Overview A mortgage is basically a loan specific to the real estate market. Typically, it covers 70-90% of the purchase price of a house or other property, with the penalty for non-payment being foreclosure, or reversion of the property to the lender. They are available from most banks, credit unions, portfolio lenders and some government agencies. Mortgage loans usually employ a 30-year repayment (or amortization) schedule. Payments are a changing combination of interest and principal, so that in the early years a payment mostly consists of interest on the outstanding principal balance, but in later years the mix becomes much more heavily weighted toward paying the principal itself. There also is private mortgage insurance to consider, which is required if less than 20% is put down on the house. It has gotten easier to actually get rid of this extra payment as soon as possible. Read More
Mortgage Is an Investment
While there is a very competitive market for mortgage loans, different lenders employ different criteria for judging your credit and sometimes use different formulas for rate escalations. It is important that you compare each lending institutions' policies and procedures to ensure that there are no hidden dangers or extra fees involved.
Needs Analysis
Before approaching a lender or making a final decision on a home, it is essential for the prospective borrower to evaluate his or her needs and future plans. Making long term goals and knowing how each type of loan works can have a major impact on how much money is spent during the lifetime of the loan. It is also crucial to consider how your needs and income might change over the duration of the loan. In short, it is a perfect time to make a financial plan. Contact us if you'd like help. Loan Process
Learning the administrative and legal aspects of the loan process is essential for anyone considering a loan. A borrower should know what contracts and documents he or she will encounter, and how to negotiate through the paperwork. Also, it is important to be aware of what fees may be assessed and how to minimize or eliminate them wherever possible. Types of Mortgages
Whether looking for a first home or simply refinancing an existing loan, homebuyers have a myriad of mortgage options available to them. The key variable is for how long you want to lock in a rate and whether you think rates are likely to rise or fall in the future. Generally, you will pay a higher rate today the longer you fix the term. Also, except for the 15-year fixed mortgage, almost all the loans amortize over 30 years: Fixed Rate Mortgage is the most familiar of all home loans, the fixed rate 30-year or 15-year mortgage maintains the same interest rate for the entire term of the loan, making it an ideal choice for those who are willing to take a slightly higher interest rate in exchange for guaranteed static interest rate Adjustable Rate Mortgage, often called an ARM, is a mortgage whose interest rate is set for only the first few months or year, after which the rate generally rises and will fluctuate with the level of short-term market rates. The advantages of this type of loan is that the initial interest rate is usually lower than that of a fixed rate mortgage, and if interest rates stay low it can save you money. On the other hand, if rates rise, your payment rises and budgeting is harder. Homebuyers who may have a harder time qualifying for higher fixed rate mortgages, or who believe that they will be refinancing soon, may well want to take the risk of an ARM. Balloon Mortgages are shorter term loans of three to seven years that start with the level payment structure of a fixed rate mortgage. At the end of the term, however, the remaining principal balance is required to be paid in full. At that time you can pay off the mortgage or refinance the loan. Another option for those who do not have long time horizons and want lower short-term rates. Government Loans also are available to the public. Some of the programs are designed to assist members of low-income or special-interest groups. FHA, Veteran's Affairs, Freddie Mac, Fannie Mae, and the Department of Agriculture all offer some form of government loans
Refinance not always best move for distressed homeowners - Lodi News-Sentinel - "Two months ago I lost my job; I have since been late on my credit cards; most of them are maxed out; and I am two months late on my mortgage payments. I had a chance to refinance early on, but the rates were very high so I turned them down; now I ...
Treasury rally could fuel mortgage-related buying - Reuters - As falling yields have lowered mortgage rates, homeowners have been enticed to refinance their loans. As a result, some fund managers and loan-service companies have been forced into so-called convexity hedging, buying Treasuries or using interest ...
Home refinancing wave still rolling across U.S. - Columbia Daily Tribune - Her advice to the worried: curb spending, improve your credit standing and consider the costs and benefits of mortgage refinancing. "Estimate how long it takes to break even, based on your refinance costs," Duni said. "If you plan to stay in your ...
Market Snapshot - BusinessWeek - Refinance Your Mortgage - Bad Credit OK Do you have bad credit? Need to refinance your mortgage? Complete a brief online form (takes less than 60 seconds!) and get up to four home refinance quotes today. This offer is restricted to US residents ...
How moving to nursing home affects reverse mortgage - Lodi News-Sentinel - She has a new reverse mortgage on her free-and-clear home to pay her living costs. My husband will inherit her house when ... The title attorney or title company who handled the refinance should have asked if you wanted the title transferred back into ...
Buyback Binge: Bane or Boon? - BusinessWeek - Refinance Your Mortgage - Bad Credit OK Do you have bad credit? Need to refinance your mortgage? Complete a brief online form (takes less than 60 seconds!) and get up to four home refinance quotes today. This offer is restricted to US residents ...
Home shoppers not deterred by credit, money issues - Lodi News-Sentinel - But home buyers who plan to fix up their home purchases to increase the market value might want to proceed anyway and then refinance in a year or two. Just be sure the mortgage doesn't contain any prepayment penalty. Whenever possible, low- or zero ...
What to do when appraisal doesn't match purchase price - Lodi News-Sentinel - Most home buyers need a mortgage to buy a home. Before a mortgage is approved, the lender or mortgage broker usually hires ... Be aware that refinance appraisals don't necessarily reflect market value. Sometimes a refinance appraisal comes in at a ...
Keep Your Home and Your Sanity - Kait 8 - 5. Refinance the loan. It may be possible to refinance your mortgage for a lower interest rate and/or lower monthly payment (this is much different than refinancing to take cash out to pay off credit cards). However, if you already have had late ...
Can judge force a real estate partnership buyout? - Lodi News-Sentinel - Sorry, there is nothing you can do to force your FHA lender to cancel your unnecessary monthly mortgage insurance premium if the lender refuses to do so. Of course, you can refinance with another non-FHA lender. The new Robert Bruss special report ...
