Home Mortgage and Refinancing » Refinancing Home Mortgage

3 Tips To Refinancing Your Home Mortgage

Mortgage Maven — Wed, 04 May 2011 00:09:05 +0000

Lately home mortgage rates have been extremely low, in fact rates haven’t been this low in over 50 years. As a result a lot of people are refinancing and if your reading this article you probably are as well. So in this article I’m going to give you 3 simple mortgage refinance tips to help you along the way.

First off, stick with smaller banks in your local area and credit unions. The great thing about these financial institutions is that they usually carry lower than normal cost to refinance. In fact when I compared bigger lenders such as Bank of America I found that they charged around an average of $3500 in closing cost. While smaller banks and credit unions only charged around $500. That around $3000 in cash savings.

Next, when you go to refinance switch to a lower term mortgage if you can. There are two primary reasons for doing this. One, with lower term mortgages the rates will typically be much lower while longer term mortgages will usually have higher rates. Second, buy switching to a lower term mortgage you’ll be able cut down on the amount of interest you might owe.

For example if you’ve been paying on a 30 year fixed mortgage for the last 5 years and you switch to a 15 year fixed mortgage you might have a higher payment but you’ll also cut 10 years of interest payments along the way saving you hundreds of thousands of dollars.

Finally, stay away from cash out refinances. This is a problem I’ve seen with bigger lenders were they will encourage people to do a cash out refinance, to pay off some of their extra bills or for whatever reason. The problem with this is it will cut down the amount of equity in your home and raise your payments in the end which the goal of most lenders when they do this.

In the end follow my simple tips to refinancing here and you’ll save yourself a ton of money and pay your home of much sooner.

7 Common Refinancing Mistakes to Avoid

Mortgage Maven — Wed, 29 Dec 2010 01:52:05 +0000

When interest rates fall, a refinancing frenzy usually comes next. Whether you’re looking to trim mortgage payments, eliminate credit card debt or pay off your car loan, experts say you should fully understand all the options available to you before you decide to refinance.

Allied Mortgage Consultants, a mortgage company recognized for educating consumers about the reality behind the new home loans and refinancing, reveals seven common mistakes people make when refinancing.

You don’t have enough savings to justify refinancing. It’s best to reduce your interest rate by at least 0.75 % to 1 %. This will save about one hundred dollars a month on a $ 150,000 mortgage.

Not knowing your closing costs up front. By law, closing costs must be disclosed within three days of the loan application. But there are different ways to calculate them. Once the details of your loan are clear, the estimated closing costs can be quoted to you. Be prepared for the worst case scenario.
Do not understand your reasons for refinancing. In addition to reducing your interest rate, there are other legitimate reasons to refinance, such as debt consolidation, renovations or major purchases. In some cases you can deduct your interest payments on your tax return. Always consult an accountant or tax adviser lawyer when making these kinds of decisions.
Not familiar with the APR “teaser rates”. Some mortgage brokers use the APR to get your attention, but it may actually end up costing you more. APRs often comes with a 30-year mortgage coupled with an accelerated payment plan. Make sure you know the actual rate of interest you will pay during the entire loan term.
Not being educated about the pros and cons of adjustable-rate mortgages. ARM’s can minimize your monthly payment, but not if there are additional refinancing occurs. In this case, they cost more in the long run.
Not aware of the services you should expect from a mortgage broker. The process of refinancing should be trouble free and completed quickly. Ask your mortgage broker to give you details about his their service plan and performance guarantees.
Not informed enough to ask the mortgage broker about all their loan products, terms and rates. Subtle differences can save or cost you a lot of money.

Learn How To Reduce Your Mortgage Payments

Mortgage Maven — Thu, 02 Dec 2010 10:08:05 +0000

In this tough economy many are making less and having to spend the same or more. For many their mortgage is the biggest monthly debt payment. The ability able to reduce mortgage payments is there for many families and they do not even know about it. When you think about how to get a lower mortgage payment, refinancing is usually the first thing that comes to mind.

Refinancing is a great option but it can add a few thousand dollars to your loan balance for closing costs. You may even have to come out-of-pocket for some or all of the closing costs. For many this is just not possible from a cash on hand standpoint. The biggest problem with refinancing is that it is tougher to qualify for a loan that ever before. It’s likely that values have dropped and being upside down on your mortgage may keep you from qualifying.

Besides refinancing there are several other ways to get a lower mortgage payment.

Shopping your homeowners or property insurance a couple of time a year can save quite a bit on your payments. Call your agent and have them check rates with other insurance underwriters in writing policies in your area.Check with a couple of other agents too. Make sure you are not over insured and consider increasing deductibles to save money.

Many homes values are over assessed. Check the property appraiser’s website and if you feel your home is over valued request a review or reassessment. Reducing property taxes will help you get a cheaper monthly payment.

Check your monthly mortgage statement for PMI or MIP mortgage insurance. This insurance protects the lender and not you. It is usually required if there was less that a 20% down payment made when the home was purchased. Sometimes a call to your lender requesting this be removed and an appraisal is all that you have to do if you have been paying on your home for more than five to seven years.

A little known method to get a lower payment without refinancing is to request a re-amortization of your mortgage loan. This means to put your loan back to a longer term. Some lenders will do this without any fees if you call and ask for it.

Doing just one of these things can save you a lot of money on your payments, combining all of these tactics can save you several hundred dollars a month depending on the size of your loan. Give it a try you have nothing to lose but a few minutes of your time.

Home Mortgage Loan Refinancing – Frequently Asked Questions

Mortgage Maven — Fri, 19 Nov 2010 22:07:08 +0000

Money tight? Obtaining a house isn’t that simple, but these days keeping your home can be even harder. Your current mortgage might have been perfect a few years back, but times have changed and now you need to consider whether to refinance the existing mortgage.

Countless homeowners now face the exact same dilemma. Do not wait until you are out of choices. Prior to any further action, you should spend some time time considering these frequently asked questions about mortgage loan refinancing.

1. Why should I refinance my house?

Maybe you would like to change an adjustable rate mortgage into the cheapest fixed rate mortgage possible. Or maybe you are paying for both a first mortgage and a second mortgage and it’s difficult to pay both, or you have high credit card debt and are faced with either refinancing or seeking credit card debt forgiveness. Or if you are currently paying private home loan insurance (PMI) but your home has appreciated enough that you now have 20% equity, refinancing may keep you from having to pay PMI.

In any of these cases, refinancing may be a good choice.

2. How would the monthly mortgage payments be decided?

Your monthly mortgage payments will be decided based on the amount financed, the rate of interest, and how many years the loan is financed over. Be careful if considering an adjustable rate mortgage (ARM), as then your monthly payments could go up if interest rates go up. With interest rates at historic lows, it is highly likely your payments may go up if you choose an ARM rather than a low-interest fixed rate mortgage.

3. Should I refinance now?

Any choice to refinance your home loan ought to depend on your financial needs and the rate of interest you are able to refinance at. If refinancing now will significantly decrease your monthly interest charges or the interest over the life of the loan, now may be a great time to refinance. Be sure to also consider how many years you have left on your existing home loan. If you only have a few years left before your house is paid off, now might not be the wisest time to refinance.

Prior to refinancing, it’s good to consult a number of home loan lenders. Think about what each can provide and which will provide the greatest benefits to you. Know the value of the property and the present trend within the real estate market in your area. These particulars are essential and should be weighed carefully when thinking about refinancing.

Choosing Between Unsecured and Secured Consolidating Loan

Mortgage Maven — Wed, 17 Nov 2010 23:04:04 +0000

Struggling to pay off several debts is not unfamiliar to many people. This situation can cause a lot of headache and stress. One solution to this predicament is to be clear with your priorities. If your priority is to have an organized payment scheme that will not be too much of a burden your monthly remittance, then you can opt for debt consolidation. Consolidating your debt is the most typical debt settlement method. This involves paying off your debts by getting a debt consolidation loan from a lending firm. You will then have to make just one payment to the lending firm at a certain interest rate. Debt consolidators will give you a statement that will show the payment scheme they will apply for you. This statement is called secured debt consolidation quote. Debt consolidation loan can either be secured and unsecured. Knowing the difference between secured debt and unsecured debt helps you make the decision on how to consolidate your loan.

You can only get a secured debt consolidation loan if you have an asset that serves as a guarantee that such loan is going to be paid eventually. It is much easier to get a secured loan to consolidate your debts because lending institutions prefer to have your asset at hand than coming after you for your unpaid unsecured debt. The advantage of getting secured debt is that it generally offers a lower interest rate compared to unsecured debt. This is because you have a guaranteed asset that they can possess, even if you cannot pay.

Unsecured loan, on the other hand, is a written agreement you make for getting a loan and paying it in time. You do not have to present an asset. Examples of unsecured loan are credit card and personal loans. If you do not pay at an agreed time, then the bank or lender can go to court to legally obligate you to pay in some ways. For example, they can ask for lien on your home or go after your wage. Due to this fact, unsecured loan presents a much higher risk for banks and lending institutions. This is the reason why they charge a relatively bigger interest rate.

Why Choose A Military Debt Consolidation Loan

Mortgage Maven — Tue, 16 Nov 2010 11:44:03 +0000

Borrowing too much money too frequently can obviously lead to financial stress and worry. We all know that fact but sometimes we still find ourselves strapped with too much debt that can make it difficult to pay all the bills successfully at the end of the month. What is more, unfortunately military families are not removed from this burden. They, too, have to worry about these difficult financial matters. Thankfully, this problem was identified over the past several years and special programs have been set up to help our men and women serving in the armed forces by providing military debt consolidation for those that qualify.

Borrowing money is as common today as death and taxes. However, the tough part can be managing the enormous burden that can come with having too much debt. It is worth stating that debt consolidation is a good program if and only if you are disciplined enough to not take on any new debt and finally control spending. It probably makes sense to have a detailed written budget to also help focus on your spending. In an effort to reduce debt, racking up more of it will short circuit the whole idea of consolidation and cast doubt on your hopes of eliminating debt forever.

Military debt consolidation works similar to civilian consolidation programs in that all open accounts are rolled into one. Where military loans separate themselves in a good way is that they provide a longer term repayment schedule and more favorable lower interest rates which lead to a lower monthly payment with idea being that repayment becomes more likely as a result of less debt load.

With added benefits, military debt consolidation is a great way for current armed forces and veterans to tackle their debt. Strive to not take on new debt while in this process and attack the debt with laser like focus. Also, seek out a qualified professional in order to help you navigate the process successfully. With all the legalese that can be on any contract, don’t sign anything until you understand exactly what you are getting into.

Clear debt solutions- John Cummuta program

Mortgage Maven — Fri, 12 Nov 2010 09:32:03 +0000

For the ones under burdens of heavy debts, scores of clear debt solutions programs are circulating online and in other media. Some of them come for free while other programs charge you a certain fee for their service. Some of these programs and professional assistance may really become helpful in guiding you to the path of a debt-free life and ways of transforming debt into wealth. But you must first see what you yourself can do to eliminate your debts.

The first thing to do is to contact your creditors and see if you can get some interest and penalties get lowered or fully waived. You should also set up a budget and be thrifty with your spending. Finally, you must try to devise ways of making some extra money at the end of each month.

Now if you really need professional assistance, a trusted and effective transforming debt into wealth system is designed by financial advisor John Cummuta. John claims that with carefully following some rigorous steps, it is possible to get rid off your various debts, including home loan. And once you eliminate those debts, building wealth is not much difficult either within the next 5-7 years.

The program package includes a transforming debt into wealth system manual and 12 CDs advising you on debt solutions. The kit also includes a debt-elimination software compatible with Windows OS, a DVD instructional manual and free coaching sessions.

John here says that if you follow and implement the steps and advices detailed on the program, it will not be difficult to pay off your debts, no matter what is the amount of your outstanding balance. And once you are back in track, starting transforming debt into wealth will be easier too, since you will already have mastered ways to save and properly utilise your money.

A Guide for Your Loan Refinancing

Mortgage Maven — Fri, 29 Oct 2010 02:48:04 +0000

If you are earning less income with a boosting payment interest, it would be the best time to think on refinancing. This article will provide you helpful and effective refinancing guide.

Debt refinancing provides you a new mortgage with the purpose of moving your high interest payments to lower interest payments. A lot of people confirmed that the best way to experience the low interest rates is by refinancing, which would help you in many ways. You can save your money by changing the current loan to a new mortgage loan that has a lower interest rate. You should be aware with the compensation and failures of refinancing because it could alter your personal financial situation.

Most people refinance from a 30 year to a 15 year loan in a lower rate. But it does not certainly lower the monthly payment. Some people changes from variable rate loan to fixed rate loan, such change are from one loan type to another.

You must think about refinancing if only you have plan to stay in your home for 5 years and up and if the recent mortgage interest rate is 2 percent lower that your original rate. This way will provide you an opportunity to stabilize your loan into your home mortgage. This will also assist you to make your interest payments tax delectable as well as lower them. By refinancing, those who bought the adjustable rate mortgage can get the advantage of lock-in on current rate on the fixed rate mortgage.

Cash out refinance is another choice to get additional cash by making a little increase in your loan than the existing amount required for clearing the mortgage. If the amount you applied is bigger than 80 percent of the value of your home, then you have to pay the private mortgage insurance. In such case, home equity loan is better than cash out refinancing.

You are to pay a high rate mortgage with a low rate mortgage when refinancing a mortgage. You can lessen your payment monthly with a good amount when you take a lower rate mortgage. However, you should consider the best loan option depending on the existing current mortgage rate and some other circumstances like cost, speed and so on. You can also apply for no closing cost refinancing from banks and other mortgage providers.

When Remortgaging is Most Beneficial

Mortgage Maven — Mon, 27 Sep 2010 18:11:08 +0000

Remortgages are available for homeowners, but may be costly. When home buyers secure financing for the purchase of their home, sometimes the rates of remortgages are not the best. There is sometimes a thought pattern that we just need to get in the home and we can refinance later. Also, when the housing market changes and the lower rates are available, refinancing your mortgage may be a consideration. Of course, the terms of your contract may be based on current circumstances but you know that change is a sure thing and you can get a better rate in the future.

Over the top Mortgages

Look into refinancing your mortgage when any one of these scenarios apply. A balloon payment is a financial hazard. An interest only loan puts you in the place of additional time added to paying off your home. Adjustable rates provide no stability.

A balloon payment is just what is says. You are required to make a balloon payment at some point and many times it is required very quickly. The balloon payment is a very large payment due at some point in the financing period. You are made aware of the payment due at the time the contract is signed. It is usually a very hefty amount over the actual regular loan payment due. You are made aware that you need to refinance as soon as possible the terms of a balloon payment. Because a balloon payment is a such a large amount of money due at once for a mortgage payment, it can definitely put you in jeopardy of losing your home if you do not make this payment.

If you get your mortgage under the terms of an adjustable rate, you can look forward to your rate going up at some point near the beginning of the contract term. Adjustable rates have nowhere to go but up. Low mortgages rates usually influence the availability and use of the adjustable rates. Locking in your mortgage rate when you initially sign your contract is probably the better way to go. You save your money in the long run because it can add up depending on the particulars of your situation if you have to refinance.

Life Requires Readjustment

There are times when you need to refinance because of life events. College is one of those events and so is a major medical emergency. You may need to refinance your mortgage for your obligation to these new events. The objective is to get a lower mortgage rate that you will be able to commit to. Looking at the fees that you may incur when refinancing, if you can get a couple points lower in percentage, it may be worth the effort to refinance.

How Much Do I Need?

Certainly needing additional money for things like major debt, a substantial purchase, or remodeling your home are reasons you may consider refinancing your mortgage an option. Consideration of the fees involved and the long-term advantages for you can make a difference in whether you decide to choose this route. The bottom line is that you must review and analyze your situation. Evaluate the options that you have and make sure that if you need to refinance your mortgage, it is most beneficial for you. Seek any professional assistance you need to make this decision. Your investment and financial future are worth the effort.

Thinking About Remortgages? Learn the Facts First

Mortgage Maven — Wed, 11 Aug 2010 05:43:04 +0000

Due to economic problems and serious financial difficulties, many people are contemplating about applying for remortgages. Are you on the same boat? If so, you should understand that this is the most excellent time for you to get a hold of a remortgage and receive competitive rates of interest. In fact, a remortgage is a cost-efficient financial assistance option.

A drop in the rates of interest is a positive driving force for a remortgage. This option involves the transfer of mortgage from your present lender to a new one with lower interest rates and even improved repayment schedules. The continuous popularity of remortgage has been backed up by its several benefits.

Should You Apply?

While remortgage can be beneficial, it should rest on some stern thought process since it is a huge decision to make. Similar to a mortgage, this option rivets your home by putting it at risk in instances of payment default. While you can apply for this assistance through your existing lender, most of the time it requires lender change. You can discuss this matter with your current lender and ask if he is willing to alter your mortgage policy and present you with more suitable and better remortgage. If he agrees with your requirements, then stay with him. Otherwise, you can always look for other loan lenders that may even offer you with a fast remortgage.

Your chief considerations when looking for a remortgage are the benefits associated to it. Many lending companies offer desirable introductory products and discounted rates to get your attention and make you switch to their services. Keep in mind that lower rates of interest are essential with this financial assistance option, permitting you to not only save considerable amount of money but also make use of your home equity in a beneficial manner.

Generating and raising capital via a remortgage will unlock new prospects in your finances. Through this option, you will be able to procure additional finances. In essence, a remortgage comes with interest rates’ reduction – meaning there will be more accessible funds for your personal expenditures. You can buy a new car, renovate your house, or expand your business.