If the time has come in your life that you’re ready to purchase your first home but you don’t know a lot about obtaining a mortgage, there are some basics you’ll want to know. Shopping around to find the lowest interest rate with your credit score and getting an FHA loan if you are a first time buyer with little money to put down is important, but there are other details you have to look into. Know the following when you go to take out a home loan.
Know Your Broker Fees
Are you using a broker to get the mortgage? If so, make sure you understand the fees. Some mortgage brokers will charge you a certain percentage of the mortgage to help you find a lender, and other brokers will charge the mortgage company. Make sure you aren’t paying out of pocket for the broker’s fees.
Know What to Include in the Payment
There are some things you want included in your monthly mortgage payment to be sure you don’t fall behind or get in a financial bind trying to pay them later on. They include the following:
When these things are included in your payment, you don’t have to worry about having insurance coverage because you forgot a payment or trying to pay a large amount of property taxes at the end of the fiscal year.
Choose the Best Terms
Different mortgage brokers will have different terms on their loans. Look for a loan provider that offers the following:
If you think that making payments twice a month would be easier than one large payment and you can afford to make those payments, this can shorten your mortgage.
If you are a first time home buyer and you have never applied for a home loan, make sure your debt to income ratio is low, your credit score is good or great, and that you have enough money to put down on the loan and to close on the property. You can sit down with a mortgage company before you apply for a loan to go over your current financial status, and to see what you could afford to pay them each month for your mortgage. Work out the details to become a responsible homeowners with a mortgage you can afford.
An adjustable-rate mortgage (ARM) – a mortgage loan on which the interest rate you pay varies – may be your ticket to buying a home. While the interest rate you pay may be lower in the beginning than the interest you would pay with a fixed-rate mortgage for the same amount, there are factors to consider when determining whether an ARM is the most practical home loan choice for you.
With an adjustable-rate mortgage and the lower rate of interest it brings in the early years of the loan, your monthly payments may be lower than with a conventional fixed-rate loan. Even after the interest rate rises, you can save thousands of dollars in interest during the years that you pay a lower rate of interest. You will also build equity in the home faster, which can play to your advantage if you sell the home or refinance to a fixed-rate mortgage before the rate adjusts.
Going with an adjustable-rate mortgage can be a step toward upgrading to a bigger, more expensive home later on. The lower payments may help qualify you for a larger loan when you go to buy a new house.
A Move In the Not-to-Distant Future
If you don’t plan on staying in the home for long, an adjustable rate mortgage can offer you lower mortgage payments during the time you spend living there. Adjustable-rate mortgages that schedule frequent rate adjustments usually offer an even lower initial rate – a factor that can lower the payment more. The lower payments may be easier on your budget and worth the risk of rate increases, especially if you know that a job transfer is imminent after only a year or two.
A Rate Cap You Can Afford
An adjustable-rate mortgage offers you a lower interest rate for a predetermined period – generally three, five, seven, or 10 years – after which time the interest rate may increase by a certain amount based on the current market conditions. If market indexes go up, so will your mortgage payment. Depending on the terms of your loan, if the market index amount goes down, your monthly mortgage payment may decrease.
When you take out an adjustable-rate mortgage, the lender or mortgage company sets a cap – the limit on how much the interest rate can increase over the life of the loan – which is specified in your loan contract. Your loan contract should also stipulate by how much the interest rate can increase the first time the rate adjusts as well as how much it can increase during the rate adjustment periods that follow.
Once you reach the highest interest rate allowed, the rate will no longer adjust. By knowing the cap on the loan prior to signing the loan documents, you can determine whether your income will be enough to pay the loan payments at the highest the interest rate can go.
For more about this topic, contact mortgage company in your area.
Interested in opening an account with an online bank? Here are three things to consider when comparing your options:
Money Transfer Fees
An important aspect to consider when choosing between online banks is whether or not you’ll be charged for transferring money to and from different accounts and, if so, how much the charge will be. Almost all online banks have different rates for transferring monies, so download them all and compare them side-by-side. Pay attention to fees for things like direct deposits, bank drafts, wire transfers, and money order deposits that can really add up at the end of the year if you use any of the services often.
Most online banks offer perks for going paperless, which is typically convenient unless you need to submit bank documentation when applying for a loan, filing taxes, or for another official reason. While some banks don’t offer paper documentation at all, many will send you paperwork once a month or periodically upon request, even if for a small fee.
Because of this, it’s a good idea to find out what policies are in place for each potential online bank you consider working with before opening an account. Make a list of potential online banks that are willing to send you reports and paperwork at least once a year and upon request, and then document any corresponding fees so you can compare your options on paper.
You may have to make account adjustments as time goes on and your needs change, and not all banks will allow you to do that without having to pay a fee. You might even find that some banks don’t offer anything more than basic checking or savings accounts. The online bank you decide to work with should give you the ability to do things such as upgrade to business accounts, turn a checking account into a savings account, and add additional accounts to those that are already active. Ask each online bank you consider opening an account with to provide you with an extensive list of their service offerings and any fees that are associated with them so you can gauge how well each service is likely to meet your future needs as your business expands or your home life changes.
By making these considerations when comparing online banking services, you should be able to narrow your options down to one or two that meet your needs now and can expand to fulfill your future demands.
If you are thinking about purchasing a piece of commercial property, you might want to consider using a commercial mortgage broker. These professionals offer valuable advice as well as many other benefits. Some benefits of using a commercial mortgage broker include these three.
1. Compare Rates
There are many different lenders available to loan you money to cover the cost of your commercial property. Unfortunately, not all lenders are the same. One of the key differences is interest rates. If you don’t know much about interest rates, a professional mortgage broker can help you. These professionals can look over all the lenders available as well as their rates. A broker can then tell you which lenders are offering the best deals.
In addition, mortgage brokers often have exclusive relationships with lenders. This might not sound like a big deal, but it can give you access to lenders that you might not have thought to apply with previously or that you didn’t even know existed. By having access to more lenders, you ultimately get a better deal. You also have a higher likelihood of being approved, especially if you have less-than-stellar credit.
2. Process Paperwork
Another way a commercial mortgage broker can help is by processing all of the paperwork for you. There is a lot of paperwork when it comes to buying property, especially if you need to process multiple loan applications. Fortunately, you can save time and frustration by having a mortgage broker do this for you. Just give your information to the broker, and they will submit it to all the lending companies you desire. This might be a simple benefit, but it can save you from hours of frustrating paperwork.
3. Potential Money Savings
Finally, a mortgage broker can potentially help you save a lot of money. Since these professionals already have relationships with lenders, they might be able to score you a good deal. From discounts to special offers, a broker can help you save a lot of money when it comes to your loan. They can also help you save money with application fees, origination fees, and any other additional fees that you might encounter.
As you can see, there are many benefits to working with a commercial mortgage broker. Not only do these professionals help you save time, they can also help you save money. If you are interested in learning more, contact a local mortgage broker such as Riverside Park Capital for more information or to get the process started.
If you are facing a short sale, you may feel like you will have a difficult time getting a mortgage in the future. Although it is not the easiest thing to do, you can get approved for a mortgage after selling a home in a short sale. There are a variety of things to be prepared for when you are ready to move forward, including the following:
There is a Waiting Period
One thing you will need to be prepared for is a waiting period. The amount of time will vary on the type of loan you are applying for, whether or not you were in default on your home before the short sale, and your credit score. Depending on all of these factors, you may have to wait two to seven years until you can get another mortgage. There are some very strict exceptions with FHA loans that will not require a waiting period. This includes making all of your old mortgage payments on time for at least 12 months leading up to the sale. This is quite hard to bypass since the loan was likely in default, which caused the need for the short sale.
Work to Improve Your Credit Score
During the waiting period mandated by your lender, use that time to work on improving your credit score. You will need to have a good credit score to get another mortgage after the short sale waiting period. The short sale will hit your credit score somewhat, but it will not be as bad as a foreclosure. Your mortgage lender will require a specific credit score for a new mortgage, which will vary from bank to bank. To improve your score, make sure you are paying your current bills on time and keep your credit balances low.
Pay Attention To Your Credit Report
As you are working to improve your credit score, you should also be monitoring your credit report. You specifically need to check the reporting of the short sale on your report, as they are often misreported as a foreclosure. This can make a huge difference on your credit score. A foreclosure on your credit report can also prevent you from getting a new mortgage for a much longer time period. You will also need to check your report for any inaccuracies that need to be repaired. Failing to check your credit report can result in a lower credit score, prevent you from obtaining new credit, and even require higher down payments on a new mortgage.
Obtaining a new mortgage after the short sale is going to take some patience and hard work. A short sale can be the beginning of a new start as long as you are responsible with your finances from this point forward.
Speak with a company like Doolin Security Savings Bank for more information.
One of the most time-consuming parts of buying a new home will be securing your financing. With several steps in the process, it’s possible for something to go wrong during any of them, leading to your home loan being denied. While you have control over some factors, others may not be apparent until after the home-buying process has started. Be aware of these three issues so that you are not caught off guard by a sudden home-loan denial.
The Home Inspection Comes Back Bad
It’s typical for a mortgage lender to want to see the results of your home inspection after you have it done. The inspection is what allows you to get a professional look at the guts of the home, and it is typically one of the last chances you have to back out of the deal in case you find something you do not like. The mortgage lender wants to look at the home inspection for the same reason.
Since it’s possible that the lender may get the property back if you default on the loan, they want to loan money for a home that is in good shape. For example, if the inspection finds major foundation damage, then your loan could suddenly be denied.
The Home Is Under-Appraised
Near the end of the home-buying process, your mortgage lender will have an appraisal performed for the home you are buying. This step involves having an independent contractor give their assessment of how much the home is worth. The goal is to see if the home is in the price range of what you ended up paying for it.
Once again, the mortgage lender technically owns the home until your mortgage is paid off. If you overpaid for the home based on the assessment value, the lender may not be comfortable giving you a loan that is more than what the house is worth. You may be required to pay the difference so that the mortgage is only worth the value of the home or your loan could be denied.
You Make Big Purchases Before the Mortgage Is Finalized
Your credit is pulled at the beginning of the mortgage process, but your lender may do it again before they finalize the loan. This is because they want to ensure your debt-to-income ratio is still the same and that you haven’t gotten another loan or haven’t had any blemishes added to your credit report since the process started.
Some homeowners decide to get a head start on their home renovations by opening new lines of credit and making big purchases at local home improvement stores. Even though you have good intentions with this kind of purchase, the lender may view you as a risk and the loan could be denied.
If you want to make sure your loan goes through, be sure to work closely with your mortgage lender throughout the entire process so you can be prepared for any of these situations. Find a lender through a company like Premium Mortgage Corp and ask them about all the factors you should be aware of before you try to take out the loan.
Applying for a loan can be a stressful experience for anyone to go through. It is common for individuals to feel somewhat overwhelmed by the assortment of loan and financing options that may be available, which can make it easier for them to overlook some of their options. For those that own their homes, it may be possible to utilize a home equity loan, but if this is not a type of financing that you have much experience using, you may benefit from having the following couple of questions answered.
How Does Equity Work?
Equity essentially describes your ownership of the house, and this is important for these loans because the home will be used as collateral. In order to determine your equity, the bank will consider any existing lines of credit against the home and the approximate value of the house. If the value of your home is greater than the amount of credit that it secures, you are considered to have positive equity in the house, which is a basic qualification for receiving this type of financing. These loans can be extremely convenient for those that own a house because they may have much lower interest rates due to the fact that the loan is secured with such a valuable asset. However, you should be aware that the amount of the loan that you can receive will be capped at the available equity in the home.
What Factors Are Considered When Taking Out A Home Equity Loan?
In order for a lender to consider you for a home equity loan, it will be necessary to verify that you are the owner of the property. To this end, you will need to submit copies of the deed and title, which will then be verified. This verification process can add several days to the application process time, but it is an essential step for the lender to ensure that its claims to the property being used as collateral are valid. Outside of considering the equity that you have in the house, lenders will also look at your overall financial situation, which will include reviewing your credit history, income and existing debts.
Applying for a home equity loan can be an excellent way of obtaining the money that you need while enjoying lower interest rates. However, if you have never considered using this type of loan, it is important for you to understand how home equity works and the various other factors that the lender will also consider. Being armed with this information will allow you to make the best choice possible when shopping for a loan solution. For more information, contact a company like New Horizons Credit Union.
Many homeowners make the decision at some point in time or another to refinance their home and see if they can get better terms. While they might think they have a solid understanding of the process, it can get quite confusing and overwhelming for many. There are a lot of specifics involved in the whole process. You want to make sure you are getting the best deal and not putting yourself into a worse financial situation than what you needed to. If you aren’t sure where to start, here are four questions to ask the lender when going through the application and approval process.
How quickly can the loan be processed through?
For those who are facing foreclosure, refinancing the loan might be the only way to overcome the default and regain control of your mortgage. If this is the case with your loan, you want to get the mortgage refinanced as quickly as possible to prevent losing your home to foreclosure. Some loan companies will process your loan through within 24-48 hours while others can take weeks. Since each company is different, you want to ask the lender this right from the beginning.
Are there any pre-payment penalties?
While you might only be able to pay the minimum amount due on your mortgage right now, that doesn’t mean your financial situation isn’t going to change in another year or so. In the event that you are able to afford to pay a little extra on your mortgage, you don’t want to be hit with a penalty for doing so.
What is the new percentage rate going to be?
You need to know how much of a difference this new percentage rate is going to make in your overall payments. Dropping your rates by even a percentage point or two can make a big difference in the life of the loan.
Will this extend the amount of time left on the loan?
Make sure you find out if they are going to extend your loan terms as well. If you only have five years left, you probably don’t want to refinance your loan for another 20 years or so. You want to keep the payments down without having to go into debt for longer. Make sure the loan terms are something that you feel comfortable with over the long haul.
By asking the questions above, you won’t end up being hit with a bunch of added costs and fees in the end. Take your time to make sure you have a solid understanding of the process before signing anything. For further assistance, contact local professionals, such as those from Best Rates Mortgage, LLC home refinance.
You may have silverware, but is it made from real silver? The following guide will show you why it may be a good idea to start collecting real silverware and a few tricks to test silver when you are out and about.
Advantages Of Collecting Silverware
The following are just some things to consider:
The first reason you want to start collecting silverware is because it can be worth some cash if you fall on hard times. You can take the piece to your silver specialist, and he or she can tell you if the piece is worth more as an antique or by weight.
Did you know that eating off real silverware can actually be healthy for you and your family? Yes, silver is antibacterial and kills harmful pathogens. There was a time that silver was used by doctors to prevent infections on wounds. So you definitely might be able to prevent all kinds of ailments, like a cold or a stomach flu.
How To Test Silver
You should be aware of a few ways to spot real silverware, especially if you purchase your pieces in places like garage sales or antique shops.
Consider the following:
There are other ways you can test if your silverware is real that a silver specialist can enlighten you about. But, as you can see, there are a few reasons to start your collection. And now you know how to check if it’s silver. Talk to gold and silver buyers for more information.
If you are in a bind and need some money before your next payday, then a payday loan is an excellent option. You might have heard that payday loans are dangerous or unwise decisions. Therefore, you might be a bit apprehensive about taking out such a loan. However, if you use payday loans with the proper amount of planning and care, then they can be a very effective tool. Here are some tips to make sure that you come out on top:
Planning Before All Else
Before absolutely anything else, you need to carefully plan out how you would use a payday loan. It might be tempting to rush out and get the cash now, but getting all your ducks in a row before making any commitments can save you a lot of money.
Figure Out How Much Money You Need
First of all, figure out how much money you need, down to the exact dollar. You should only take out the money that you really need, such as money for food or medical expenses. If you need to pay for something, but could postpone the payment for a few days or weeks (at the expense of some additional interest), then simply waiting to make that payment will likely be a much more financially feasible option.
Check the Laws
Secondly, you should take a look at the relevant laws and regulations in your state. Not all states allow payday loans, which might not be immediately apparent if you are shopping for loans online. Additionally, some states have very strict limits on the size of payday loans and how much interest may be charged. Finally, some states have laws about repayment and how the interest will change over time. In some cases, this can mean the difference between a rapidly increasing interest rate and a more manageable interest rate.
Don’t Pay One Loan with Another (Usually)
You almost never want to take out one loan to pay off another. Therefore, you don’t want to get a payday loan to pay off another loan and you definitely don’t want to get another payday loan to pay off your first payday loan. If that does happen, you can end up with a very high interest rate that grows too fast for you to keep up. The one exception to this situation is when you are getting a debt consolidation loan, which can drastically reduce the overall interest rate that you need to pay.
For more information on payday loans, talk to a professional like EZ Money.