Posts Tagged ‘Home Loans’

Home Equity Loans: Variable or Fixed Interest Rate?

Posted in Real Estate on 03/08/2011 12:16 am by admin
Kate Ross asked:




There are many issues involved in this decision. These issues include the amount of money you can save on interests, the possibility to loose those savings due to changes in market conditions, the possibility to end up paying even more than what you projected, the possibility of being unable to repay the monthly installments and having to refinance your loan.

Home Equity Loans

Home equity loans are secured loans that guarantee the lender repayment of the loan with the remaining equity on your home. Equity is the difference between your home value and the outstanding debt guaranteed by the property (usually a home mortgage). The secured nature of these loans provides the borrower with many benefits.

For starters, with home equity loans you can obtain higher loan amounts than with unsecured loans. Moreover, you can obtain longer repayment programs and thus, lower monthly payments than with unsecured loans. But most importantly, these loans have lower costs because the interest rate charged is significantly lower than the rate charged for unsecured loans. All of this is due to the lower risk that the use of collateral implies for the lender.

Interest Rate

As Explained above, due to the lower risk, home equity loans feature lower rates than almost any other kind of financial product. These loans offer rates lower than credit cards, store cards, unsecured personal loans, pay day loans, cash advance loans, overdrawn agreements, etc. Probably the only loans that feature lower rates are home loans and some subsidized student and business loans.

Not only the interest rate is lower than almost every other financial product, it also comes in two shapes. You can obtain a home equity loan with a fixed interest rate or with a variable (adjustable) interest rate. There are some differences between these two kinds of interest rates than can be very important when it comes to deciding which loan best suits your needs.

Variable or Fixed

A fixed interest rate stays unaltered through the whole life of the loan which in turn implies fixed monthly payments over the whole life of the loan too. This provides a lot of certainty to the borrower that can budget the loan payments with confidence knowing that they will stay the same each month. But, it doesn’t provide such certainty to the lender who can suffer from inflation and loose money to a fixed rate. That’s why fixed rates are always higher than variable rates at any given time.

Variable rates on the other hand, will change every three or six months according to the market conditions. Almost always these changes are moderate and don’t alter monthly payments too much. However, if an increasing tendency subsists on the market, a variable rate can turn a home equity loan into a very onerous deal.

Bernice
 

Home Equity Loans With Bad Credit

Posted in Finance on 02/26/2011 07:00 am by admin
Zeeshan Syed asked:




Getting home equity loans with bad credit is not really a big deal. In reality, this is easier than you might think. This article contains some information that will help learn some of the the hows and whys invovled in getting home equity loan with bad credit.

It is commonly assumed that if you have bad credit, you will not quality for loans. Be it auto loans, personal loans, construction loans or home loans etc. This is not necessarilty true, especially when it comes home equity loans with bad credit. Home equity loans borrows from the equity that you already possess in your home. Most of the creditors or lenders, however you call them, they are actually more than willing to take this risk of providing you a loan even with bad credit. Why? That’s because they know that, if required, they will still be able to take over your home and get their money so for them it’s a pretty safe game isn’t it?

If you are concerned about getting home equity loans with bad credit then here is some information that will help you feel better and be less worried:

Getting approved for home equity loan is easy.

Even if you have a bad credit, qualifying for home equity loans is not that hard. The only thing your bad credit score will do is that it makes sure that you end up paying higher interest rates than you actually would if you had a good credit score. While this may not sound pleasing but it is better than not qualifying for the loan at all.

Creditors want business with you

A number of lenders are out there who will be looking forward working around your credit issues and problems. In fact, the majority of the lenders today, known as sub-prime lenders are out there, waiting for people like you and with issues like you have, to come and get in touch with them. You can find such sub-prime lenders online by doing a little search on different search engines or by browsing through our website. The sub-prime lenders specialize in getting loans for people who have bad credit. If you work with these kind of lenders, you will increase your chances of getting approved quickly and finding a home equity loan program that suits your financial situation and needs.

Sean
 

5 Steps To Finding Home Loans And Bad-Credit-OK-Home Loans

Posted in Finance on 02/19/2011 12:51 pm by admin
Robbie T. James asked:




Home loans are absolutely necessary if you want to buy a home of your own. Only a tiny percentage of the home-buying public buy their house using cash – and that is usually when they are downsizing from a large home to a smaller one. The percentage who buy with 100% cash is even smaller among first-time home buyers.

When you are out to buy a home, it is useful to learn the ropes in terms of what you need to prepare and how to search for the right home mortgage deal. It is especially important to learn how to shop for a home if you have a bad credit score.

If you are looking for home loans, and bad-credit-OK home loans in particular, here are 5 steps to finding the best deal:

1. Finding a deal on a home loan means knowing how and where to look:

The biggest mistake that would-be home buyers make when looking for a deal on a home is to just start calling around to average home mortgage lenders. If you follow this method, you are basically putty in their hands. And, you probably will not end up with the best-possible deal.

2. Start by getting a realistic sense of your credit score:

Start the application process by pulling your credit report with the three major credit bureaus. Make sure you take note of not only your scores, but also any reporting errors that show up on any of the reports. Be sure to get those removed right away, as doing so will have a positive effect on your credit score.

3. If you have a bad credit score, look for a special kind of home loan lender:

Over 95% of lenders specialize in working with people with average, good or excellent credit. If you have a bad credit score, you will benefit greatly from applying solely with bad-credit-OK lenders. They specialize in finding ways to determine your creditworthiness even when your credit score itself is low.

4. Research lenders’ websites and online discussion boards:

Now, put together a list of multiple bad credit home mortgage lenders. Then, do your research by examining their websites. Also, have a look at discussion boards and chat rooms and do searches for their names. Find out if anything good or bad has been said about them recently.

5. Spend the time to get pre-approval with 3-5 home loan lenders:

Finally, create a shortlist of at least 3 lenders and start applying. Be sure to take the time to apply to all of the ones on your candidate list.

Take these 5 steps to finding home loans and bad-credit-OK home loans.

Henry
 

Home Equity Loans – Generate Funds Against Your Home

Posted in Finance on 01/27/2011 11:58 am by admin
Johns Tiel asked:




Equity is the worth of your home after reducing all outstanding expenses and mortgages to be paid. This equity can be placed as security at the time of financial needs to raise funds. In your financial substantial financial requirements home equity loans can be a way out of troubles. You can easily rely on these loans and grab financial help on time.

One can even advance home equity loans for paying off home loans. These loans can be taken up for other purposes as well. You can easily meet diverse financial needs such as:-

Carry home improvement
Buy a car
Pay off outstanding debts
Educational purpose
Go for holidays

Home equity loans are secured in nature. The amount of loan is also calculated by deducting all the outstanding. The loan amount varies from

 

Home Equity Loans – The Things You Should Know

Posted in Finance on 12/15/2010 02:32 am by admin
Joel Gray asked:




If you are planning on buying your dream home, a second or vacation home, or even planning to relocate with a new home purchase, there are definitely a variety of home loan options to check out.

Many banks, financial institutions and private lenders offer home loans; home equity loans, private loans or equity line of credit loans. All good lending programs will consider this, as it helps you to borrow the money, just by using your home on collateral basis.

What is equity?

In financial jargon, it is said to be the difference between the cost of home and how much you owe on the mortgage or combined mortgages, in the case where you have a second mortgage out on the property. In other words the value of your home is the equity you have built into it.

Home Equity Loan Rates

You can find out what current home equity loan rates are, compare them with several different financial institutions and use handy online calculators at BankRate.com: http://bankrate.com . For example, as per the current statistics of the Bank of America, their home equity loan interest rates are as follows:

1. 30 year with a fixed rate is 5.81 percent on the amount taken as loan.

2. 15 year with a fixed rate is 5.51 percent on the amount taken as loan.

3. 30 year with a fixed jumbo is 6.12 percent on the amount taken as loan.

4. 15 year with a fixed jumbo is 5.78 percent on the amount taken as loan.

The monthly payment of a loan is calculated to be around $400 to $1000.

Home Improvement Loan

If you want to fix up your home, then you will want to search for information on a home improvement loan. These types of loans are designed for the people who want to finance their home repairs, renovation of their homes, room additions to their old homes, etc. without going for equity loans.

The benefits for this kind of loans are:

No or limited requirement of collateral.

Interest rates are competitive and are lower than line of credit loans.

Approval of loans is faster

Information of the loan and the transfer of the balance both are can be done through online banking.

Transfer of funds for the payment of loans can be done through online banking access.

Now that you have been shown the ins and outs of getting a home loan, what do you think that next thing you should do is?

So get a loan and get ready to move into your dream home today!

Ron
 

What Are the Home Equity Loan Rules in Texas?

Posted in Real Estate on 10/22/2010 11:57 pm by admin
Jon Spears asked:




The state of Texas has some pretty interesting refinance rules. This is especially true when one wants to pull cash or equity out of their home.

There are two types of mortgage refinances. The first type is called a rate and term refinance. This is simply when someone wants to lower their rate or change the term of their original home loan. For example, someone with a 30 year mortgage at 7% may want to refinance to a 5.25%, 15 year mortgage.

In this instance they are not pulling cash out they are just changing the rate and/or the term of their original loan. During the “refinance boom” (2001-2004) many loan officer and mortgage brokers did dozens and dozens of rate and term refinances because mortgage rates dropped so low.

Most people refinance when their home loans when the market rate is much lower than their current mortgage rate. A good rule of thumb is when you can save about 1% it may make sense to refinance.

The second type of refinance is called a Texas Cash out Refinance. This is when someone wants to pull cash out of their home in addition to lowering or changing the rate or term.

Texas once outlawed the ability to pull cash out of one’s home but now allow this as long as the loan meets these criteria:

80% Texas Cash Out Rule: This rule states one that the loan can not exceed 80% of the home’s appraised value.

For example, if one’s home is worth $100,000 and the current mortgage owed is $50,000 than an equity loan can go up to $80,000 (80% of 100k). Thereby netting the borrower $30,000, less closing costs.

3% rule: This rule state that the total fees can not exceed 3% of the loan’s value. For example, if someone does a 100K equity loan the total fees can not exceed $3000. This means broker, title, survey, appraisal, underwriting, doc/prep (everything!) can’t exceed 3%. This law was intended to protect borrowers but it actually penalizes lower loan amounts making it difficult for those with small loans to take advantage of their equity.

This is a great example of regulation doing the opposite than what it was intended. So for those with loan amounts under 100K, it’s very difficult to do a home equity loan as state law also requires one to purchase a new title policy each time one refinance. Title policies usually run 1% of the loan amount.

However, it’s important to note that the 3% law does not apply for those doing an investment cash out home equity. So it’s actually easier to do a home equity loan on an investment property than on an owner occupied property in Texas!

12 Day rule: This is one of the more unique rules. Whenever you do a home equity loan your loan officer or mortgage broker will ask you to sign a 12 day form. This form states that the loan can’t close until 12 days after the date of the application. I guess the state of Texas wants you to have 12 full days to think about your loan!

3 day rule: Then, after we wait 12 days, we are required to wait 3 days until we fund. Not to mention one is required to look and sign the final HUD (settlement statement) 24 hours before closing.

So to make things simple: The loan can’t close for 12 days. Then, once the HUD is prepared by the title company the borrower(s) must review and sign the HUD 24 hours before we close. Then we can’t fund the loan for 3 full business days.

These rules are why it often takes 30 full days to fund a Texas Cash out loan.

Oh, and by the way. The final rule…one must wait 12 full months between home equity loans. So if you do a Texas cash out one year and the price of your home goes up significantly you must wait a year before refinancing.

Because Texas home equity loans have so many rules it is important your mortgage professional truly know the rules so everything goes smoothly with your refinance.

Susan
 

Equity Home Rates and Loan Negotiation

Posted in Finance on 06/17/2010 08:31 pm by admin
Timmy Deleu asked:




Equity rates is a very difficult subject to most people and because taking a home loan is a very big and often life changing decision, hopefully this article can help you get a better understanding about home equity rates.

Everyone who is thinking about applying for a home equity loan or a mortgage has to consider slight differences of rates in the states they are living in, because the rates vary in the different states. Equity rates are variable with the changes in the economy.

Equity rates are controlled by several aspects, banks have a small impact on the rates while the Federal Government observe the economy inflation statistics to find out if the equity rates need to go up or down. Rates are different in Washington compared to New York, for example in July 2008 the equity rates for a $75K home equity loan FICO where 7.70% for Washington while in New York the rates where 7.55%. These are also vary on the type of loan and of course the length of the home loan.

Don’t get scared off because equity rates vary so much from state to state, to more you learn about it the easier it will become. Like with any subject the beginning is always a little harder.

As you know now, your state is calculated into the rates on home equity loans. Thus, when requesting for an equity loan, it makes perfect sense that you know what the rates are in your current state to get ready to talk terms with the lenders. It really is of no importance if you are an investor when requesting for equity loans because the only thing that matters is finding the best deals. You have to know that almost all lenders are rivals of each other and almost all of them will listen to your negotiation when discussing home loans. You have to keep informed and up to date on current rates and loan offerings if you are to negotiate.

As a final note, when considering home equity loans, you have to stick to the advice offered to avoid any losses. By listening to the advice, you can be prepared for the future, and spare yourself of financial burden.

Think about what you just have been reading about equity rates and I’m sure you will do a great job next time you are negotiating for a home equity loan.

John
 

COMPARE MORTGAGE RATE-REFINANCE-MORTGAGE LOANS-HOME EQUITY LOANS-HOME LOANS VISIT US NOW AND APPLY ONLINE NO FEES GUARANTEED APPROVAL

Posted in Mortgage Refinancing on 05/01/2010 11:42 pm by admin
Boundary5694774644 asked:


COMPARE MORTGAGE RATE-REFINANCE-MORTGAGE LOANS-HOME EQUITY LOANS-HOME LOANS VISIT US NOW AND APPLY ONLINE NO FEES GUARANTEED APPROVAL If you’re looking for a low payment and the security of a rate that won’t change for the life of your mortgage, the 30-year fixed is probably right for you….

Barbara

 

Online Home Equity Loans – Tips On Refinancing A Mortgage Online

Posted in Finance on 04/28/2010 02:46 pm by admin
Tim Gorman asked:




Online home equity loans have opened the flood gates both for the lender and the borrower by eliminating all the intermediaries between them. As a result, the online lender is able to offer much cheaper rates than other traditionally operating lenders who have huge office setups and need to meet fixed overheads. Home equity loans are clean loans which provide you with cash to meet your needs. What you use the cash for is none of the lender’s concern.

Smart Home Equity is the online authority for home equity loans. Smart shopping can yield a very good home equity loan refinancing deal due to the competitive nature of the market and the current, low interest trends. Compare several companies for the best deal.

Refinancing, in this case, might result in raising your monthly payments as well as your interest charges instead of lowering those charges. Refinancing your mortgage with cash out option may result in further discounts. The best information about refinancing a mortgage online should be obtained prior to taking this course of action.

Refinancing you current mortgage has never been easier. If you thought refinancing meant getting buried under mountains of paperwork, think again!

Refinance options with online home equity loans are used to pay a previous loan amount or to cover other unexpected expenses that have come up. A refinanced loan is secured by the same property from the original loan.

Mortgage companies and online lenders are now offering home loans for those who have a bankruptcy on their credit report. Some lenders will even approve your loan as soon as one day after your bankruptcy has been discharged. Mortgage life insurance is private insurance which is purchased to pay off the mortgage on your home in the event of your death. This mortgage insurance is normally due up front at closing.

As property prices have risen quite dramatically over recent years, many homeowners have found themselves sitting on quite a nest egg, giving them the leverage to borrow money against the property if the need arises. Deciding factors abound and can include everything from the value of the houses surrounding yours, to recent propositions in your state.

It’s tempting to check out the burgeoning world of online appraisal sites and calculators to see what your neighbors’ homes are selling for and what, perchance, that new bathroom has done to your home’s value. If you have lived in your home over 12 months, a recent tax assessment, simple drive-by appraisal, or automated value model (avm) can be used to judge the amount of online home equity loans. An avm is a computer generated assessment of your home’s value which is based on recent home sales of comparable houses in your neighborhood.

Melvin
 

What to Know About a Second Mortgage

Posted in Mortgage on 11/12/2009 03:45 pm by admin
Brian Jenkins asked:


Second mortgages and home loans are among the most popular ways for homeowners to get extra cash for important life events. Also known as home equity loans, second mortgages allow you to borrow money “against the equity in your home”. The concept sounds simple enough, but there are things that you should understand about second mortgages before you agree to take one out.

A second mortgage uses your home as collateral.

Ads for second mortgages don’t always make it clear that they are secured loans. That may sound good, but the security isn’t for you – it’s for the bank. When you take out a second mortgage, you are promising the lender that if you can’t make the payments; they can get their money back by selling your house. That is the single most important thing you need to understand about second mortgages. If you default on a second mortgage, you CAN lose your home.

There are good and bad reasons to take out a second mortgage.

Those same ads also often use tempting images to convince you that taking out a second mortgage for fun things is a good idea. Why wait for that cruise when you can put your house on the line to finance it? It’s best to use savings and earnings for fun things and luxuries. A second mortgage is a great way to fund things that will last and give you a return on your investment. Among the best reasons for a second mortgage are



paying for education and training

Education and training can make an enormous difference in your life or the lives of your children. Borrowing money to allow you to change your life for the better is a good investment.

making improvements or repairs to your home

Increasing the value of your home is another excellent reason for taking out a second mortgage on your property. This holds true whether you are making improvements and repairs in order to make your house more marketable, or simply to increase your own enjoyment of it. In either case, you’re using borrowed money to increase your own wealth, one of the best reasons for borrowing.

paying for once in a lifetime events

A wedding can set you back by tens of thousands of dollars. If you can find a second mortgage with payments that fit your monthly budget, taking out a loan against your home can allow you to pay for important lifetime events that you can’t pay for all at once. A better choice for this kind of purpose may be a home equity line of credit, though.



The amount that you can borrow is determined by the amount of equity you have.

The equity you have in your home is the difference between the amount that your home is worth and the amount that you still owe on your mortgage. Here’s a quick example to help you understand.

Suppose you bought a house for $200,000, and put down a down payment of $20,000. The day that your mortgage closes, your home equity is the same as your down payment – $200,000 (home value) – $180,000 (amount owed on mortgage) = $20,000 (equity). Now imagine that five years have passed, and you’ve made your payments faithfully. You’ve paid down $13,000 on your mortgage, and now owe $167,000 on it. Your home’s value has increased to $250,000. Your home equity is now $250,000 (home value) – $167,000 (amount owned on mortgage) = $83,000.

Depending on your credit and the housing market, you may find lenders who are willing to lend you up to 125% of your home equity, but it’s more common for them to lend 60-80% of home equity. Thus, with $83,000 in equity, you may be able to borrow from $49,800 to $103,750.

The interest rate that you’ll be offered is dependent on your credit rating.

As with any other loan, the interest rate on your second mortgage will depend on how good your credit rating is. The better your credit rating, the lower your interest rate will be. You can affect that interest rate by taking the time to clean up your credit before starting to look for a second mortgage.

Shopping around for second mortgage rates is always a good idea.

Don’t just take the first second mortgage that you’re offered, though. Every lender has different ways of factoring in credit ratings and other factors, so it’s definitely to your benefit to shop around and get several loan quotes before making a decision.

It can take several weeks to get a second mortgage approval, but there are ways you can speed up the process.

One of the best things you can do in the interests of speeding up the process of loan approval is to get your own home appraisal before applying for a second mortgage. It’s not foolproof, but many lenders will happily take your expert’s appraisal rather than pay for one of their own.



ELTON
 
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