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Thanks to Federal Regulators there is once again good and bad news. The bad news is more paperwork and tougher standards when applying for and ultimately purchasing your home. Creating tightened guidelines for stated income and piggy back loans and stricter rules for option arms and interest only is meant to create security for the lenders. Good news for home buyers? YES! Ever since the days of School House Rock we have known that "Knowledge is Power!" nothing has changed. If the borrower knows the rules, they can be prepared to meet the lending institution requirements and come out ahead or no worse for the wear. Here are the basic steps to survive and flourish under the new "Rules" 1. Be prepared to have payroll stubs and or tax returns available. Instead of using stated income, using actual income will ensure that you get the right size payment and decrease the chances of default later on. 2. Keep your credit report up to date. Check for errors in information. If

No Credit Scores, believe it or not it's very common. There are lots of people out there that don't have any credit. It is like a double edge sword, no credit could hurt you, but bad credit will definitely hurt you. Normally people that have no credit scores, fall into two categories. 1. Young and just starting out.2. I pay cash for everything. Luckily there is hope for individuals that don't have credit scores and want to buy a home. There is a loan called FHA, which is a life saver for lots of happy homeowners. FHA is the single largest insurer of loans in the world. This particular loan is more lenient with banks, because it is insured by HUD. The qualifying process is less stringent. FHA does not require credit scores to get a mortgage. It offers an alternative in place of no scores. It will allow you to provide alternate lines of credit. Typically the underwriter will require 3 sources. The following would work. 1. Last 12 month payment history from any utility company

Do you owe more than your house is worth? Or are you unable to make your mortgage payments? Mortgage costs including taxes and insurance should be no more than 40% of your take-home income, at worst. Many people are paying more than this. Your mortgage payments may feel like a crushing burden and you probably don't know where to turn for help. It turns out that a short sale may be the answer for you. I want to focus on doing a short sale -- that lets you sell your house, get out from under your mortgage without paying in any cash, and get out from under even if you owe more than your house is worth. Because let's look at your choices. Choice #1: If you sell your house and you owe more than it is worth, you can pay your own money to make up the loss. For example, if the buyer pays $180,000 because that is all you can get as far as an offer, and your mortgage is for $250,000, you have to pay in $70,000 cash at closing or else the deal will fall through. Do you have that kind of c

There are several different types of methods for interest to be charged on mortgages. Tracker mortgages have a variable interest rate that moves roughly in line with the Bank of England Base Rate (BoEBR). Another popular type of interest rate is a fixed rate which does not move in line with the base rate. The interest rates on tracker rate mortgages are quoted as a fixed percentage above the base rate and will normally exist for a short period, although it can be attached to the tracker rate mortgage for its entire term. Once the tracker period expires the interest rate will convert to the lender's Standard Variable Rate (SVR). A typical example would be tracker rate mortgages that are quotes as having an interest rate of BoEBR+2% for three years. The BoEBR is set by the Bank of England Monetary Policy Committee (MPC) each month. The MPC will evaluate a range of economic indicators to decide whether a change in the base rate is necessary to meet the Government's inflationary po

Interest only mortgages allow borrowers to reduce their monthly mortgage payments by only paying interest on the outstanding loan balance. Capital repayments are not made on a monthly basis with interest only mortgages. Instead, the payment of the capital portion of interest only mortgages is deferred until the end of the term of the mortgage. Because interest only mortgages reduce the amount of the payments due to the lender each month, they are a popular vehicle for individuals to finance the purchase of their first home. Interest only mortgages can help ease the financial burden involved with home ownership, allowing for borrowers to get a foot on the property ladder and switch to a repayment mortgage when it becomes more affordable. Interest only mortgages are therefore a short-term solution to the high cost involved in borrowing money to acquire property. While interest only mortgages are popular at all times, they become even more popular during times of high interest rates. Desp

I once talked to a Loan Officer whose only goal was to close more loans. He had a plan he told me. He was going to send out postcards and mailers then follow up with phone calls asking the client if they wanted to refinance. On top of that, he was planning on taking about 2 days a week and visit Realtor offices and drop off information for the Realtors. Not just rate sheets mind you, he was going to pass out flyers and a bio sheet telling everyone about him and what he can do for them. After all, it was a perfect fit, a Mortgage guy and a Realtor, they both need each other, right? Then, he was going to buy a bunch of leads from a lead generation company and spend two nights a week calling folks from the list. Does this sound like you? Do these activities sound like something you've ever done? Most Loan Officers and Mortgage Brokers do at least one of these activities to get their business started. Not only that, but the average Loan Officer continues to do these activities througho

Oh Yes...it's a time of goodwill and cheer! With the holidays comes a bit of stress and anxiety. Some of those factors are money, buy, buy, buy, and some are time, more, more, more. It's tough to just sit back and take it in and revel in the spirit. A cup of cheer will sometimes help. So that's what we're going to try to give you today...a symbolic cup of cheer. But first the grinch doeth cometh. Rate Is Low, like most in the mortgage business has gone through many changes this past year. Some have been disappointing. We've had to do layoffs and downsizing. We've had to change our view of what to expect and how to get to the end game. For the last three months the fall out from programs not being available has been nothing less than shattering. Because of the mammoth exodus of lenders, many borrowers have been left in a financial lurch with no where to go. There just weren't any programs for them. And good or excellent credit didn't matter...everyone suf

If you are a US homeowner approaching retirement, and have already realized that your pension, social security, or 401K will not be enough to let you maintain the lifestyle you have been able to afford during your working years, you may be considering a reverse mortgage. If you are, you should take advantage of the services offered by the National Reverse Mortgage Association. Started in 1997, the National Reverse Mortgage Association has a decade of experience in assisting both seniors who want to use reverse mortgages to help fund their retirements, and lenders who want to offer reverse mortgages as part of their services. For homeowners who have made the decision to preserve their financial independence through reverse mortgages, the Reverse Mortgage Association offers educational programs. For lenders who wish to offer reverse mortgages, the Reverse Mortgage Association has a Code of Conduct designed to safeguard interests of older homeowners, and which it expects its lenders to ho

Only recently has LeBron James of the Cleveland Cavaliers lived up to his superstar status. He has arrived. Reverse mortgages have been around for years. They, for the most part, have had a low profile with only smaller lenders being involved. They have been the subject of ridicule and some serious misgivings. Only recently has it dawned on the biggest lenders in the country what a huge market there is in reverse mortgages-78 million baby boomers in the next decade to be precise. Now the big lenders are getting into the fray in a big way. The race is on for market domination. They have arrived. The nation's aging population, along with the rapid housing-price appreciation from 2000 to 2005, has led to record growth in reverse mortgages, which allow homeowners 62 years old and above to turn home equity into income they don't have to repay until they move out. Reverse mortgages provide income to the homeowner in the form of a lump sum, monthly payments, or a line of credit while

If you want a cheap loan despite your bad credit than you can choose bad credit home equity loans. These loans are given on the security of your home. People with CCJ's, arrears or any default payment can easily go for these loans. The lender keeps your home as collateral so that they don't have fear to loose their money. This provides you the cheap interest rate. The loan amount is decided by evaluating equity on your home based on its current market price and mortgages over it. You can use the loan amount for any purpose such as home improvement, clearing medical bills or any other debts without the intervention of lender. These loans do not have any specific prerequisites and lender may only want to see the paper of home and details of various mortgages on it. These loans require some paperwork to be done so it may take about 3 to 4 days in the approval. As stated, the loan amount is decided by the current market value of your home and the mortgages it carry. The interest ra

Home equity refinance can come in handy when your main objective is to pay off your credit card debt or you want to remodel your home. The best part about home equity refinance is that you get the much-needed cash very quickly and that too without any problem. This is not the case with traditional refinance where you need to fill lots of application forms and go through various procedures. No closing costs- Another good thing about home equity refinance is that you don't need to pay any sort of closing costs for the loan. However, there are few financial institutions that will charge you few dollars for processing the loan but it is still quite low as compared to other loans. Private mortgage insurance- Don't opt for private mortgage insurance because not only it is useless but also quite costly in nature. You have to pay private mortgage insurance if you borrow against your home for more than 80 per cent of the value. You can avoid private mortgage insurance by going for a hom

Following you will find a few easy steps you should follow to obtain extra funds from your property by refinancing and use the money to eliminate your outstanding debt. Assess Your Financial Situation It is important that you analyze your financial situation before making any type of decision. Whether it is advisable to obtain a cash-out refinance home loan or not to eliminate debt will depend on several factors that constitute your finances. The first thing that you must analyze is how much debt you will need to consolidate with the amount of money you get out of a cash-out refinance home loan. Unless you have subsidized loans like student loans or loans with high prepayment penalty fees, chances are that you should consolidate all your outstanding debt with the mortgage refinance home loan. Also, check how much money you are spending monthly in terms of debt repayment. Add up mortgage payments, car loan payments, unsecured loan payments, credit card average balance payments, etc. Thi

People who are into a much more manageable way of paying off their mortgage will definitely benefit from a bi-weekly amortization schedule. This type of amortization schedule will go by more quickly than a monthly mortgage because if it is biweekly then the payment schedule is accelerated. You usually make 26 half payments in a year instead of 12 full payments. Should you decide to go for a biweekly amortization schedule, you will find yourself being able to compare the size, interest rate and number of years of biweekly mortgages against monthly ones. It is then not very surprising to know that research and statistics confidently reveal that the demand for such an amortization program is indeed very outstanding. Such a side by side schedule of amortization can show you the dramatic interest when it comes to saving and speedier payoffs of frequent payments. The great results that this type of schedule shows are quite amazing. If you pay for your mortgage every two weeks, your dollar sa

100% finance mortgages are mortgages with zero money down required at the time of the initial loan. The main advantage of this type of loan is the ability to buy a home with almost no money down. Providing 100% financing of the purchase price of your home, this mortgage is specifically designed for homebuyers who have limited available cash, but excellent credit. 100% financing offers complete financing of your property. The other option, 80/20, finances your mortgage with two loans. If you have a strong credit profile but have limited funds to commit to a down payment, then an 80/20 mortgage is just right for you. Lenders typically require a down payment of at least 20 percent of the purchase price. If the loan amount is for more than 80 percent of the purchase price, PMI is usually required. You can avoid paying PMI by getting a second mortgage ('piggyback loan') to back up your first mortgage.The first mortgage is provided for 80 percent of the cost of the home and the '

Most people wouldn't just purchase the first car they look at, so why would shopping for a mortgage be any different? New would-be homeowners are looking for ways to simply just secure financing that they forget that they are the ones in control of their terms. To help you get the best mortgage deal for your current financial situation and for your future, here are three steps you will want to take.Before you can take advantage of any of these steps, it will help if you to gain a basic understanding of the mortgage process and terms you might run across as you begin your search. There are a number of helpful books and websites you might want to look into that can help you begin to find your footing in this maze of mortgage-speak.First of all, you need to look at the lending information from several different lenders. You have a number of options for borrowing money - credit unions, banks, thrift institutions, and mortgage companies. So, with those places in mind, you will want to s

If you've watched any amount of daytime TV, especially on minority channels, you can't fail to have seen some of the many adverts extolling the virtues of taking out a loan secured on your home. These adverts all seem to follow similar themes - a busy family situation with smiling children but a somewhat saddened parent pondering on their financial troubles, with the suggestion that taking out a loan will free you from your financial worries and lead to a brighter, happier life.The implication of these promotional messages is that taking out a secured loan is a beneficial part of everyday life, and one which you'd hardly need to think twice about pursuing. In actual fact, a secured or homeowner loan represents a very significant financial decision with ramifications far into your future, and at least one loan company has recently been censured by the financial regulators for not sufficiently emphasizing the gravity associated with such a financial commitment.Of course, ther

Things such as County Court Judgements (CCJ's) or a poor credit history can scupper the chances of you getting a personal mortgage because mortgage companies deem you a high risk.If you are self-employed, and even have a pristine credit history, you may find it just as difficult to get a mortgage due to your circumstances, which is unfair.However, there are more and more specialist mortgage companies that are sympathetic and able to offer bad credit mortgages to people - as well as mortgages for the self employed.Many of these companies do not charge excessively high interest rates as they have done in the past, meaning that you should be able to get a mortgage and pay a fairly realistic interest rate. Apart from the obvious benefit of taking out a mortgage for whatever purpose you need it for, having a mortgage can actually improve your credit scoring - making it easier for you to borrow money and get credit in the future! However, you will need to make your monthly repayments on

It is becoming increasingly popular to use a mortgage in lieu of a low-interest savings account. Is this a good idea?The latest version is a home-equity line of credit that is used to buy a home. It is marketed as a way to pay down your mortgage faster than the traditional mortgage. But it only works at this if you use it correctly. It could be both good and bad that you can use the funds from the account whenever you want to. All you have to do is write a check.It is basically an adjustable-rate home-equity credit line that is based on the value of the property. You make interest-only payments for the first 10 years. The balance is then fully amortized over the next 20 years. You will pay both the interest and the principal at this time.If you go ahead and own the home for ten years, you could be facing amazing monthly payments. Your monthly payment could more than double on you. Yet, there is no negative amortization on this loan program. The interest is capped for five years and hig

In the old days if your credit history was less than perfect, the only mortgage you would be offered would be one with extortionate interest rates from a shady broker. Nowadays, there are more sympathetic lenders who will offer you a bad credit mortgage without charging you sky-high interest charges. And because there are more lenders out there now offering these non-standard mortgages, it has driven the interest rates on them down which is good news!The term ‘Bad credit’ can be anything from County Court Judgements (CCJ’s) on your credit file to something like having missed a mobile ‘phone payment or made a few mortgage payments late. More and more people now have a ‘bad’ credit file. Rising inflation and credit companies making it easier for people to borrow means that just because you have a bad credit file, you are not rubbish with money!So, what can you do to get a mortgage, without being ripped off by greedy lenders?First of all, if you are considering using a mortgage for debt c

Taking out a mortgage is always a huge decision. With interest rates varying and different mortgages to choose from there are right ways to go about getting a mortgage and ways you shouldn’t. Taking your mortgage from the salesman who makes commission from selling is not the best way to go. In many cases, they are going to sell you the costliest deal possible so always shop around and to get an idea of the best deals available. That way you will be better informed should you choose to use a broker or financial adviser.Some companies will include mortgage payment protection insurance (MPPI) along with your mortgage but you should realise that in most cases, this isn’t compulsory. By including the cost of mortgage payment protection insurance in your mortgage, it can boost up the price by hundreds of pounds. Again by shopping around you can purchase MPPI independently at a much lower cost. Of course if you are looking for a 100% mortgage it will cost you more. By going, say, for a 95% mo

A mortgage is a kind of an agreement made to pay the money, which was loaned, to a person by keeping the house as collateral. Mortgage is a promise made to pay the debts by putting it in writing basically. Mortgages have terms and interest rates which are either adjustable or fixed.Mortgage terms: Mortgages are designed in such a way that they can be paid in installments for a certain period. The time frame which allows the person to pay back his mortgage is called the term. The term may be 10 or 15 or even 30 years. The length of the term determines the amount of money to be paid, which is actually spread in installments.Mortgage interest rate: The interest rate depends on the percentage to be paid on the mortgage loan amount. The interest rates vary according to the credit score of the person. If the credit score of the person is very high, the interest rate and the amount of monthly installments are lower. If the credit score is lower then the interest rates and the monthly installm

The home mortgage might be biggest personal financial commitment of a borrower in his or her lifetime. Hence, it becomes very important to choose the right kind of home mortgage to save money as well as save from headaches which might crop up in the future. Mortgage is a kind of a pledge or guarantee made by the home purchaser or borrower to repay the loan to the lender. A right home mortgage loan can save thousands of dollars in the long run. Hence, it becomes very important and crucial to the borrower.Important factors to be considered while selecting the right kind of mortgage loans:The purpose for the borrower should be solved: The home mortgage selected should fit the purpose of the home buyer. If the home purchaser intends to live in the house he has purchased then the most suitable will be the home mortgage loan while an investor will need a residential investment loan.The loan structure: The loan structure or the type of loan should suit the interests of the borrower. It depend

When comparing mortgages, it isn’t just a case of looking at the difference in interest charging and choosing the one with the lowest rate. There is so much more you need to consider finding out the true cost of a mortgage.First of all, how much is the arrangement fee? This can vary from lender to lender. Sometimes it will be a flat fee of around £500. With others it can be a percentage of the loan amount. With the latter, as an example, a charge of 1.5% of the loan amount as a fee equates to £2,625 on a £175,000 mortgage. Also look at valuation, legal, early redemption costs and exit fees. Some providers will offer a free valuation or similar as an incentive for you to buy their product which could save you money.Do bear in mind that overall, high charges do not necessarily mean that the mortgage product is a no-go. If you have a bigger mortgage it is more likely in the long run that you’d be better off choosing one with higher charges and a lower interest rate.The key is to sit down

When you sit down with a mortgage lender, you should be the one in the driver's seat; after all, you are the one that will be paying for this mortgage in the coming years. To help you stay in control of the things that are happening as well as stay informed of what you need to do next or if you are dealing with the right lender, here are ten questions you need to ask.What is the interest rate I will be getting with this mortgage?Obviously, this is the most important question that's already on your mind. In order to negotiate for a good interest rate, you need to ask what you will be offered from a number of lenders, keeping in mind that a poor credit rating might be negatively affecting what you can expect.Can I set up a way to lock in my interest rate?The goal of any home mortgage is to get the lowest interest rate. But if this isn't possible in the current market, you might want to choose a loan that has a variable interest rate, keeping you available to lock in the lowes

Considering buying properties either as investments or to sell? If so, you need to look at mortgages differently. In order to make the most money, borrow as little money as possible. Remember: retaining the capability to turn the property around to the buyers without causing you payments in the process is important. Thankfully, there are several ways that you can mortgage these investment properties to everyone's benefit.What Can You Afford Now?As with any business, there is an initial start up fee. In the investment properties business, this means that you will make payments on any property that you are unable to immediately sell again (or 'flip' as the popular term is). However, if you do not have a lot of money to spare, there are ways to ensure that you can still get into real estate sales without having to spend a lot of your money in the process.Take a moment to review your current financial status. If you can afford a down payment on a house, you may want to go ahead

Whether they realize it or not, more people than ever have bad credit. When it comes to buying a home, this is bad news for the prospective buyer. If you are ready to buy a home, you need good credit in order to impress the lenders you will be asking to loan you money. But sometimes it can be confusing to see where you should begin to repair your credit. With so many leaks in your financial history, how do you begin to plug them up?Find Your Credit ScoreThe best thing you can do is find credit score. This is a free process in most cases. Each citizen is entitled to one free credit report every year. Even if you already have your credit report, you can also pay to receive this report from one or all of the three major credit reporting agencies – Experian, Equifax, and TransUnion. This report will tell you what your rating is from 350 to 850. The higher your credit rating is, the better you will look to lenders. While you may never have a perfect credit rating, you want to have it as hig

When your children get older, it's absolutely normal for them to strive to become independent, and living separately is the first step towards that. And it is also absolutely normal for you as a parent to be willing to help your children as much as possible. So, when your child decides that the time has come for him or her to buy a home of his/her own, should you assist by co-signing the home mortgage? This is a very tricky matter, and it takes a lot of thinking to decide what is best for you both, because co-signing a mortgage for your child can with equal chances turn out to be a very good idea or not so good at all. Everything depends on what you want your role to be.First of all, let's look into the concept of co-signing in general. Why would a lender require a co-signer at all? The answer is simple: a lender will only require a co-signer, if an applicant for the mortgage does not meet all of the important criteria. A co-signer in this case is a person, who assumes responsi

We all have home mortgages and have to pay monthly mortgage payments that put a substantial burden on our budget. And we all want to get rid of that payments as soon as possible. So if your current financial situation allows you to repay you mortgage early, why not go for it? It could be a wise thing to do, if you can afford it, but there are some matters you should account for. Let's see, what things you should pay special attention to when paying your mortgage off ahead of time.Advance repayment sounds like a totally good idea both for you and for your lender company, and the common sense says that your lender should appreciate such decision. But the main catch here is that in fact some lender companies don't want you to pay early. Why? The answer is very easy: they take advantage of the interest you are paying and are willing to extend the interest payment period for as long as possible. That is why, in order to prevent early repayment, some lenders often impose pre-payment

For new homebuyers the common mistake is buying up things to fill the homes. In doing so they will not found any difficulties as the lender will provide them enough money whereas the seller has nothing to refuse the deal. But some hurdles are still there invisible to the naked eye and should be overcome before you make some decision. Things which you need to avoid during the process of home buying to ensure your transaction will go smoothly are:-a. It is always tempting for buying new items to make your new home a comfortable one. Major purchases including electronic equipment, jewelry, cars, or furniture must be avoided until you finish your home and all the transactions. Financing these stuffs when you are already paying up transactions for your home could jeopardize your credit worthiness no matter whether you use your own credit card or a store credit card. Using cash to buy these products also have some impact on approval of your mortgage where banks take into consideration of the

Bad credit score is not an uncommon thing. The question is, can you actually qualify for a mortgage if you have a bad credit? The simple answer is: yes, you can! Even if your credit is less than flawless, you still have a chance to find mortgage that will meet your requirements and suit your needs. The main trick here is that you will probably have to put down more money than in case of a usual loan just to convince the lender of your reliability, but after that your monthly payments will be the same as for a borrower with a flawless credit.There are several ways to find a bad credit lender. The best place to start your search would probably be online. There are some internet-based companies directly specializing in lending money to individuals with bad credit scores, and such companies will be willing to work with you and will propose you the best rates they can. Perhaps that would be a right way to get funds for the house you want.Another place to visit is your bank. Of course, most

What type of mortgage to choose is a very important question when buying a house. Will it be more appropriate to choose an adjustable rate mortgage (ARM) or a fixed rate mortgage? Many potential homeowners ask this question, willing to know what are they in for with this two options. The first thing to understand here is that the type of mortgage you choose actually determines the amount of interest payable and the overall size of your monthly mortgage payments. Initially ARMs offer lower costs, which look very attractive to smart investors, but the reverse side of this option is that the mortgage rate is subject to fluctuation, which introduces high degree of uncertainty. Fixed rate mortgages, on the contrary, provide high degree of certainty, but are generally more expensive. Thus your particular situation will determine what type of mortgage is more suitable for you, and in this article we shall try to give you some hints that will hopefully help you in choosing between the above tw

Reverse mortgages are government insured home loans specifically designed for senior homeowners. This type of loan allows a homeowner to payoff their existing mortgage along with a combination of the following: establish a credit line, receive monthly checks, or withdraw cash. The amount of cash available depends on many factors, which we will discuss shortly. If you choose to get cash with your reverse mortgage loan, you can choose from the following methods:Tenure – equal, monthly payments. Modified Tenure – line of credit combined with monthly payments. Term – equal, monthly payments for a fixed period.Modified Term – line of credit combined with monthly payments for a fixed period.Line of Credit – payments or installments at the borrower’s discretion (much like a standard credit line – use the money only when you choose to).Perhaps the most worthwhile benefit of a reverse mortgage is that the borrower will not be required to make any mortgage payments for the duration of their stay