Refinancing Your Home Mortgage!
Posted on December 30, 2008
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Refinancing Your Home Mortgage!
In the past 30 years, interest rates have ebbed and flowed significantly in a financial tide of home mortgage offerings. Near the beginning of the 1980s, for example, rates for traditional 30 year, fixed rate mortgages were around 18 percent. Right now, though, we’re seeing rates for the same type of loan around 5 percent - and on some days recently, in the 4 percent range.
Many home owners who bought when rates were sky-high are now considering refinancing in order to reap the benefit of today’s lower rates. If you’re one of these people, know that there are some costs involved in refinancing your home, such as an appraisal, title insurance, and a loan origination fee, just to name a few. To figure out whether these costs will balance out with the potential money you can save by refinancing, you can use the general rule of thumb called the 2 percent rule. In plain English, this rule suggests that the percentage difference between the current rate you have on your loan and the new rate being offered should be at least 2 points. So, if you were one of those borrowers in the 1980s who got a rate in the teens (and you can get a rate now for around 5 percent), it would make pretty good sense to refinance.
I’ve included below 3 benefits for refinancing with a lower rate:
1) Lowering monthly payments - By lowering the rate of your loan, you can see a significant difference in your monthly mortgage payment. And, every little bit adds up. Some borrowers who refinance can save thousands of dollars over the course of their loan period. How much you save, though, completely depends on your numbers. So, be sure to talk with a mortgage specialist who can do the number crunching for you to see how much you can potentially save by refinancing.
2) Changing the type of loan you have - Some borrowers choose to refinance even if they won’t save any money by doing so. Think of the many borrowers who got an adjustable rate mortgage. We’re seeing a lot of these borrowers refinancing simply to switch to the fixed rate mortgages. Also, some borrowers who have a balloon worked into their mortgage choose to refinance when it’s gets closer to the time to make that bulk payment.
3) Getting money from your equity - If you’ve been in your home for ten or more years, you probably have a good bit of equity due to the overall appreciation of your home (even with the current dip in home values) and to the fact that you’ve been making those monthly payments for some time. For this reason, some borrowers opt to pull money out when they refinance their mortgage in order to help with retirement or with their children’s costs for college.
If you’re considering refinancing your home, be sure to talk with a home loan professional - someone experienced in refinancing who can sit down with you and go over your numbers and the options available to you. And, know that each situation is different. Your lender should be able to go over short-term and long-term benefits (or consequences) that are specific to you and geared towards your financial future.
Lee Keadle specializes in the James Island SC real estate market, but he works with all Charleston homes for sale.
Article Source: http://EzineArticles.com/?expert=Lee_Keadle
Wells Fargo Loan Modification - Things to Know Before You Apply!
Posted on December 21, 2008
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Wells Fargo Loan Modification - Things to Know Before You Apply!
Stuck in an unaffordable mortgage and wondering how you can qualify for a Wells Fargo Loan Modification? You are not alone-thousands of borrowers are trying to get approved for a Wells Fargo loan modification program that will lower their monthly payment so they can afford to stay in their home. Unfortunately, not all homeowners will qualify for this help, so it is very important to know a few tips that the professionals know so you can increase your chances of getting the help you need and deserve.
Here are a few INSIDER TIPS that can help you when you apply for a Wells Fargo loan modification:
- You must prove to the lender that you have suffered a financial hardship and thru no fault of your own can no longer afford the current mortgage payment. An acceptable hardship can be any number of circumstances, however the most common include a divorce or separation, job loss or income decrease, military service, adjustable rate mortgage payment increase, death of family member, or medical bills or illness. A successful borrower will provide a convincing and compelling hardship letter that explains to Wells Fargo your current situation, but also tells them how you plan to rectify it and your intention to remain committed to home ownership. The Complete Loan Modification Guide will help you compose an acceptable hardship letter by providing you with an outline and a letter template to assist you.
- Back up your story with proof of your hardship. For example, if you were ill, provide copies of the medical bills. If you were laid off, a letter from your employer. This will demonstrate that the delinquency was out of your control and you are doing your best to deal with an unexpected situation.
- Work out a new family budget that eliminates all unnecessary expenses and then decide what a truly affordable mortgage payment would be. This is your “target” payment and the goal when working on your Wells Fargo loan modification. The new lower payment needs to fit within the lenders guidelines and meet a certain debt ratio requirement. The Complete Loan Modification Guide will take you step by step in calculating your ideal payment so that it is affordable and meets the lenders guidelines for approval.
- Carefully complete the required loan modification forms so that you clearly demonstrate that while the current payment is a hardship, the new lower modified mortgage payment will be affordable and sustainable. This can be tricky, but The Complete Loan Modification Guide makes it simple to do by providing a Current and a Proposed Financial Statement, and gives you detailed directions on how to complete these statements properly.
- Now, put it all together into an accurate and professional Wells Fargo loan modification application by following the easy submission checklist provided in The Complete Loan Modification Guide.
The first step in getting a lower mortgage payment with a Wells Fargo loan modification is to learn and understand what the bank needs to see from you in order to grant approval. It is pretty hard to qualify for something that you do not even know the requirements for, right? Homeowners who follow a few simple steps can greatly increase their chances of success. So take the time to learn and prepare before you submit your Wells Fargo loan modification application and you will soon be on the path to secure home ownership again.
You can get the help you need to understand the loan modification process by ordering and downloading The Complete Loan Modification Guide. This is a low cost, easy to read handbook that will provide you with everything you need to prepare a professional and acceptable loan modification application. You are provided with all of the necessary forms and given detailed directions on how to complete them properly. The Complete Loan Modification Guide will take you step by step through calculating your debt ratio, completing the financial statements, writing your hardship letter and then putting it all together to submit to your lender. Get started today on the path to secure home ownership, order and download The Complete Loan Modification Guide.
For more information about mortgage loan modification, please visit us at: http://www.myloanmodificationcenter.com
Article Source: http://EzineArticles.com/?expert=Susan_V._Gregory
Unemployment Will Cause The Most Foreclosures In 2009!
Posted on December 16, 2008
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Unemployment Will Cause The Most Foreclosures In 2009!
It’s not just risky home loans that are the cause of foreclosures now. The recession, unemployment and the massive layoffs happening now and expected to happen next year that will force people to default on their mortgages.
Don’t expect to see your property value to go up in 2009 or beyond. Currently one in ten homeowners are behind in their mortgage payments and it is expected to get much worse.
You need to know is your rights when it comes to bill collectors or creditors when you have fallen behind on your payments. It is highly illegal unless given personal permission by you or your family to receive creditor calls beyond what is considered normal and they can be prevented by state and federal laws that are in place to protect you.
But what exactly is normal? By the time most nonpaying families, either by life’s circumstances or choice happen to receive bill collectors calls the creditor can become very ugly. For this reason, every attempt to make some sort of arrangements should be done before things get out of hand, even though there are situations when the money is simply not there.
What spurs most bill collectors on is that most of them get about 25% of whatever is paid to them—which makes it their goal to get the money out of you, to get a percentage of the money owed as part of their own income, which accounts for the lying, bullying, cut-throat tactics used by many.
The Fair Debt Collection Practices Act (FDCPA) limits the type of legal practices that can be practiced by bill collectors, recognizing that abusive bill collection practices—such as harassing creditor calls–actually have a lot to do with the increase in personal bankruptcies and with the large amount of joblessness happening we will see an increase in invasions of individual privacy by bill collectors or creditors. Most people do not go into debt on purpose, it’s not something to do because they are bored. Many situations are at fault: layoffs, a drop in household income, emergency situations, or the loss of a major income source like retirement income or 401k value.
Is it possible for you to ever buy a home again after going through bankruptcy? In other words, what happens if you file bankruptcy, but you would like to purchase another home at some point in the future? Will there be any major problems caused by your credit status? Each state will have it’s own policy when it comes to eligibility for buying a house again after bankruptcy.
If you file for bankruptcy and are a veteran, you may still be able to receive a VA home loan if you are eligible under the standard VA policies. Of course, there is a downside. You will most likely be put through a required waiting period. This period is typically two years after the “discharge date” of the bankruptcy. Then you will be able to buy a house again. You need to understand that it is the discharge date and not the filing date that is the starting point of the waiting period.
CAN YOU ELIMINATE YOUR CLOSING COSTS?
Posted on November 23, 2008
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CAN YOU ELIMINATE YOUR CLOSING COSTS?
Many new home buyers have the mistaken impression that the closing costs for a home loan are actually covered by the mortgage. This is not true, although you can do a number of things to minimize the costs in many cases you will not be able to totally eliminate your closing costs. The most common way the closing costs can be minimized is thorough the structuring of the real estate contract that you obtain.
When you apply for a loan, the amount may be the purchased price or the appraised value of the house, which ever ends up being less. This means that if you would like to have your closing costs to be included in the loan, you need to increase the price. More than this, you must include a stipulation in the agreement, which says that the seller will pay the closing costs and other pre-paid expenses equal to the increased price.
This will eliminate your closing costs and any surprises before the first mortgage payment arrives. Your appraisal value must also equal the value of the increased price for you to benefit from this arrangement.
Everyone’s circumstances are different. One loan type make work for some, but not for others. For instance, someone with bad credit cannot get a loan anymore. Someone with really amazing credit to good credit will be able to get a mortgage during our current economic crisis. Your lender will be looking at job stability, payment history and if you can come up with the down payment. A good broker lender mortgage will be able to take these aspects into account before suggesting the right lender and loan product to you.
Credit isn’t the only think that can affect the kind of loan you get. For instance, there are usually breaks for people who are first time home buyers. If this is your first house, make sure to mention this to your broker lender mortgage worker so that they can find any credits or loopholes. This way, you know that you will be getting the best possible deal for your money and your time.
CAN YOU BUY A NEW HOME IN TODAY’S MARKET?
Posted on October 13, 2008
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CAN YOU BUY A NEW HOME IN TODAY’S MARKET?
The short answer is yes. The new way to buy a home is like the old way. To begin with, back in the 1980’s to buy that new home you had to come up with a 20% down payment. You needed to have a stable job that would show the lender you could afford the loan and your basic living expenses.
Considering the current mortgage crisis no lender will even look at a potential borrower that has a credit score lower than 640 if at all. You have to work on creating a better score for your financial health as well as for any chance to purchase a new home. having Bad credit is currently no longer acceptable when trying to buy that new home so you must work on fixing your credit and the lenders will want to see that you are diligently working on the problem.
A fixed rate mortgage is the simplest form of mortgage to calculate. We recommend using a fixed rate mortgage calculator.
They come with a fixed interest payment that is for the life of the loan. You can estimated the interest payment very closely to what the present rates are on mortgage loans. You can add in the down payment that you are choosing to make to get the loan (which will have to be 20% to qualify these days). The mortgage calculators will also ask for the term of the loan. Fifteen and 30-year loans are pretty common mortgage products, but you can now get one for 40 years too. The mortgage calculators will crunch the numbers and give you an amortized table of your payments. If you are not asked for an estimate of hazard insurance or property tax escrow payments, then the value you see might be smaller than the value you get at closing. If you want a closer estimate, be sure to find out what you hazard insurance and escrow payments might be for the house you are considering buying.
To get your fixed rate mortgage quote, the application will ask you to fill in some data about your finances, and about your credit history. Your credit record will not be pulled at this time, but you will need to indicate how well you pay your bills. The lenders’ applications may ask if you have had a bankruptcy, and you will have to check yes or no. At this time there is no obligation to any lender. If you go through a mortgage company, they have mortgage brokers that send your application for a fixed rate mortgage quote to several different lenders and when they get them back they the lender will send you out the 4 lowest fixed rate mortgage quote offers.
When you know how much money you will need to buy the home you want you can then start actively looking for the best fixed rate mortgage quote. When you receive the quote you are interested in, you can then apply for the loan you need. The interest rate that is advertised on the company’s webpage may not be the same interest rate you will be offered. The interest rate you are offered will be based on your income, and your credit rating,the current lowest rates offered and the term of loan you are asking for. A 15 year loan will have a slightly smaller interest rate than a 30 year loan. The payments will be higher in the 15 year loan, but you will be paying less interest over the term of the loan. Shopping around for the best fixed rate mortgage quote can save you a significant amount of money when it comes to lock into the loan.
For The Right Mortgage Company Compare Mortgage Rates
Posted on September 16, 2008
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For The Right Mortgage Company Compare Mortgage Rates
When you’re looking to get a mortgage, you will find that there are many different types of mortgages as well as many different types of mortgage lenders. There commercial mortgage lenders, adverse credit mortgage lenders, mortgage brokers and direct lender mortgages.
And with the current financial turmoil in the lending markets there will not be too many lending institutions left to choose from.
Many people don’t know the difference between a mortgage broker and a bank. Although a mortgage broker loan and a direct lender/bank mortgage are similar, the lenders actually are quite different.
A direct lender mortgage is a mortgage that you obtained through the services of a direct lender/bank. In other words, there is no middleman. All of the dealings are directly between you and your mortgage lender.
Contrary to what some people believe, you won’t really see a difference in the interest rate you are charged between a mortgage broker mortgage and a direct lender/bank mortgage. Both of them get their interest rates from the secondary market rate.
A difference may be with a direct lender/bank mortgage, the direct lender or bank has the flexibility to offer you a rate that they choose, but a mortgage broker may have to speak with the lender he works for first. Whereas direct lenders and banks set their own guidelines, mortgage brokers cannot.
Compare Mortgage Rates
As part of your mortgage shopping to compare rates you should also try to compare banks, credit unions and mortgage brokers. By comparing at home you can narrow down your search for a lender with the best interest rate.
If you have good credit you may be able to negotiate better terms on your own, or if you don’t think you can find a better interest rate on your own you can use a mortgage broker.
A mortgage broker, being the middle-man,will bring the lender and borrower together. Sometimes the broker may be able to find you a better deal than you could negotiate on your own.
How Do You Choose A Lender For Refinance?
Posted on August 13, 2008
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How Do You Choose A Lender For Refinance ?
Usually when a person goes down the winding road of refinancing their current mortgage they are looking at some other lenders than the one they are with. Most of the time, the whole idea of refinancing is to save money, correct? And lenders are in the business of making money, right?
So, it only seems obvious that for you it’s a good idea to avoid dealing with your current lender because they are going to lose money on a refinance deal, right? Well maybe not.
You may actually find that your lender is more than willing to work with you on refinancing. Why? It is really simple. If you refinance your loan somewhere else then your lender is losing out big time. If they refinance the loan for you then they are only losing a little and keeping you as their customer.
You can see how it makes sense to consider your current lender when refinancing your home. It is a pretty simple idea that most people don’t think about and it’s an idea that may get you the best deal. They might even offer you a better deal than you hoped for hoping just to keep you as their customer.
A Home Is Still A Great Investment
Posted on June 10, 2008
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A Home Is Still A Great Investment
Since mortgages are such a complex and expensive type of loan you may wonder why you should even get into one in the first place. The answer is that a home is one of the greatest assets you can ever own.
With the value of homes now at some of their lowest levels in years it’s a great time to invest in your future.
To begin with, real estate is valuable. Your home will go up in value over the years. You can borrow money from the worth of your home, as well.
You should also consider that owning a home gives you security. You have a place to live and a place to pass down to your children or sell when you want to liquidate your assets.
Owning a home is a dream for many people because it is such an ultimate investment. Putting your money into a home is one of the best things you can do with it. That is why there are so many options in mortgages. Lenders want people to invest their money in a smart way and this is one of the smartest investments that will pay you back multiple times.
How do you get the most out of this major investment? Find a great mortgage and become as knowledgeable as you can about home loans. Many resources exist to help you.