|Mortgage Refinance Information|
Home Loans and Mortgages ? Watch Out for Dangerous Subprime Loans
With the growing interest in real estate purchasing and speculation, more and more lenders are offering "nontraditional" types of mortgages. These include adjustable rate mortgages (ARM) of every shape and size, the more popular interest-only mortgage, and the very dangerous Option ARM mortgage, which can cause the amount you owe to actually increase as time passes. One rapidly growing sector of the lending market is the so-called "subprime" market, which caters to consumers with poor credit records. The subprime market is a profitable one, as lenders offer loans to consumers whose poor payment history targets them as risky clients. Yes, they are risky clients, but the lenders charge fees and interest rates that are high enough to offset the additional risk. People who are interested in purchasing a home should be careful, however, as many people who should qualify for traditional loans are being pushed into higher-priced subprime loans instead.
The subprime market is quite a lucrative one for lenders, who are able to charge higher fees and interest rates due to the increased risk posed by clients with substandard credit histories. A subprime borrower might pay an interest rate that is several percentage points higher than that of a traditional loan, and the fees may include several additional "points" as administrative fees. A point is one percent of the loan amount. This can add several thousand dollars to the closing costs and tens of thousands of dollars to the cost of the loan over the life of the typical 30-year mortgage.
While it is understood that customers with poor credit histories represent a higher risk to the lender, potential borrowers need to make sure that they aren't classified as "subprime" by their prospective lenders. Studies show that up to 15% of subprime borrowers have credit scores that should have entitled them to loans at lower, more traditional interest rates. What this means for potential borrowers is that you should shop around for the best price on a loan and not accept it as fact when a lender tells you that you don't qualify for the traditional rates. The Federal Trade Commission is investigating several lenders who have increased their profits tremendously by steering borrowers who should have qualified for low-interest loans into higher-interest subprime loans, claiming that they didn't qualify for the lower rate.
How can you avoid such problems? Obtain a copy of your credit report. You can obtain one, with your credit score, from any of the three major credit bureaus ? Experian, Equifax, or Trans Union. As a rule, lenders offer subprime rates to customers who have credit scores below 620. If your score is higher than that, you should be able to qualify for a better interest rate. If not, you can either accept the higher rates from lenders, or take time to improve your score by paying off some bills in a timely manner.
ęCopyright 2005 by Retro Marketing. Charles Essmeier is the owner of Retro Marketing, a firm devoted to informational Websites, including HomeEquityHelp.com, a site devoted to information regarding mortgages and home equity loans.
Why Its Important to Get Pre-Approved
Having a pre-approved mortgage will give you the confidence of knowing exactly what you can spend on a home before you start looking. You will also be protected against interest rate increases while you look for your new home.
How to Find the Lowest Rate Possible!
The quest is on! You're in the market for a new home loan, a refinance, or a consolidation and you absolutely insist on finding the lowest rate possible! So what better place to do your research, then here on the internet, late at night, with your coffee in hand, and your family fast to sleep!
The Truth About Shopping for Mortgage Rates
With so much lender advertising focusing just on rates, you may not be aware of the importance in choosing an experienced, reliable loan professional who can match you with the appropriate loan program. Good loan officers and mortgage brokers may quote today's rate when asked, but they will quickly add they need to know more about you to determine the best program for your individual situation. So rather than asking questions, you should be prepared for, in fact looking for, a loan officer who asks you questions about your credit history, employment, income, down payment, and future plans.
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Faced with the threat of a foreclosure on their home, with all the weight of the mortgage industry and its army of attorneys against them, the average homeowner might feel like David facing Goliath.
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Flexible Mortgages - Offering Relief from the Fixed Mortgage
A pension mortgage may seem lucrative at the first sight. However, they seldom are, if the customers who took pension mortgage are to be believed.
Stated Income Mortgage Loan - Get Approved Online
A stated income or no doc mortgage loan allows individuals with difficult to document income to buy a home. With a documented credit score and reasonably stated income, you can qualify for a mortgage at a slightly higher rate. Online mortgage lenders allow you to easily compare rates on stated income mortgage loans, guaranteeing that you get the best rate.
Understanding UK Bridging Finance
Bridging finance, also referred to as "bridge loans" and "bridging loans", have nothing at all to do with re-constructing the London Bridge. Bridging finance is typically a short-term loan that a business uses to supply cash for a real estate transaction until permanent financing can be arranged. The word "bridge" conveys the fact that the loan is designed to get you over a temporary obstacle.
Jumbo Mortgage Loans - Getting Approved for a Jumbo Mortgage Loan Online
Getting approved for a jumbo mortgage loan online is similar to getting approved for a traditional mortgage when you use a mortgage broker. However, you can expect to find lower interest rates online with better terms.
What is a Repayment Mortgage?
A repayment mortgage is the type of mortgage that most people think about. The idea behind a repayment mortgage is that you pay monthly for a set period and each payment consists of an element of capital and interest.
Real Estate Finance Strategy that Few People Consider
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Refinancing Your Home Mortgage Loan With Bad Credit
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Fees Paid To Brokers By Mortgage Lenders Are Far Too High
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Adjustable vs Fixed Rate Mortgages
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Types of Financing for Your Mortgage
When financing a home purchase, the kind of mortgage you choose determines your monthly payment and the interest rate you get on your loan. There are four main ways of financing the mortgage for your home: 30-year fixed rate, 15-year fixed rate, adjustable rate, and interest only. Each of these mortgage financing options has its pros and cons, your credit union can help you find the right financing for your situation.
Bankers Dont Want You to Know That You Pay for Your No Cost Home Loan Forever
With mortgage rates continuing on a downward trend, the competition in the business is fierce. A day never passes that I don't hear some crazy advertisement about a new loan program that XYZ mortgage company has and no one else offers. One of the oldest programs remains steadfast in both its high profile and its duplicity. This program is the No Cost Home Loan -- the one bankers say is free, but you actually pay for as long as you have the loan.
How to Save Money by Using an Independent Commercial Mortgage Broker
Being a creature of habit can cost you plenty when it comes to applying for a commercial mortgage instead of going through an independent commercial mortgage broker. Let me tell you why.
Secured Loans ? Making the Most of Your Home as Collateral
My visit to the lender was interrupted with my wife demanding a reason for my preference for secured loans. Though I hushed up the matter then, it kept on ringing in my mind hours later. Actually, I didn't know of options other than the secured loans that are available. The various instances of people that have lost their homes to lenders that she used to supplement her contention refused to leave my thoughts.
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