home mortgage loans

Harold asked:


My parents are giving me their current house and building a new one. The house needs some improvements (Kitchen, Bath, Carpets, etc) what is the best loan to get? I currently rent so I don’t have a mortgage. Do I get a home equity loan, first mortgage, home improvement loan? Please help.

EDWARD

Andrew Bicknell asked:


For many people there comes a time when it makes sense to refinance their home mortgage. There can be any number of reasons to do this but for most people the primary goal is to lower their interest rate and their monthly payment. Everybody’s situation is different so the reasons for doing a refinance can vary from person to person.

When you do a home mortgage loan refinance you are basically taking out a new loan and using it to pay off an existing loan. You of course do not want to refinance if your new loan will cost your more in interest and monthly payments so it pays to research any new loan carefully.

As you delve further into the realm of refinancing a home you will undoubtedly run into terms that you may not be familiar with. These may include the following:

Term Length - This is the amount of time you have to pay back the loan. The majority of loans go for either 15 or 30 years. The longer the term the more interest you will pay during that term.

Fixed Rate Mortgage Loan - This is a mortgage in which the rate is set at closing and does not change for the life of the loan.

Adjustable Rate Mortgage (ARM) - This is a mortgage with an adjustable rate. That means the rate can move up or down depending on what the prime rate or treasury index it is tied to is doing. This type of loan usually starts out at a low rate that makes it a great deal, but consumers need to be careful if and when the interest rate goes up, increasing the monthly payment.

Annual Percentage Rate (APR) - This number represents all the costs associated with a mortgage shown as an interest rate. It can vary among different lenders because they all calculate it a little differently. If you are comparing rate use the Good Faith Estimate that all lenders are required to provide.

Good Faith Estimate (GFE) - This is a document that all mortgage lenders are required by law to provide to all applicants. It will give a full account of all the estimated costs for a loan from a particular lender. You should have this in hand no longer then 3 days after filling out a loan application.

Loan to Value Ratio (LTV) - This ratio is a percentage that shows what percent you are borrowing against the appraised value of your home. Keeping this ratio below 80% is what most lenders are looking for. If your LTV is higher then 80% you will probably be required to purchase mortgage insurance in order to refinance.

Points (Discount & Origination) - There are two types of points that you can pay. Discount points are paid up front at the closing and are used to bring down the interest rate. Normally one point will equal one percent of what your total loan amount is. Origination points, or fees, are paid for the services rendered by the loan representative.

Refinancing a home mortgage loan can be a good way of freeing up money for other uses but it pays to pay close attention through out the process because you don’t want some hidden cost or fee to make your new loan cost more than the original mortgage.



ROYAL

Julie M asked:


Does anyone have or know someone that has a home ownership accelerator loan, also called a mortgage checking account? I am new to this loan and would like to know from someone who has it if they like it.
Thanks
I heard in Aust. it’s called an All-n-one

PARKER

Alan Lim asked:


A life time investment

Taking out a home mortgage loan is a life time investment. You therefore have to show a lot of caution when making a decision. This is because a wrong step might haunt your financial life throughout the rest of your life. Carry out a detailed research and get advice wherever things are not clear to you. You have a duty of care to give yourself the best deal.

Do you qualify for a home mortgage loan?

This is a question that you must address to a home mortgage loan officer. Take note that his answer will be dependent on your cooperation with the loan officer. Therefore you must be able to relate a genuine account of your credit history to him. A good credit history will convince him to give you a home mortgage loan. But when your credits history proves bad, do not hide it from him. There are mortgage arrangements for those with good credit as well as to those with bad credit history.

What are your financial liabilities?

This question should be asked to be on familiar terms with the accurate cost of the home mortgage loan. Make sure that the document states a precise amount of payment and a precise period for payment. Inquire what provisions, if any, are applicable in case of an advance payment. It is usual that you may have an expected opportunity to make a lot of money in the future. If you decide to use this to settle your debt, there may be certain charges tied to this. It is good to know what and how much it entails.

Also inquire if there is a possibility of you changing from one regime to the other in future. Your financial situation might change. It therefore becomes imminent that you will have to make an adjustment. This should be clearly stated in the home mortgage loan agreement. Avoid letting the lender coercing you into a deal.

Be prepared to sign the home mortgage loan

A home mortgage loan is always an exciting event to a potential mortgagee. Most of them will always be excited about getting the loan. They will therefore be prepared to sign anything once the loan is approved. Have you thought of going through everything in print before you sign the paper? Keep in mind the some unscrupulous lenders may exploit your excitement. Take the pain of getting to understand every single phrase. Never sign a document with blank spaces. If you are not in possession of every credential, waiting until everything is available.



FRANK

Dominique Halet asked:


One of the most expensive financial investments that most people make in their lifetime is for sure a home mortgage loan. Deciding which loan is the best for their financial situation can be really hard to do for a first time future homeowner. There is big percentage of home buyers that cannot determine the differences between the two traditional choices: fixed vs. variable interest rate home mortgage loans.

This article will learn you the most important factors you have to know before making decision for a fixed or a variable interest rate home mortgage loan.

It is critical to gather as much information as possible on the financial decisions that you will cope with. For that reason, in order to choose between fixed and variable interest rate home mortgage loan and before applying for loan pre-approval, you have to read anything you find about these two choices.

Fixed interest rate home mortgage loan offers the consumer the opportunity to lock into a certain interest rate till the end of the loan, except if the borrower chooses to refinance the loan. This interest rate won’t change and won’t become fluctuated based on the activity of the market. If interest rates increase, then you won’t have to make higher payments. Obviously, if rates fall, your loan won’t be affected and your monthly payments will remain as high as they used to be at the beginning of the loan.

Variable interest rate home mortgage loans are being constantly adjusted according to the interest rates that are applicable on the current market. These rates directly depend on the activity that is being conducted within the economic sector. Simply explained; when the rate in the economy goes down a lower interest rate is applied on the home mortgage. But this process works both ways; when the rate in the economy is high, a higher interest rate is charged on the home mortgage; which signifies that the monthly payment of the consumer will increase.

Whether you end up choosing a fixed or adjustable interest rate home mortgage loan, it is essential to establish your decision on your personal preference for danger related to financial affairs and the overall situation of the market on which your home mortgage loan depends.

When choosing a variable interest rate home mortgage loan, there are dangers associated with the choice. Keep in mind that the monthly payments you will be doing will be higher as a consequence of an increase of the interest rate. Although banks do their best to keep the payments around the same number per month, these big rises leave them no option but to rise the sum of the monthly payment.

A lot of borrowers and homeowners believe that a fixed interest rate allows them to affix a number within their monthly budget without any surprises when it comes time to pay the home mortgage payment. In case you are facing financial difficulties, then a fixed interest rate home mortgage loan will make the difference of whether you are able to pay the mortgage that is tied to the buying of your dream home.



BRADY

jason asked:


Is it going to be more difficult to secure a 800K Commercial Building loan than say 6 months ago? I will be in the market for that kind of loan in the next week or two and haven’t a feel for the market right now.

TRISTAN

Liz asked:


We live in NJ and are looking to buy our first place, but we aren’t sure if we’ll have enough money by the time the process is over for the down payment, the closing costs, the safety net AND new hardwood floors, but we feel that’s necessary to move in. We’re planning to get a townhouse that’s well within our budget in the long run and in terms of monthly payments, we just don’t have the cash up front. Can you build an extra amount of cash into a mortgage, and get it upfront for such upgrades? Thanks!
You could be of service by answering the question!

HAL

Dominique Halet asked:


One of the most expensive financial expenses that most people will ever make is surely a home mortgage loan. For first time potential home buyers one of the hardest tasks is in all probability to decide which loan is the best for their financial resources. Between the two conventional choices: fixed vs. variable interest rate home mortgage loans – there is an huge percentage of consumers that are unable to figure out the differences between the two.

It is essential to gather as much information as possible referring to the financial choices that you are faced with. For that reason, in order to choose between fixed and variable interest rate home mortgage loan and before enquiring for loan pre-approval, you have to read every document about these two options.

Fixed interest rate home mortgage loan enables the consumer to lock into a certain interest rate till the end of the loan, or until the loan is to be refinanced. This interest rate will always stay unchanged and won’t be at the mercy of the fluctuations of the financial market. If interest rates rise, then your monthly payments will not change. On the other hand, if rates drop, your loan won’t be concerned and your monthly payments will stay as high as they used to be at the start of the loan.

Variable interest rate home mortgage loans are regularly reviewed according to the interest rates that are available on the current market. These rates highly subject to the activity that is being conducted within the economic sector. Simply explained; when the rate in the economy goes down a lower interest rate is charged on the home mortgage. But this works both ways; when the rate in the economy goes up, a higher interest rate is charged on the home mortgage; which involves a higher monthly payment for the borrower.

Whether you end up choosing a fixed or variable interest rate home mortgage loan, it is important to establish your choice on your personal preference for hazard associated with financial affairs and the general conditions of the market on which your home mortgage loan depends.

When selecting an adjustable interest rate home mortgage loan, there are risks associated with the decision. If there is an rise in the interest rate, you could be exposed to making a higher monthly payment. Although lenders make efforts to maintain the payments around the same number per month, these sharp increases leave them no choice but to rise the sum of the monthly payment.

Many borrowers and homeowners feel that a fixed interest rate provides them with the opportunity to add a fixed number to their monthly budget with no surprise when time has come to do the home mortgage monthly payment. If you are encountering financial problems, then a fixed interest rate home mortgage loan will make the difference of whether you are able to afford the mortgage that is bound to the purchase of your dream home.



LOREN

Pat asked:


trying to figure out whens the best time to refinace or get a fixed home equity loan.

STAN

Yahoo! Answers Law Enforcement asked:


Wouldn’t those companies make more money if they allowed everyone to keep their house and just lower their payment to something more affordable? Not only would they still be getting some money it would help the mortgage crisis. Correct me if i’m wrong.

CYRIL