Tuesday, July 25, 2006
found a good article on mortgages
You’ve been thinking about buying your own home for quite a long time, and now you’re ready to take the plunge. You’ve been saving money for a down payment, and you know the next step is preparing to apply for a mortgage.
But where do you start?
Here are the top 5 things you need to know before approaching a mortgage lender.
1. Understand Your Options
All motrgages are not created equal. There are several different types, which vary based on interest rates and payment terms.
For example:
• With a fixed-rate mortgage, your monthly payments remain the same during the entire length of the mortgage. There will be no variations in monthly payments, regardless of changes in interest rates and inflation.
• With an adjustable-rate mortgage, you will often receive a lower initial interest rate, but your monthly payment amount can rise and fall as interest rates fluctuate (within certain caps or limits).
• With a balloon or reset mortgage, you once again may be offered a low interest rate, but it will hold for a limited time. After that, the balance of the mortgage will be due, or you will need to refinance.
2. Become a Rate Watcher
The state of the economy influences interest rates, which ebb and flow on a regular basis.
Your daily newspaper tracks these rates, so stay current by watching whether rates are rising, falling or remaining stable.
It behooves you to become as educated as possible about how these rates will affect your mortgage—and to see if you want to postpone applying for one until rates drop.
3. Get Pre-Approved
Consider getting pre-approved for a motrgage, says Frank Nothaft, PhD, vice president and chief economist for Freddie Mac, the stockholder-owned corporation established by the United States Congress in 1970 to create a continuous flow of funds to mortgage lenders in support of homeownership and rental housing.
”A benefit of being pre-approved for a mortgage loan is that it gives the prospective homebuyer additional bargaining leverage when competing with other prospective buyers for a home,” he says. “A home seller may be more likely to accept an offer from a pre-approved borrower—because the seller knows the buyer can get a loan—than from another bidder, who may be exactly the same in financial qualifications and offer, except that he lacks the pre-approval.”
4. Consider Making a Higher Down Payment
Making a higher down payment on a home will reduce your motrgage, but there are definite pros and cons, according to Dr. Nothaft.
”The pro of putting down more money is that you can often obtain lower-cost financing,” he says. “High down-payment loans—that is, low loan-to-value ratio—represent less default risk to a lender, and are safer. That may translate into a lower interest rate or obviate the need for mortgage loan insurance.
“The con,” he continues, “is that it may result in the borrower having to delay a home purchase, because the borrower does not have enough liquid assets to make a larger down payment. Low down-payment loans are especially important for first-time home buyers, who typically do not have the financial wherewithal to make a large down payment.”
5. Select Your Lender Carefully
As in any industry, there are “bad apples” who ruin the reputations of respectable professionals. In the mortgage business, these folks are known as “predatory lenders”—individuals who take advantage of vulnerable consumers. Those most prone to becoming victims include the ill-informed, the elderly, women, minorities, low-income buyers and consumers with bad credit.
To avoid becoming “prey,” select a lender with solid credentials. You can secure a referral from your bank or credit union, real estate agent, government housing agency, or friends and relatives who have successfully purchased homes.
Never trust a mortgage offer that arrives via email, as it likely originated from a spammer.
----
Mortgage Relief specializes in assisting Australian families with mortgages by making their monthly repayments more manageable and decreasing their overall debt and total interest paid over the life of their mortgage. Mortgage Relief is a mortgage refinance provider that it part of Australia’s largest Debt Relief™ organization. Visit Mortgage Relief on the web at http://www.mortgagerelief.com.au or contact them directly on 1300 789 014.
Article Source: www.iSnare.com
But where do you start?
Here are the top 5 things you need to know before approaching a mortgage lender.
1. Understand Your Options
All motrgages are not created equal. There are several different types, which vary based on interest rates and payment terms.
For example:
• With a fixed-rate mortgage, your monthly payments remain the same during the entire length of the mortgage. There will be no variations in monthly payments, regardless of changes in interest rates and inflation.
• With an adjustable-rate mortgage, you will often receive a lower initial interest rate, but your monthly payment amount can rise and fall as interest rates fluctuate (within certain caps or limits).
• With a balloon or reset mortgage, you once again may be offered a low interest rate, but it will hold for a limited time. After that, the balance of the mortgage will be due, or you will need to refinance.
2. Become a Rate Watcher
The state of the economy influences interest rates, which ebb and flow on a regular basis.
Your daily newspaper tracks these rates, so stay current by watching whether rates are rising, falling or remaining stable.
It behooves you to become as educated as possible about how these rates will affect your mortgage—and to see if you want to postpone applying for one until rates drop.
3. Get Pre-Approved
Consider getting pre-approved for a motrgage, says Frank Nothaft, PhD, vice president and chief economist for Freddie Mac, the stockholder-owned corporation established by the United States Congress in 1970 to create a continuous flow of funds to mortgage lenders in support of homeownership and rental housing.
”A benefit of being pre-approved for a mortgage loan is that it gives the prospective homebuyer additional bargaining leverage when competing with other prospective buyers for a home,” he says. “A home seller may be more likely to accept an offer from a pre-approved borrower—because the seller knows the buyer can get a loan—than from another bidder, who may be exactly the same in financial qualifications and offer, except that he lacks the pre-approval.”
4. Consider Making a Higher Down Payment
Making a higher down payment on a home will reduce your motrgage, but there are definite pros and cons, according to Dr. Nothaft.
”The pro of putting down more money is that you can often obtain lower-cost financing,” he says. “High down-payment loans—that is, low loan-to-value ratio—represent less default risk to a lender, and are safer. That may translate into a lower interest rate or obviate the need for mortgage loan insurance.
“The con,” he continues, “is that it may result in the borrower having to delay a home purchase, because the borrower does not have enough liquid assets to make a larger down payment. Low down-payment loans are especially important for first-time home buyers, who typically do not have the financial wherewithal to make a large down payment.”
5. Select Your Lender Carefully
As in any industry, there are “bad apples” who ruin the reputations of respectable professionals. In the mortgage business, these folks are known as “predatory lenders”—individuals who take advantage of vulnerable consumers. Those most prone to becoming victims include the ill-informed, the elderly, women, minorities, low-income buyers and consumers with bad credit.
To avoid becoming “prey,” select a lender with solid credentials. You can secure a referral from your bank or credit union, real estate agent, government housing agency, or friends and relatives who have successfully purchased homes.
Never trust a mortgage offer that arrives via email, as it likely originated from a spammer.
----
Mortgage Relief specializes in assisting Australian families with mortgages by making their monthly repayments more manageable and decreasing their overall debt and total interest paid over the life of their mortgage. Mortgage Relief is a mortgage refinance provider that it part of Australia’s largest Debt Relief™ organization. Visit Mortgage Relief on the web at http://www.mortgagerelief.com.au or contact them directly on 1300 789 014.
Article Source: www.iSnare.com
Saturday, July 22, 2006
repaying a mortgage
If you’re looking for a mortgage, whether it’s a first mortgage, second , or refinance mortgage, there are several ways of repaying it, which is something most people often forget. So you shouldn’t just take the first offer, but look at the different options available:
Interest and Capital is the most common way for repaying your mortgage, because you pay each month on the capital, or principle, of the loan. This can take from 10 to 50 years, depending on who’s the lender and where you’re currently living. The money you give to the mortgage company each month take a percentage and place it towards the interest with the rest going towards the capital of the loan. At the beginning of the loan, most of the payment goes toward the interest and towards the end most of it goes to the capital.
Interest only repayment is used a lot in the United Kingdom, but rarely in the US. In this case, the capital isn't repaid through the term of the loan, instead, you make regular 'payments' to an investment account or to a plan that helps you to build up a large sum that will in turn repay the mortgage completely at the end of the loan. This is called an “investment-backed mortgage”, “Personal Equity Plan Mortgage”, “Individual Savings Account Mortgage”, or “Pension Mortgage”. So now you know what those terms are about. These mortgages have huge tax advantages, so ask about them.
If you’re old, no interest or capital payments might be good for you.
Sometimes you’ll be offered a “reverse mortgage”, “lifetime mortgage” or an “equity release mortgage”, it just depends on where you’re living and where your motrgage company is located. Basically this is compounded each year, with the interest rolled up into the capital. Of course there’s a problem because the debt increases each year of the mortgage being open. These are good for older people because the mortgage is not paid until they’ve passed away.
Of course there are also other, less common ways of repayment that might be good for you, so don’t focus too much on these options.
Interest and Capital is the most common way for repaying your mortgage, because you pay each month on the capital, or principle, of the loan. This can take from 10 to 50 years, depending on who’s the lender and where you’re currently living. The money you give to the mortgage company each month take a percentage and place it towards the interest with the rest going towards the capital of the loan. At the beginning of the loan, most of the payment goes toward the interest and towards the end most of it goes to the capital.
Interest only repayment is used a lot in the United Kingdom, but rarely in the US. In this case, the capital isn't repaid through the term of the loan, instead, you make regular 'payments' to an investment account or to a plan that helps you to build up a large sum that will in turn repay the mortgage completely at the end of the loan. This is called an “investment-backed mortgage”, “Personal Equity Plan Mortgage”, “Individual Savings Account Mortgage”, or “Pension Mortgage”. So now you know what those terms are about. These mortgages have huge tax advantages, so ask about them.
If you’re old, no interest or capital payments might be good for you.
Sometimes you’ll be offered a “reverse mortgage”, “lifetime mortgage” or an “equity release mortgage”, it just depends on where you’re living and where your motrgage company is located. Basically this is compounded each year, with the interest rolled up into the capital. Of course there’s a problem because the debt increases each year of the mortgage being open. These are good for older people because the mortgage is not paid until they’ve passed away.
Of course there are also other, less common ways of repayment that might be good for you, so don’t focus too much on these options.
Friday, July 21, 2006
motrgage calculator
Found a useful tool that can calculate your mortgage so you know how much you'll be spending.
How to save a lot of money on your mortgages
Most, if not all of us, dream of having a large, comfortable house that we can live in and in which
we can retire.
Now if you don't belong to the upper-class you may have a problem coming
up with the money and that's when a motrgage comes in handy. Now you may possible have to pay for them for many years to come. But there is a way to pay off your mortgages quicker and thus save time and money and yourself a lot of stress: the "Accelerated Payment Clause". Almost all mortgages have this built in. It helps, since it allows you to pay more than the minimum amount of your monthly mortgage payment. If you pay more than the minimum, you will save a lot of money on interest charges. If you save up some of the earnings from your job and use them to pay off the mortgage, you'll be able to retire the mortgage a lot earlier, thus saving yourself a lot of money!This works best by being consistent with the amount of money that you pay on your monthly mortgage Changing the amount of monthly repayment of the mortgage will also have an effect on the amount that you will actually save.
we can retire.
Now if you don't belong to the upper-class you may have a problem coming
up with the money and that's when a motrgage comes in handy. Now you may possible have to pay for them for many years to come. But there is a way to pay off your mortgages quicker and thus save time and money and yourself a lot of stress: the "Accelerated Payment Clause". Almost all mortgages have this built in. It helps, since it allows you to pay more than the minimum amount of your monthly mortgage payment. If you pay more than the minimum, you will save a lot of money on interest charges. If you save up some of the earnings from your job and use them to pay off the mortgage, you'll be able to retire the mortgage a lot earlier, thus saving yourself a lot of money!This works best by being consistent with the amount of money that you pay on your monthly mortgage Changing the amount of monthly repayment of the mortgage will also have an effect on the amount that you will actually save.
This is a Mortgage blog
Hey. This blog is all about motrgages. Here I will be posting information on the topic of mortgages and how you should act if you consider a motrgage.
