
If you need more expert advice from a loan professional, go to Second Mortgage Advice.
Article Source: http://EzineArticles.com/?expert=Mona_Loring

Home Equity Loans: Features and Benefits

Puzzled by Home Equity Loans? You are in good company. With the many options available to you, it is easy to feel overwhelmed. Different types of home equity loans have a variety of features and benefits for homeowners. If you are thinking about making home improvements that will add value to your home, trying to lower your monthly payments on an existing home equity loan or line of credit or want to consolidate your debt, read on for a guide to piecing the puzzle together.

Second mortgages, home equity loans and home equity lines of credit all use your home as collateral and the interest on these loans is tax deductible. However, they differ on many levels. Although second mortgages and home equity loans are usually lump sum loans for a fixed period of time, depending on the type of loan you choose, the interest rate can be either fixed or variable. On the other hand, home equity lines of credit allow you to borrow money from the equity in your home in the same way a credit card allows you borrow money against your credit limit. In other words, you can continue draw off your equity up to the limit set by your loan.

Another piece of the puzzle is cash-out refinancing. Cash-out refinancing is different from home equity loans because it is a replacement of your existing mortgage, not an additional loan. With cash-out refinancing you can borrow more than the amount you owe on your home and use the additional cash you receive at your discretion. According to a recent article on Bankrate, homeowners must answer the following questions before beginning a cash-out refinance:

· Are you refinancing at a lower interest rate?
· Will your monthly payments decrease enough to offset closing costs and other fees associated with refinancing?
· How do you plan to spend the money?
If you are refinancing at a lower rate, are able to recoup your closing costs in a fairly short amount of time and are planning on spending the cash on something that will add long-term value to your home or life, then cash-out refinancing might be the piece of the puzzle that fits for you.

Many of the same considerations apply for refinancing an existing home equity loan. Most homeowners look at this option if they are trying to obtain a better interest rate, switch the loan from an adjustable to a fixed interest rate or avoid a balloon (large) payment at the end of the loan repayment period. How long you plan on staying in your home should be another factor in your decision to refinance your existing home equity loan. “If you plan to be there a long time, then it makes sense,” says Steve O’Connor, senior director of residential finance for the Mortgage Bankers Association of America, in a recent article from American Home Equity. If you plan on selling your home soon after refinancing your loan, you are less likely to recover the closing costs.

For those of you to whom debt consolidation is the main goal, your best option is most likely to apply for a home equity loan versus a line of credit or refinancing. Because home equity loans must be repaid within a specific time-frame, you won’t have to pay interest on your credit card debt for the entire length of your mortgage.

When looking over your options, be sure to consider your lifestyle and your comfort level with the type of loan you choose. If you’re a big spender, you might end up getting yourself in even more debt if you use the $20,000 from a cash-out refinance as a down payment on an exotic sports car. Or if you tend to be overly cautious, you may find yourself wishing you had taken out a larger home equity loan when your home improvement project goes over budget. That’s why the most important piece of the puzzle is you – the homeowner.

Jennifer is a free-lance writer who provides many home equity mortgage realted articles for Home Equity Loan Quotes & American Home Equity Loans
Article Source: http://EzineArticles.com/?expert=Jennifer_Frakes

No Doc Mortgage Loans – How This Mortgage Could Help You

If you are struggling to find a traditional mortgage loan because you cannot document enough of your income to qualify, you could benefit from a no doc or low doc mortgage loan. Here is what you need to know about this unconventional type of mortgage loan.

Traditional mortgage lenders require documentation of income when applying for a loan. This documentation typically comes in the form of pay stubs from your employer and bank statements showing your assets. Documenting income is difficult for some individuals who or self employed or are paid on a commission basis; these individuals could benefit from no doc mortgage loans.

No doc mortgage loans differ from traditional mortgages in that they require much less documentation of income and assets to qualify. The lender assumes a higher risk in lending; this risk is passed on to the borrower in the form of higher interest rates and lender fees. The no doc mortgage lender may require a higher down payment or points paid to qualify for this loan. No doc mortgages fall into three categories: No Income/Asset loans, No Ratio loans, and Stated Income loans.

Income/Asset loans do not require information about your income, assets, or employment status. The mortgage lender will rely on your credit score and the appraised value of the home to make a decision on your loan application. If your application is approved you can expect your interest rate to be as much as 3% higher. These loans are ideal for individuals with superb credit.

Ratio loans do not require you to state your income; because of this the lender does not look at your debt to income ratio. The lender will require documentation of your assets, debts, and employment status to approve this loan. The interest rate you receive for a no ratio loan is higher than a traditional mortgage, but not as high as a income/asset no doc mortgage loan.
Stated income mortgages enable you to declare your income without providing documentation. The only requirement for this loan is that you document your employment history and state a reasonable income for the type of work you do.

The lender will use your assets and debt-to-income ratio to qualify you for the loan; because of this the interest rate you can expect to pay is typically only half of point higher than traditional mortgage financing. You will need excellent credit and a sizeable down payment or up front points to qualify. This type of mortgage is ideal for the self-employed.
To learn more about your mortgage financing options and how to avoid common mortgage mistakes, register for a free mortgage guidebook.

To get your free mortgage guidebook visit RefiAdvisor.com using the link below.
Louie Latour specializes in showing homeowners how to avoid common mortgage mistakes and predatory lenders. For a free copy of "Mortgage Refinancing - What You Need to Know," which teaches strategies to find the best mortgage and save thousands of dollars in the process, visit Refiadvisor.com.
Claim your free guidebook today at: http://www.refiadvisor.com
Mc Lean Mortgage Refinance
Article Source: http://EzineArticles.com/?expert=Louie_Latour

How Do Second Mortgage Loans Work?

If you need extra money for home improvements, debt consolidation or even to purchase an additional home then a second mortgage might be exactly what you are looking for to make that happen. However, when you hear the term second mortgage you might not be sure exactly what it means. To put it simply it is just another mortgage on your existing home. Basically you are borrowing money for one or more reasons and using your home as collateral.

The term “second” means that the loan you are taking out does not have priority on your home if for some reason you can’t pay it back on time. In all cases the initial mortgage on your home would be paid before any money would go toward a second mortgage payment. With that being said, the next question is why in the world someone would put their home up as collateral for money. Well, the answer is that you shouldn’t unless you are in a situation where you need a large amount of money fast.

Western Vista Federal Credit Union in Wyoming notes that a “second mortgage is what it says - the second loan against a specific piece of property. Consider this example: Let's say you have a first mortgage on your home. The value is $100,000 and you have a $60,000 balance left to pay on your loan. The $40,000 difference is considered equity, or the part of the home that you own outright. If you wish to further borrow against that $40,000, you would be taking out a second mortgage on the home in order to do so. Why borrow against this equity? In many cases, the interest rate you pay on your mortgage is lower than many other types of loans. Interest is also frequently tax deductible for a first or second mortgage, but not necessarily for a car loan or a credit card.”

When a person borrows money against their home that’s a large chunk of change being used for collateral and it also allows the borrower to get a bigger loan. There are some disadvantages to second mortgages such as the fact that you are taking a chance with your home should something happen and you have trouble paying the second mortgage back.

Take a look at the interest rate on a second mortgage too. You can probably expect the rate to be a bit higher because it is riskier to the lender who knows that if a default occurs the primary mortgage gets paid first and then the second mortgage. You can also be choosy about a second mortgage so check more than one source when trying to make a decision. Watch out too for balloon payments, which is a payment that starts out low and rises as time goes by. If possible, choose a fixed interest rate. Also be aware that second mortgages, like any other loans, have additional closing costs. There are the appraisal fees, application costs and other closing costs that can be as random as title searches.

At the Mortgage101 they say, “Many companies will charge a fee for lending you money. The fee is usually a percentage of the loan and is sometimes referred to as "points." One point is equal to one percent of the amount you borrow. For example, if you were to borrow $10,000 with a fee of eight points, you would pay $800 in "points." The number of point’s mortgage companies charge varies, so it may be worthwhile to shop around.” You also want to make sure you get a second loan that allows you to keep your first mortgage.

In the long run second mortgages are a good bet for home improvement financing and some second mortgages can even be extended for up to 20 years. Remember though, it’s not only home equity lines of credit that don’t outline the amount of the monthly payments so read your contract. There are many second mortgage loans that don’t either. Joe Prussack notes, “Everybody loves low monthly payments… These popular 2nds' (second mortgages) also usually have adjustable rates so these loans aren't for the faint hearted.” In this case, if you are one of the fainthearted then stick with a fixed interest rate versus one of the variable interest rate loans. This way you will know exactly what payments are expected each month be it for a second mortgage or another type of loan in order to secure a big ticket item that you have needed for the past few years.

Rita is a seasoned free-lance writer who has produced many popular articles related to real estate financing. To learn more about cash out second mortgages and equity loan options, please check out the Second Mortgage Refinance programs.
If you need more expert advice for the 2nd Mortgage & Home Equity Loan process, please visit BD Nationwide Mortgage.
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Mortgage Loan: Escrow Basics

If you are applying for a mortgage the lender may require you to have an escrow account pay your insurance and property taxes. Lenders do this to protect the property secured by the mortgage loan they have given you. Here is what you need to know about escrow accounts.
Escrow accounts are a way for your mortgage lender to ensure that your property taxes and insurance are paid on a monthly basis.

The lender is protecting their interest in your home against seizure for failure to pay property taxes or damage that would be covered by insurance. Escrow is a third party company that pays the insurance and taxes for you. The monthly payment you make will include the monthly amounts for your insurance and taxes; you will make your payment directly to the escrow company and they will use this money to pay the mortgage lender, insurance, and property taxes.

The mortgage lender may require you to make an initial deposit to the escrow company in case you fall behind on the payments.
Escrow can be beneficial to many homeowners by spreading the payments for taxes and insurance throughout the year. Because the escrow company makes these payments, the homeowner has one less thing to worry about. By making monthly payments the amount due is easier to manage for homeowners on a tight budget.

Mortgage lenders are limited in the amount they can require you to pay in escrow; two months payment is the most your lender can legally require you to deposit in your escrow account. The escrow company will handle adjusting your payment amount for increases in your property taxes and insurance; you will receive periodic notifications from the escrow company whenever there is a change in your monthly payment amount.

Some homeowners prefer not to use escrow accounts to pay their taxes and insurance. If you have good credit the lender may be willing to waive the escrow requirements if you make the necessary down payment. To learn more about financing your home and how to avoid common mortgage mistakes, register for a free mortgage guidebook.

To get your free mortgage guidebook visit RefiAdvisor.com using the link below.
Louie Latour specializes in showing homeowners how to avoid common mortgage mistakes and predatory lenders. For a free copy of "Mortgage Refinancing - What You Need to Know," which teaches strategies to find the best mortgage and save thousands of dollars in the process, visit Refiadvisor.com.
Claim your free guidebook today at: http://www.refiadvisor.com
Mc Lean Mortgage Refinance
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Pros and Cons of a Home Equity Loan

What is a Home Equity Loan?

A home equity loan is an example of a secured loan – the money is loaned to you with the value or equity in your home as security. Put simply, the equity is the difference between the amount you owe on your mortgage and the amount your home is actually worth at current market value.

For example if your mortgage is for $150,000 and your home would now sell for $200,000 you may be eligible to take a loan out for the additional amount of $50,000. The remaining value of your home is security on the loan.

Home equity loans, sometimes called a second mortgage, are more popular with homeowners than ever – in 2005 an estimated $204 billion was cashed out in home equity in the United States.

Advantages

There can be significant tax advantages of taking out this type of loan. Always consult with your tax advisor, but the interest paid on the loan may be tax-deductible. Most of the closing costs and fees for a home equity loan are paid up front or can be rolled over into the loan itself. Interest rates on these loans tend to be competitive.

With many plans you can pay off the loan sooner, by paying more towards the principal, rather than just paying the minimum payment – just as you can with your mortgage payments. And the cash from your loan can generally be used for whatever you like – home improvements, vacations or college tuition costs are all popular reasons for taking out a home equity loan.

Disadvantages

Just as with your actual mortgage, you run the risk of losing your home if you don’t make the payments on a home equity loan. If the value of your home drops significantly, you may end up owing more on the home than it is actually worth. A home equity loan may not be the right choice if you are contemplating a career change and potentially a lower income.
There are also various charges and fees usually associated with taking out the loan, which can rapidly add up although often the charges can be incorporated into the loan amount. The charges typically include a property application fee, home appraisal fee, title fee, taxes and points on your mortgage.

Things to Watch Out for when Applying for a Loan

Some loans have steep penalties for paying off the loan too early – a typical penalty might be 10% of the amount borrowed. Make sure there isn’t a penalty assessed by the lender for prepaying your home equity loan. Be careful of loans in which you are just paying the interest each month and are then hit with a large payment of the principal amount towards the end of the loan term. These are sometimes known as balloon loans.

Don’t forget the “three day” rule – you have the legal right to cancel your loan within three days of taking the loan out, in which case all the application fees will be returned to you.
Finally, one thing you may want to do is consider a home equity line of credit rather than an actual loan – this has the advantage that you are only paying interest on the amount you actually use. You may have a potential line of credit of $20,000 but only actually use $5,000 of it – you are only paying interest on the $5,000.

You may freely reprint this article provided the following author's biography (including the live URL link) remains intact:
About The Author
John Mussi is the founder of UK Personal Secured Loans who help homeowners find the best available loans via the http://www.uk-personal-secured-loans.com website.
Article Source: http://EzineArticles.com/?expert=John_Mussi

Mortgage Refinance - Advantages and Disadvantages

Your friend was able to get a real good deal when he went to refinance his mortgage. You know of others that came out better, too - but for some reason you have not yet tried to get your own mortgage refinancing. Well, the truth is, finding out about your own prospects of getting a better situation are only a few minutes away. In this article you will find a few pros and cons about it that should enable you to make up your own mind as to whether mortgage refinancing is for you.

Let's look at a few of the pro reasons first. By refinancing you could...

Get A Better Loan

It is possible that you may have purchased your home with a hybrid loan, or a variable interest rate mortgage. At the time, you were really excited because it enabled you to get the house you really wanted, and it gave you good low payments. But soon, you will either have to pay it off, or go to much higher payments. Recently, Martin Crutsinger, Economic Writer for the Associated Press (March 24, 2006) reported that “The Federal Reserve has raised short-term interest rates for nearly two years, and those increases finally are starting to trigger a sustained rise in long-term borrowing costs.” By refinancing your mortgage, you could get into a more solid fixed rate mortgage, a predictable rate of interest, and you may even get tax deductions for it.

Have Lower Payments

If you are facing higher payments because you initially bought an ARM, or have already taken out a second mortgage, and have some credit card debt (or other), it could be a much better idea for you to consolidate it into a single new loan, by mortgage refinancing. This could give you a lower overall debt, an d a lower payment.

Reduce The Length

If you currently have a 30 year fixed rate, or a 40 year fixed rate mortgage, then you are paying a lot of extra interest. By getting locked into a shorter-term fixed mortgage interest rate, you could save a lot of money.

Another Option – A Second Mortgage

Another option may be just getting a 2nd mortgage based on a home equity line of credit. Home equity loans can also be used to give you the possibilities of debt consolidation, home improvement, and possibly even a monthly savings - if your credit card debt is high, then this option can bring about a lower interest rate and lower monthly payments for you.
Now for a couple of reasons that are against it - the cons side.

The Cost

Getting a new mortgage could cost a pretty penny. You need to see if there is a penalty for early pay off on your existing mortgage. It also could be more costly if you have any bad credit ratings - good credit is always more desirable. Costs for a new mortgage could come to an amount that might take you 2 or 3 years to recoup before you are able to see any real savings. For instance, if your costs for refinancing come to $1000, and you are able to lower your payments by $50 per month, then that means it will take you 20 months before you really begin to save anything. Or, if you are considering selling the house within that time, it really would not be much benefit to you.

How To Determine If It Is Better For You

Guidelines given by the financial industry tell us to consider mortgage refinancing to be a better idea if your current level of interest on the loan is more than 2 points higher than market level. Other suggestions are to do some real research into the prospect of refinancing before you ever sign something that you might have years of regret for later.

If you want to get lower rates and pay off the mortgage as quickly as possible, and are pretty sure that you can, then consider getting an ARM. Make sure that the fixed mortgage interest rate portion of the loan is for a long enough period to be able to pay off the loan – without any penalties for early pay off.

Michael Valles is an experienced writer who focuses on refinancing and debt consolidation. You can read more of his refinance articles at Mortgage Refinance and learn more about refinance and home equity loans for people with all types of credit.
To get more free second mortgage & refinance tips, please visit Refinance & Second Mortgages.
Article Source: http://EzineArticles.com/?expert=Michael_Valles