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
Monday, May 29, 2006
Choosing the Right Mortgage Lenders
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.
Article Source: http://EzineArticles.com/?expert=Carrie_Reeder
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
Article Source: http://EzineArticles.com/?expert=Louie_Latour
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
Article Source: http://EzineArticles.com/?expert=Louie_Latour
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/
Article Source: http://EzineArticles.com/?expert=Rebecca_Sparenberg
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.
Article Source: http://EzineArticles.com/?expert=Rita_Cook
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
Article Source: http://EzineArticles.com/?expert=Louie_Latour
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
First Time Buyer - Your Dream Home is All Yours
For a first time buyer, things might be little hard and confusing in the market. No prior experience of buying a home often results in one being in such things. However first time buyer should not worry, as all the people with prior experience also go through the same plight.
As the name suggests first time buyer, are all those people indulging in purchase of home for the very first time. They might be living as tenant now wishing for a home of their own, away from all anxieties and troubles.
Purchasing a home without any support is not every ones cup of tea. Nowadays the asking rates for properties is quite high, thus it becomes difficult for a common man to afford it easily as he has other priorities as well. Hence the right option turns out to be mortgage. Market is flush with lenders who offer mortgage services, which turn out to be very beneficial for a first time buyer.
A first time buyer enjoys low interest rate and small monthly installments. Flexibility is given in repayment duration. Hence he is not overburdened with mortgage amount and can repay his amount at his convenience. In addition to this he makes a small payment or down payment at the beginning, while lender pays rest of the amount of the purchase.
The house you have purchased is kept as collateral with the lender. If you are not able to repay your amount on time, lender can legally take away ownership of your property.
A first time buyer can search online to get in touch with various lenders. Collect all relevant information regarding lenders and their interest rates. A first time buyer should be very careful before he goes for any deal.
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 Adverse-Credit-First-Time-Buyer as a finance specialist.
For more information please visit http://www.adverse-credit-first-time-buyer.co.uk
Article Source: http://EzineArticles.com/?expert=Ruth_Stanhop
The Home Improvement Loan and What It Can Do For You
If you are trying to get improvements done on your home and you are having a difficult time acquiring the cash to complete them, you may want to consider a home improvement loan. This will provide you a solution to your cash availability problem and allow you to fix up your home and finish any needed repairs.
The Benefits
The home improvement loan will give you the cash to make necessary improvements or renovations to your home. Whether you are adding onto your home, remodeling existing rooms, doing general repairs, or even updating systems, such as the heating system or plumbing, this will allow you the needed cash to accomplish them.
Determine Your Needs
When taking out a home improvement loan, you’ll want to first sit down and determine what your needs are. Do you want to take out the maximum amount allowed? This would help you to make necessary repairs and make improvements to increase the value of your home or set some money aside in case of an emergency.
The Terms
Generally, most home improvement loans will allow you to repay them over a period of 5 to 25 years. This, of course, depends upon your income and the amount of equity you have in your home. The equity is what the value of the home is less what you owe on your mortgage. Most often, a lender will allow you as much as 80 to 90 percent of the equity in the home. Of course, your credit history will also play a role in how the lender will determine the rates.
Compare Rates
If you are contemplating borrowing on the equity in your home, the best thing you can do is to shop around. Visit the lender that currently holds the mortgage on your home, however, don’t be afraid to research other lenders, as well. Many lenders will offer competitive rates and you’ll want to find the one with the best terms and you will even be able to research and apply for them online.
Bad Credit Home Improvement Loans
If you have blemishes on your credit history, you still should not have too many problems securing a home improvement loan. The fact is the lending industry is very competitive and if you have less than perfect credit, you should still be able to get a loan. Your rates may be higher but it will allow you to make necessary repairs and improve your home.
Making A Profit From Your Loan
Many individuals often will acquire a home improvement loan to fix-up the home which improves the value of the home. In many instances, the home is then sold, the loans paid off, and the homeowner makes a profit on the home. For example, an individual purchases a fixer-upper for $80,000. They then borrow $30,000 making the total owed on this home $110,000. After using the $30,000 to make improvements, they sell the home for $150,000 and after paying loans off, they are left with a profit of $40,000. This is how many individuals make their living.
The home improvement loan is made available to help those who wish to make changes to their home to improve their living conditions. The most important thing you can do when contemplating taking out this loan, however, is to do your research and find the best rates that are available to you.
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 Direct Online Loans who help homeowners find the best available loans via the http://www.directonlineloans.co.uk website.
Article Source: http://EzineArticles.com/?expert=John_Mussi
Finding Your Right Home Owner Loan
The opportunity may be right for you to be able to get the home owner loan that you have wanted. The economy has made it possible for many who could not get loans before to be able to get one easier now. This article will give you some information about the kind of loans that may be available to you.
Home owner loans come in many different forms, and can be used for a variety of purposes. By comparing available rates on the Internet, or by visiting a loan office, or bank, it will help you to quickly find a home owner loan for your needs, and in a secure manner. Above all, by taking a little time to do some research into this type of loan, it will help you to make the most informed decision about getting that right home owners loan for you. Some of the more common types are:
Home Equity
The easiest kind of loan to get would be if you have some equity in the house. This kind of loan basically allows you to borrow against the money that you have already paid into your home.
Second Mortgage
This kind of loan can be obtained now even if you have not lived in the house long enough to build up much equity. A second mortgage can be applied for either as a secured loan (with equity), or as an unsecured loan (no equity). Both types have their advantages, but the secured loan will be the cheaper way to go - but, if you default, you lose the house. Banks love the stability of knowing that there is something solid to fall back on, and that is why the loan is cheaper.
Home Repair or Upgrade
A home owner loan can also be taken out in order to get the desired work done on your home. It is really the same thing as a second mortgage – or, personal loan. It can also be taken out as a secured loan, or unsecured.
Debt Consolidation
This could be the best time to get your cheap loan by putting all of your bills in one place. Even if you cannot refinance your home, there is always the possibility of getting a second mortgage and consolidating your bills all into one easy payment. Just remember, that if you do put any credit card bills into this debt consolidation, that it will only pay to do so if the interest amount of your second mortgage is actually lower than your credit card interest. Also, it is in your best interest not to stretch it out as long as possible and you need to be allowed to pay it off early without penalty. A second mortgage loan is usually a little higher in interest than your first mortgage.
Many of these loans are cheap simply because the competition is pretty fierce. In fact, many home owner loans can now be obtained by those who never could have received a loan even just a few years ago. Cheap loans can be gained these days even if your credit ratings are not so good. Be sure to shop around and find your own best loan.
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 Bad Credit Loans4u who help homeowners find the best available loans via the http://www.uk-bad-credit-loans4u.com website.
Article Source: http://EzineArticles.com/?expert=John_Mussi
Getting A Homeowner Loan
Thinking of getting a homeowner loan to help you with those needed bills? Many places would be more than glad to give you a loan, if you have good credit. But before you apply, here are some things that you need to know in order to save you some money.
Higher Rates Apply
Whatever your reason is for wanting that homeowner loan, you can be assured that it will probably have about a 1% or more higher interest than your first mortgage. This may make it a better choice to see first if you can rather finance your existing mortgage for a better rate of interest than you currently have.
Look At The Homeowner Loan Types
There are basically two types of a homeowner loan that you can get. These are:
• The Fixed Mortgage Rate
This is just like the name implies. It gives you the confidence of knowing what your payments will always be for the life of the loan - they are fixed. This loan is the surer way to go if you are looking just to make the payments for the life of the loan.
• The Adjustable Rate Mortgage (ARM)
This type of homeowner loan gives you an initial time frame (either 1,3,5 or 7 years) in which the rate stays the same. But after that, your payments will vary from year to year depending on the state of the economy - but that is unpredictable. It could become lower or higher. If you intend to pay off the loan during the fixed rate time portion of the loan, then this may be the option for you.
Borrowing Extra Money
While seeking to save as much money as possible in the getting of the right kind of homeowner loan, you also need to consider the option of debt consolidation - which is very popular today. Of course, this already could be the reason you are looking into it. Remember that some credit cards do carry a low rate of interest - possibly even lower than that of the homeowner loan. Therefore it would not pay to put the debt on such a card onto a higher interest loan. Remember too, that it may save you even more money if you are able to get a 0% APR credit card and do a balance transfer to that card - you cannot beat 0% interest!
Calculate The Timing Of The Loan
Homeowner loans are always determined partly by your current credit rating. This means that if you are near, but just below the excellent rating level, that it would save you considerably more money to wait a couple of months and seek to raise your credit level to where it needs to be to obtain the best rates. Just those few points of change in your credit rating could result in saving you literally $10,000, or more, if you can save as much as $34 per month, over a 30 year period.
While we often look at loans as being a way to get money quickly, these few suggestions should also help you to save money when you get that homeowner loan. As a person is actively doing their due diligence, you will become informed in the process, which will also enable you to keep more money in your pocket.
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 Bad Credit Loans4u who help homeowners find the best available loans via the http://www.uk-bad-credit-loans4u.com website.
Article Source: http://EzineArticles.com/?expert=John_Mussi
Mortgage Note Brokers
There are several brokers who help people to sell and buy mortgage notes. They match people who want to sell their note with people who want to buy that note. Their professional fee is paid entirely by the note buyer. The real estate notes are today a massive industry, worth more than $400 billion.
Mortgage brokers are independent contractors who usually shop for loan applications amongst lenders to find the most attractive term for a borrower. Mortgage brokers offer loan products of multiple vendors. These multiple vendors are known as wholesalers. The mortgage broker gets paid for his services by the lender.
Mortgage brokers do not lend; they primarily counsel borrowers on the problems involved in qualifying for the loan. Brokers also help by compiling all the documents that are required for the transaction. This reduces delays in the loan processing.
Mortgage notes are usually produced by banks or mortgage companies. The federal government secures these notes. There are several agents who facilitate the sale of existing private mortgage notes or commercial mortgage notes. These agents or service providers can easily arrange for point of sale funding, commonly known as table funding or simultaneous closing. This enables the seller and the agent to offer financing to their buyers, without taking the trouble of securing their bank lines of credit.
While issuing mortgage notes, agents or service providers look at the type of property, location of the property, the way in which the mortgage is structured, and the credit history of the buyers. These elements essentially dictate the guidelines for the valuation of the mortgage note. The more information given to the service agent, the better they can evaluate the right transaction for sellers. To collect information, service providers usually seek information by E-mail, fax or telephone.
Sell Mortgage Notes provides detailed information on Sell Mortgage Notes, Buy Mortgage Notes, Mortgage Note Brokers, Mortgage Notes for Sale and more. Sell Mortgage Notes is affiliated with Atlanta Interest Only Mortgages.
Article Source: http://EzineArticles.com/?expert=Steve_Valentino
Mortgage Loan: Home Equity Basics
If you are a homeowner in need of cash for any reason, you might consider borrowing against equity in your home. Equity in your home is an excellent source of secured credit; here are the basics of how home equity loans work.
If you borrow against equity in your home there are no limitations on what you can or cannot do with the money. You can use the cash to pay for your child's college, remodel your home, or pay off your bills. You can even take a European vacation. Needless to say, some uses are better than others, but it is after all, your money…sort of.
While you do own a portion of your home referred to as equity, the lender is loaning you money against this equity. You get equity in two ways: by paying down the balance of your mortgage, or by appreciation you realize in the value of your home in a rising housing market.
A home equity loan is simply a second mortgage secured by your property. If you default on this loan, just like your first mortgage, the lender will foreclose and take your home. Home equity loans come in several flavors: second mortgage loans that pay a lump sum, and equity lines of credit that you can write checks or use a debit card against. Both types of loans have their pros and cons; you must choose the type of home equity loan most appropriate for your situation.
There are expenses involved when taking out a home equity loan. You may be required to pay an application fee, lender fees, title search, appraisal, points, and closing costs. Because of these expenses it pays to shop around and compare fees from a variety of lenders. To learn more about equity and your mortgage, 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
Interest Only Home Equity Loans
Interest only home equity loans are an option for the homeowner that needs to have low initial payment amounts for a home equity loan. If you need cash from your home equity but are concerned your budget cannot handle the payments at the moment, an interest only home equity loan could be right for you.
This home equity loan is different from your standard home equity loan; during an initial period the borrow makes interest only payments that do not include any of the loan principal. This interest only period varies by home equity lender; interest only home equity loans are interest only for one to five years.
At the end of the interest only period the loan is converted to a fully amortized, traditional home equity loan and the borrow will see their monthly payment go up significantly to include loan principal. The payments will be much higher at this point because the interest only period is gone from the amortization schedule; you now have to pay back more in less time compared to a standard home equity loan.
If you are in the process of selling your home and need to make repairs, you could benefit from an interest only home equity loan. This loan would allow you to make the necessary repairs to sell your home while keeping more cash in your pocket. After you sell the home you can pay back your primary mortgage and the home equity loan.
Interest only loans of any kind have the potential for financial peril if abused. Interest only loans are not interest only forever; the lender is going to want their loan principal back at some point, and when this happens the monthly payments will go up significantly. This loan secured by your home like your primary mortgage; If you fall behind on your payments the lender can take your home. To learn more about using interest only loans while minimizing the risk, 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
Home Loans for People With Bad Credit
Bad credit loan is a type of loan that mostly depends on your past credit history. The past credit history is important for it contains all your documents such as defaults on repayments of previous loans, county court judgments and financial transactions. If you have a default or late repayment then there is a risk to offer you any loan for your application will be marked as mortgages with bad history.
However, some institutions are there which provide mortgage for bad credit. But it is for sure that they charge a higher interest rate from you. If you have a bad credit or poor credit history, you may have trouble convincing the lenders to approve your loan. Getting a home loan with bad credit has actually never been easier than it is today. Here are some tips to get the best deal on bad credit refinancing:
Shop Around – You should go and shop around to approve your application. It is recommended to apply to those online brokers who will forward your application to multiple lenders. Each broker works with its specific type of lenders. Some work with flexible lenders and others not. So search the best option.
Improve Your Credit Score – Here are some simple tips to improving your credit score, which help you in getting your "Mortgage bad credit rating" approved. First of visit the website of your bank and dispute on the incorrect entries (if any) in your account. Next, pay your current payments on time and without late penalty. Keeping the number of credit enquiries down will help you maintain a good credit score.
Save For A Down Payment – Some lenders may be ready to approve you even for 100% financing, with low interest rate but they can demand for 5-6% down payment. So try to save as much as possible for a down payment.
We have made the most comprehensive research on home loans. Find it only on the Mortgage bad credit rating and info website. All about home loans on LeanderNet - http://www.leandernet.com
Article Source: http://EzineArticles.com/?expert=Oliver_Turner
3 Things To Know Before You Get a Construction Loan
Maybe you have a "dream" home in your mind that just isn't on the market, or perhaps you've already picked out the perfect piece of land--but it still needs a house. If so, chances are you'll need a construction loan to build your new home. But there are a few things you should know before you get the loan, such as:
IT'S SHORT TERM
Unlike a regular mortgage, which typically has a term of 15, 30 or even 40 years, a construction loan is short-term. Generally, the loan term is 6 months to a year, and the money is used to finance the building of the house. If you're looking for a construction loan, make sure you find a lender that will "lock-in" your rate during the loan term, so you don't have to worry about your costs rising during the construction of your home.
IT'S DUE ALL AT ONCE
With most mortgages, you pay off the loan a little bit at a time in the form of monthly payments. With construction loans, however, the entire balance is typically due at the end of the loan term once the house is built. That means you need to either have a cash reserve that you can use to pay off the loan when it's time, or you have to get some other type of financing or loan to cover the balance. Known as "permanent" financing, this type of loan requires a new application, and you'll have to pay closing costs and other fees. In some cases, you can get a combination of a construction loan and permanent financing so a second application and extra set of fees is not required.
YOU DON'T GET THE MONEY IN A LUMP SUM
Most people assume that they receive the money from the construction loan, and then it's their responsibility to save it and use it to pay the home builder. However, although it is your responsibility to disburse the funds to the appropriate contractors or subcontractors, you won't receive the funds in one lump sum. Typically, the bank will give you a certain amount of money periodically based on the percentage of work that's been completed on the house. Here is a list of recommended Construction Loan Mortgage Lenders online. It's important to use a reputable lender online to make sure your personal information is secure.
If you want to build a home, a construction loan is almost a necessity (unless you have significant savings). But there are differences between a construction loan and a typical mortgage loan, so be sure to talk to your lender for more specifics.
ABC Loan Guide, a loan information website owned by Carrie Reeder, can give you valuable information about New Home Mortgage Loans, and also help you find a lender with free Mortgage Quotes Online.
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5 Questions To Ask When Buying a New Home
Tired of renting? Relocating for a new job? Have a growing family? It may be time for you to buy a new home. However, before you dive into this large financial purchase, make sure you ask yourself these five questions:
HOW MUCH CAN I AFFORD?
Check online for financial calculators that use your income and debts to calculate how much you can afford to spend on a house. The best calculators will also include tallies for things like your annual homeowners insurance premiums, real estate taxes and maintenance costs. These calculators usually tell you the maximum amount you should spend on a house.
WHAT NEIGHBORHOODS DO I LIKE?
If you have kids, it's important to check out things like the local schools and parks. You may also want to consider things like crime rates, employment rates, the commute to your job, shopping and traffic issues. Some folks prefer planned developments, and others like the freedom of no rules and restrictions. You'll need to figure out what's best for you.
ARE THERE HOME INSPECTIONS I NEED?
Check with your real estate agent to find out what typical home inspections are included in the geographic area where you want to buy your home. Then pay close attention to see if you need to get other inspections, too. If the area is known for a high rate of radon, you may want a radon test. If termites are common in the neighborhood, you may need a pest inspection.
DOES IT MEET MY NEEDS?
When you do start looking at houses, make sure they meet your needs. Sure, you may fall in love with the built-in bookcase and breakfast nook, but is the yard too small for your kids and dogs? Maybe the little den would make a perfect small office, but there aren't enough bathrooms.
ARE THERE OTHER HAZARDS?
If the house is older, you may need to worry about hazards like lead paint. Depending on the state or city, you might want to see if the house is located in a high-risk zone for things like flooding, tornados, hurricanes or earthquakes. Here is a list of recommended Home Mortgage Lenders online. It's important to use a reputable lender online to make sure your personal information is secure.
Buying a new home is a serious financial commitment with long-term consequences. Make sure you carefully consider all the pros and cons of any house before you decide to purchase it.
Use ABC Loan Guide's sources to find a Low Interest Rate Mortgage Loan, or to research New Home Mortgage Loans as well.
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Guide to a Home Loan
A home loan is a loan that you take out against your house—using the equity you have built up in your home as collateral against a loan.
There are several reasons to consider a home loan: to obtain a lower interest rate when they are at a low point, to obtain cash out of the equity built up in a home to pay off other debts or make home improvements or to change loan programs.
Personal loans are often not as large as a home loan, so if you need a larger sum of money, this is the type of loan that may be more beneficial and suit your needs. These loans often boast a lower interest rate than personal loans, making a loan against your home a much more feasible option for you.
Owning a home can be quite expensive, and finding out just how expensive home improvements can be can be daunting. In many cases, homeowners will take out a loan on their home to do improvements that will increase the value of their home.
Cheaper Interest Rates
In many instances, a home loan offers a much cheaper interest rate than many other loans and credit cards. Homeowners will often take out a loan on their home to pay off other debts and credits that they owe simply because it can save a great deal of money each month in payments.
Some loan programs and mortgages that were offered even a year ago, hold a much higher interest rate than the rates currently offered. Homeowners have an option of taking out a home loan to take advantage of low interest rates while they are in effect, potentially saving thousands of money.
If you have better credit now than you did before, taking out a new loan against your home may be of great benefit. If you had bad credit before and took out a loan but have made steady payments for some time, then a home loan could offer you a much better option now.
These loans are usually a great option for homeowners for a variety of reasons. Regardless of the reasoning for asking a lender for a home loan, most people who take out this type of loan are quite happy with their decision. A loan of this type cannot only save thousands of dollars each year, but can also help you to build a better credit rating.
Another reason that families may take out a home loan is to help pay for, or save for, a college education for their children. When interest rates are low, it may be a good time to take that large, lump sum of money out and put it into a term deposit or an education fund for your children’s educational needs after high school. Sending your children through post-secondary education can be a costly endeavor.
By taking out a loan against your home’s equity (money that you have tied up in your home) while the interest rates are low can help a great deal come the time your children are ready for post secondary schooling.
A home loan may be the best option for you—check out the options with your financial advisor or institution to find out if this option is best for you.
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 Direct Online Loans who help homeowners find the best available loans via the http://www.directonlineloans.co.uk website.
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Is A Second Mortgage Going To Help You?
Nowadays, almost everyone buys his or her home using a mortgage. Sometimes, though, life can be unexpected, and sometimes it can be just plain expensive! At times like these, it's frustrating to know that your house is worth so much more than you paid for it, and yet you can't just take that equity down to the local store to buy groceries - or can you?
Well, you probably wouldn't want to touch the equity of your home just for the groceries, but if you need to improve the house, start a business, pay off some expensive debts, or maybe put your kids through college, then a lump sum would be very handy. That's where a second mortgage may prove to be a good option.
Basically, when you buy a home and take out a mortgage, that's known as a first mortgage. That means that if you get into financial trouble, and the lender forecloses, they have "first" grab at the sale funds. If you then take out a second mortgage against the house, usually against the equity you've built up over time, then that lender will get "second" grab at the sale funds.
Because the lender who gives you the second mortgage is second in line, the risk to them is much higher. If the property is sold under foreclosure, and doesn't fetch the expected price, then it's the second mortgage lender who's going to miss out - well, at least until they start chasing you personally, anyway. But all that means they're opening themselves up to a bigger risk of losing money, or having a lot of hassle getting their money back.
So second mortgages are almost inevitably more expensive that first mortgages - both in terms of interest rates, and the fees charged. Quite often, too, a second mortgage has to be paid off in a shorter time frame. Your first mortgage might be for 30 years, but the second mortgage might only be for 10 years, as an example.
Apart from that, second mortgages come in almost as many different variations and have as many options as first mortgages. You can get fixed rates, adjustable rates, interest only, balloon payments - and the list goes on. So before you start trying to source a second mortgage, it's a good idea to have a very clear idea of what exactly you're looking for, and what you can afford to pay. If you're not in a position to make high payments every month, then you might be able to source a second mortgage with lower payments and a balloon payment after 5 years. Hopefully by then (particularly if you're doing home improvements) your house will be worth more, and you may be able to refinance both mortgages into just one, lower rate first mortgage.
There are a couple of different ways to set up a second mortgage, although technically they're not all called second mortgages! Basically, what we're talking about here is ways to access the equity you've gained in your home. So there's a standard second mortgage, which means you have two loans against your home. Remember, though, that even the combined loans probably won't be able to go above eighty percent of the value of the home.
You can also organise a home equity loan. This is mostly the same as a second mortgage, but is generally cheaper, both in interest rates and charges. Generally these are offered with adjustable rates, and quite often are taken out with the same lender as the first mortgage.
A variation of this is the home equity line of credit. This is where the loan funds are set up like a big bank account, and you can take out amounts periodically when you need them - for example, when the college fees are due.
All types of second mortgage will generally require an application, a credit check and a home appraisal. The criteria are often stricter than for a standard home loan, simply because the risk to the lender is higher. Even so, it's unlikely you'll be able to borrow more than eighty percent of the appraised value of the home.
In the end, only you can decide whether a second mortgage is a good idea for you. It can be enticing to suddenly have a windfall of a large lump of money, particularly when things are tight, but in the end it's no different to any time of credit - at some point, you are going to have to pay it back. So think very hard about your financial situation and your ability to make repayments when considering a second mortgage.
There's lots of great home loan information at Home Loan Zone Central
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