When Is It Best To Refinance Your Mortgage

By admin on August 3, 2011

After the Federal Reserve announced it had lowered its rate by a half percentage point many Americans assumed it was time to refinance. So, around the country, thousands of people called their lenders to start the process.

There are many facts you must gather and consider first. How long is your current mortgage? Does it adjust? When will it adjust next? How high can your loan go? How many years are left on your loan at the current interest rate?

One of the main questions is, how is your credit? What is your credit score? How long will you keep the home you are now in? How much home equity do you have? What interest rates will you qualify for (this relates directly to your credit score)?

With the current mortgage mess, lenders have raised the minimum credit score you need to get a great loan. If you previously needed a 720 on your FICO score to get that great rate, you now need a 760 or even a 790 score.

You also need to have some equity in the property in order to refinance. Many homes have fallen in value. If that’s the case in your neighborhood, you might not have the equity you once thought you had.

To give yourself the largest number of options, be sure to shop around. I would typically call four or five different lenders to make sure that the rate you are going with is the best.

Your original lender often try’s very hard to keep your business and if you have kept up with your payments and on time, you most likely will be shown loyalty for this.

They will want the business of a customer who has had a good credit history with their company. There are thousands of people out there now that are having problems making their monthly house payment.

There are times when it makes sense to refinance other types of mortgage loans that you have been tied into other than just a fixed loan. It’s important to have the financial objective in mind so that you’re more able to choose the most appropriate loan.

Since the Federal Rate has gone down and if your credit score is in a good position, now is the time to consider changing to a safer and more productive move if you have one of the following: adjustable rate mortgage, to lower your interest rate if it is substantially higher, to reduce from two mortgages to one or if advised by a financial advisor for other purposes.

Court provides information about student loan consolidation and helps people refine their strategic internet marketing.

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Uncovering Reverse Mortgage Myths & Misconceptions

By admin on August 1, 2011

Have you been considering a reverse mortgage but are just afraid of some of the negative things you’ve heard? There are some negative myths that senior borrowers have heard about this type of financing that simply aren’t true and we’re going to expose some of those here.

Myth #1 The Lender gets my house. This is not true. You own your home and the lender records a lien, just like a forward mortgage. The difference is that instead of borrowing money and then making monthly payments on the money, the lender gives you money against the equity in your home either all up front, in monthly payments, as a line of credit you can use when you want, or all of the above. You make no monthly payments and the interest accrues until the loan is paid in full. When you sell the home, stop living in it as your primary residence or the last borrower on the mortgage passes, the loan and all interest becomes due and payable (there are also some second home programs available). You (or your designated heirs upon your passing) retain title to your property.

Myth #2 I don’t have good enough credit to get a loan. There is almost no credit qualification for a reverse mortgage. On the government Home Equity Conversion Mortgage or HECM, the only requirement is that you cannot be delinquent on a federal obligation such as an FHA loan, Federally Insured Student Loan, Federally Insured SBA Loan etc. If you have declared bankruptcy, you are still eligible for a HECM reverse mortgage. If you are currently on a bankruptcy payment plan, you can still qualify if you have a history of 12 months or more of making the plan payment. You can even get a reverse mortgage if you are currently in foreclosure!

Myth #3 My house has to be paid in full to get a reverse mortgage. Some seniors get a reverse mortgage to augment their income and do start with homes that are paid in full or have loans with very small balances, but some seniors take a reverse mortgage just so that they can pay off their existing financing and never make another loan payment for life. In fact, some loans go to people who bring in cash to close the loan, just to stop all payments for life.

Myth #4 A reverse mortgage will affect my social security benefits. Reverse mortgages do not affect a senior’s social security benefits. We recommend that seniors consult with a trusted financial advisor because need-based programs such as Medicaid, can be affected if the reverse mortgage is not administered correctly. However, retirement programs, social security and taxes are not affected and this should not stop seniors from getting the help they need to stay at home if that is what they desire.

Michael G. Branson (CEO All Reverse Mortgage Company)is a Mortgage Broker who has over 31 years of mortgage banking experience. Toll Free (888) 801-2762

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HUD Insures First Fixed Rate Reverse Mortgage

By admin on July 30, 2011

Many senior borrowers who start looking into reverse mortgages are not aware of it, but there is a fixed rate Home Equity Conversion Mortgage (HECM) available. The HECM or Heck-um as you may hear it called, is the government insured reverse mortgage program offered by lenders and insured by the Federal Housing Administration. Many senior borrowers prefer the security of the government insured reverse mortgages but up until very recently, the only reverse mortgages available were adjustable rate mortgages.

The adjustable rate mortgages are tied to different indices. It used to be that senior borrowers basically had the choice between a monthly or annual adjustable rate mortgage. Borrowers still have the choice of those adjustable rate mortgages (and now with different indices as well with the recent introduction of the London Interbank Offered Rate or LIBOR rates), but now borrowers can also opt for fixed rate mortgages as well! However, due to the closed end financing regulations associated with fixed rates, there are some limitations on fixed rate reverse mortgages that are not present on adjustable loans. Therefore fixed rate HECM loans can’t offer all the features that their adjustable counterparts can. That does not make them worse, you just need to know the differences and choose the one that is right for you.

The starting rates on the adjustable rates are a little bit lower and since that is one of the variables which determine how much money you will receive, you will typically get a little less money up front with a fixed rate. However, since the rate is fixed, it will never go up even if the interest rates rise in the future. This means your equity will not erode as fast. If the rates go down in the future, the fixed rate will not change with those changes either, but the adjustables have a ceiling, or cap on the rate of 10% above the initial rate so the interest that accrues on the adjustable rate reverse mortgages could go up dramatically if the rates rise in the future.

The other consideration with a fixed rate reverse mortgage loan is payment options. On the adjustable reverses, you can get a lump sum payment (that is all your money up front); a line of credit to use when you want that grows on the portion that you don’t use; a monthly payment for a set period of time or for life; or a combination of any of these terms (in other words, you could take cash payment now AND keep some back for a line of credit for when you need it AND get a monthly payment). However, the only option available on the fixed rate is the one time distribution at the initial funding. If you are paying off an existing mortgage and need it all up front, this would not be a problem and the fixed rate is an excellent option. However, if you didn’t need all the money and did not want to take all the money in the very beginning, then the fixed rate may not be for you.

So as is the case with reverse mortgages in general, education and knowing what your needs are and what will fill those needs is the key to deciding what’s best for you. If you’re like me, I always like the sound of a fixed rate better but if the fixed rate option doesn’t give you enough money to meet your needs and the adjustable rate mortgage does, then the adjustable rate might be better for you. Also, if you don’t want all the money up front, then you need to consider the adjustable rate mortgage. But remember, if you do want to take all your funds up front, the numbers work for you, and you like the security of a fixed rate mortgage, then the new fixed rate HECM reverse mortgage might be perfect for you!

Michael G. Branson (CEO All Reverse Mortgage Company)is a Mortgage Broker who has over 31 years of mortgage banking experience. Toll Free (888) 801-2762

Click Here to visit our Homepage
Click Here to watch the Reverse Mortgage Benefit Video
Click Here to Read all ARMC Articles
Click Here to Read all Frequently Asked

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The Best Benefits Of A 2nd Mortgage

By admin on July 27, 2011

Now that you have come to the decision to buy a home in Tampa Bay, or its surrounding areas, it very important that you find a home mortgage that meets your needs. This means that you want a loan with the best terms available and that can fit within your current budget allocated for the financing.

You may be surprised to learn that there are actually people out there that can negotiate their way to a good mortgage loan, and you too can be one of those people. Believe it or not, you do have a say as to what your mortgage terms will be.

Mind you, of course, that only some parts of the mortgage are negotiable, but they are still worth negotiating for. And, many of those factors that are negotiable can easily create a mortgage that fits your budget and needs. So much so, that you may actually be able to afford a bigger and better house.

The first major point you have to keep in mind is that there is very high competition amongst companies in the mortgage industry. It is a common misconception that this has changed due to the record number of foreclosures last year, that, however is wrong. The truth is that due to these record number of foreclosures, competition between lenders has actually gone up over the past few years.

So, with this increased competition, you can try to negotiate the first aspect of your home loan. The loan’s interest rate. Now, don’t get out of hand when trying to get the rate lowered. There is only so much that a lender can do.

Your credit score will be your best bargaining chip. The better your score, the more likely you are to see a reduction in the rate and the more likely the rest of the negotiations will go your way. Over the course of the loan, even the smallest decrease in the rate will lead to a substantial savings.

What are some other parts of the loan you can negotiate?

Appraisal costs, closing costs, and other random costs that will pop up while you are trying to get your loan. It’s important to know what you are going to ask for, because this allows you to prepare for the negotiations thoroughly. Just know this, if you do it right, you can win. People have been doing this for years, and will continue to.

Now it’s time for you to do some homework. You are not going to just do a search in the search engines and choose the first result you see.

You are going to have to look at dozens of lenders to find out what makes one unique from another. Over your research you’ll discover what parts of a loan are negotiable, and which of the lenders seem to be the best fit for you.

Try to find the special offers each lender promotes, because it will make it very obvious where lenders can adjust their prices and fees.

Find the right tampa home mortgages, 2nd mortgages, or get the info you need to refinance second mortgages.

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Bad Credit Mortgages And Getting The Finance You Need

By admin on July 25, 2011

Bad credit can be financially crippling when trying to apply for a credit card or a loan or even more of a problem when applying for a mortgage. Bad credit can cause many sleepless nights and family stress, while trying to acquire a mortgage for your new home.

It is very easy indeed to lose your good credit status, a few late payments, or one missed payment can seriously damage your credit rating. A couple of weeks off work, sick, or some unforeseen large payment can easily damage your credit. Making it difficult to get a mortgage for your dream home.

Many people will turn to companies that specialise in helping people repair their credit status. These people may not realise that having bad credit does not necessarily bar you from getting a mortgage. It may, make it more difficult, and a little more inconvenient, but it certainly does not mean that mortgage is beyond your reach.

A bad credit mortgage may in fact be the best way of repairing your damage credit and regaining the confidence of lenders of all kinds. One of the main purposes of the bad credit mortgage is to repair the damaged credit score, and also get individuals back on the road to financial security.

Bad credit mortgages will give you the opportunity to show lenders and credit reporting agencies that your credit status was caused by situations outside of your control and you are in fact, well capable of making regular payments.

Making these regular payments can quickly show to lenders that you are a responsible borrower who wishes to resolve their credit history problems.

The first thing you need to do to obtain a bad credit mortgage is to find a company to lend you the money. It is not advisable to do this on your own unless you have considerable knowledge of the mortgage market.

It is quick and simple to secure the services of a mortgage broker, who has the knowledge and the skill to bring you together with a quality mortgage lender who will suit your needs.

When you find a broker, you need to make him aware from the beginning that your credit is less than perfect. That way, he can save time by knowing which lenders may be suitable for your needs.

Not only can a bad credit mortgage help you to resolve your credit score problems. It can also be used to fix some of your financial credit problems as well.
By credit mortgage can be used to fund paying off some of your existing debts, such as credit cards and car loans. Lowering your monthly payments by rolling all his debts into one payment, which will be far more affordable for you.

Some companies now specialise in these kind of mortgages, and are sympathetic to people who have found themselves in difficult financial and credit situations. They understand that circumstances beyond your control may have forced you to miss a couple of payments on a credit card. But that does not necessarily make you a bad risk of paying your mortgage in a timely fashion.

There are many mortgage brokers, some of them online, who can point you in the right direction and give you lots of useful advice about how to locate the best mortgage provider for your bad credit mortgage situation.

Joe Kenny writes for Glitec.org, offering cheap online mortgages and mortgages or visit Rebuild.org for great refinance quotes

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Fixed Rate Mortgages Pros And Cons

By admin on July 23, 2011

Here is one view of fixed rate mortgages pros and cons. There are several benefits worth considering when trying deciding if a fixed-rate mortgage is right to you. Unfortunately like many things in life, for every advantage, there seems to be a disadvantage.

The first thing to keep in mind that just because your friend at work thinks that fixed rate is the only way to go for a mortgage. And your father says he has never had a fixed rate, and never would have one.

That does not mean either of them are correct. The point is that it is a matter of personal circumstances, needs, and your current financial situation. Especially with regard to interest rates, that should govern if a fixed rate mortgage is the right one for you or not.

Whichever mortgage type you choose, it is essential that you get all the information you can, and seek professional assistance to help you choose which is the most suitable type of loan for you.

Below we have set out some fixed rate mortgages pros and cons for you to consider.

There can be several benefits to obtaining a fixed rate mortgage. The first and most appealing benefit for many people is the fact that the interest rate and monthly payments remain constant.

This means that a sudden rise in interest rates will not affect you, and you will not suddenly have to pay considerably more for your mortgage each month. In the early 80s, interest rates went from 7 to 14 percent literally, overnight.

Within a few days, they did settle at just over 9%, but even this increase of just under 2%, was a crushing blow for tens of thousands of homeowners, who subsequently lost their homes.

With a fixed-rate mortgage, you would be protected from that kind of wild fluctuation. With a fixed-rate mortgage, you know where you stand, and how much money you will need each month to fulfil your mortgage.

The fixed rate mortgages have several pros and cons this is defiantly the main advantage. They are also very straightforward and simple to understand. Because of these advantages, a fixed-rate mortgage often appeals to younger people and first-time buyers who need to know exactly what the monthly cost will be over the next few years.

There are also fixed rate mortgages cons, to consider. All of the above assumes that interest rates will go up; therefore you will save money each month compared to what you would have to pay the higher interest rate. But with volatile economic problems arising all the time, and world events such as rises in oil prices. The government is sometimes forced to raise or lower interest rates to help the economy remain stable. So it is just as likely for interest rates to go down, instead of up.

If they go down you would be paying more for your mortgage than you need to, but in most circumstances it is always possible to move to a flexible style mortgage.

Another problem fixed term there is that if you decide to move your mortgage to another company at the end of a lower interest period. There will be fee’s payable not only for the implementation of the new mortgage, but also in the paying off your old mortgage.

Whatever type of mortgage you choose, it is essential to get as much quality information as you can find from a well-trained and respected broker. You need to be fully aware of fixed rate mortgages, pros and cons.

A mortgage is a big commitment and needs to be very carefully considered no matter what type of mortgage you are interested in.

Joe Kenny writes for Glitec.org, offering mortgages in the UK, visit them today for cheap cheap mortgages or visit Rebuild.org for great mortgage loans.

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Amortization Table – Calculate Your Own the Quick and Easy Way

By admin on July 21, 2011

Within the world of finance is a world of borrowing because using other people’s money is how regular people get started in big business.

Borrowing is also how people who don’t happen to have $400,000 at their disposal purchase nice new homes in nice neighborhoods. Without mortgages, very few people would own homes and the middle class wouldn’t exist, as there would be two classes of people, the homeowners and those who rented from them.

The most important part of borrowing is knowing how much money you are paying back to the lender and how much money you are wasting on interest. Central to this knowledge is the understanding of what an amortization table is and how to use it.

In this article not only will we discuss these two things, but also you will actually be taught how to build an amortization table and we will calculate one as we go along.

What will the table tell us?

The first step to calculating an amortization table is the understanding of what the table will tell us. In short, amortization tables break monthly payments into two parts, the principal paid and the interest paid. So, it would behoove us if we knew what the total monthly payment was to begin with.

I know, it probably sounds like a cop out because we could calculate the payment, but that part of the equation will be left for another article. Here, we’re going to go to a financial or mortgage calculator and find out the payment. Then, we will do the calculations to break the payment down into its two parts.

Let’s start by using an example. In this example, the numbers may sound peculiar but we are going to use numbers that will make the example easy to follow. So, let’s say we have a mortgage with a principle of $360,000. The mortgage will be paid off over 30 years, or 360 monthly payments. The interest rate will be a 1970′s type 12%.

Interest calculation formula

Now, we will see how much interest we will pay on the first payment. First we will take the amount of principal we have left to pay. In this case it will be the whole mortgage of $360,000. We need to divide it by the number of months we have left to pay because we are building a monthly amortization table. This will tell us the amount we are paying interest on for one month.

Next, we want to multiply this amount by one month’s interest. One month’s interest will be found by dividing the yearly interest rate by 12. Then we have to multiply this amount by the number of months left to pay on the mortgage, in this case 360. If we didn’t do this, we would just be seeing the amount of interest that would be paid if there were only one month left to pay the mortgage.

Simplify the formula

Here’s how that formula looks: Int. on month’s payment=principal left/ number of months left x monthly interest x number of months left. Now, if you look at the formula you will see the term “number of months left” twice. Once it is a numerator (above the line) and once it is a denominator (below the line). This means we can divide it by itself. So, the formula now looks like: Int. on month’s payment=principal left x monthly interest. Pretty easy, huh!

Begin calculating

Now, let’s build our amortization table. $360,000 x .01= $3,600. This is the interest paid the first month. Not sure where the .01 came from? It is 12%, or .12, which is the yearly interest rate divided by 12 giving us the monthly interest rate.

Next, we take the monthly payment we got from a mortgage calculator, which is $3,703.01, and we know the interest on the first payment is $3,600 so we will subtract it from $3,703.01, which will tell us the principal part of the first payment is $103.01. This is the first entry in our amortization table. $3,6000 interest and $103.01 principal.

At this point, we know we no longer owe $360,000 on the mortgage because we have paid $103.01, so the principal left is now $360,000 – $103.01, or $359,896.99. We now multiply this number by .01 to get the interest part of the second payment. This is $3,598.97 and, since we know the total payment is $3,703.01, we will subtract $3,598.97 from it to get $104.04 which is the principal paid on the second payment.

There you have it. You just continue calculating in this way for another 358 payments and you will have built your amortization table completely by hand. This, by the way, is something few people can say!

Even if you don’t continue on making these calculations, you now know, from a very inside perspective, exactly what amortization is all about!

Ed Lathrop is a successful Real Estate investor. He has developed a Website where you can print out a mortgage payment table showing monthly payments for hundreds of different combinations of interest rates and borrowed amounts. Get your free printout at : House Payment Chart. Also, find out how to get your amortization schedule and use it to save big money at: Amortization Schedules Free.

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