The fluctuation of home mortgage rates is one of the benchmarks of the overall economy because interest rates are largely tied to the decisions made in New York by the Federal Reserve, among many other economic factors. Interest rates are adjusted according to the financial matters in the US such as exportation and inflation because such factors determine how easy or hard it would be to borrow and lend money.
Mortgage rates are used to help control the economy. If the movement of the economy is deemed to be too fast, higher rates are imposed so that individuals and corporations would be less willing to apply for loans. Conversely if the economy seems to be rather slow or stagnant, rates are lowered so that people would be more enticed to do more business transactions.
Trends in Home Mortgage Rates
It is quite interesting to know that mortgage rates have been lower than 8.5% since the year 1996, with the lowest rates of about 5.5% seen on the middle of 2005. While individuals might see an extremely different mortgage rate at a particular time due to other factors that affect rates (their salaries or credit histories), the trend has generally been observed to be generally consistent throughout financial circles.
The fall of interest rates from the high figures prior to 1996 has allowed a lot of people to buy their homes, purchase lands, or more to larger houses. Perhaps this reflects an effort to speed up the economy from that time up to now. However this year, the rates are rising probably because of an upsurge that the American economy has experienced in the previous year.
Current Home Mortgage Rates
Mortgage rates in the year 2006 are generally higher than that of the previous year with rates of about 6 percent for 30-year fixed rate mortgages (FRM). As of the 21st of September, 30-year FRMs have an average rate of 6.40%, while 15-year FRMs have an average rate of 6.06%. Adjustable Rate Mortgages (ARM) on the other hand are slightly lower with 5/1-year ARMs having an average interest rate of 6.08% and 1-year ARM having a mean rate of 5.54%.
The difference between this year’s and last year’s interest rates are not really significantly high as it would entail only a few hundred dollars increase in yearly payment rates. This probably would not stop a lot of people from getting mortgages, however if the rise continues, more people would become hesitant to get home loans.
Showing posts with label home mortgage. Show all posts
Showing posts with label home mortgage. Show all posts
Sunday, 3 August 2008
Friday, 1 August 2008
Home Sweet Home… But Can You Afford It?
You’ve finally found your dream house and are ready to commit but there’s that question of home mortgage affordability. Don’t let this thought scare you away just yet. Find out if you can go ahead and buy that house at last.
1. Know how much you have and how much you owe. How much income are you receiving at present? Is there a chance that it would increase? What will be your financial situation several years from now?
How much money do you owe to creditors? How much monthly payments do you make? Can you still afford to shell out more money after the bills are paid?
You’ll need a consistent source of income that can cover your mortgage and other expenses. Try to foresee possibilities that you’ll need to factor in: a new child, changes in the job, back-to-school plans and cash-flow five or several years from now. Be prepared to be in it for the long haul.
2. If your debts are well managed, then you can afford a home mortgage. The lender will approve your loan more quickly if he sees that your debt-to-income ratio is well within manageable range.
The lender will ensure that your payments will only total 33% or less of your monthly gross income. Otherwise, pay off some of your debts before applying for a home mortgage.
3. Decide which one you prefer: fixed, adjustable or balloon rates. Paying a fixed rate is a more popular choice because it can protect you from surges in interests while paying the lowest rate possible for an agreed period of time may be lighter on your budget, but your mortgage payment can go up later.
4. Interest rates will go up and down depending on the activity of the market. If you can read and understand market trends and economic indicators, you can save a lot of money.
5. Be prepared to pay a downpayment. Typically, it is about 20% of the total price. A house priced at $200,000 will require a down of $40,000. There are also loans with low or no-downpayments, but it will cost you in terms of equity in the long run.
6. You have enough money saved that’s equivalent to at least three months’ monthly income. This will help cover unexpected expenses that could affect your mortgage payments.
There is no fixed answer on the affordability of a home mortgage. It will all depend upon your income, debt, interest rate and other factors. If the home mortgage fits into your personal situation, then you can definitely afford it.
1. Know how much you have and how much you owe. How much income are you receiving at present? Is there a chance that it would increase? What will be your financial situation several years from now?
How much money do you owe to creditors? How much monthly payments do you make? Can you still afford to shell out more money after the bills are paid?
You’ll need a consistent source of income that can cover your mortgage and other expenses. Try to foresee possibilities that you’ll need to factor in: a new child, changes in the job, back-to-school plans and cash-flow five or several years from now. Be prepared to be in it for the long haul.
2. If your debts are well managed, then you can afford a home mortgage. The lender will approve your loan more quickly if he sees that your debt-to-income ratio is well within manageable range.
The lender will ensure that your payments will only total 33% or less of your monthly gross income. Otherwise, pay off some of your debts before applying for a home mortgage.
3. Decide which one you prefer: fixed, adjustable or balloon rates. Paying a fixed rate is a more popular choice because it can protect you from surges in interests while paying the lowest rate possible for an agreed period of time may be lighter on your budget, but your mortgage payment can go up later.
4. Interest rates will go up and down depending on the activity of the market. If you can read and understand market trends and economic indicators, you can save a lot of money.
5. Be prepared to pay a downpayment. Typically, it is about 20% of the total price. A house priced at $200,000 will require a down of $40,000. There are also loans with low or no-downpayments, but it will cost you in terms of equity in the long run.
6. You have enough money saved that’s equivalent to at least three months’ monthly income. This will help cover unexpected expenses that could affect your mortgage payments.
There is no fixed answer on the affordability of a home mortgage. It will all depend upon your income, debt, interest rate and other factors. If the home mortgage fits into your personal situation, then you can definitely afford it.
Monday, 28 July 2008
Getting A Home Mortgage From Chase
Chase (www.chase.com) offers programs that fit specific needs whether it’s your first home, your second or a new vacation home you’ve been planning to buy. They offer several options that may just be what you’re looking for.
What loans are available for me?
ARM (Adjustable Rate Mortgage), FRM (Fixed Rate Mortgage), conforming and jumbo loans are offered, along with special mortgage programs for low-to-medium income buyers, FHA or VA loans, low downpayment option or special credit needs. An interest only mortgage is also available for an agreed-upon period.
What do I do to apply for a loan?
After identifying your needs and the price range of your choice, you will need to prepare your documents before applying for a mortgage. Here is the initial list of documents you may be asked to prepare:
- SSS number or proof of permanent residency
- Last two months’ pay slip
- Last two years’ W-2 forms
- Last 3 months’ bank statements
- Last two years Federal tax returns
- Information on your current creditors
If you have already spoken with a seller of your chosen home, a signed contract of sale may also be required.
Applications may be done privately and securely online. An interactive tool can help you look for the loan that’s best for you. You can also call any Chase Mortgage Consultant at 1-800-873-6577 or find the nearest Chase branch and speak to a Loan Officer who can walk you through the loan process.
Online applications will be reviewed by a Mortgage Consultant who will then get in touch with you to ask for the required documents and other additional supports.
What happens next?
Chase will then order your credit report, so it’s best to review it first before application. Correct any errors so delays may be avoided during processing.
Chase does not require a home inspection, but it would be good to know the true condition of your home as evaluated by a professional.
A Home Analyst will order a property appraisal, property boundary survey, title search and insurance. A Closer will prepare the closing package which will include all the fees and closing payments required from you. He might establish an escrow account to pay the necessary taxes and insurance. He will then authorize the release of the mortgage funds. A Chase representative will get in touch with you to schedule the closing.
As with any other loan, it is best to check your best option before making a commitment. Information is given free online, through the phone or from a consultant who can discuss with you if Chase can offer the best choice to meet your needs.
What loans are available for me?
ARM (Adjustable Rate Mortgage), FRM (Fixed Rate Mortgage), conforming and jumbo loans are offered, along with special mortgage programs for low-to-medium income buyers, FHA or VA loans, low downpayment option or special credit needs. An interest only mortgage is also available for an agreed-upon period.
What do I do to apply for a loan?
After identifying your needs and the price range of your choice, you will need to prepare your documents before applying for a mortgage. Here is the initial list of documents you may be asked to prepare:
- SSS number or proof of permanent residency
- Last two months’ pay slip
- Last two years’ W-2 forms
- Last 3 months’ bank statements
- Last two years Federal tax returns
- Information on your current creditors
If you have already spoken with a seller of your chosen home, a signed contract of sale may also be required.
Applications may be done privately and securely online. An interactive tool can help you look for the loan that’s best for you. You can also call any Chase Mortgage Consultant at 1-800-873-6577 or find the nearest Chase branch and speak to a Loan Officer who can walk you through the loan process.
Online applications will be reviewed by a Mortgage Consultant who will then get in touch with you to ask for the required documents and other additional supports.
What happens next?
Chase will then order your credit report, so it’s best to review it first before application. Correct any errors so delays may be avoided during processing.
Chase does not require a home inspection, but it would be good to know the true condition of your home as evaluated by a professional.
A Home Analyst will order a property appraisal, property boundary survey, title search and insurance. A Closer will prepare the closing package which will include all the fees and closing payments required from you. He might establish an escrow account to pay the necessary taxes and insurance. He will then authorize the release of the mortgage funds. A Chase representative will get in touch with you to schedule the closing.
As with any other loan, it is best to check your best option before making a commitment. Information is given free online, through the phone or from a consultant who can discuss with you if Chase can offer the best choice to meet your needs.
Sunday, 27 July 2008
Getting A Home Mortgage From Allied
Allied Home Mortgage Capital Corporation (AHMCC), incorporated in 1991, is the largest private mortgage broker and lender in the U.S. The company is based in Houston and provides a wide selection of home mortgage loans.
Allied is a mortgage broker which acts as middleman, which gives them the capability of offering several options to their clients to fit their special needs. What clients get is a customized loan package. Allied is also one of the first in the industry to operate a Spanish-language website.
If you choose to apply with Allied, some supporting documents that they might request from you are:
- Social Security Number
- Proof of employment history in the past two years, with salary
- Pay slips covering the last 30 days
- Current W-2 forms
- Bank information including check, savings accounts and certificate of deposit
- Other investment info (stocks,bonds) and a list of assets
- Insurance company info including face amount and cash value of insurance, if available
- Liabilities with creditor’s info, monthly payments, balances
- Other sources of income
- Copy of DD Form 214 and Report of Separation for VA Loans
Allied offers assistance for a wide line of loan choices like new home purchases, refinancing, new construction, debt consolidation and customized loans, among others. These loans are available to most types of clients: first time homebuyers, the self-employed, retirees, singles and investors, including those who might have difficulty getting their loans approved.
Potential clients can apply online to utilize the Express Approval program, which allows them to get loan approval in minutes. Buyers can also compute a loan estimate by using online mortgage calculators. This will give them an idea of the price range of the house they can afford, their mortgage payments and closing costs.
While the calculators are a good indication of loan affordability, they are by no means completely accurate. That is why Allied representatives recommend that you talk to them first, to see how much you can afford to pay and how much you are qualified to loan. The advantage of getting a pre-qual is that you have the confidence to make an offer on your dream house, knowing that you have control.
Allied Home Mortgage has more than 700 offices located in 49 States and in Guam and the Virgin Islands. Should you decide to get their services, there are branches available all across the country. With more than $12 billion loans closed, Allied may just have the home mortgage loan that’s tailor-fit for you.
Allied is a mortgage broker which acts as middleman, which gives them the capability of offering several options to their clients to fit their special needs. What clients get is a customized loan package. Allied is also one of the first in the industry to operate a Spanish-language website.
If you choose to apply with Allied, some supporting documents that they might request from you are:
- Social Security Number
- Proof of employment history in the past two years, with salary
- Pay slips covering the last 30 days
- Current W-2 forms
- Bank information including check, savings accounts and certificate of deposit
- Other investment info (stocks,bonds) and a list of assets
- Insurance company info including face amount and cash value of insurance, if available
- Liabilities with creditor’s info, monthly payments, balances
- Other sources of income
- Copy of DD Form 214 and Report of Separation for VA Loans
Allied offers assistance for a wide line of loan choices like new home purchases, refinancing, new construction, debt consolidation and customized loans, among others. These loans are available to most types of clients: first time homebuyers, the self-employed, retirees, singles and investors, including those who might have difficulty getting their loans approved.
Potential clients can apply online to utilize the Express Approval program, which allows them to get loan approval in minutes. Buyers can also compute a loan estimate by using online mortgage calculators. This will give them an idea of the price range of the house they can afford, their mortgage payments and closing costs.
While the calculators are a good indication of loan affordability, they are by no means completely accurate. That is why Allied representatives recommend that you talk to them first, to see how much you can afford to pay and how much you are qualified to loan. The advantage of getting a pre-qual is that you have the confidence to make an offer on your dream house, knowing that you have control.
Allied Home Mortgage has more than 700 offices located in 49 States and in Guam and the Virgin Islands. Should you decide to get their services, there are branches available all across the country. With more than $12 billion loans closed, Allied may just have the home mortgage loan that’s tailor-fit for you.
Saturday, 26 July 2008
Financing Choices for Home Mortgage
There are several ways to finance your home. In order to choose the most appropriate home mortgage for your personality and lifestyle, assess the different type of financing for home mortgage:
1) Fixed-rate mortgage
Fixed-rate mortgage are those with interest rates that remain the same until the life of the loan ends. For consumers who are looking for a stable rate that will not experience interest rate fluctuations, this home mortgage financing is a great deal.
A favorite among first time homebuyers and retirees, it can help in organizing and budgeting finances while protecting consumers from increase of interest rates. This kind of financing for home mortgage is best for consumers who plan to stay in their homes for more than 5 to 7 years.
2) Adjustable-rate mortgage (ARM)
Adjustable-rate mortgage, or simply ARM, is a kind of financing for home mortgage wherein the borrower and lender agrees on a certain interest rate that will periodically change. Interest rates will rise or fall, usually with regards to a specific index.
The advantage of an ARM is that the initial interest rate is usually lower than a fixed-rate mortgage. When the interest rate goes down, so will your payments. If you’re planning to keep a home for a short period, this mortgage financing is suitable for you.
3) Balloon Mortgage
A balloon mortgage is a loan that is amortized over longer period compared to the loan term. A balloon mortgage usually has a 15-year term, which is amortized over 30 years to make monthly payments controllable. When the 15-year term ends, you must repay the full principal due of the loan in one large sum, called the “balloon payment”.
When you plan to keep your home for a short time, this may be a practical financing plan. However, make sure to ask when the term ends to prevent possible financial problems.
4) Government loans
Through government lenders such as the Veterans Administration (VA) and the Federal Housing Administration (FHA), government loans often allows consumers with a lower down payment compared to traditional bank loans.
VA loans are perfect for veterans. Government loans are also suitable for consumers buying lower-priced homes with smaller down payments.
5) Convertible ARM (Adjustable-rate mortgage)
Convertible ARM usually starts out as an ordinary ARM, and then gives you an option to lock a fixed rate without refinancing. However, this option will only be offered after a specified time.
Knowing your financing options for home mortgage can save you money by preventing high interest rates and unworkable payment plans. Make sure to ask questions to learn which financing plan best fits your needs.
1) Fixed-rate mortgage
Fixed-rate mortgage are those with interest rates that remain the same until the life of the loan ends. For consumers who are looking for a stable rate that will not experience interest rate fluctuations, this home mortgage financing is a great deal.
A favorite among first time homebuyers and retirees, it can help in organizing and budgeting finances while protecting consumers from increase of interest rates. This kind of financing for home mortgage is best for consumers who plan to stay in their homes for more than 5 to 7 years.
2) Adjustable-rate mortgage (ARM)
Adjustable-rate mortgage, or simply ARM, is a kind of financing for home mortgage wherein the borrower and lender agrees on a certain interest rate that will periodically change. Interest rates will rise or fall, usually with regards to a specific index.
The advantage of an ARM is that the initial interest rate is usually lower than a fixed-rate mortgage. When the interest rate goes down, so will your payments. If you’re planning to keep a home for a short period, this mortgage financing is suitable for you.
3) Balloon Mortgage
A balloon mortgage is a loan that is amortized over longer period compared to the loan term. A balloon mortgage usually has a 15-year term, which is amortized over 30 years to make monthly payments controllable. When the 15-year term ends, you must repay the full principal due of the loan in one large sum, called the “balloon payment”.
When you plan to keep your home for a short time, this may be a practical financing plan. However, make sure to ask when the term ends to prevent possible financial problems.
4) Government loans
Through government lenders such as the Veterans Administration (VA) and the Federal Housing Administration (FHA), government loans often allows consumers with a lower down payment compared to traditional bank loans.
VA loans are perfect for veterans. Government loans are also suitable for consumers buying lower-priced homes with smaller down payments.
5) Convertible ARM (Adjustable-rate mortgage)
Convertible ARM usually starts out as an ordinary ARM, and then gives you an option to lock a fixed rate without refinancing. However, this option will only be offered after a specified time.
Knowing your financing options for home mortgage can save you money by preventing high interest rates and unworkable payment plans. Make sure to ask questions to learn which financing plan best fits your needs.
Friday, 25 July 2008
Consult Professionals for Home Mortgage
Buying your dream home can be quite confusing. You are probably just like the millions of aspiring home buyers who do not have enough know-how to determine whether you are getting a great deal or not, you probably are not sure whether a particular home mortgage offer is right for you. If such is the case, it is best that you consult professionals so that you would know what to look for when buying a house or getting a home mortgage.
What to expect when consulting professionals for home mortgage?
You should expect home buying professionals to do the following for you when you consult them:
1. Check your qualifications to determine the price range that is affordable to you
2. Consider your preferences or wishes to look for homes that would fit your taste and requirements
3. Take you to the actual location of houses that would meet your specifications
4. Give you a good backgrounder on the area where the house is such as the profile of the community, where schools are, the location of hospitals, the rates of property taxes, specific building codes and regulations, the quality of services in the community, etc.
5. Give you the specifics of each property such as the zoning, the size of the house and lot area, the age of the property, the equipment there, the utilities, and the other important information about the property.
6. Be your representative to the seller and present what you can offer to them
7. Be the one to arrange the details of closing
8. Give you advice about mortgage lenders and rates, attorney for the real estate, title companies, and home inspectors.
9. Help you determine if the deals are good or not.
Tips when consulting with professional:
-Even if you already have a house in mind, be sure to as the professional to show you more houses. When buying a home, it is important that you see all options before closing a deal.
- Check for signs that you are being manipulated in a certain way either to veer you away from or to persuade you towards a particular house or community. If such as the case you can look for a second opinion.
- Always read everything carefully before signing. Even if it is the professional’s job to help you get a great deal out of a home or mortgage, you still have to be cautious when doing such a major purchase.
It is always best to consult professionals when you are confused about something. When getting home mortgage, a professional can help you make more sense of such important matters.
What to expect when consulting professionals for home mortgage?
You should expect home buying professionals to do the following for you when you consult them:
1. Check your qualifications to determine the price range that is affordable to you
2. Consider your preferences or wishes to look for homes that would fit your taste and requirements
3. Take you to the actual location of houses that would meet your specifications
4. Give you a good backgrounder on the area where the house is such as the profile of the community, where schools are, the location of hospitals, the rates of property taxes, specific building codes and regulations, the quality of services in the community, etc.
5. Give you the specifics of each property such as the zoning, the size of the house and lot area, the age of the property, the equipment there, the utilities, and the other important information about the property.
6. Be your representative to the seller and present what you can offer to them
7. Be the one to arrange the details of closing
8. Give you advice about mortgage lenders and rates, attorney for the real estate, title companies, and home inspectors.
9. Help you determine if the deals are good or not.
Tips when consulting with professional:
-Even if you already have a house in mind, be sure to as the professional to show you more houses. When buying a home, it is important that you see all options before closing a deal.
- Check for signs that you are being manipulated in a certain way either to veer you away from or to persuade you towards a particular house or community. If such as the case you can look for a second opinion.
- Always read everything carefully before signing. Even if it is the professional’s job to help you get a great deal out of a home or mortgage, you still have to be cautious when doing such a major purchase.
It is always best to consult professionals when you are confused about something. When getting home mortgage, a professional can help you make more sense of such important matters.
Thursday, 24 July 2008
Compare Home Mortgage Rates
One of the most essential factors of a person’s decision to get a home is how the mortgage rates fare for a particular time. Rarely can people afford to buy houses on a cash basis thus getting a home loan has been the norm for several decades already. But there are different types of mortgages and to get the best deals with home loans, it important to compare home mortgage rates.
Mortgage Rates 101
Mortgage rates are simply the payment people pay to lenders, such as banks and other financial institutions, for letting them borrow money. Mortgage rates are affected by numerous factors that generally affect the entire economy. And the varying rates make it possible for people to get the best deals at a particular time if the know how to compare them.
Mortgage rates are generally based on certain decisions of the Federal Reserve in New York. The Federal Reserve studies the current economic trends such as exportation and inflation to see how fast or slow the economy is moving.
If the economy is rather sluggish or inactive, mortgage rates are lowered so that people would be more encouraged to apply for loans and make business transactions. On the other hand, if the economy is moving rather too fast, mortgage rates are raised so that people and businesses would be discouraged to make investments or do transactions.
To get a good deal when buying a house, it is important for people to compare the mortgage rates across different times and different types. One may benefit from looking at the trends of the mortgage rates to see whether rates at a particular time are higher or lower when compared to rates in the past.
Current Home Mortgage Rates
The mortgage rates of this year is somewhat higher when compared to that of the year 2005. As of September 21, 2006, the average mortgage rate for 30-year fixed rate mortgages is 6.40 percent while for the 15-year fixed-rate mortgage it is 6.06 percent. For the 5/1-year adjustable-rate mortgage it is 6.08 percent and for the 1-year adjustable-rate mortgage it is 5.54 percent.
Apart from comparing home mortgage rates according to different periods, it is also important to compare interest rates according to individual lenders. This can easily be done through the internet by going to online mortgage and economic websites such as www.bizrate.com, www.bankrate.com, www.mortgagenews.com, www.mortgageloan.com, among many others.
Home mortgage rates are manageable if proper comparisons are made. To best deals are those made with the best comparisons.
Mortgage Rates 101
Mortgage rates are simply the payment people pay to lenders, such as banks and other financial institutions, for letting them borrow money. Mortgage rates are affected by numerous factors that generally affect the entire economy. And the varying rates make it possible for people to get the best deals at a particular time if the know how to compare them.
Mortgage rates are generally based on certain decisions of the Federal Reserve in New York. The Federal Reserve studies the current economic trends such as exportation and inflation to see how fast or slow the economy is moving.
If the economy is rather sluggish or inactive, mortgage rates are lowered so that people would be more encouraged to apply for loans and make business transactions. On the other hand, if the economy is moving rather too fast, mortgage rates are raised so that people and businesses would be discouraged to make investments or do transactions.
To get a good deal when buying a house, it is important for people to compare the mortgage rates across different times and different types. One may benefit from looking at the trends of the mortgage rates to see whether rates at a particular time are higher or lower when compared to rates in the past.
Current Home Mortgage Rates
The mortgage rates of this year is somewhat higher when compared to that of the year 2005. As of September 21, 2006, the average mortgage rate for 30-year fixed rate mortgages is 6.40 percent while for the 15-year fixed-rate mortgage it is 6.06 percent. For the 5/1-year adjustable-rate mortgage it is 6.08 percent and for the 1-year adjustable-rate mortgage it is 5.54 percent.
Apart from comparing home mortgage rates according to different periods, it is also important to compare interest rates according to individual lenders. This can easily be done through the internet by going to online mortgage and economic websites such as www.bizrate.com, www.bankrate.com, www.mortgagenews.com, www.mortgageloan.com, among many others.
Home mortgage rates are manageable if proper comparisons are made. To best deals are those made with the best comparisons.
Wednesday, 23 July 2008
Choosing The Right Lender
Loans are often difficult to obtain, especially with credit reports and credit ratings made easier this time with the advent of technology. Some banks, financial institutions, and other lenders are very picky when it comes to the person applying for a loan, home mortgages included. You can’t really blame them, since they are just being careful with their money, just like any normal person would.
Lenders look for specific things when deciding whether to grant a loan or not, and this is usually reflected in either the credit rating or credit report, or both. However, being careful or specific when it comes to decisions should not be with the lenders only. The borrowers themselves can search for a specific lender, one that offers them the best deal and where they would be most comfortable with.
Lenders can come at various descriptions – national banks, financial and money lending institutions, up to small money lending businesses. They all are unique when it comes to their lending policies, which is a good thing because borrowers have the freedom to choose. In looking for the best lender for you, here are just three important things to consider:
First, the ability. Yes, lenders, no matter how big or small they might be, should have enough money to be able to lend you what you need, so it’s not really a question of their capability, since they won’t be in that business if they couldn’t lend. This is normally the area where national lenders beat out their local counterparts.
Ability refers to the various loan types that lenders can offer – which translates to diversity in products. Because a national lender has access to capital in any kind of economic environment, they often have more to offer than locals, which have fewer sources that potentially could dry up. As a borrower, you ought to consider the ability of the lender in various sources, including services during the loan (which could translate to less hassle), of which national lenders are advantageous.
Second, rate of interest. As is often the case, local lenders have more of an advantage here as they usually bring their interest rates down in order to entice borrowers to do business with them. It is understandable that they do this so that their national counterparts would not be able to monopolize the business locally. Nationals usually have a fixed rate that would have to go through some channels in order to be lowered, which is not much the case with locals.
Since the rate of interest determines how much you will be paying over the course of the loan, this is an important factor to look out for, particularly for the borrower. One percentage point can make a big difference between the borrower being able to pay the loan or not. The consequences of not paying a loan can be grave, both for the short term and long term of it, so this particular factor should be taken into consideration carefully.
Third, accessibility and relationship. As a borrower, it would be more to your benefit if you establish a good working and professional relationship with your lender. Sometimes, this is a hard task to accomplish, while sometimes it can be easy, and so it’s more of a case-to-case basis. A poor relationship with your borrower can potentially lead into a lot of different problems.
In accessibility, there are some things to look out for. One of these is what types of clients the lender loans money to – since there are some that require a higher credit rating, while some deal only with those who have bad credit. It would be better for you to know beforehand what type of borrower a certain lender does business with before actually applying for the loan.
In relationship, a one-on-one professional relationship with a lender is recommended. This is for your benefit as you will be updated and reminded as to the status of your loan, whether there is a payment soon, any potential problems, and the like. If there is no, one-on-one relationship, there could be problems.
These are just three important things to look for in a lender. There are some more, but these are some of the most important. By following these three, you are well on your way to choosing the proper lender for you.
Lenders look for specific things when deciding whether to grant a loan or not, and this is usually reflected in either the credit rating or credit report, or both. However, being careful or specific when it comes to decisions should not be with the lenders only. The borrowers themselves can search for a specific lender, one that offers them the best deal and where they would be most comfortable with.
Lenders can come at various descriptions – national banks, financial and money lending institutions, up to small money lending businesses. They all are unique when it comes to their lending policies, which is a good thing because borrowers have the freedom to choose. In looking for the best lender for you, here are just three important things to consider:
First, the ability. Yes, lenders, no matter how big or small they might be, should have enough money to be able to lend you what you need, so it’s not really a question of their capability, since they won’t be in that business if they couldn’t lend. This is normally the area where national lenders beat out their local counterparts.
Ability refers to the various loan types that lenders can offer – which translates to diversity in products. Because a national lender has access to capital in any kind of economic environment, they often have more to offer than locals, which have fewer sources that potentially could dry up. As a borrower, you ought to consider the ability of the lender in various sources, including services during the loan (which could translate to less hassle), of which national lenders are advantageous.
Second, rate of interest. As is often the case, local lenders have more of an advantage here as they usually bring their interest rates down in order to entice borrowers to do business with them. It is understandable that they do this so that their national counterparts would not be able to monopolize the business locally. Nationals usually have a fixed rate that would have to go through some channels in order to be lowered, which is not much the case with locals.
Since the rate of interest determines how much you will be paying over the course of the loan, this is an important factor to look out for, particularly for the borrower. One percentage point can make a big difference between the borrower being able to pay the loan or not. The consequences of not paying a loan can be grave, both for the short term and long term of it, so this particular factor should be taken into consideration carefully.
Third, accessibility and relationship. As a borrower, it would be more to your benefit if you establish a good working and professional relationship with your lender. Sometimes, this is a hard task to accomplish, while sometimes it can be easy, and so it’s more of a case-to-case basis. A poor relationship with your borrower can potentially lead into a lot of different problems.
In accessibility, there are some things to look out for. One of these is what types of clients the lender loans money to – since there are some that require a higher credit rating, while some deal only with those who have bad credit. It would be better for you to know beforehand what type of borrower a certain lender does business with before actually applying for the loan.
In relationship, a one-on-one professional relationship with a lender is recommended. This is for your benefit as you will be updated and reminded as to the status of your loan, whether there is a payment soon, any potential problems, and the like. If there is no, one-on-one relationship, there could be problems.
These are just three important things to look for in a lender. There are some more, but these are some of the most important. By following these three, you are well on your way to choosing the proper lender for you.
Tuesday, 22 July 2008
Applying For A Home Mortgage Plan Online
Since the advent of the worldwide technology that is the Internet, human life has never been the same. Internet did not only changed the way we do business, or how we communicate with one another, it has also changed the landscape of our lives and how we do things.
The Internet has provided a way to make things better and easier. So how does the Internet manifest itself in our daily lives? Let’s take a look at a very practical example- applying a home mortgage plan. During the days when the Internet was still being conceived, getting a home mortgage plan will take a very long time.
One has to physically visit application centers and meet different kinds of brokers just to know which deal is the best. Now, with the Internet already established, everything has been cramped down into a world which can be accessed with a click of a mouse.
Another good thing about the Internet is that it has broken down the walls of information asymmetry. Back then, many lenders may resort to bringing interest rates up or creating a temporary market shoot up just to earn more money.
They can do this because the people have no other source of information regarding the going rates of home mortgage plans except the lenders themselves. But now, because of the Internet, this information asymmetry has been broken down into pieces. People can access the Internet and find the best deals for a home mortgage plan. Now, that’s convenience and fairness.
A good number of the lenders who have Internet websites usually have a certain “mortgage calculator” which one can use to be able to have an idea as to what kind of loan he can avail. There are also calculators which can give good estimates as to how much one will be paying for a certain period of time throughout the payment period.
One has to make sure to make a good assessment of the different rates that the different lending institutions are offering. This is something that can be done easily with the Internet, since everything is already uploaded and readily made available.
Once the initial research has been done, one can apply for the home mortgage plan of his choice online. This eliminates the need to physically apply for a home mortgage plan at a center.
Going online is the way to go in applying for a home mortgage plan. Just make sure that you did the necessary preliminary research about the company and the rates that they are giving out.
The Internet has provided a way to make things better and easier. So how does the Internet manifest itself in our daily lives? Let’s take a look at a very practical example- applying a home mortgage plan. During the days when the Internet was still being conceived, getting a home mortgage plan will take a very long time.
One has to physically visit application centers and meet different kinds of brokers just to know which deal is the best. Now, with the Internet already established, everything has been cramped down into a world which can be accessed with a click of a mouse.
Another good thing about the Internet is that it has broken down the walls of information asymmetry. Back then, many lenders may resort to bringing interest rates up or creating a temporary market shoot up just to earn more money.
They can do this because the people have no other source of information regarding the going rates of home mortgage plans except the lenders themselves. But now, because of the Internet, this information asymmetry has been broken down into pieces. People can access the Internet and find the best deals for a home mortgage plan. Now, that’s convenience and fairness.
A good number of the lenders who have Internet websites usually have a certain “mortgage calculator” which one can use to be able to have an idea as to what kind of loan he can avail. There are also calculators which can give good estimates as to how much one will be paying for a certain period of time throughout the payment period.
One has to make sure to make a good assessment of the different rates that the different lending institutions are offering. This is something that can be done easily with the Internet, since everything is already uploaded and readily made available.
Once the initial research has been done, one can apply for the home mortgage plan of his choice online. This eliminates the need to physically apply for a home mortgage plan at a center.
Going online is the way to go in applying for a home mortgage plan. Just make sure that you did the necessary preliminary research about the company and the rates that they are giving out.
Friday, 18 July 2008
Tips On Looking For A Home Loan Mortgage Company
People who need to get a loan will soon realize that banks are not the only ones who can lend money to a customer. There are also home mortgage companies who can also offer the same service to the person.
There are two ways for the individual to find a home mortgage company. The first will be to do this without anyone’s help. The second will be looking for a middleman or a broker who will do all the legwork.
In any case, the applicant will have to shop around for a firm that is offering it at a reasonable rate. Those who have never done this before should be accompanied by a friend because the lessons learned will prevent the individual from making the same mistakes.
The person will notice that home mortgage companies can be found in the phone directory, the newspaper and in the Internet.
The best of these is probably the one found in the web since there is a home calculator that can be used to figure out the amount that has to be paid monthly if the individual chooses to get a loan from this firm.
Regardless where the home mortgage company was found, the person will have to narrow this down perhaps to five from the ten or twelve that have sent a proposal to the home. This will make it easier to review before meeting a representative and asking some hard-hitting questions.
This includes finding out how these firms are compensated. Some of these home mortgage companies will charge a flat fee while others make money by getting a percentage from the amount of the approved loan.
If the payment is reasonable, the individual should also ask for a few names of past customers who have transacted with this firm. These people will be able to tell if the service provided was adequate enough to suit the needs of the customer.
Should there be no problems, the person should also check with the agent if this is the best package to get. The home mortgage company may have something better to offer to the client.
Getting a home mortgage loan is easy. The challenging part is finding a company that is there to help and not just get money from the customer. Those who are successful will just have to fill up the forms and wait a few days to find out if the request has been approved.
There are two ways for the individual to find a home mortgage company. The first will be to do this without anyone’s help. The second will be looking for a middleman or a broker who will do all the legwork.
In any case, the applicant will have to shop around for a firm that is offering it at a reasonable rate. Those who have never done this before should be accompanied by a friend because the lessons learned will prevent the individual from making the same mistakes.
The person will notice that home mortgage companies can be found in the phone directory, the newspaper and in the Internet.
The best of these is probably the one found in the web since there is a home calculator that can be used to figure out the amount that has to be paid monthly if the individual chooses to get a loan from this firm.
Regardless where the home mortgage company was found, the person will have to narrow this down perhaps to five from the ten or twelve that have sent a proposal to the home. This will make it easier to review before meeting a representative and asking some hard-hitting questions.
This includes finding out how these firms are compensated. Some of these home mortgage companies will charge a flat fee while others make money by getting a percentage from the amount of the approved loan.
If the payment is reasonable, the individual should also ask for a few names of past customers who have transacted with this firm. These people will be able to tell if the service provided was adequate enough to suit the needs of the customer.
Should there be no problems, the person should also check with the agent if this is the best package to get. The home mortgage company may have something better to offer to the client.
Getting a home mortgage loan is easy. The challenging part is finding a company that is there to help and not just get money from the customer. Those who are successful will just have to fill up the forms and wait a few days to find out if the request has been approved.
Thursday, 17 July 2008
7 Tips to Getting the Best Home Mortgage Arrangement
Choosing the best home mortgage arrangement is like going to a shop to get a pair of custom-tailored jeans. It might fit the other guy perfectly, but it might not be as good for you. The best home mortgage is one that you’ve decided on after you’ve factored in several considerations.
So before going to a lender to arrange the best home mortgage for you, find out first if you have enough power to negotiate. Here are some tips:
1. Consider your income and disposable cash. If you have a consistent source of money and have sizable cash in bulk to take care of the 20% downpayment, that’s a point for you. If you pay a substantial amount now, you can arrange for lower monthly payments.
2. Take care of your debts. The lender will want to check your credit history to see if you are capable of consistent and responsible payments. A good record can help you a get an arrangement that’s more to your liking.
3. Don’t worry too much about rates. Although timing can factor into a good home mortgage deal, it’s best not to obsess about it too much. Concentrate more on how much you can spend for how long minus your debts.
4. Understand the different kinds of mortgages available. Make sure you know the facts before deciding on one. It might look like the best deal at the start, but consider what happens down the line. It might cost you more money.
5. Consider how long you plan to stay in the house. If it’s 10 years or less, you might be better off taking an ARM (Adjustable Rate Mortgage) than an FRM (Fixed Rate Mortgage). While monthly payments will go up and down with an ARM, the risks are outweighed by the savings.
6. If the lender allows it, try to pay more each year. Adding a month’s worth of payment to your loan that will also cover the principal will result to a shorter period of loan and save you thousands of dollars. If you can arrange for it, instead of paying monthly, pay twice a month.
7. Refinance your mortgage if the interest rates are favorable – meaning, low. Just make sure that it is at least 1% lower. Otherwise, it’s not worth the effort. Refinancing will give you more cash that you can use to pay off the principal. Result? A loan that gets smaller and smaller.
Getting the best home mortgage arrangement will require some research on your part and coupled with consistency and money smarts, you can always find one that’s just right for your needs and wallet.
So before going to a lender to arrange the best home mortgage for you, find out first if you have enough power to negotiate. Here are some tips:
1. Consider your income and disposable cash. If you have a consistent source of money and have sizable cash in bulk to take care of the 20% downpayment, that’s a point for you. If you pay a substantial amount now, you can arrange for lower monthly payments.
2. Take care of your debts. The lender will want to check your credit history to see if you are capable of consistent and responsible payments. A good record can help you a get an arrangement that’s more to your liking.
3. Don’t worry too much about rates. Although timing can factor into a good home mortgage deal, it’s best not to obsess about it too much. Concentrate more on how much you can spend for how long minus your debts.
4. Understand the different kinds of mortgages available. Make sure you know the facts before deciding on one. It might look like the best deal at the start, but consider what happens down the line. It might cost you more money.
5. Consider how long you plan to stay in the house. If it’s 10 years or less, you might be better off taking an ARM (Adjustable Rate Mortgage) than an FRM (Fixed Rate Mortgage). While monthly payments will go up and down with an ARM, the risks are outweighed by the savings.
6. If the lender allows it, try to pay more each year. Adding a month’s worth of payment to your loan that will also cover the principal will result to a shorter period of loan and save you thousands of dollars. If you can arrange for it, instead of paying monthly, pay twice a month.
7. Refinance your mortgage if the interest rates are favorable – meaning, low. Just make sure that it is at least 1% lower. Otherwise, it’s not worth the effort. Refinancing will give you more cash that you can use to pay off the principal. Result? A loan that gets smaller and smaller.
Getting the best home mortgage arrangement will require some research on your part and coupled with consistency and money smarts, you can always find one that’s just right for your needs and wallet.
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