Home Equity Loans – second mortgage

Adam Hefner asked:




If you don’t have a great credit score you shouldn’t give up on the home ownership dream. There are poor credit home loans for you. You just have to know where to look and which programs might be applicable to your situation. The benefits of home ownership justify the research necessary for you to find the right loan.

Most normal private loans have minimum credit score standards. Some are firm with this and will not budge. Others might make exceptions assuming you come up with a higher down payment. It might also be possible to get a cosigner. It is worth the time to inquire about such possibilities if they are applicable to you.

The current real estate market condition also presents other opportunities for creative buyers with bad credit. Taking over a mortgage could be a possibility. It might otherwise be possible to sign a long term lease with an option to buy the property at current market value.

Some owners might even allow rent payments to be applied towards the purchase price should the option be executed. This is a great way for those with bad credit to get into an equity building situation. It also avoids any down payment.

If those paths prove fruitless, then all is not lost. There are loans backed by what is called the Federal Housing Administration. These are commonly referred to as FHA loans. FHA loans do not require minimum credit requirements. Aside from not having minimum credit score requirements, FHA loans also provide other advantages which are usually needed by those with less than stellar credit.

Credit isn’t an issue with an FHA loan unless you have filed for bankruptcy within the previous two year period or have had a foreclosure within the previous 3 year period. FHA loans also do not require the traditional 20% down payment. Most often, they only require a 3% down payment making it much easier for those with bad credit to close on their property.

Another advantage is the waiving of the stipulation that closing costs be borne by the borrower due in full at closing. These can often add up to thousands of dollars. With an FHA loan, the lender pays half of these fees, and the other half is tacked onto the principal of the mortgage.

Do not make the assumption that there are no poor credit home loans available for you. There very well may be. You just have to know where to look. The above ideas are just a few out of many. Do your research and you might discover that home ownership is within your reach.

Curtis

Mary Wise asked:




You may have taken out a home equity line of credit to help you cover the expenses of life – anything from adding an additional bedroom to your home to putting your twins through four years of grad school. But if you suddenly received a letter stating that your home equity line of credit has been frozen, you are probably wondering where to turn next.

Most home equity credit lines bear the stipulation that the creditor can freeze your line under situations that are outlined in Regulation Z, under the Federal Reserve Board’s codes. For many home equity lenders, this is interpreted as being able to shut you off from your available line of home equity credit if market conditions in your area make the value of your home decline, or if your income has been reduced to where they feel you are at great risk of defaulting on payment to them for credit already extended.

Get Around Regulation Z

You have several options. You can argue with your lender to attempt to persuade them to reinstate your credit line. You can back up your argument by pointing out your good payment history (if payments have come due under your agreement); or by listing homes in the area that have recently sold at or above market value. Discussing the freeze with customer service for your lender has a small, but not impossible, chance of getting your credit line unfrozen.

Your best option is to vote with your feet by choosing a different lender. True, you may have to pay additional closing costs over what you have already paid for your current, now-useless credit line, but you can switch lenders.

In fact, there are online lenders who deal very effectively with taking on borrowers who have had a frozen credit line. With less strict stipulations regarding market values, these lenders can refinance your current line while making the additional credit you need available to you.

Apply Online For the Credit Line You Need

To apply, you will need to gather all the information pertinent to your current home equity line of credit. Visit the lender’s secure online site where you can begin the application process. You will be asked to verify certain things – like your income, employment, etc. Most of the needed documentation can be either emailed or faxed to the new lender.

As with a your original home equity line of credit, your new credit line will allow you to use your home equity line of credit for up to twenty five years. At the end of that period, you will have the opportunity to renew your credit line, or begin repayment. Oftentimes, you can pay during the time that your home equity line of credit is open; this greatly reduces the amount that you will owe at the end of the term.

If you have had your home equity credit line frozen, voting with your feet by choosing a new lender can not only make a bold statement to the lender that you have other options, but can also save you money by the possibility of getting better rates online.

Franklin