Turbo Equity-Building With A Mortgage Refinance

Refinancing to a shorter term can be a great way to give your equity building efforts a jolt. This is because a shorter term means that your interest is not stretched out over as many years, so you pay less of it. Additionally, even though the payments on the refinance loan may be higher than your original mortgage payments, more of the money goes to the principal. And this is how your home builds equity: by paying down the principal.

What is equity?

Your home builds equity as you pay down the principal, or as your home increases in value. Basically, equity is the difference between how much your home is worth and how much money you owe. For example, if you have a home that is worth $150,000, to figure out the equity, you subtract how much you still owe on your mortgage. If you still owe $90,000, the equity in your home amounts to $60,000.

Boosting your equity

Because so much of your mortgage payments go to interest during the first half of the term of your home loan, equity builds slowly, especially in the first 10 years. If you have an interest-only loan, the equity builds at an even slower rate. If you want to boost the rate at which your home builds equity, you can refinance to a loan with a shorter term. A shorter term means that you will have to make higher payments on the refinanced loan, but it also means that more of the money is going to the principal, helping you pay down the loan faster and building equity at a more rapid rate.

Advantages to refinancing to a shorter term

While the higher payments may be a deterrent to those whose income has remained steady for years, someone who has received an increase, and expects that increase to remain in place, can derive the following benefits from refinancing a mortgage to a shorter term, such as from a 30-year loan to a loan term of 10, 15, or 20 years:

· Lower interest rate for a shorter term means you pay much less in interest

· Shorter term means that the principal goes down faster, quickly building equity

· Less money is paid out in interest on account of fewer years to spread the loan over

· House is paid off faster, freeing the funds sooner than if you had a 30-year mortgage

Of course, before refinancing for any reason, you should make sure that your current mortgage is not subject to prepayment penalties.

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Get Extra Cash By Refinancing

There are many ways of consolidating debt. One of the smartest, though, is to refinance your home mortgage and use the extra money you can get out of your home equity to cancel other debts.

Benefits Of Refinancing

When you refinance your home mortgage you obtain a loan in order to pay off the existing one. This is beneficial especially if the new loan presents either a lower interest rate or a longer repayments schedule. In any case, the applicant will be able to reduce his monthly payments considerably.

By refinancing you will also be able to request a higher amount than the remaining of the outstanding loan and thus obtain extra cash from the equity you have built on your home. These refinance loans are known as Cash Out Refinance Loans and the surplus can be used for many purposes. However, you can raise your credit score and improve your credit history by using it for eliminating debt by paying off a certain amount of the remaining debt, especially high interest debt.

When To Refinance

If you think that refinance might be a good option for you to consolidate debt, you should pay special attention to the interest rate and the loan amount since these two issues will determine whether refinancing your home loan is convenient or not. A lower interest rate with a similar repayment program would lower your installments and thus you would have extra money for repaying your debt sooner. The same thing can be achieved if you can get a higher loan amount.

If you can obtain a lower interest rate by refinancing your mortgage, if you can get a longer repayment schedule and thus lower monthly payments or if you can get all the extra money you need by refinancing for a higher amount, then refinance is the right option for you.

If none of these benefits can be obtained by refinancing your home loan, then you should reconsider refinancing. There are other options like unsecured or secured personal loans and home equity loans and lines of credit that can help you consolidate your debt. You should also check when considering refinancing that the previous home loan does not have a prepayment penalty. Otherwise you might loose all the money you were going to save by refinancing your mortgage.

How To Find The Right Lender

Finding the right lender that will offer you the best deal on your refinance home loan is the key issue when it comes to refinance. The smartest way to go is to search online; there are some online companies that offer access to many lenders dealing with mortgages and refinance mortgage loans where you will be able to obtain free quotes and compare them in order to make a conscious decision. Refrain from contacting realtors to get advice on refinance home loan lenders. The truth is that it is not their area of expertise and they usually have agreements with lenders that will turn your refinance loan more onerous. If you want to get the best deal available you should shop around and compare rates.

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FHA Refinance & VA Refinance Home Loans with the Lowest Rates

American Wide Loans is the nationwide mortgage company that provides the best affordable home loans for all types of customers and credit. If you want a fixed, adjustable rate mortgage, purchase a home or consolidate debt, we have the loan for you.

Time to Refinance?

It doesn't make sense refinancing when you shouldn't. So, check out the mortgage refinance tips as given below and get an idea on when to refinance. Build up equity: It is feasible to go for a refinance when you have built up at least 10% equity in your home(For Fannie Mae owned mortgages, the value is 5%). You can also choose the option if you are below 5%, but the programs are not that diverse. Check if current market rates are low: It's better to follow the 1% Rule which suggests that you can enjoy the benefits of a home refinance if you get an interest rate 1% lower than that on your current loan. The interest savings will help you recoup the costs you've paid for the new loan provided you stay in the property for a certain period of time (break-even period).

Also, you can have a no-cost loan done where the costs are put into the loan. But you can expect comparatively higher rates on such loans. Moreover, these loans are limited when the market is in a credit crunch. Pay off any late payment: There is no such limit on the number of times you can go for home refinance loans. Most lenders prefer that you have no late payment for the past 12 months before you switch over to a new loan. Remove negatives and improve credit score: Pull your credit report from the bureaus and review it for any negative items (late pays, collections etc) and inaccurate detail. Try to dispute negative items and remove them from the report. If required pay off any unpaid debt. Otherwise, you won't get a low rate and may not even qualify. Of course there are lenders in the subprime market who may offer you a bad credit refinance loan, but it's better to avoid them as they'll possible charge higher rates and fees.

Now is the time to do a FHA Refinance!!

FHA home mortgages are not just for first-time home buyers. FHA refinance loans can help people get out of toxic debt situations caused by sub-prime mortgages with interest rates that have spiraled out of control. There are different ways to get into an FHA refinance loan.
The advantages include a low fixed rate mortgage guaranteed by the FHA, predictable FHA mortgage payments and lower interest rates for those who qualify. The FHA also has the cash-out option to refinance and credit cards or major improvements on your home. You may qualify for one of two FHA mortgage plans which offer cash-out plan. FHA refinancing loan offers amounts up to 85% of the appraised value.

FHA refinance mortgages require copies of tax returns to verify money you report to the government. If your job situation has changed since your last tax filing, you may be able to furnish proof of income through your new employer.

Now is the time to do a VA Refinance!!

Important factors to keep in mind about your Cash-out VA Refinance include:A cash-out VA refinancing loan is a VA guaranteed loan which refinances any type of lien or liens against the secured property. The liens to be paid off may be current or delinquent, and from any source. (tax or judgement liens, VA Refinance, FHA, or conventional mortgages). Income, credit and your home value will be used to qualify you for the loan.. Loan proceeds beyond the amount needed to pay off the liens may be taken as cash by the borrower for any purpose acceptable to the lender. Cash-out VA refinance loans can be for up to 100% of the appraised value of the home. The loan must be secured by the first lien on the property.
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Advantages of Home Mortgage Refinance

Some of the most common factors contributing towards this situation are loss of job, income reduction, loss at business, sky rocketing prices of the basic commodities, and increasing rate of interest of debts. It is because of the benefits that mortgage refinance loans are becoming famous. Some of these benefits are as follows.

Reduction in the rate of interest:

Earlier the monthly payment was the prime concern of the debtors but now the situations have changed and some people consider rate of interest to be as relevant as the monthly payment. In fact the rate of interest can make a lot of difference on the total money paid to the lender to get rid of the debt. The current mortgage rate makes the debtors to pay a lot more than thought of. Many people seek to refinance mortgage and take the advantage of the reduced mortgage refinance rates.

Reducing mortgage term:

There are some homeowners who like to get rid of the mortgage faster so the equity can be build up quicker. These homeowners would like to shorten the duration of the mortgage. If your income is good and can afford to pay higher monthly payment it is better to increase the monthly payment and get quick riddance from the mortgage. Hiking of the current monthly payment can generate rich dividends in the future in the form of home equity.

Increase mortgage term:

Some people cannot afford the current mortgage monthly payment and could go to any extent to reduce the monthly payment. Usually in this case the monthly payment is reduced but because of the prolonged duration of repayment, the applicable rate of interest increases.

Taking the benefits of the equity:

In some case it is possible that the debtor may have been paying the mortgage monthly payment for a considerable time. Usually the prices of the property appreciate and when major part of the mortgage has been repaid, the increased home equity can be used to generate cash. The process of generating money this way is also called cash out refinance. The debtor can use this cash to serve or get rid of other debts and financial obligations. The rate of interest for refinance home loan is also lower than that applicable for unsecured debts and loans such as credit card debt.

Conversion of mortgage type:

With reference to rate of interest there are two types of mortgages; one is adjustable rate mortgage (ARM) and the other is fixed rate mortgage (FRM). Adjustable rate mortgage (ARM) features reduced monthly payment in the starting years of the term, but as the term advances and especially when there is economic recession the rate of interest hikes, consequently making you pay more than what you may not have thought even in your dreams. When faced with this situation of adjustable rate mortgage (ARM) wherein you have to payments that are not affordable, you would like to reduce the mortgage monthly payments. You can avail home refinance mortgage and convert adjustable rate mortgage (ARM) to fixed rate mortgage (FRM), consequently stopping the rate of interest from wavering and making it predictable and affordable.
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Refinance Home Loan: The Right And The Wrong Way!

In our currently down economy and hard financial times, refinancing your home loan should be a very important for your plan. Indeed, there are many different reasons why people take advantage of the refinance home loan. Whether your reasons are for mortgage refinances or because you received one of the first time home buyer loans with a high interest rate, this funding option can help you. In addition, you should not forget that home loans for bad credit are also a good option for getting a financial aid.
What is the idea behind this concept?
Do you need a smaller monthly mortgage payment? If you do, this option can help you to achieve it in one of two ways. You can either refinance to get a better rate on the interest or you could extend the length of the payment time period. Either option will allow you to receive a smaller monthly payment.
Fine, which way should you go now?
If you hate paying interest, then an option for you is to shorten the length of your payment contract. If you are able to pay back the money in a shorter period of time, you will not have to pay as much interest. It could cause the monthly payment to increase slightly.
Have you ever thought about trying this idea?
Do you need some extra cash? Borrowing against the equity of your house is another option. Get the money that you need to make house improvements, repairs, consolidate your debt, or pay off bills. Refinancing will allow you to do this. In addition, it is not a bad idea to consider debt consolidations programs and it is now your duty to work on comparing both options for you.
Nevertheless, does it really make any sense to do so?
Yes, I would even strongly encourage you to do it due to the significant advantages of this approach. Indeed, the difference between the home equity loan and the refinance home loan is that the first possibility does not pay off your initial debt. With the second one, the initial mortgage is paid off and that is why it is worth your time to do it.
Does a refinancing house debt with no closing costs sound good to you?
If yes, they are available and nearly everyone is looking for this option. I would recommend for you to search in this direction by calling your bank or a broker as they can offer you the best mortgage refinance help. They can assist you by answering questions and guiding you in the right direction to suit your needs.

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Bad Credit Refinance 101: The Hows and The Whats

If you are like every other home owner or general consumer out there, you need to pay for your expenses somehow. If you have bad credit, you might be limited in your options as to what you can do (or so you thinkkeep reading!). This can be especially annoying to homeowners who want to refinance their mortgages to take advantage of low interest rates but have had a few debt defaults in recent years. The story is always the same: you see these low 5% interest rates advertised on TV and you know that you deserve to refinance your home loan with this low interest rate. However, once you call, you find out that in fact you can refinance your mortgage, but it will cost you a lot more than you think. "What?" you think to yourself "Why does it cost more for me to refinance my mortgage than I thought it would?" The reason is simple: bad credit. Refinancing with bad credit can be difficult. You might have filed for bankruptcy or racked up a whole bunch of debt which you just couldn't pay off. Debt defaults take a long time to get off your credit report (if they ever come off!) and they can affect every lender to whom you owe money.

This is because these days, lenders are very clued in to borrowers credit scores and credit history. All your credit information is stored in a giant database somewhere and if your credit is bad for some reason, it's going to show up on a mortgage refinancing report. And banks probably don't mind seeing a few defaults and bad credit accounts here and there. More fees for them! Your bank might like to see one of their client's earmarked as 'bad credit'they can raise your interest rate and you can't do anything about it.

These days, having bad credit isn't necessarily as bad as it should be. This is because banks are business entities too. Banks borrow money just like people do. In times of relatively low interest rates, banks need to make money by originating loans. And, a lot of new 'subprime' lenders have opened up shop in recent years and are specifically in the business of lending to people with bad credit. They are looking to refinance bad credit accounts like yours and collect massive fees on the backend.

Many people with bad credit history look to take out loans from friends and family. While this may be a fairly good short term solution, it might not be the smartest of long term business moves. What you need to do is refinance your mortgage and lower your payment. The best thing you can do for yourself is to shop around. I'd be willing to bet that some banks will give you a better deal on a mortgage refinancing than you think they would. Find out who's got the best rate to get the best deal on your loan. This might take a little legwork, but it could pay off. Finding that right bank to give you the right deal on your refinancing will be worth the effort.

Mortgage can last a lifetime and that extra 1% can add up to literally thousands of dollars over the years. I have friends that are in their 70s and still paying off their home loans. It'll pay off in the long run to make sure you find the best deal possible. Don't let bad credit stop you from refinancing your home.
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Mortgage Refinance and Loan Modification Tips

It makes no difference how careful people are while spending money, it’s possible to incur debt. As per statistics, for the average family, the monthly mortgage installment turns out to be the biggest payment while redeeming the mortgage refinance loan. In case there's an emergency, or money needs to be borrowed for a settlement of credit card debt, it can disturb the balance between monthly income or cash inflow, and the monthly overheads. As a result, an affordable situation becomes highly unaffordable. So how should one cater to unavoidable circumstances? The basic rule is to communicate with your creditors. The second rule is to keep on paying to the best of one’s ability, to prevent the mortgage refinance loan liabilities from becoming unmanageable. When delinquency occurs, or if the debtor stops paying the monthly payments, it reduces the creditor's sympathy, and creates unhealthy grounds for solving your financial problems. In addition, being delinquent means you attract penalties as well as service charge, which will mount up your net payable debt.

The solution you may desire from your home mortgage refinance provider would be ideally a reduction in your home mortgage refinance loan monthly installments. It would be possible to avail this facility by extending the term of the mortgage loan, or by decreasing the interest rate. The question is why should a creditor modify your loan? The issue is for lenders the foreclosure option is tantamount to using a sledgehammer to crack a nut. If the lender is presented with a foreclose, there are negligible chances of recovering the bulk of the amount lent in the form of refinance home mortgage loan. The second issue is prevailing market conditions present a dull perspective as far as earning is concerned by selling the security offered in the mortgage. So lenders are now thinking about providing some additional chances or options so that the debtor can work out something and redeem, rather than get stuck up with litigations and a potential loss in recovery through judicial proceedings. It turns out o be more cost-effective to recover less from a borrower rather than spend money to recover through legal suits and face the dilemma of selling or not selling the security.

To successful redeem the mortgage; the first step would be to learn what is required to qualify for a loan modification program, and how to meet the prerequisites. The following insights can help you select amongst the many loan modification companies, and help you prepare for your mortgage loan modification programs:

# Presentation

Each creditor has his or her own loan modification guidelines and policies. It’s required to spend the required time and effort to educate yourself about how the mortgage modification process actually works, and find out what your creditor is hoping to see in your application before approving it, and what other options are available to pay the dues.

# Debt ratio

It’s the ratio, which lets you know how much you owe in comparison to your monthly income. Your lender will determine a new target amount, which will ideally be a percentage of the gross monthly income. By availing a longer loan term, or doing a principal forbearance, you can improve upon your chances for a successful mortgage loan modification.

# Disposable income

How much do you spend each month? Loan modification application includes a financial statement, which represents a detailed breakdown of your income and expenses. The applicant has to show the monthly bills and expenses against the monthly income, and prove it’s possible to redeem. This assures the lender that you extra liquidity and are not a risk in being delinquent, if granted the home loan modification.

# Hardship letter

To avail financial hardship benefits, a detailed explanation of your current situation, and why you want to keep your house, and your future plans will help your lender understand how you are facing payment difficulties. Draft your letter to the point, and include enough documentation to avail your refinance mortgage claim by modifying your refinance mortgage loan. A well-written hardship letter plays an important part for a successful application.
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Why you should not refinance today

Have you heard? Home construction is down 27 percent from a year ago. The ripple effects can already be seen slowing the other sectors of the economy. Yes, this is a good thing for inflation, but what about the home owner? Will your home go up in value, decline in value? How will your home equity be affected?

Lets slow down and tackle these questions one at a time. Slower inflation means that the federal reserve won't increase interest rates, letting the potential buyer loan money from the bank without the sum being more expensive in terms of interest to pay back -- meaning that your home will retain it's value. However, too low of an inflation usually means that the economy is not growing, and may signal the fed to lower interest rates, making it cheaper to borrow money, and hence for the buyer to afford more expensive property, and hence for you to sell your home at a higher price.

So now, since the interest rate increase has been halted, at least for now, borrowing money against the equity of your home might not be the best idea. Following the current trend, the interest rates will most likely not increase in the near future, meaning that they are at their highest point right now, meaning that if you wait you might get a better deal.

What else does this slowdown in inflation and pause of interest rate hike mean? It means that things will not get more expensive, things like your everyday expenses. It won't cause a business to pay more in interest rates, the cost otherwise, past down to the consumer in terms of a price increase. Take for example a shipping company. If the cost of borrowing money for this company doubles, this company will have to charge its clients more money, it's clients possibly including food companies, that will increase the price of their produce in stores, electronic companies, that will increase the cost of their cameras, computers, cell phones in stores, and so on. Since this increase in price will not be necessary, with the expenses being stable, everyone will adjust their pricing strategy accordingly and will soon be making money again. But then, again, once there's extra money, there will be inflation, and the interest rates will rise, until it becomes too expensive for companies to borrow. And after a while the rates will fall, and the cycle will begin again.

Figuring that right now we're a the peak of the interest rates, it is probably in your favor to wait before borrowing money on your home equity, as if the interest rates start falling, you will be able to borrow more at a cheaper price, and who's not in favor of that?

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Home Loan Refinance - A Guide To Getting One

Buying a home is one of the most important financial decisions you will ever make. If it has been a while since you took out a mortgage, it is a good idea to make sure you understand everything that is involved in obtaining a home loan refinance.

There are certainly many advantages to a home loan refinance. If you have been in your home for awhile, there is a good chance that you have built up quite a bit of equity in your home. Even if it has not been that long since you purchased your home, if you live in an area where prices have appreciated considerably, you could still have a significant amount of equity in your home to tap into for a home improvement, purchase or to use for debt consolidation.

If you are considering a home loan refinance, it is important to know what you should expect. In some ways, getting a home loan refinance is not much different from getting your first mortgage with the exception that you already have the house! You will want to make sure that you look for the best terms and interest rates. In a similar fashion, the lender will want to make sure you are credit worthy before they approve you for the loan.

One of the first questions the lender may ask is why you are interested in refinancing. Be honest with the lender, because this may help him or her to design a home refinance package that perfectly suits your needs. Even if you are planning to consolidate your debts with your home refinance, be sure to mention this when you apply.

Be prepared for the fact that the lender will run a credit check on both you and any co-borrower in order to determine the level of credit risk you present. This is part of the process of becoming pre-approved in the home buying process. The lender will check your credit score and also check your credit report to determine the number of delinquencies you may have, the number of open accounts you have and the balances on those accounts.

The lender will also be interested in your income and various expenses. This is to ensure that you will be able to actually afford the proposed home loan payment. The underwriting guidelines for every lender are different; however, the general rule of thumb is that a prospective buyer should not have a debt to income ratio that is higher than 36%. Additionally, lenders usually prefer for your total housing expenses not to exceed 28% of your income. Of course, there are some exceptions to this rule. In certain circumstances, lenders will approve loans for buyers who have a debt to income ratio up to 40%. You can usually qualify with a higher debt to income ratio if you are able to make a larger down payment and/or if your credit rating is good enough.

To ensure there are no surprises when you sit down with the lender to discuss your home loan refinance, it is a good idea to check your own credit score in advance and be certain there are no mistakes or discrepancies before you submit your home loan application. If you do find any discrepancies, take the time to have them fixed before you apply for a home loan refinance.
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Compare Mortgage Rates For Refinancing – Choosing The Best Refinance Mortgage Option

When refinancing a mortgage loan, homeowners have several options. There are numerous reasons for refinancing an existing mortgage. The past five years have witnessed low mortgage rates. However, low rates will not remain forever.

Before interest rates begin to climb, homeowners should take advantage of their refinancing option.

Which Home Mortgage Lender to Choose?

Many financial lending institutions offer mortgage refinancing. If hoping to secure a good refi loan, it may be practical to use a refinancing specialist. Mortgage specialists are able to address all your concerns. Moreover, they can offer expert advice on which type of mortgage refinancing to choose.

Homeowners who are satisfied with their existing mortgage lender may consider obtaining a new mortgage with the same lender. However, using the same lender is not required. In fact, even if your mortgage lenders offer a good refi loan rate, it helps to obtain additional quotes and compare the different offers.

What are Your Refi Loan Options?

When refinancing a mortgage loan, homeowners have several loan options. Usually, homeowners refinance to lock in a low fixed rate. This way, mortgage payments remain predictable. Many select adjustable rate mortgages below of their low introductory rate. If homeowners choose a mortgage loan with an adjustable rate (ARM), they should anticipate changing rates. If rates falls, ARM’s pose little threat. However, if rates increase, so does the mortgage payment.

Homeowners should also select an ideal term when refinancing a mortgage loan. For example, will they extend the loan term by refinancing for another 30 years, or choose a shorter term and refinance for 15 years.

Cash-out Refinancing Loan Options

Because the average consumer debt is approximately $8,000, excluding auto loans and student loans, many homeowners choose refinancing as a method of reducing their debts. Cash-out refinancing, which entails borrowing from your home’s equity, is perfect for consolidating debts and financing other large expenses such as home improvements.

Before applying for a refinancing, homeowners should do their research and familiarize themselves with the refi process. For example, refinancing involves paying closing fees. Thus, homeowners ought to have a cash reserve or select a mortgage loan that includes the option of wrapping the closing fees into the principle balance.

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5 Refinance tips

All of us want to save money. It's almost unfeasible looking out for a person who is very happy to spend excess money than they have to, either on their mortgage or personal bills. Home mortgage is the present trend. It's a hard task looking for mortgage refinance.
Many costs are associated with a mortgage transactions including, processing costs, application costs, loan discount points and many more. The borrower can negotiate with the lender charges. Florida refinance relevant points are discussed below.
Always apply for a pre-approval to diverse Florida mortgage refinancing companies to make sure that you are receiving the possible lowest interest rate. Ensure that your credit history
is not taken into account. You would wish to keep your credit expenditures for the mortgage company likely you want to work with. Interact with different companies to conclude. Every time you credit is extracted; it lessens your credit amount just a little. More inquiry will get you a home mortgage with less interest rate. Most refinancing companies do not dig out your credit when you pre-apply for home mortgage loans online.
You can also check the same in refinancing company's websites. Also, they cannot extract your credit if you do not provide them your social security number. Even if they mention in the application to describe your credit history, they are probably not extracting your credit.
o Always make sure that your original mortgage doesn't bear any penalty of pre-payment or any type of early payoff penalty. Sometimes people get into mortgage refinance schemes without knowing that their existing mortgage is having a pre-payment penalty.. Usually, pre-payment penalties attract, with an early penalty payoff, from 6 months - 3 years. Primary payment has to be arranged before refinancing to adhere to pre-payment penalty.
While examining offers from various refinancing companies, in the process of mortgage loan pre-approval, closely assess the offered rate of interests and the closing costs. These two biggest factors will help you in figuring out the best refinancing company for you. If any of these two factors is very high then it could change your profit of refinancing.
The interest rate has to be ascertained before accepting refinance from a company. Ask for a promise in advance from your refinancing company of all the costs relevant with your loan.
The hidden costs are to be ascertained initially otherwise it may jeopardize the total scheme.
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Finding The Best Refinance Mortgage Interest Rates

The World Wide Web stores a magnificent amount of first-class articles where you would be capable to pick any piece of crucial knowledge in relation to any topic on this planet. When allowing for the refinance mortgage, all this information may seem daunting. The sites presented on the World Wide Web have very informative and authoritative articles for this issue that may aid you to develop toward a more informal among the ins and outs of the financial world. All the best information you could need is available for the looking.
You have to be certain of all the available information , and make certain if it is pertinent to you. Advice followed appropriately would render the tasks to a large extent ,easier. Ignoring widespread advice can give you a unfavorable upshot on all your hard work. The period of refinancing is of the most essential concern if you are to add some sort of advantage from refinancing. If you have any fears , get a little human advice , there are a countless many complimentary advice services, they would want your business, although you are not indebted to procure anything from them.
There are a great many grounds to refinance with a second mortgage. One of the best reasons is to unite several mortgages into one. Straightforward and successful solution that outcomes in a solitary monthly commitment. Regularly the interest rates are to a great extent much more gainful on a refinance, just for the reason that first and second mortgages are for a buy and a united refinance loan is for the decrease of monthly outgoings. We all are perceptive that great deals are offered where we are in a position of a to take it or leave it situation. Timing is , however, super imperative.Refinancing when rates or the market is poor is not a great moment in time.
You must be conscientious when choosing the suitable time to get a refinance. From time to time it is the stress from you own personal dilemmas that oblige you to act at a precise time. The main requirements of the ordinary second mortgage refinance is those of the sum cost, the duration of time , and the other various circumstances of the proposal. It is not uncommon for a refinance loan to have a penalty section should you wish to end that loan ahead of time, occasionally known as a tie in .This moreover affects you on a further refinance, if you should choose to do so. Mortgage calculators on the Internet have been free for a while now , and would make it easy for you to balance the loan interval versus to the cost per month.
The key point to remember is that your refinance second mortgage is a long term benefit, and you ought to not rush into a rash choice, if the plan is not to your taste , walk away. There are so many lenders in this particular marketplace and you may be rather choosy. A high-quality lender would present great proposals to the desirable applicants.
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Seize Lower Interest Rates with Mortgage Refinance

Did you buy your home 15 years ago or longer, or during a period of time when interest rates were much higher than they are now? You may see things on television about five and six percent interest rates and think about how lucky the home buyers of today are compared to you because of these great interest rates. Instead of just envying those that are buying homes today, why not get in on the savings? A lot of people have had their home loan for so long that they assume that this is just what they have to work with. The fact of the matter is that you can seize those low interest rates with mortgage refinance. When you refinance you can say so long to the high interest rates that you have been paying for far too long! Refinancing truly can change your life!

Start Saving with Mortgage Refinance

Just because you bought your home during a time of higher interest rates doesn't mean you have to stick with those rates. It doesn't matter if you purchased your home 20 years ago, it's never too late to start saving by getting a better rate. Many of the young people that are buying homes today don't realize that their parents and grandparents were paying 15 to 18 percent for home loans when they were buying, and many of these parents and grandparents don't realize that they don't have to keep paying these rates.

If you bought your home during a period of higher interest rates, mortgage refinance can help you get the rates of today. The way that this works is that you pay off your current loan with a new loan with a better interest rate and then you pay on the new loan. So, if you bought and received a 10% interest rate and you refinanced today, you could drop your interest rate as much as five percent! This would mean a huge savings per month and even over the course of the loan.

What you need to be sure of when you consider mortgage refinance is that you have long enough for the refinance to pay for itself. You will have closing costs for this new loan and you need to make sure that the savings are above and beyond what you will pay. If you are making such a drastic cut in your interest rate, chances are the refinance will pay for itself in a matter of months and it will be worth it. It's just important that you look at this because the idea is to save money.

Mortgage refinance has helped a lot of people to stop paying so much for their home and even get out of debt. When many people refinance they find that they are suddenly much more able to pay off old debts. This allows people to create the financial freedom that they had always hoped for but was very difficult to achieve because of higher mortgage payments due to much higher interest rates. Lowering your interest rate by even two to three percent can mean substantial savings, so consider refinancing if you know that you are paying more for your loan than you would have to pay for it if you bought your house today.

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Mortgage Refinance and Loan Modification Tips

Home Loan Refinance - A Guide To Getting One

Knowing When to Refinance Your Home Loan

There are a lot of people who are intimidated by the thought of refinancing their home. They tend to concentrate on the closing overhead and costs more so while neglecting the benefits that a lower mortgage payment can create for them.

Evaluating a mortgage refinance is actually fairly easy. Basically it involves adding up the overheads and adding up the benefits to see if the benefits will outweigh the overheads. If in the end you are going to benefit from refinancing a home loan, then the outlay are minimally viewed as an investment.

When you conclude that you are willing to look into refinancing your home, you need to find out what present mortgage rates are.

Recall your financial rating as it will play a huge part in what home loan rate you are accepted for, but you can get a overall idea by staying on top of and monitoring what the US typical mortgage conditions are. If you don't know how much your APR is on your home mortgage, find out as quickly as possible. You can check your mortgage papers or call your lender to see what it is. If your note is higher than what the present home loan rates are, you may profit from refinancing your mortgage.

Check with lenders and find out what their closing fees are for a refinance loan. It is usually a few thousand dollars to refinance a home, but often the ultimate expenses are reduced more than a home mortgage purchase transaction, due to less parties involved. Then have the broker decide what your new monthly payment would be if your refinanced that day. Subtract that number from your present monthly payment total. For example, if you currently pay $1,000 a month and you can get your payments lowered to $900 a month with a refinance, you will have a monthly savings of $100. Now let's say that it costs you $1500 to refinance your mortgage. With those numbers it will take you just 15 months to break even and after that you will commence saving money on your new home loan.

After you compute out how long it will take you to commence saving money on your payments, think about how long you will be staying at your residence. If you intend on relocating in the next year or two, refinancing is commonly not the best selection. But, if you expect on staying at least another 5 years in your existing residence, you are expected to be able to profit from a decreased interest mortgage payment when refinancing.

One other thing that you have to think about when deciding when to refinance is how much collateral you have in your home and what your house is currently valued at. If you don't have that much equity in your home or you still owe more on your residence than what your home is currently assessed for, then it's expected that you will not get accepted for a refinance.

Lastly, if you have an adjustable terms on your new home loan (ARM) and you are scared about the fluctuating rates, you definitely want to look into a mortgage refinance while the terms are low, so you can secure a low note with a permanent rate mortgage. Call your broker or other viable mortgage company to see if you will be able to be approved for a home loan.

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Turbo Equity-Building With A Mortgage Refinance

Refinancing to a shorter term can be a great way to give your equity building efforts a jolt. This is because a shorter term means that your interest is not stretched out over as many years, so you pay less of it. Additionally, even though the payments on the refinance loan may be higher than your original mortgage payments, more of the money goes to the principal. And this is how your home builds equity: by paying down the principal.

What is equity?

Your home builds equity as you pay down the principal, or as your home increases in value. Basically, equity is the difference between how much your home is worth and how much money you owe. For example, if you have a home that is worth $150,000, to figure out the equity, you subtract how much you still owe on your mortgage. If you still owe $90,000, the equity in your home amounts to $60,000.

Boosting your equity

Because so much of your mortgage payments go to interest during the first half of the term of your home loan, equity builds slowly, especially in the first 10 years. If you have an interest-only loan, the equity builds at an even slower rate. If you want to boost the rate at which your home builds equity, you can refinance to a loan with a shorter term. A shorter term means that you will have to make higher payments on the refinanced loan, but it also means that more of the money is going to the principal, helping you pay down the loan faster and building equity at a more rapid rate.

Advantages to refinancing to a shorter term

While the higher payments may be a deterrent to those whose income has remained steady for years, someone who has received an increase, and expects that increase to remain in place, can derive the following benefits from refinancing a mortgage to a shorter term, such as from a 30-year loan to a loan term of 10, 15, or 20 years:

· Lower interest rate for a shorter term means you pay much less in interest

· Shorter term means that the principal goes down faster, quickly building equity

· Less money is paid out in interest on account of fewer years to spread the loan over

· House is paid off faster, freeing the funds sooner than if you had a 30-year mortgage

Of course, before refinancing for any reason, you should make sure that your current mortgage is not subject to prepayment penalties.

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How to Save with 100% VA Refinance Loan

The downside is the 100% VA Refinance Loan are similar to standard loans, since the buyer is placing his home up for collateral. First time buyers may want to consider the 100% VA Refinance Loan, since no upfront costs are needed; however, be aware that risks out of the ordinary are involved. The 100% VA Refinance Loan whether equity is involved or not looks at “negative equity.” If you take out the loan, and the value of the property falls below the amount of money borrowed, then you may face additional charges.

Many of these loans come with higher interest rates and at times a lender may require that the borrower agree to additional stipulations, such as the “Mortgage Indemnity Guarantee.” This policy ensures that--one way or another --the lender will get his money. If you fail to agree to the policy, the lender most likely will deny your loan. But in most cases this will never happen wth VA Refinance Loan.

Another great VA Refinance Loan is the 5/1 Arm provided by the VA. It is fixed for 5 years and then will adjust after that period. Since the VA Streamline Refinance is simple and easy to do for veterans, getting a low rate while they are good presents a differnt outlook on what to take first, the fixed or the adjustable.

You may qualify for a VA Home Loan if you fall into one of the following categories:
Active-duty Veterans discharged during WWII or later, without the status of "dishonorable"
Active-duty Veterans with at least 90 consecutive days of service during major conflict
Peacetime Veterans and active-duty personnel with at least 180 days of consecutive service
Enlisted Veterans whose service began after 1980, or officers whose service began after 1981, and who have served at least 2 years.

National Guard and selected Reserve members may also qualify. Check your eligibility with a qualified VA Home Loan Specialist at American Wide Loans if you have any questions.

Finally, when consider loans, make sure you know what you are getting into by reading all available information pertaining to the loan. You will want to understand what all of the different rates and fees will be–and how this will ultimately affect how much you pay monthly and for the long term–by weighing out the pros and cons before signing any permanent agreement.
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Refinance ~ Selecting the Most Ideal Time to Refinance ~ refinancing

Many fiscal issues influence the direction of interest rates.....
.....Refinance, refinancing, mortgage refinancing, home loan refinance, home loan, mortgage brokers....."

Deciding upon the best time to refinance the loan on your home isn't as simple as it seems. Present interest rates aren't the only factor that contribute towards your decision to refinance at a certain point in time. A variety of factors play an important role in whether or not the best time to refinance is now or later.

Economic Environment
The current economic situation can affect your decision to refinance.

Many fiscal issues influence the direction of interest rates. When consumer expenditure levels are high, prices go up in keeping with the laws of demand and supply. During such times, the government boostsinterest rates to reduce the inflation rate. As a rule, when the rates of interest increase, consumers spend less. The resulting drop in demand therefore results in a lowering of prices.

Conversely, in times when the economy is slow, it may be decided to drop interest rates as a means of encouraging consumer spending. For a number of people in many situations, when interest rates fall due to a drop in consumer expenditure, it is a good time to refinance and enjoy the benefits of lower interest rates.

Your Credit Score
Before starting to apply for refinancing funding, pull a copy of your credit score from the three primary credit offices and verify that the information on it is correct. If there are mistakes on your credit reports, particularly those that negatively impact your credit, get them corrected before you apply for financing.

If you know your credit score when you approach potential mortgage lenders, generally they can give you a hint of what type of interest rate you could receive with a refinance mortgage. This can save you a lot of unnecessary time, filling out paperwork if you aren't likely to qualify for a better interest rate than the one on your current mortgage in the first place.

Age of Current Loan
Mortgage lenders disapprove of borrowers who refinance frequently. Usually, you should keep a mortgage loan for at least four years before looking at refinancing.

Bear in mind also that there are closing costs associated with refinancing your mortgage loan. If you haven't had your current loan for a long time, the savings you realize from a small drop in interest rates might not make up for the closing cost expense.

Other Considerations
It may be worth your while to refinance if there has been a significant rise in the market value of your home. If you need ready money for a major purchase, or you are paying a high interest rate on the debt on your credit cards, automobile loans, or some other type of debt, it would be sensible to refinance and take equity from your home to pay off those other expenses.

If your financial situation has changed appreciably in a positive way, since you got your previous mortgage, you may want to consider refinancing. If you have received a large raise or completed credit rehabilitation, you may possibly qualify for a better interest rate now, regardless of the economic environment.

In Conclusion
Ensure thatyou are aware of the full cost of refinancing your home. Refinancing is never worthwhile unless your interest rate is going to drop by 2% or more. Also be sure that you are aware of all of the costs associated with refinancing. Is there a penalty for early settlement of your current mortgage? What are the closing costs? Always shop around to be sure that your lender is offering the best available interest rate and closing cost terms.

"..... If you have received a large raise or completed credit rehabilitation, you may possibly qualify for....."
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Consider Other Foreclosure Options if a Refinance is Unavailable

Some borrowers believe that refinancing is a worthwhile option when they are attempting to prevent foreclosure. This is generally a good idea, if there is equity in your home and if you get a new loan before your credit is damaged from the missed payments. The problem is that many homeowners do not get placed into this category. In general, foreclosure victims have very bad credit and no equity. This means that the majority of homeowners facing foreclosure and wasting important alternative opportunities trying to find a foreclosure loan.

A better solution is a loan modification with your existing lender. This is when the terms of your existing mortgage are altered to produce a lower monthly payment. In reality, it is just like a refinance, but your credit and equity are not a large determining factor, like a refinance. In most cases, the interest rate is reduced and the term of the loan is re-amortized to a 30 year fixed rate. In some cases, the principal loan amount is even reduced to reach the target payment.

In some cases, simply asking your lender for a loan modification will work. But more often than not, you will need to hire a professional bargainer to work on your behalf. When you hire a professional, make sure you do not pay cash up front, or if you do, it is placed into an escrow account until the case is complete. If you do not get results, you should not have to pay for their efforts! Do your research and be careful not to get taken advantage of. New laws are in place to protect borrowers, but criminals will always be there to steal your money if you allow them.

When negotiating with your lender, you will have to complete a loss mitigation package when attempting your loan modification. This will help them ascertain your qualifications. This is where a professional will come in handy, since getting rejected can be irreversible. It is important to submit a package that is complete and can be approved without delay. You may be asked to demonstrate proof of income, as you did when you obtained the original loan. Whether or not things have changed with your income is one of the things that the companies will look at.

If the value of your home has fallen and you are "underwater" in your loan, then you need to decide if keeping your property is even the best decision. As I said earlier, you may qualify for a loan modification with a principal reduction, but selling the property may be your best bet. When you are underwater in your mortgage, a short sale can be an easy way out. A short sale is when the property is sold for less than the total amount and the bank forgives the difference.

Short sales can be tricky anyway, because your lender will not easily agree to this solution and may pursue a deficiency judgment after the home sells. It is very important to get your agreement in writing and to make sure they waive their right to pursue this deficiency judgment at a later day. We never recommend borrowers attempting a short sale on their own. Professional short sale negotiators or real estate agents specializing in this type of sale are available at little or no charge to the borrower, so take advantage and make sure your rights are protected.

Regardless of what you decide, it is important to know that you have options and allowing the property to go to foreclosure is rarely a good idea. Your credit will be ruined for the next decade and buying a new home will be virtually impossible unless you have recuperated. Do not be afraid to ask for help or retain a professional to help you through these rough times.

Article Source: http://www.moneyarticlelibrary.com

Types of VA Refinance Mortgages

VA home mortgages are a benefit available exclusively to those who have served our country; this includes eligible veterans and men and women currently in the military. In addition to their exclusivity, these loans also require no down payment and no mortgage insurance. These two factors save applicants money and leave them with more money for other expenses, such as other bills, home maintenance, or personal necessities. This type of financing has flexible credit requirements, so veterans and service members are more likely to qualify for the loans.

Cash-Out Refinance Loan

If a homeowner has sufficient equity built in his or her home, he or she can use a cash-out refinance to turn the equity into cash to be used however he or she pleases. There are no restrictions on how the cash is used. When refinancing with this loan, a homeowner can take out a loan for a higher amount than his or her current mortgage and receive whatever is left over, after paying off the existing mortgage, in the form of cash. The cash can be used to pay off debt, pay for home repairs or maintenance, or pay for personal expenses.

Homeowners who find themselves in a significant amount of debt may find an encouraging solution in the cash-out option. With this loan, a homeowner can combine some or all of his or her debt into one loan. Doing this could lower his or her monthly costs. Instead of receiving multiple bills and paying different lenders, a homeowner could consolidate many payments into one. Consolidating debt can not only reduce monthly costs, but it can also help simplify the process of paying bills each month.

Rate/Term Refinance Loan

A homeowner who would like to refinance his or her current conventional mortgage can switch from a conventional loan to a VA mortgage using the rate/term refinance option. Refinancing can give the homeowner a lower, fixed interest rate, which would also lower his or her monthly mortgage payment. Refinancing with this type of financing would also give the homeowner access to all of the other great benefits of a VA home mortgage, including no mortgage insurance.

Interest Rate Reduction Refinance Loan (IRRRL)

Another refinancing option is the Interest Rate Reduction Refinance Loan. This is a streamlined option known for its quick processing. It allows a homeowner who already has a VA loan to lower his or her rate, which will in turn lower the loan's monthly mortgage payment. Other terms of the loan can also be change, if desired.

If interest rates decrease after a homeowner has taken out a VA mortgage, the IRRRL can be used to lower his or her rate quickly and easily. Homeowners can also use an IRRRL to switch from an adjustable interest rate to a fixed rate or to change the length of their loans to better suit their needs.

A VA refinance mortgage can be used to procure a lower interest rate, consolidate debt, receive extra cash, and/or to change the terms of a homeowner's original mortgage. With rates low, it is a great time to take advantage of this exclusive benefit.

Article Source: http://www.happy-living-articles.com

Home Loan Refinance Information

If you have a home loan and you think that your property went up in value by ten percent or more since you took out your current loan, you might be a good candidate to refinance. It can save you loads of money on your mortgage payments, improve your terms, or both.

The bank uses your home as collateral for the loan when you take out a home loan. So the more expensive the collateral is, the lower will be the bank's risk that you may default on the loan and walk away from that collateral.

If the collateral grows in value over the years and the bank's risk is reduced, then you are able to qualify for a lower rate. And if your home went up in value by ten percent or more, banks will have to consider your home loan to be a less risky investment and would offer you a lower rate. This is, of course, assuming that you have the same job and income, made all payments on time, and your market interest rates are the same or lower.

Lower interest rate can indeed benefit you in several ways. You can either go for a home loan refinance and lower your monthly payments, or refinance into a shorter loan term, which means you would be making the same monthly payment, but you would pay off your home sooner.

Before having to home loan refinance, you have to consider the cost of doing it and then compare it to your savings. If it would cost you $5,000 to refinance and you have $25 savings per month then it would surely not be worth it because it will take you over 16 years to just break even. But if you have $250 savings per month or 5 years worth of mortgage payments, then it would be good move to refinance your home loan.

And so, before you apply for a home loan, it is important to ask for copies of your credit reports and review them carefully for any errors. If there are errors, you will need to immediately dispute the errors with each credit agency.

Another helpful tip is to do comparison shopping for a mortgage, as it will help you find the best home loan offer. The Internet is a wonderful tool for locating and comparing mortgage offers quickly. You can quickly screen mortgage loans from dozens of lenders with just a little time and effort.

The one too common mistake homeowners make when having to home loan refinance is rushing through and accepting the first promising offer they receive. But if you take the time to learn mortgage terminology, you will be able to understand the home loan offers you consider. Just remember, don't rush your financial decisions and you can save yourself money and future financial problems.

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Refinancing Home Mortgage: Understanding Your Options

Are you considering refinancing your home mortgage? You’re not alone these days. The drop in interest rates and turbulence in the housing market has made refinancing home mortgages a very popular option. There are several reasons for seriously considering a mortgage refinance, and each of them suggests choosing a particular option for doing so.

Refinancing your home mortgage for a lower interest rate. Historically, the most common reason for doing a mortgage refinance is to take advantage of a lower interest rate. Over the past several years, home buyers often took primary mortgages with higher interest rates with the expectation that they could refinance when their circumstances changed enough to qualify them for a lower interest rate. This is an especially attractive option for young professionals at the start of their careers who expect to be earning better wages a few years down the line.

Refinancing your mortgage can decrease your monthly payment. There are two ways to use a mortgage refinance to lower your monthly mortgage payment. Obviously, refinancing into a lower interest mortgage will reduce your monthly payments if all other terms remain the same. You can also refinance into a longer term loan. This option reduces your monthly payment by spreading out your remaining payments over more months, making each installment lower. Be aware, though, that refinancing into a longer mortgage may reduce your monthly payment, but it will almost inevitably increase the amount of interest that you pay overall. In fact, moving from a 20 year mortgage to a 30 year mortgage, even at a lower rate, can potentially increase the real cost of your new home by tens of thousands of dollars.

Refinance from an adjustable rate mortgage to a fixed rate mortgage. Many borrowers opt for an adjustable rate mortgage in order to qualify for lower interest rates for the first two to five years of their loan. Historically, this has allowed new home buyers time to build equity in their homes along with building their credit to qualify for lower interest rates on fixed rate mortgages.

Refinancing from an adjustable rate mortgage to a fixed rate mortgage offers one major advantage – your mortgage rate will not change over the entire life of the loan. That means that your mortgage payment will be immune to fluctuations in interest rates, making it easier to budget and manage your money. If interest rates rise, you’ll be saving money. If they fall in the future, you may be in a position to refinance into a lower interest rate.

Refinance your mortgage with a cash-out loan. A cash-out refinance gives you access to cash that’s tied up in the equity of your home. If the current value of your home is more than the amount that you still owe on your mortgage, a cash-out refinance can put cash in your hands when you need it. Essentially, you take out a mortgage for any amount greater than your mortgage and up to the full value of your home. After you pay off your current mortgage and any fees associated with the refinancing, the additional cash is yours to use as you need it. In many cases, lenders are willing to loan as much as 125% of the equity you have in your home.

Do keep in mind, though, that the “extra” cash is not a gift. It’s a loan on which you’ll be paying interest, and can potentially increase the length of time it will take you to pay off your home and own it free and clear.

Refinance your mortgage to finish paying off your home sooner. While most people think of refinancing their mortgage as a way to decrease their monthly mortgage payments or lower their interest rates, there is another good reason to refinance – to pay off your mortgage sooner. If your circumstances have changed since your original mortgage and you can afford to pay a higher monthly payment, it makes good financial sense to refinance into a shorter term mortgage, even if you have to take a higher interest rate to do it. The difference in overall cost between a thirty year fixed rate mortgage and a fifteen or twenty year fixed rate mortgage is substantial. If you’re planning to stay in your home for the long term, and can afford higher payments, you could be out of debt ten to fifteen years sooner and save tens of thousands of dollars in interest payments.

Take advantage of the Making Home Affordable Program for refinancing your mortgage.

Thanks to the economic downturn and the collapse of home prices, many homeowners are ‘underwater’ on their mortgages – owing more on their mortgage than their home is currently worth on the market. That makes it impossible for them to refinance their mortgages, even if they have good credit. The federal government has established the Making Home Affordable program to assist those who are in this situation by making special incentives available to lenders who refinance those loans.
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FHA Streamline Refinance Saves Money!

An FHA streamline refinance has multiple benefits for homeowners who want to refinance their current FHA mortgages. One of these benefits includes a lower interest rate. A lower interest rate, along with the other benefits of the loan, will save homeowners money that they can use to pay off other debt or to pay for other expenses.

What is an FHA Streamline Refinance?

The purpose of this type of financing is to lower a homeowner's interest rate on his or her loan and, in turn, lower his or her monthly mortgage payment. This loan allows homeowners to refinance their existing home loans with a more efficient process. With this type of financing, there is less documentation and less underwriting, which can make the loan process significantly quicker. There is also an option to refinance with this type of loan without having to get an appraisal, as long as certain requirements are met. If no appraisal is done, the new loan amount cannot be more than the original loan that was taken out by the homeowner.

Requirements of this Loan

A homeowner must already have an FHA mortgage that is current in order to qualify for this type of financing. This means there can be no delinquent payments on the mortgage. With this particular type of financing, no additional cash can be taken out. If a homeowner would like to receive cash back when refinancing his or her loan, there is a cash-out refinance option available, but this option is not a streamline loan.

There are closing costs associated with this loan, but a homeowner has options that allow him or her to avoid paying them out of pocket. In some instances, homeowners can choose to obtain a higher rate in exchange for lower closing costs. On the other hand, if there is sufficient equity in the home, a homeowner can decide to have the closing costs included in the new loan amount. An appraisal will determine if there is an adequate amount of home equity for the homeowner to choose this option.

Benefits of this Type of Financing

Refinancing with this loan can lower a homeowner's rate and monthly payment and save him or her money over time. This type of loan has more efficient processing when compared with other home loans. It can have fewer requirements, and, in some cases, the closing costs can be financed so homeowners will have less money to pay upfront. This saves them more money for their other expenses.

There are not strict eligibility requirements for this type of financing. Homeowners do not need a high credit score or income to qualify for this loan, but most lenders will require that a borrower have a credit score of at least 620. For homeowners who would like more refinancing options besides the streamline refinance, the FHA also has refinance loans that allow a homeowner to consolidate debt, change the terms of his or her loan or receive cash back.

This type of financing is a great option for current homeowners who want a quick way to reduce their current interest rates and lower their monthly payments without having to meet all of the standard requirements for a home refinance loan.

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The Bank's Dirty Little Secrets They Won't Tell You And Don't Want You To Know

What the bank won't tell you when you renew or refinance your home is that they are giving you a higher rate of interest than new customers.

Most people believe that if you are loyal to one bank, pay your mortgage on time, and keep all your other business such as investments and insurance with that bank that you will reap the benefits of lower rates but in reality the exact opposite is true. The bank knows that most customers don't have any intention of shopping around because they assume they are being treated fair. They also know that a customer will experience anxiety when trying to negotiate and as a result won't try, so instead of providing their good customers with their best rates they reserve those rates to attract new customers.

The bank trains its staff to offer as good a rate as necessary to get your business. All mortgage specialists working for the banks are on a bonus program. By not offering the best rates whenever possible the bank makes more money and is willing to share some of this with their mortgage specialists. When you think these people are doing you a favour in actuality they are costing you thousands of dollars. I think this policy is outrageous because the bank is profiting on your trust.

The good news is that there is a very simple solution. Use a mortgage broker to look out for your financial interests.

When you buy a house you have a trained professional dealing with the sellers and their agents to look out for your interests, you also have a lawyer to look out for your legal interests and it also makes sense to use a mortgage broker to protect your financial interests. A mortgage broker deals with all the top lenders and also some specialized situations. With the right broker you will deal with a person that is working for you and not the lending institution. He will arrange the right mortgage for you and your situation and the best part is that in most cases you will get the best rates at no cost to you.

If you are self employed and need a mortgage, a broker will have lenders that specialize in these products. Lenders know that as a self employed person you legally write down your income to pay the least amount of tax and they are willing to accept declared income.

If you have little or no down payment there will be lenders to qualify you for a house or
If you are new to the country he will have lenders that specialize in this scenario and will be able to get you a mortgage.
If you have credit issues he will have lenders for this situation or if you just need to refinance or renew your mortgage this specialist will meet with you and help you determine which option will save you the most money.

The best part is that all these services are available at no cost because a mortgage broker receives a commission from the lending institution that you sign your mortgage with.
When you deal with a mortgage broker you have someone who specializes in this field and someone who is in your corner who has your best interests at heart. When you are making such an important decision that can make a difference of thousands of dollars it is a relief to know that you knew all your options and were able to choose the one that was best for you.

Article Source: http://finance-cp.com

Five Reasons to Consider a Remortgage

Gone are the days when we took out a mortgage and stuck with it for life, until the debt had been completely repaid. The remortgage market is big business these days, and taking a look at the options available could considerably improve your finances. What are some of the reasons for considering switching your mortgage?

1) Get a better deal: Are you sure that your current mortgage is the best one you can get? The market is very competitive and mortgage providers are desperate to attract new business, usually by offering special deals to people who switch their mortgage over to them. As well as aiming for a lower interest rate and lower monthly repayments, remortgaging could net you other benefits such as cash back, free home insurance, or other valuable extras depending on the deal.

2) Lock in a low rate: Interest rates are at historic lows, even taking into account the recent rise. Many experts are predicting that rates will begin to rise again over the next few months and years, leading to more expensive mortgages. By replacing your variable rate mortgage with one that has a rate fixed for a few years, you can protect yourself against future rises in the interest rate.

3) Release equity: As house prices have gone through the roof over the last decade or so, many people find that they are sitting on a large amount of equity in their home - the difference between how much their house is worth and what the outstanding mortgage balance is. Taking out a remortgage that will pay off your current mortgage and also give you some extra funds is an effective way of unlocking some of this stored wealth, providing you with the funds you need for home improvements, a holiday or wedding, or any other large expense. It is often cheaper to raise the money with a remortgage than by, for example, taking out a personal loan.

4) Debt consolidation: It's well known that the public as a whole are in debt to a level never seen before, with easy access to relatively cheap credit providing the temptation to 'live now and pay later'. Nonetheless, the money has to be repaid at some time, and credit cards and the like aren't an ideal way of obtaining long term credit. Taking out a remortgage large enough to cover both your mortgage and your other debts will simplify your finances, leaving you with a single monthly repayment to make, which will usually be for a smaller amount than your total repayments at the moment.

5) Change your mortgage type: People's circumstances change over time, and what might have been an ideal mortgage a few years ago when you took it out might not be the most suitable for your current needs. Maybe you want to switch from an interest-only mortgage to a capital repayment one, or you might want to take advantage of some of the more recent features of mortgages such as flexible payments or offsetting - a remortgage can give you the chance to get a deal more in tune with your current circumstances.

Bearing all the above in mind, a remortgage might seem like an ideal way forward for restructuring your finances. It's important to remember though that the decision to remortgage is not to be taken lightly, as you could potentially be putting your home at risk if you get it wrong, and so it's essential to seek the advice of a properly qualified mortgage advisor if you are in any doubt.

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The Benefits of Refinancing a Mortgage

How can refinancing a mortgage benefit you? The answer to that question depends a great deal on your individual circumstances, but there are a number of different ways that a mortgage refinance can help you achieve your financial goals or otherwise make your life better. Whether you choose to refinance into a longer term or trade in your outgrown adjustable rate mortgage for a fixed rate mortgage, there are benefits to be gained from refinancing a mortgage.

Refinancing your mortgage can reduce your monthly payments.

One reason that people refinance their mortgages is to reduce the amount of money they pay out each month as a mortgage payment. There are several different ways to accomplish this. The one that you choose will depend upon your financial circumstances.

• Refinance into a lower interest rate. If your credit score has improved since you took out your current mortgage, you may qualify for a lower interest rate on a new mortgage. Your credit score or credit rating is fluid, and will change over time as you build up a history of making on time payments on various loans and credit accounts. Thus, if you’ve made a couple of years of payments on your mortgage and credit cards without defaulting on any loans or making late payments, your credit history could conceivably have improved enough to earn you a lower interest rate if you choose to refinance. Since you’ll have a lower interest rate, you’ll have a lower total mortgage amount, and likely a lower mortgage repayment.

• Refinance to lengthen the amount of time you have to repay your loan.Another way to reduce your monthly payment is to refinance your mortgage into one with a longer term. Most financial advisors would recommend against refinancing for a longer term, because it will nearly always increase the amount you’ll pay for your mortgage overall. If you’re in a situation where you need to reduce your monthly payment, though, refinancing to a longer term is preferable to defaulting on your mortgage.

For instance, if you refinance a thirty year mortgage for $150,000 at 5.04% to a forty year mortgage with the same amount and terms, you’ll reduce your monthly payment from $807 to $727 a month. Depending on the amount that you’ve already paid on your current mortgage, your monthly savings could be even greater. On the other hand, because you’re paying on the mortgage for ten years longer, you’ll end up paying considerably more in the long run. In the example given above, you’ll pay a total of $58,420 more in interest over the life of your loan.

Refinancing can reduce the amount of interest that you’ll pay on your mortgage.

Another reason that people opt to refinance their current mortgage is to reduce the amount of money that they pay in interest to the bank or lender. Naturally, you’ll pay less in interest if you can refinance to a lower mortgage rate, but it’s important to consider what it will cost you to refinance the loan. Closing costs and prepayment penalties on your original mortgage can reduce the savings you’ll see by reducing the interest rate you pay. In general, if you can get a mortgage with an interest rate at least one percentage point lower than you are currently paying – and if you’ll be staying in your current home for four or more years longer, you’ll save enough in interest payments to make it worthwhile to refinance.

However, you may also save money by refinancing to a shorter term, even at the same or a higher interest rate. While refinancing your mortgage for a shorter term will probably increase your monthly payment, it can save you a considerable amount of money for the overall cost of your home loan. If you refinance a 30 year mortgage for $150,000 at 5.04% to a twenty year mortgage for the same amount and same interest rate, your savings – outside any closing costs and pre-payment penalties – will be a whopping $52,200. If you can afford to pay the extra amount on your mortgage each month, you’ll probably benefit in the long run.

These examples are only rough estimates of the amount of savings you can realize by refinancing your current mortgage. Refinancing your mortgage isn’t for everyone, and you should look carefully at your circumstances before making the decision to trade in your mortgage for a new one with a lower monthly payment or a shorter or longer term of payment. If you do decide that refinancing your mortgage makes sense for you, be sure to shop around for the best rates available. Every lender is different, and you could save considerably just by getting quotes from several lenders and choosing the best one for you.
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Refinancing Home Mortgage: Understanding Your Options

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Refinance Now To Save Thousands on Your Mortgage

Death and taxes - two things you know are for certain in life. However, there is a third that is almost nearly as certain as those two - fluctuating interest rates. With a home mortgage being one of the largest purchases you will ever make, even the slightest decrease in the rate that you pay on the loan can save you thousands. For many of you, now may be the perfect time to refinance your mortgage and put thousands of dollars back into your pocket.

In the past decade the mortgage industry has become a highly competitive field. With recent events in both the mortgage industry and the U.S. economy, rates are changing rapidly. For many of us, we may be paying for more than we should on our mortgage and not even realize it. Indeed, many people never think about their mortgage over their years - a mistake that can cost them serious money. They just sign the papers and pay the monthly payment. However, during the 20-40 years that mortgage runs, interest rates will rise and fall - and the smart consumer knows to take advantage of these fluctuations.

Maybe you are thinking that it is too much hassle to refinance and not worth the time. Just think about this: If you took out your 30-year mortgage 5 years ago at 6.1%, that same mortgage may now be available to you for 5.45%. Although it may seem like only a small amount, 0.65% to be exact, that 0.65% adds up to over $3,400 you can put back into your pocket over the life of the loan. Ask yourself this; is 4-8 hours of your time worth $3,400? For most of us the answer is a resounding yes! If your average monthly payment is $600, this means you will chop an entire half-year off your repayment!

Another reason you may want to refinance is to get your mortgage handled by a different company than you are with now. Sometimes, for various reasons, our current mortgage lender doesn't meet our needs or provides below par customer service. You may wish to move your business to a local lender, or one that offers more options for repayment.

Some people find themselves refinancing to get rid of adjustable rate mortgages and other balloon payments. Thanks to the competitive market out there for mortgage notes, the average homeowner with decent credit will have no problem finding a mortgager who will refinance them at terms they can both agree on.

So as you sit down to pay your monthly mortgage bill as yourself these questions:

" Am I getting the best interest rate available for someone with my credit?

" Am I happy with the level of service my current mortgage holder provides?

" Do I have a mortgage payment that will go up in later years that I can refinance now to lock in a lower payment?

Each of these questions is good reasons to evaluate your current mortgage and consider refinancing. In the end, you may not only save a lot of money on your total house payments, but you may also end up getting better service with lower payments - something we can all enjoy!

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