MortgageMade.com

 Happy Friday all!  So, how do you get approved for a new home mortgage in this tough climate?  Here are three great starting points.

If you’re looking for a new home, there is good and bad news. The good news is that the number of available properties is quite plentiful. The bad news is that banks are becoming more reluctant to give out a new home mortgage. Here are some strategies to help you get approved.

Strategy #1: Clean Up Credit Reports

Hopefully, you have a little time before you start planning your move because before you begin applying for a new home mortgage, you need to make sure your credit report is in great shape. You don’t just want good credit; you want the best credit you can get. There are two reasons for this.

First, your lender is going to base a lot of his or her new home mortgage decision on your credit score which is based on calculations determined based on the information in the report. If you even want to be considered for a new home mortgage, your score needs to be above 600 in today’s market. You might be able to squeak by with something in the 500 range but only if you have a sizable down payment and proof that you earn plenty to cover the mortgage.

Second, your credit score is going to determine your interest rate. The highest scores pay the lowest rates. If you have a credit score of around 750, you’ll pay a lot less than someone with a score of 650.

Strategy #2: Be Ready to Prove Your Income

Even though you may be the most honest person in the world, that doesn’t mean the lender is going to trust your information about your earnings. Instead, he or she is going to need documentation to support your claims before approving a new home mortgage.

That proof comes in two forms: your W-2s or pay stubs and your filed taxes. The lender will ask to see your last two years of tax forms. The income on these forms will be averaged to determine how much you are likely to make during the life of the new home mortgage. Unfortunately, if you don’t report all of your income or if you had a bad year, this could hurt your chances.

Self-employed people face the biggest challenges because they cannot easily demonstrate the stability of their income. Having those tax forms available is essential but may not be enough to get you approved, especially if there is no one else contributing financially to the family full-time.

Strategy #3: Save Up for the Down Payment

One mistake many people make is borrowing the down payment for the home they want from a family member then explaining this to the lender. Most lenders see this as a bad sign. After all, the whole purpose of the down payment is to make sure you are financially able to pay the loan and so you’ll have an investment to lose in case things go sour. If you want that new home mortgage, save up for the down payment yourself.

Need more information on how to get your New Home Mortgage approved? You’ll find all of the secrets at http://www.homemortgageloan-refinance.com/Things-To-Watch-Out-For-When-Getting-A-New-Home-Mortgage.php.

Article Source:http://www.articlesbase.com/mortgage-articles/three-strategies-to-help-you-get-approved-for-a-new-home-mortgage-870401.html

Home equity loans or lines of credit allows you to borrow money, using your home’s equity as collateral where equity is the difference between how much the home is worth and how much you owe on the mortgage. A home equity loan (or line of credit) is a second mortgage that lets you turn equity into cash, allowing you to spend it on home improvements, debt consolidation, college education or other expenses.

Advantages and Disadvantages of the home equity loans

Advantages: There are many other advantages of home equity loans. The loan payments on these loans are tax deductible. Home buyers can take bigger sum equity loans. These loans also carry a low rate of interest. But it’s best to heck the prevailing interest rates from many lenders and banks before you actually go in for a loan. It’s also important that the borrower check the credentials of the lenders before applying for a loan. They are many scam and con artists who can take away your home in lieu of giving you a home equity loan. The borrower also risks losing the home in case they default on the loan.

The two major advantages of borrowing with a home equity loan are lower interest rates and potential tax savings:

- The interest rate you will pay on the average home equity loan is generally lower than the interest rate you will pay on the average credit card or any other type of non-secured debt.

- For home equity loans, you can generally deduct the interest you pay. The interest you pay on credit cards and other types of personal loans is generally not tax-deductible.

Disadvantages:

Risk of losing home. If you can’t repay or refinance the loan, then you may be forced to sell or lose your home. Your home is the collateral for the loan. Being late or missing loan payments can trigger foreclosure within 60 to 90 days.

Rising interest rates. With a variable interest rate, most home loan rates change when the economy changes. This means your monthly payments can rise and fall. Be sure you know what the cap is on the loan’s interest rate. The cap sets how high your interest rate can increase each year as well as how much it can increase over the whole loan time period.

Fees. Lenders can charge a variety of fees including origination, application, and withdrawal fees. Be sure to ask about all possible fees.

The major disadvantage of a home equity loan is that you are using your house to get approved for the loan. For some people who have flawless credit this might not be a problem, because they can insure themselves that they will do whatever it takes to pay off their loan. However, instances have arisen where individuals have forgotten or were they are not financially able to pay for their loans. So at this point you’re wondering what happens if you cant pay your home equity loan? With all financial decisions come risk and the risk of losing your home wouldn’t be an option, especially if you have a family.

Home equity loans are best used for home improvements that will increase the value of your home. Some improvements, such as swimming pools, don’t usually increase the value upon resale. Others, such as additional bathrooms, living space, renovated or updated kitchens, etc., generally do increase the value of your home.

The bottom line is this: if your home is worth more than you owe on it, a home equity loan can be a great way to take advantage of this, but it can also get you into serious financial trouble, and should be used wisely. Why not use the equity in your home as part of your retirement fund instead of spending it on things that may not last?

Over the life of home loans - sometimes up to thirty years - your financial circumstances can change dramatically. Starting a family, changing jobs, children leaving home and many other factors can alter your financial circumstances over the term of the loan. A home loan that is right for you at the beginning has the potential to become the worse mistake you ever made.

Refinancing can be useful and financially rewarding but it can also carry risks. It takes time and costs money, so before you decide to change to another lender, ask yourself if it is really the right thing for you.

• Are you happy with your existing lender? Have they been professional and helpful in all the dealings you’ve had with them?
• Are you happy with your existing loan? Is the interest rate comparable to other lenders? Could you use some extra features offered with other products?

Has your financial situation changed? Maybe you’ve started a new job or become unemployed.

Author has a versatile knowledge on financial consultancy Services and particularly on Home Loans and Home Equity Loans. He has expertise in mortgages recommendations and evaluation for any project.

Article Source:http://www.articlesbase.com/mortgage-articles/home-equity-loans-advantages-disadvantages-864727.html

Below is an excellent article on an FHA home loan refinance program called the FHA Streamline or 203K program.  If you’re home is needing repairs to sell or you just want to make improvements, the FHA 203K program can be a wise choice.

We all have heard about the negative news lately about the real estate market and the glut of home foreclosures on the market.  You may be thinking now is the time to take advantage of the low interest rates and purchase a foreclosed home.  But the problem may be some of the foreclosed homes you have seen need a lot of repairs and improvements.  You don’t have the cash to make these repairs.  Well, there is good news and it comes in the form of the FHA 203K Rehab Loan.

When I refer to the FHA 203K Rehab Loan I am referring to the FHA Streamlined 203(k) Limited Repair Program.  It is for improvements and repairs that don’t require structural improvements.  It is not for total renovation of a property but for repairs not totaling more than $35,000.  The FHA 203K Rehab Loan did have a minimun of $5,000 costs of repairs, but that has been eliminated.

There are many benefits for using a FHA 203K Rehab Loan for improvements to a house you are planning on buying.  Also, you can use this FHA Loan Program to refinance your existing mortgage and do repairs and improvement to your existing home.

Some of the benefits of a FHA 203K Streamlined Rehab Loan Are:

1.  The borrower can take out just one mortgage to cover both the purchase of the property and the cost of upgrades.  This loan can be amortized over 30 years, unlike a conventional rehab loan that has a shorter amortization period and higher interest rates.

2.  Like I said before that there is no minimum cost for repairs.  You could use it only to put in an energy-efficient furnace.

3.  There are many different repairs and improvements you can use the loan for.  You can read an article on the list of improvements by clicking on the links at the bottom of this article.

4.  This is not a government loan, it is a FHA insured loan.  There are a lot of FHA Approved Lenders across the country.  Because it is insured by FHA, the FHA Approved Lenders are more willing the make the FHA 203K Rehab Loan.

5.  On of the biggest benefit is the low down payment of 3.5%.  Most conventional rehab loans require a 20% down payment.

6.  Lower interest rate.  Because FHA insures the loan, FHA Approved Lenders can make loans to people that don’t have perfect credit.  That doesn’t mean any one can get a loan, you still have to prove you can pay the loan back.

7.  The FHA 203K Streamline Loan eliminates the need for a consultant, engineers, plans, and consultant’s fees.  This speeds the process up and lowers the costs of the improvements.

As you can see if you are considering buying a home that need repairs or want to make improvements to your own home, the FHA 203K Rehab Loan could be just what you are looking for.

P.S.  Want More Information On FHA 203K Rehab Loans Or FHA Loans?  You can find more articles on what improvements or repairs  are eligible for the Streamlined 203K Loans by clicking on the links below.

If you are considering a FHA 203K Rehab Loan or any other FHA Loans you can get more articles by clicking here FHA Loans Information.

You can information on FHA home foreclosures for sale by clicking on How to Buy HUD-FHA Homes for Sale.

Article Source:http://www.articlesbase.com/mortgage-articles/fha-203k-rehab-loan-make-improvements-to-your-home-with-fha-203k-rehab-loan-858975.html

If you’re looking to apply for a mortgage, there are several things to consider.  Here is a good article for starting the process if you are thinking of moving forward with a mortgage, particularly if you are a first time home buyer. 

Did you hear that you can qualify for a mortgage, yet you don’t think you would? Have you qualified for a mortgage, but wonder if you should have been approved? If you are unsure whether you’re prepared for a mortgage, whether from a financial (income) standpoint or a credit history (credit score) standpoint, you probably need to think twice before you actually sign the dotted line. Have you heard horror stories about people who were not truly ready to handle a mortgage payment, and then they got sucked into mortgages and faced home foreclosure? You probably heard the angle that it was all the mortgage company’s fault. First of all, let’s acknowledge that yes, indeed, there are some very unethical practices going on in some parts of the mortgage industry. Yes, there are in fact booby traps being set up. And yes, some mortgage companies (but NOT all of them) are trying to take advantage of vulnerable unknowing first time home buyers. However, and this is important, you are equally responsible if your home faces foreclosure. You need to make sure that you understand the seriousness of signing a mortgage. It is a legally binding contract that you must stick to. Before you sign, you need to not only go over the entire thing with your mortgage specialist, but also have it reviewed by an unbiased third party. Check and make sure you know what will happen if you miss a payment or if the interest rate goes up. If you are not sure whether you are ready for a mortgage financially, then you probably are not ready. Think twice, save some money up, crunch numbers with your monthly budget, and then reconsider. You deserve to own your own home someday - we all do. Just make sure you are in the right position to do so before going through with this major life decision.

Get great mortgage rates from your mortgage broker - http://www.compoundproperty.com

Article Source:http://www.articlesbase.com/mortgage-articles/are-you-unsure-if-you-can-or-should-get-a-mortgage-857437.html

Up until 2008 or so, the accelerating prices of homes in many parts of the U.S. created large equity or cash positions for many homeowners, particularly in areas with huge price increases.  For this reason, home equity loans went from popular to commonplace as owners saw many benefits of a home equity loan.

The available equity sitting in the home is a lure for financial advisors, most of whom advertise strongly. The homeowner now has gained a large potential financial asset that he wants to protect.  Especially now with home equity loan rates being attractive, many are ramping up their marketing.

What should be done with this home equity, if anything? Many financial strategist advise that you should maximize your mortgage to gain the tax advantages; and place the money tied up in equity into a safe, liquid, investment with good return and tax benefits.

Others suggest using your home equity to pay off large credit card bills, or maybe even a car that might be at a higher interest rate.   A safe investment method is  borrow on a tax-deductible, simple-interest basis and invest the loan proceeds in investments that compound in a tax-favored environment.  Again, with a favorable home equity mortage rate, the appeal of slashing credit card debt is not a bad idea.

One should be cautious of advice that encourages an increase of personal debt, but if you own a house free and clear, or owe on a mortgage, the property appreciates the same. The amount of equity has nothing to do with the appreciation.

The concept that you can get rich by tapping into your home equity and investing the equity funds, needs to be weighed out with caution -  particularly in these tough economic times.

A mortgage is leverage by which you can purchase an  asset — a house — with little or no down payment. Without this leverage, home ownership would be unattainable for many people. If you had, as example, $300,000, you could purchase a home free and clear, or you could purchase it with $30,000 down, leveraged with a $270,000 mortgage. 

However, wiht falling home values, one must be careful not to get “upside down” in a mortgage or a home equity loan, wherein you owe more than a home is worth due to the market downturn. 

On the positive, interest rates are low, and, if you are fortunate to have substantial equity, home equity mortgage rates are quite attractive right now.

When you refinance your home mortgage you are essentially replacing your existing loan with a loan of either the same amount or more, but with a lower interest rate. It is important to remember that refinancing your current loan is best considered when the current rates are at least 2% less then the interest rates you are currently paying.

There are several benefits to refinancing your existing home loan: First, refinancing allows a home owner to lower his or her existing monthly mortgage payments. Second, refinancing is also a great way for a home owner to consolidate their debt so as to save valuable money in the long term. Finally, home owners can also benefit from a lower refinancing rate by freeing up cash that can be used on much needed expenditures. In most cases, a lower interest rate is a good reason to refinance a home especially when the home is still quite new, for example the homeowners have been paying on it for only a few years.

In most cases, a lower interest rate is a good reason to refinance a home especially when the home is still quite new, for example the homeowners have been paying on it for only a few years. Many homeowners refinance to free up funds for other things like pay off credits cards more quickly, buying a car, another home or growing the family business. To do this type of loan, a cash out loan, they rely on the equity in the home to get the loan amount they need.

Probably the best way to go about doing a home mortgage refinance is to get multiple quotes from multiple lenders. You can compare quotes and decide whether you would like to accept of the refinance home mortgage quotes offered. There are a lot of lenders that would love to assist your with your refinance home mortgage, but you need to find the one that will best meet your needs. Using an online mortgage loan broker to explore several options for your refinance mortgage is a guaranteed way to save money.  Not only will these sites be able to give you rates and quotes, but they will often allow you to find out more information on lenders so that you can make the best choice for your situation. And the best part is there is no obligation when you get a free online quote.

No matter what the reasons for doing a home mortgage refinance be sure to be clear as to exactly why you need to do this in the first place. Is it to save money on interest or to tap into the equity into your home for a large purchase? Be sure to do your research and get the best deal both in terms of interest rates and payment options that best fits into your financial needs.

To learn more about a mortgage refinance please visit the website Home Equity Loan by clicking here.

Article Source:http://www.articlesbase.com/mortgage-articles/when-to-refinance-your-home-mortgage-853204.html

Today more and more lenders are implying that they are doing everything within their power to help home owners that have fallen behind on their payments, but I am sure if you speak to anyone that has attempted to get a loan modification, will beg to differ as they tackle road block after road block from their lender.

Not only are home owners finding that it’s a mission to reach a work out officer within the loss mitigation department of their lender, but to make matters worst, if they do receive an approval for a loan modification from their lender, they are finding that new payments are as unaffordable as the original mortgage.

As more and more borrowers default on their loans for such reasons as job loss or an adjustable rate mortgages, lenders are finding that their loss mitigation departments are flooded with request from home owners who can no longer afford their payments.  One of the main causes of this is lenders were not set up for the work load and mortgage restructuring that the rise in foreclosures have caused.  The main purpose of servicing companies were to collect monthly payments from the borrowers as there were limited request to help home owners modify their existing mortgages within past years.

Most loan modifications that are offered by lenders result in either a temporary and minimal rate reduction and an increase in the principal amount owed, as the lenders tact on the arrearages with late fees and many other garbage fees that purposively arise from the mortgage going into default.  Home owners will find that the amount they owe increases because of the missed payments and these junks fees and as a result the new payment that is being offered by the loan modification is even higher than the original mortgage payment.

In saying that, some home owners need to realize that a loan modification isn’t for everyone and that renting and starting over can be a better options for many, especially if you live in a state like Florida where many Floridians have loss in excess of a hundred thousand in equity over the last 2 years and the Florida market is still declining.

With a combination of the current U.S. economy and sub prime loans, foreclosures are far out pacing the number of loan modifications that are being done.

Many modifications done today tend to be unaffordable, because of no reduction to the principal balance of the mortgage and or a significant rate reduction and as a result we are now finding that over 50% of loan modification done within the last year have gone back into default.

One of the main duties of a servicer is to collect every dollar owed by the home owner for the lenders or investors that actually owns the loan, and this is one of the main reason that home owners are finding that their lenders are sometimes reluctant to modify their loan, as this could result in less income for them and the potential of huge losses for the investors or lenders that hired them.

Marlon Baugh is a nationally-known mortgage expert. Since 2003, he has specialized in Florida FHA Mortgage Loans for people with Bankruptcies, Foreclosure or with other credit issues, as well as Florida Loss Mitigation. If you would like a Free Copy or to get instant access to the remainder of this Insider Mortgage Report, please visit http://specializedfinancialsolutions.com/lendersexposed.htm or Call 954-678-5796

Article Source:http://www.articlesbase.com/mortgage-articles/do-you-know-who-benefits-from-a-loan-modification-851387.html

A second mortgage can also be referred to as a home equity loan. It is in essence a secured loan that is second, or subordinate, to the first mortgage against the property. The key issue for anyone getting this type of loan is the amount of equity they have in their home. This will ultimately determine the amount of money that can be secured for the home owners use.

Equity is the amount of money that is paid down on the home, or it can be the value of the home minus any loans owed on the home. The main reason for taking out a second mortgage is to take equity from your home and turn it into cash in pocket. What this means is that if you have enough equity in your home you can borrow money using your home as collateral. There are three basic types of loans to choose from: the traditional second mortgage, a home equity loan, or a home equity line of credit.

A second mortgage should not be confused with a mortgage refinance or re-mortgage. When you refinance your first mortgage you are replacing your old loan with a new loan, usually at a better interest rate. A second mortgage, or home equity loan, is another loan in addition to the primary loan, which will result in two monthly payments. It is important to distinguish the two to make sure that two payments will not seriously affect your monthly budget.

The interest paid on a second mortgage, up to the first $100,000 borrowed, is tax deductible provided that the loan is on your primary residence. It should be noted that interest rates on home equity loans are generally higher than a first mortgage, usually in the 2-4% higher range. But the interest rate on a this type of secured loan will be lower then on an unsecured loan, such as a car loan, and much, much lower then you will find on a credit card.

The common reasons to get a home equity loan are to pay off high interest credit cards or other higher interest rate debts, refurbishing the home, urgent family matters such as education, medical, etc. This is called debt consolidation and refinancing and is a good way to tap the asset value of your home to meet your investment and budget needs, and helps you avoid incurring high interest unsecured debt like credit cards. If you have extensive credit card debt, and are not making progress in paying it off on a monthly schedule, a second mortgage may be a good move.

There are a couple of things that anyone getting a home equity second mortgage should be aware of. A second mortgage puts a second charge on your home, meaning that the second mortgage provider can take a share of any proceeds if your home has to be sold.  What is worse, if you pay the first mortgage but fail to pay the second, that mortgage provider can seize your home, even if the sum involved is relatively small.

Getting a second mortgage home equity loan can be a good way to use the equity in your home to do any number of things. Like all financial decisions using a second home loan should be carefully considered in all aspects. If it makes sense and fits within the monthly budget then it is something to be strongly considered.

To learn more about a second mortgage home equity loan please visit the website Home Equity Loan by clicking here.

Article Source:http://www.articlesbase.com/mortgage-articles/the-second-mortgage-home-equity-loan-849298.html

A mortgage refinancing home equity loan is simply a loan that you take out to pay off an existing mortgage with a new loan that is more financially friendly to your financial goals. The purpose of this type of loan should be to help you save money.  To do so you should consider the implications of total interest costs, annual percentage rates and repayment period of your home equity refinance mortgage loan.

Refinance of your home loan at a good refinance rate can open up a lot of possibilities.  Depending on the refinance plan you choose, you can either save the extra money through rate and term refinancing, or get the cash immediately with cash-out refinance.  Since you are getting money through refinance that you would ordinarily be spending on your loan repayments, it makes a lot of sense to invest that money back in you property in order to raise its overall value.

You can choose to use a mortgage refinance cash out amounts for any personal purposes based on your needs. Making small or large improvements around your property can drastically increase your home equity.  Whether it’s interior improvements, an addition, landscaping, or simply restorations, you will surely enjoy the benefits of the higher home equity long after work is completed.  Additions are always a good bet for increasing home equity.  Landscaping can also go a long way towards making property more desirable, and therefore should not be overlooked as a way to spend home equity refinance money.

Mortgage interest rates are determined by several factors, such as the down payment being made, credit score, loan amount applied for, and the policies that the lender follows. When you refinance your mortgage, you may be pleasantly surprised by the low mortgage rates or your ability to reduce your monthly mortgage payments.  When applying for a home equity mortgage refinancing loan make sure that you deal with a lender that offers you the best terms at lowest rates.

Your credit report will show them your credit history, whether you’ve paid your bills on time and who you may be in debt to.  It is advisable to carry out a credit check before you refinance your home equity loan, although too many inquiries can lower your credit score.  If you have a poor credit, there are still lenders who may refinance your home equity mortgage loan.

Consider the following prior to applying for a home equity refinance: Ask your lenders about transaction fees, points and closing costs.  If these fees are exorbitant, it may not be cost effective to refinance your home equity loan.  If you plan to stay in your house for a short period of time it normally doesn’t make sense to refinance.

If you are thinking of doing a home equity refinance then do some research and get at least four quotes from reputable lenders to see which package may work best for you.  Make sure you get multiple quotes, because shopping around can save you a lot of money. With risk free quotes, you can learn about loan costs without hurting your credit score.

To learn more about a mortgage refinancing home equity loan please visit the website Home Equity Loan by clicking here.

Article Source:http://www.articlesbase.com/mortgage-articles/what-is-mortgage-refinancing-home-equity-loan-849333.html

I’m really fearful naive folks will be even more gullible in this mortgage mess.  Here’s a good article on home mortgage scams from http://www.LJWorld.com

Scams perpetrated by people claiming to assist with modifying mortgages are showing up across the state, Kansas Attorney General Steve Six said.