Wednesday, April 29, 2009

13 Reasons Why Reverse Mortgages Just May Be The Perfect Marketing Niche

For most of us, our mortgage pipelines are in dire need of some good solid loan business. If you fall in this category, it may be time to evaluate the business opportunities that await you in the Reverse Mortgage marketplace.

If you've been paying attention at all, you probably know that the projected potential of the Reverse Mortgage market is absolutely staggering. As you probably know...The Department of Housing and Urban Development (HUD) refers to a Reverse Mortgage as a HECM, which stands for Home Equity Conversion Mortgage.

When you do your review and evaluation of this growing niche, be sure to take into account these thirteen (13) facts and how they can impact your mortgage future:

1. It is estimated that between 9,500 to 12,000 people a day turn 62 years of age and if they are home owners, eligible for a Reverse Mortgage.

2. Seniors that are 62 years of age and older (our definition of a senior for this discussion), control more than three quarters of our nation's wealth.

3. They are living longer and continue to be more active than any generation before them. They, like many of us...continue to have goals, aspirations, desires and even problems...that they would love to solve.

4. They have equity in their homes but don,t have a clue how to convert their equity (non-liquid asset) into spendable and useable cash (a liquid asset).

5. Originations of Reverse Mortgages have increased 109% for the past few years. In fact, each year for the past 5 years the number of loans has doubled each year.

6. FHA endorsed 10,026 reverse mortgages in June alone, bringing the year-to-date total to 83,871. By comparison, FHA insured 8,925 loans in June 2007 totaling 80,425.

7. Its estimated that there are now 75 million prospects that would benefit from this type of program and that number continues to grow every day.

8. Less than one quarter of all Mortgage Companies currently offer the Reverse Mortgage product. Now is the time to market Reverse Mortgages while competition is minimal.

9. Recognizing our current credit crisis and the problems we have funding our normal forward based and credit scoring models are not used with the Reverse Mortgage product. The benefits received are based on age and equity.

10. The Reverse Mortgage product is a Federal Housing Authority (FHA) insured non-recourse loan and subject to FHA loan limits.

11. Recent surveys of Reverse Mortgage holders indicate more than a 95% satisfaction rate of the product.

12. There have been drastic improvements since the first Reverse Mortgage was written in 1989 and, the number of Lenders has increased.

13. Effective January 1st, 2009, the HECM Purchase Program is now operational, allowing Seniors to purchase a primary resident.

On the surface you may feel that a Reverse Mortgage could be the easiest type of loan you could ever originate. After all...there is no Credit Qualification, no Income Verification, and best of all...your commission is generally based on the value of the home...not the loan amount.

But please remember...a marketing niche is only as good as the dedication, knowledge, expertise, and professionalism you are willing to bring to bear on the marketplace.

Yes...working with Seniors can and will prove to be extremely profitable. Plus...You will also get personal satisfaction and gratification as a result of your efforts.

If your current organization or situation does not allow you to originate Reverse Mortgages, you need to either be the catalyst to change that...or, find a home that does allow you to market to Seniors.

You can become very successful by dedicating yourself to Reverse Mortgages and the Senior market. If you prepare yourself and your marketing program well, you can get ready to explode your Mortgage Business.

About the Author

Tom Domin is a contributing author to The Reverse Mortgage Mentor membership training site. Put your mortgage production back-on-track with the very best Reverse Mortgage marketing training. Sign-up for our $1.00 ten (10) day trial membership at

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Tuesday, April 28, 2009

Types of Asset Finance - How to Choose The Right Option

Businesses run on assets. They either manufacture products or provide services by making use of a variety of business assets such as computer systems, photocopiers, office furniture, restaurant equipment, plant, machinery, commercial vehicles, company cars, forklift trucks and buses.

Companies acquire these assets either by purchasing them outright using their reserve cash or through commercial loans or having them financed through asset finance options. Asset financing has become quite popular in recent years since this method allows one to acquire business critical assets without making large capital investments. It also helps businesses to keep abreast of the latest technological developments as they can get new assets as and when they require them without having to arrange for large amounts of funds through commercial loans or some other arrangement.

Asset Finance Types

Operating Lease

In this type of lease, the lessor remains the owner of the asset and he rents it to the lessee for a particular period (ranging from one to five years). Thereafter according to his particular need, the lessee can either renew the lease or return the asset to the lessor. The lessor can then either sell the asset in the second hand market or lease it to some other lessee.

Rent is usually low in this case as the lessor does not need to recover the full asset value. This type of lease works fine with business which are either into seasonal operations or who operate in a business environment where the technology keeps on changing such as IT.

Contract Hire

This is one form of operating lease which is used mostly in vehicle finance. The lease arrangements include service features like maintenance, replacement during repair, management, etc. The rental payout is calculated on the basis of the residual value of the asset after the lease term, thus covering the depreciation over this period.

Finance Lease

In this type of asset finance, the lease period is long and covers the entire working life of the asset. Hence, the leasing payments realize the full cost of the asset over the lease period. When the asset is sold at the end of the term, the lessee will share a percentage of the disposal price with the leasing company.

Contract/Hire Purchase

This is the commercial avatar of hire purchase. In this case the ownership of the asset in question is transferred to the purchaser at the end of the term after the final payment is made.

Lease Purchase

This arrangement is just like a hire purchase contract with one difference - there is one single large payment at the end of the term after which the legal title to ownership is transferred to the purchaser.

Choosing the Right Type

There are separate advantages to all the above types of asset finance options. You have to understand all the options and your needs and circumstances before committing to a particular type. Here is some more help in understanding which would suit you best:

-If it is important for you to own an asset right away, you should go for an outright purchase funded by your own means or through commercial loans.
-If you want to own the asset but not right now, you should go for the hire purchase option. This will keep the outgoings low and steady and will have you owning the asset at the end of the term.
-If, considering the nature of your business, you want to utilize the asset for most of its useful life but don't want to own it, then financial lease is the best asset finance option for you.
-If you want to utilize the asset for a period of time significantly shorter than its useful life, you should consider operating lease type asset finance.

About The Author:
Richard Heaney is a writer on business and finance. He specializes in writing on financial planning, Business asset finance and various other commercial mortgages. His write-ups highlight the different aspects of credit market and broking firms providing the asset finance.

Home Interest Rate Refinance-hardship Letter Mortgage

If you want to become a real estate investor, find a "fixer-upper" owned by an anxious seller. Finding distressed houses at bargain prices, fixing them up, and then selling them on a consistent basis can make you a multi-millionaire.

Why Sellers Sell At a Discount

Home owners' problems often prevent them from staying on top of their home's upkeep. Factors such as job loss, divorce, serious illness, various addictions, or other personal problems quickly overwhelm distressed home owners, forcing them to sell. These sellers can't make the needed repairs because of financial or physical limitations, and when that happens, their home becomes a low priority and sometimes will go into foreclosure.

Look for the "Triple D"

Home sellers with three problems give beginning investors a great opportunity. A "Triple D" is a Doghouse, involved in a Divorce, and in Default. The label "doghouse" comes from Southern California Realtors who used this term to describe the worst fixers. These houses maybe "tired" and need only cosmetic work in order to favorably compare with other homes in the area.

What to Look for in a Doghouse

The hardest house for a homeowner to sell is a "doghouse," "dump," or "fixer-upper." These run-down houses scare off most buyers, who don't have the money to cover the down payment, closing costs, new furniture, carpeting, appliances, roof repairs, and other deferred maintenance required to bring the home back into top condition.

As you look through the classified ads or at Realtor listings, keep an eye out for terms like "handyman special," "as is," "fixer," or other tell-tale words. Also have your agent use similar terms when scanning the Multiple Listing Service for your target area.

Once you've found a property that you can turn from doghouse to dollhouse, find out the seller's problem and then offer a solution. Distressed sellers frequently experience financial problems and need cash as soon as possible. Therefore, if you're ready to close quickly, you'll be set to negotiate a lower sales price.

How to Close Quickly

Find an experienced lender and get yourself not only "pre-qualified," but also "pre-approved." Taking that second step assures worried sellers that you already have your loan in place for their property, and this puts you well ahead of other potential buyers.

How to Know When "Bad" Is Good

When you first start out in the real estate "fixer" business, you'll want to look for "ugly" houses needing only cosmetic work. Look for entry level fixers that just need some cleaning up, painting, and carpeting.

When you're new to the fixer business, always remember your limitations and use caution when considering houses needing structural repairs. My husband replaces structural beams, sub-flooring, walls, plumbing, and electrical systems, but he acquired those skills after years of experience.

If you find a house with structural problems, get estimates from reliable contractors to do the work. Experience teaches you how to do more over time. Until then, rely on experienced professionals to do the repairs. Take professional estimates into account before deciding whether or not to purchase an investment property.

The Easiest Houses to Sell

A dollhouse, located in a popular neighborhood, sells the quickest. For instance, we once sold a home we named "Orange Tree Cottage" in just three hours! To qualify as a dollhouse, a home must be in a location that buyers want and must offer the number of bedrooms, bathrooms, and amenities they're seeking. Beyond the price, however, buyers purchase the house that meets both their basic requirements and their emotional needs.

Filling Buyers' Emotional Needs

After many years of investment experience, we've found that using Design Psychology and Marketing Psychology techniques greatly increases our profits. Both concepts go far beyond "curb appeal."

For instance, we use colors that target our prospective buyer's income level and match the selling season. Generally, buyers of higher-priced homes prefer complex colors. And using cool colors during hot weather and warm colors in cold seasons makes buyers feel like they've found an oasis or sheltering haven.

We also paint the front door a happy color and entice buyers into the house by placing potted plants on the porch. Once inside, we use home staging strategies to create a buyers' dream home. We don't use a lot of furniture; just a few accessories to suggest happy activities. The idea is to make the buyers believe that if they buy your home, they'll enjoy a new lifestyle.

Over the years, we've bought and sold dozens of distressed properties. By using caution and common sense, as well as following a few simple rules and using Design Psychology strategies, you, too, can become a wealthy real estate investor!

By: romeoicq1

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Monday, April 27, 2009

Government Helps Homeowners With New Mortgage Support | Mortgage News

Latest forecast by the British Chamber of Commerce suggests that unemployment figures could rise to ten percent or around 3.1 million people during this year 2009. According to Credit Action personal debt in Britain today stands at almost £1.5 trillion in November and the amount of debt has surged ahead of the country’s gross domestic product (GDP) last year 2008. The Council of Mortgage Lenders had forecasted up to 75,000 homes could be repossessed in 2009 if something was not done by the government to help.

With the above in mind it is little wonder that government help is urgently required. That’s why during the last Pre-Budget report on the 2nd September, Alistair Darling announced that his Government would be providing a package to help homeowners who found themselves unemployed and struggling to pay their mortgage. He said that he was determined to support people during these difficult economic times.

The package Alistair Darling was referring to was the extension to the Support Mortgage Interest which came into effect today the 5th January 2009. This included shortening the waiting time for Support Mortgage Interest (SMI) from 39 weeks to 13 weeks and increasing the capital limit to £200,000. Today the Government is announcing that this new rule will also apply to people who are waiting now.

According to the Secretary of State for Work and Pensions, Mr. James Purnell the government has decided that they do not want a person who is unemployed through redundancy to worry about paying their mortgage. They want people who have already served 13 weeks or more of their waiting period by today the 5th January 2009 to be entitled to claim Support Mortgage Interest.

So what does all this actually mean to you and me? Well if you are unemployed through redundancy then instead of waiting 39 weeks for the government to pay just the interest on your monthly mortgage payment you would now only have to wait 13 weeks for Support Mortgage Interest to be paid by the government.

Previously Support Mortgage Interest would only have covered up to £100,000 and then on the 2nd September 2008 the government increased it to £175,000. Now under the new instructions issued by Alistair Darling at his pre-budget report he increased it to cover your mortgage up to £200,000. The standard rate of interest which is used as the basis to calculate Support Mortgage Interest has been frozen at 6.08% for the next six months.

The above scheme works well as long as your mortgage is less than £200,000 and your wife does not work or you are single. But what if you are a couple where the main bread winner has been made redundant and their partner continues to work and you still cannot afford your mortgage payments? Also how would this ruling affect a couple who had a mortgage and a secured loan under £200,000? Previously, you would not have qualified for Support Mortgage Interest; it might be possible to apply for the Gordon Browns other government incentive below.

Let’s not forget Gordon Brown recently announcement for “middle income households” that his government would underwrite a £1 billion scheme which he had agreed with eight of the largest mortgage lenders. This scheme will be available to anyone who loses their job or suffers from a loss of income. For example: a couple where the main bread winner has been made redundant and their partner continues to work, but they are struggling to pay the mortgage.

Under this scheme any household with a mortgage of up to £400,000 will be able to defer some or all of their interest only payments on their mortgage for a period of no more than two years. To further qualify for this scheme you should have less than £16,000 in savings. The terms of suspension of mortgage payments will need to be agreed between the mortgage borrowers and their mortgage company or bank. More information and details are required and the devil may well be in the detail. Your thoughts, experiences and comments are welcome.

Sunday, April 26, 2009

Education On Loan Modifications Opportunities

Before selecting anyone to help with the modification of your home loan, it is very important that you understand all of the available options. Not all modification companies are the same. In fact, there are some significant differences that can effect your ability to obtain a successful result.

At The Mortgage Reel, we've created an impartial and easy-to-understand comparison of your options. We strongly encourage you to conduct further investigations and to talk with any person or company whom you're considering to negotiate with your lenders about a loan modification.

Attorney and Law Firm Representation

Modification Company Claiming to be Attorney-Backed

Modification Company or Individual

To View the Chart, please visit the website, the link is below.

Please check our Professionals Corner on our site for a list of loan modification lawyers who can protect your interests. We do not receive any referral fees or commission whatsoever from the attorneys listed on our site. Rather, we provide their names as a resource and to help you find trusted legal professionals who will provide the assistance you need at this challenging time.


The Mortgage Reel


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Friday, April 24, 2009

Uncle Sam Wants To Pay 10% Of Your New Home Loan

If 2009 is the year of your first home purchase, then Uncle Sam is ready to give you a gift that equals up to 10% of your entire purchase price. Known as the homeowner tax credit, the Obama Administration has finally figured out a way to make home buying a much more delectable proposition. Add this to the falling mortgage loan interest rates, the drop in home prices, and it would appear that Uncle Sam not only found a great way to sweeten the deal for aspiring home owners, but also tied it neatly with an irresistible ribbon.

This 10% gift is actually an outcropping for the American Recovery and Reinvestment Act of 2009. Consumers are undoubtedly familiar with the wrangling that had lawmakers debate the intricacies of this unprecedented bailout package in the media and also behind closed doors. As the discussions began to draw to a close, speculations about the actual nature of the mortgage credit were rampant and a lot of misinformation or soon outdated information would hit the blogs, forums and also news websites. Prospective homeowners have been cautiously optimistic that this could finally spell an end to the slow moving real property market.

Finally, upon passage of the act, the details of Uncle Sam’s new mortgage plan became known. Prospective homeowners may qualify for the tax credit if the home was purchase in 2009 as a primary residence. In addition, consumers need to be able to prove that it is their very first home purchase. The scope of the tax credit is 10% of the actual purchase price, but it is capped at $8,000. Unlike previous tax incentives under the Bush Administration, the Obama Administration has shied away from making this a repayable incentive loan.

There are of course some limitations; for example, if a single taxpayer seeks to qualify for the new mortgage loan credit but earns more than $75,000 as adjusted gross income, she or he may not be able to take the full amount.

Nevertheless, the $8,000 tax gift has gotten the calculations and speculations going of those who want to maximize their home loan advantage. Some are looking to keep their down payment to a reasonable minimum and then turn around and use the tax credit to pay it toward the outstanding principal balance, cutting down on a significant amount of interest debt. Others see the credit as a useful way of lowering their overall tax bill.

Even those who are not too worried about positioning their tax liabilities in the most advantageous light realize that no matter what, they could end up ahead of the game by $8,000. This is a lot of money, especially for those who had already decided that 2009 would be the year in which they are going to buy their first primary residence. At this juncture the only open questions that remain are where to find a great deal on a home, and also how to find financing in a lending market that seems to have greatly clamped down on offering consumer loans.

By: Lender411

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Mortgage Life Cover For Mortgage Security in the Event of Your Death

Anyone who has a mortgage to repay over a span of many years needs to give some thought to taking out mortgage life cover. If you are the main wage earner in the family then you need to consider how your loved ones would cope when it came to paying the mortgage in the event that you as the main income provider died, so protecting them is essential. Without cover they might not be able to maintain the mortgage repayments and lose their home and with it they would be able to use the money from the cover to payoff the outstanding mortgage and at least not have the worry about losing the roof over their heads.

Mortgage life cover is usually known as decreasing life insurance. This means that the payout you would get back from the life insurance would decrease along with the mortgage. You would initially insure the mortgage balance when taking out a policy and as you payoff the mortgage each month you owe less. Therefore you would take out mortgage life insurance to reflect the number of years you have left to pay on the mortgage. If you die the amount left owing on the policy is paid out but if you outlive the policy then of course the mortgage would be paid off and there would be no payout.

This type of insurance is great peace of mind to safeguard and protect your family at a time when they need it the most. The cost of insurance would of course take into account the amount you chose to insure and other factors such as age and your health when applying for the policy. The younger you are usually the less life insurance will cost. Premiums will also take into account your family history health wise, for example if there is a history of heart attack or stroke in the family you would usually have to pay more for the policy.

If there are two names on the mortgage then you could take out a policy for both names. Usually you can insure to payout upon the first death and then cover would cease.

When looking for mortgage life cover you need to compare the cost of premiums from several different providers to ensure that you get cover at a price that suits your budget. One of the quickest and easiest ways of doing this is to allow an insurance broker to search around on your behalf. They will be able to gather insurance quotes which you can then compare in the comfort of your own home. When comparing the cost of life insurance always check the exclusions which should come in the key facts of the cover.

Different providers add in different exclusions and these are what can stop a claim being made on the policy. It is essential when taking on the insurance that you always tell the truth, even if it means you would pay more for the cover, as if you are caught out then again a claim might be refused.

Thursday, April 23, 2009

Is A Mortgage A Good Or Bad Thing?

Are mortgages simply a trap? Many people have been burned by the real estate market and the corruption in this industry over the past several years. Should you even get a mortgage, or should you fear that if you do you'll face nightmares like foreclosure and losing your home?

Don't be afraid. Be smart. It's true that you can get taken advantage of and end up on the street (and taking a huge financial loss) if you are not careful. So the solution is not to give up entirely; the solution is to be cautious! Don't jump into a mortgage agreement you don't understand!

You see, that is what caused a lot of this mess. The reason so many people have lost their homes is two-fold. First of all, the economy and unemployment rates are both in very bad shape to date. This means that many people simply can't afford things like a mortgage.

The other issue that is causing people to lose homes is that they get into mortgage agreements and the interest rate fluctuates, goes through the roof, and then they cannot afford the monthly payments. Is this due to a deliberate booby-trap set up by mortgage companies? Perhaps.

On the other hand, when you sign a mortgage, this is a legally binding contractual agreement. You should never sign anything you don't completely understand or agree to, but especially not something with such a huge dollar value attached to it.

Face it: this is the biggest investment of your lifetime, this home you are financing! Do not take it lightly. Make sure you understand the mortgage before you sign. And don't be unrealistic about how much you can afford.

By: Roberto Bell

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Monday, April 20, 2009

What Do Lenders Consider During The Home Mortgage Approval Process?

This article will give you a perspective through the eyes of a bank or financial institution so that you can know what they are looking for when it comes to deciding whether or not somebody is considered a trustworthy borrower, and what goes into the mortgage preapproval process.

The Difference Between Prequalified and Preapproved

While people will sometimes use the words prequalification and preapproval interchangeably, these two words do not mean the same thing and it is important to understand the difference.

Prequalification means that you have met with someone at a financial institution and discussed the particular issues of your personal finances such as your income, assets, commissions, and debts, and from that discussion the lender has offered an educated opinion as to how much money you are qualified to borrow.

Preapproval is a much more in-depth evaluation where the financial advisor will actually go over your paperwork such as past paychecks and pay stubs, tax forms such as W2's and 1099's, bank statements, credit reports, and any assets that are owned. After this evaluation you will receive a letter from the lender that specifies how much money you are allowed to borrow pending a good review of the property to be purchased.

What Type of Paperwork Does The Lender Look For?

One important thing that your financial institution will look for when deciding whether they should or shouldn't give you a loan is your credit score and past credit history. If you have a good history of paying back you credit cards on time, especially if you can spend $10,000 or more in a month and then pay it off rapidly, this is a good signal of financial competence.

So what to do if you have a low credit score or an unattractive credit history? Start by not charging anything more, and then pay off all your credit card balances down to zero. From then on, only charge on your credit cards what you have the money in the bank to pay off immediately.

Lenders will also consider your income over the past months and years by reviewing your paychecks and pay stubs, and they will also look for your tax forms to verify your income. They will want to see the paperwork for your other bank accounts or investment accounts so that they can verify your current assets and work that number into the total evaluation.

Also important is your current outstanding liabilities such as credit card debt or other loans. With all of this information, plus any other information deemed appropriate to your personal financial picture, your bank will decide how much money they would be willing to lend you for a home loan.

About the Author

Nathan Navachi is an expert in the mortgage industry and specializes in mortgage refinancing information. You can read more of his expert advice at

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Sunday, April 19, 2009

Guide To Overpaying Your Mortgage

Mortgage overpayments

If youve got an extra bit of money lying around, the first option that may spring to mind is to overpay your mortgage. By paying more than the required mortgage repayment each month you erode the amount you owe quicker, reducing the interest you pay and potentially knocking years off your mortgage term.

A borrower with a £150,000 tracker mortgage will have seen their monthly repayments drop by nearly £400 since interest rates peaked. If they used this extra money to overpay their mortgage each month, and continued to overpay it by the same amount for the rest of the term, they could repay their loan 11 years early on a 25-year mortgage.

The pros and cons

While being mortgage free 11 years ahead of schedule might sound like a very tempting prospect, there are several things that need to be considered before you go down this route.

1) Does your mortgage lender allow you to make overpayments or will you be penalised for doing so? Theres no point using your spare cash to pay extra off the mortgage each month if doing so will trigger penalty charges.

2) Its worth finding out if you can get your hands on the money again if you need to. Some mortgages enable people to borrow back money theyve overpaid at the same rate. Others allow people to take payment holidays up to the amount theyve overpaid. But on some deals, once the moneys been used to pay down the loan, the borrower cant get it back without remortgaging.

3) People are generally advised to repay debts with the highest interest rates first. So it might not make sense to prioritise making overpayments on your mortgage, if you have outstanding credit card or loan debt on which youre paying double-digit interest.

4) Since the credit crunch first struck, lenders have been increasing the size of the deposits or equity stakes people need in order to qualify for the most competitive mortgage rates. At the same time, house price falls mean people now have significantly less equity in their property than they did a year ago.

Making overpayments might be enough to reduce your loan-to-value ratio sufficiently to put you into a lower mortgage tier, saving a considerable amount on the rate youll pay when you come to remortgage.

By: Kate Tee-11606

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Friday, April 17, 2009

Steps to Consider when Looking for a Mortgage

The process of applying for a mortgage can be long and complicated, especially if you are a first time buyer, have poor credit, or have special mortgage requirements. Whether you’re a first time buyer or a seasoned pro, it’s good to refresh yourself on the important steps you should consider when you’re shopping for a new mortgage.

Step One: Your Finances

Regardless of any other circumstances, the first step in applying for a mortgage (or any other large loan, for that matter) should always be a thorough investigation of your finances, including your credit rating. This is an important first step, even though your lender will eventually want to examine your finances more thoroughly. Having a rough idea of your financial situation, and the amount of money you can afford to borrow, is going to be important when it comes time to choose a mortgage type and speak with potential lenders.

To examine your finances, look at your total monthly income, and total monthly debts, to find out how much you can afford in the way of mortgage repayments each month. In addition, check out your credit score. If your credit rating is over 700, good news, you should not have any trouble getting a mortgage. Under 700, you’ll probably be looking at a higher interest rate on your loan. To get a handle on fixing your credit, make sure you pay bills on time, and check your credit report for any obsolete information or errors.

Step Two: What Kind of Mortgage?

Generally you’ll be deciding between a fixed rate mortgage or an adjustable rate mortgage. If you plan to move or refinance within five years or so, a balloon mortgage may also be a viable option.

In most cases the main point to consider, apart from your finances, is how long you plan to stay in the home. A fixed rate mortgage gives you long-term peace of mind, in knowing that your mortgage repayments will never increase, so it’s a good option when you know you’ll be living in the home long term. The lower initial repayments of an adjustable interest rate or a balloon mortgage, on the other hand, can be useful if you know you will sell the home within a few years.

Step Three: Comparing Mortgage Quotes and Choosing a Lender

Once you’ve decided on the type of loan you want, it’s time to start getting quotes from lenders. Doing this before you start house-hunting can be very useful. Getting pre-approval gives you leverage when you make an offer on the property, and it saves time at closing too.

Try to get all your quotes within the same 14 day period, to make sure your credit rating isn’t affected by your credit inquiries. Getting all your quotes within a short space of time will also make comparing those quotes more accurate.

The problem is, it’s not always easy to get reliable quotes. Unscrupulous lenders often advertise very low rates to attract potential customers, but aren’t able to deliver on the advertised rates. Tell prospective lenders you can apply for a mortgage immediately, and most will be more likely to quote accurate rates they can deliver on.

Narrow down your list of lenders, and ask questions to help make your final decision. Ask about points and interest rates, closing costs, private mortgage insurance, pre-payment penalties, and anything else that’s important to you.

Once you’ve chosen your lender and applied for the mortgage, you should receive an Annual Percentage Rate and a Good Faith Estimate within three days. The GFE is required by law but lenders aren’t required to guarantee the estimate, so if a lender is willing to supply a written guarantee, consider that a good sign.

Step Four: Interest Rates and Points

Another important part of the application process is buying points, and locking in your interest rate. By purchasing points, you can buy down your interest rate, potentially saving thousands of dollars over the term of the mortgage. However points must be paid in cash when you close on the house, so if your cash flow is tight, it may not be an option. Also check out whether buying points will actually save money, as sometimes the money you spend on points may turn out to be more than the amount you save over the mortgage term.

Finally, a note on locking in your interest rate: It’s tempting to try and ride the market for as long as possible, hoping to lock in a low rate, but this requires some very careful attention to detail. Waiting even one day too long could leave you locked into a rate you can’t afford in the long term.

About the Author

Rachel Jackson is a freelance writer who writes about topics and pertaining to the mortgage industry such as how to refinance home mortgage

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Home Loan Modification - 5 Steps To Navigate Through The Mortgage Modification Process

It is an unfortunate truth that many people are facing foreclosure. While some may see no options available, a home loan modification is a very real possibility for many. This process is designed to change some of the terms in your home loan contract in order to reduce the monthly mortgage payment. If this process is done properly it can help people who have been unable to make their monthly mortgage payments obtain a new payment that fits within their budget. These changes are possible because the bank does not want to deal with a foreclosure. If the homeowner defaults on the mortgage, the bank stands to lose money in the process.

Here are 5 steps that lead you through the mortgage modification process:

1. Discovery. Understand the basic process involved with a home loan modification. Although the process seems difficult to many people, learning a little about the process lets a homeowner determine whether modifying their home loan is right for their situation. Understanding the process is valuable whether you handle the process yourself or hire a third party.

2. Decision. If a mortgage modification is something you want to pursue, decide whether you are going to do it yourself or hire someone to help. If you do it yourself, continue learning about the process and consider a book or other resource to better understand how to work with your lender. If you decide to hire a company or attorney to help with the process, find a reputable person or company and ask plenty of questions to be sure they are the right "fit" for your situation.

3. Letter. An important document for anyone interested in a loan modification is a hardship letter. This letter is typically required by all lenders. The letter should describe your financial hardship and why you need a change in the terms of your mortgage. If you are using a company or attorney, they can help you with this letter. If you are handling the procedure yourself, find a good resource that explains how to write this letter.

4. Communication. Stay in contact with your lender (if you are handling the home loan modification yourself) or with the company/attorney you hired for assistance. Be sure you understand what documents are needed and provide them in a timely manner. Also, communicate regularly and be certain that you understand the next step in the process and what your task is for that step.

5. Patience. The process can be frustrating and time consuming. Be patient and realize that lenders are handling many home loan modification requests, with new requests arriving daily. Be polite, even if the process seems to be moving slowly.

Following these steps will likely improve the overall process and increase your chances of receiving your desired mortgage modification.

By: Mark Winfield

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Tuesday, April 14, 2009

Looking At Two Popular Residential Mortgage Companies

Are you looking for a first time mortgage? Are you looking for a new mortgage or a way or refinancing your current one? If so, then you have probably looked over the promotional material of many lending agencies.

Those that have not explored what is offered by American Home Mortgage and Allied Home Mortgage would definitely benefit from taking a closer look. Both of these lenders have many positive attributes a brief overview of what these entities have to offer is provided?.

American Home Mortgage ( ?This is a service that provides a number of simple and easy to use online mortgage tools. These tools can then be employed to find high quality loan programs and competitive, low rates. This company offers a host of services including purchasing, refinancing, and even construction lending. This makes it a very popular online destination for those looking for a high quality mortgage issuance service.

Allied Home Mortgage ( ? Allied Home Mortgage is such an expansive lender that is issued over $15 billion in one year in the form of 12,000 approved loans. Yes, this is one of the largest mortgage lenders in the United States. In addition to its expansive online presence, it is affiliated with various lenders in all 50 states. This company issues all variety of loans making an attractive to applicants from all sectors of borrowing.

In terms of the specific loans that each lender offers, applicant can seek to apply for a multitude of loans. American Home Mortgage offers 30 year fixed rate mortgages; 15 year fixed rate mortgages; Traditional Adjustable Rate Mortgages (ARM); Hybrid, Annual, and Monthly ARM rates; and rare mortgage loans such as 2/1 Buy Down and Negative Amortization loans. Allied Home Mortgage offers many of these same mortgage deals as well as a full variety of traditional loans.

There are also a host of other helpful benefits offered online. American Home Mortgage offers free online consultations. These online consultations can be accessed through an internal instant messaging system that provides real time answers to your questions. This will aid in making sure you are applying for the right loan and are able to properly fill out the necessary applications. Allied Home Mortgage does not offer online help, but you can contact them via phone or email.

A representative will definitely contact you in a timely manner to help you with your inquiry. American Home Mortgage also offers a clear description of the loans they offer on their website. Allied Home Mortgage offers a glossary featuring the loans they offer, but it is not as clear or easy to navigate as American Home Mortgage. So, it would be fair to say that American Home Mortgage has more expansive online services; however, this is not to infer that Allied Home Mortgage is inferior in any way.

In summation, both of these lenders have something to offer those looking for a lending source. As such, it is recommended to visit both sites and read them over. Within their online pages, you might be able to locate the answers to your lending queries.

By: Mohamad Alodah

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This is the Best Time for a Home Loan Modification

At last President Obama has announced what anyone and everyone connected to the real estate sector has been requesting for a long time. The new mortgage plan announced by the US government has been welcomed by all analysts and loan modification consultants across the country. The plan is a solid stimulus package created to stem the foreclosures which has been one of the biggest contributors to the collapse of the economy. It addresses the core issues of the real estate sector and helps responsible homeowners out of their precarious mortgage situations.

In fact if all goes as per the plan, it is the homeowners who will be the real winners here. President Obama’s mortgage plan gives special attention to people who either are struggling with their mortgage situations or threatened with a potential foreclosure. The new package sets aside $75 billion for homeowners falling under various categories so that they get the necessary help that is required from their mortgage lenders and have a more favorable mortgage plan.

Both analysts and loan modification consultants agree that now is the best time to apply for a home loan modification. While Obama’s detailed modification plan will not be revealed until March 4th, it is recommended to apply for home loan modification now because the long line of homeowners looking for a modification will be even longer in the future. Homeowners should not waste any time and immediately contact a loan modification consultant to help them apply for a mortgage modification plan with their lenders. The consultants are in a better position to help the homeowners as they will be able to submit the application as per the prescribed norms set by the banks and make sure all necessary documents along with the reasons for loan modification are in place. By going through a company, homeowners will also save themselves from being taken advantage of by their lender.

Homeowners who have been facing problems with their mortgage and have already defaulted on their monthly payments need to act quickly and get their applications submitted immediately as this is the best time that modifications would get approved given the added pressure from the US government on the lenders. Of course it is not just the added pressure, now that the banks and lenders have financial support from the government; they are much more open for home loan modifications as there is less risk for them.

The real estate industry as a whole is extremely optimistic that the new measures announced by President Obama will give the much needed momentum to the already battered industry. Real estate values have been plummeting since 2007 and the same scenario has been continuing in early 2009 as well. The latest stimulus package aims to help restore some value of properties eroded due to foreclosures and lack of new home buyers. Investors who have shied away from the real estate sector for almost a year now are also expected to start coming back although in much lesser numbers than before.

What remains to be seen is whether all the measures announced over the last few days is going to help the economy get back on its knees and at least stay stabilize if not improve. But one thing is for sure, homeowners have to act now as if they let go of this latest opportunity, they might lose their chance to secure some stability with their current situation.

About the Author

Bridget Toomey is a licensed real estate and loan modification consultant in the state of California. Since the economic downturn in early 2007 she has focused her time on assisting homeowners who have home loan modification needs. To know more about her or if you have any questions, please visit

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Monday, April 13, 2009

Finding The Best Mortgage Lender In Brisbane

Buying a home is a huge commitment and investment. It is essential to find the Best mortgage lender for you. After all, a good mortgage lender can save you a lot of money in interest rates. A mortgage can last thirty or more years. This means that you need to make sure that you are happy with your mortgage lender. You don’t want to cut corners in your research. Finding the best mortgage lender is a matter of shopping around and knowing exactly what you are eligible for. It may also mean researching and speaking to other people who have found a mortgage they are happy with.

Without a doubt, buying a home is better in the long term than renting. When you rent, you are basically tossing money down the drain, as you don’t get anything you can keep. When you buy a home, it is an investment. Of course, this means that your investment could go horribly wrong. The neighborhood could decline rapidly. Your house could sustain damage. You could buy a home and then find that you need to move. In the current economical situation, it can be extremely difficult to unload a house that you need to sell quickly. In these cases, you might end up desperate and selling for cash, which would mean that you would make a lot less than you paid.

Finding the best mortgage lender is important, but before you do this, you should make sure that you know your credit score. Before you go and see your mortgage lender, it is better not to be surprised. You don’t want to go into your first meeting only to learn that your credit is not high enough for a mortgage. Or, you might find that your credit is not high enough to get a decent interest rate. There are many online services that can tell you your credit score. If you know your credit score, you can usually find the best mortgage lender to deal with your credit situation. Your mortgage lender should be prepared to handle your credit score and find the best interest rate for you.

When looking for your best mortgage lender, you might start by asking around. Your friends, colleagues and coworkers might have insight as to which lenders are the best. Speak to someone who has a mortgage that they are happy with and speak to their lender. However, if your acquaintances and friends have no advice, you can start searching online. You can often get reviews online for different mortgage companies. Feel free to call and ask about lending rates before you commit to one company. You aren’t going to hurt the lender’s feelings! This way, you can find the best mortgage lender for you.

If your credit isn’t high enough for a decent mortgage rate, you might want to put off the home purchase for a year or so, or at least until you can repair your credit. You don’t want to get trapped in an interest rate you can’t afford because you were in such a hurry to buy a home. Also, most mortgage lenders will require a down payment, so you should make sure you are financially prepared for this.

By: Robert Foster

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Friday, April 10, 2009

Flood Damage - Do Not Be Caught Without Insurance

With the economy the way it is now days, paying for insurance of all kinds is becoming a huge problem that more and more Americans are being faced with every day. People are losing their jobs and health insurance at a rate no one wants to talk about. When they are laid off and now can not even pay the necessary bills they have each month, they have to cut back on something. Making your flood insurance one of these cuts is not the smartest idea.

Out of nowhere a flood can strike. There can be heavy downpours that make creeks and rivers over flow and in a matter of hours the water can reach a flood level that could end up making you a victim of the water. If you live in a low lying area, this could really be a disaster for you and your family. It can ruin some things or everything you own inside a home. There is nothing you can do at this point except wait it out and see how bad the damage is going to be.

When the water begins to recede, the damage will be revealed in a very ugly picture of destruction. If you have canceled your flood insurance, it will be the only thing you are able to think about. This is exactly the situation you do not want to be left in. Even if your home is paid for, how would you make the necessary repairs? And if your home is not paid for, just wait until your mortgage company or bank finds out your flood policy lapsed and has been canceled.

In the worst case scenario, your home could be totally submerged by flood water and could be a total loss. In a less severe instance, you might only receive a few inches of water in your home from a natural disaster flood, but that will still not be an easy or inexpensive situation to deal with. The water will have to be removed and the home dried completely. Your belongings that are not destroyed, will likely be damaged and must be repaired, cleaned, or replaced.

Then there will be the walls and floors that could be damaged that might have to be replaced as well. At the very least they will have to be dried out and sanitized to prevent mold and mildew. Dealing with the full extent of a home flood caused by natural disasters is never a good thing and it is usually never cheap either. If you manage to stay in your home during these difficult times, find a way to hang on to your flood insurance too because it is definitely one insurance you do not want to be caught without.

About the Author

Visit Aydan Corkern's and water damage

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Wednesday, April 8, 2009

Loan Modification "how To" - Important Steps To Avoid Foreclosure

Obtaining a loan modification is not something that homeowners look forward to. This is due to the fact that in most circumstances a modification is a step taken by someone who is facing inevitable foreclosure if they don't find a way to reduce their monthly mortgage payments. At times it can be difficult to understand the loan modification process. There is good news however, the process doesn't need to be as difficult as many people think. You just have to understand what is involved and take the appropriate action.

Loan Modification "How To": Writing A Hardship Letter

Writing a hardship letter is one of the most important things you can do when you are looking to get a loan modification. This letter should briefly outline why you need to modify your existing loan. It should also explain why receiving this modification to your loan will help you to ensure that future mortgage payments will be made on time and with no further issues. It is important to avoid emotions and complaints in the letter. Keep the letter short and to the point - focusing on the details of your situation. This will increase the chances that the bank representative will read the letter and respond favorably.

Loan Modification "How To": Getting Results

When you are going through the process of applying for a mortgage modification it is important to stay in contact with the bank. Do not expect the bank to do anything on its own without any form of outside influence from you. Most banks are processing many mortgage modification requests, with new requests being received every day. So, failing to stay in contact with the bank can lead to your request ending up lost or overlooked. Remember to contact the bank and let them know each time you send a fax or email to ensure they received the document. Also, maintain a record of phone calls and other communications with the bank - who you talked to, what you discussed, and the next step (and expected date) in the process.

Be sure you understand the mortgage modification process and the specific requirements of your lender before contacting the lender.

By: Mark Winfield

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Monday, April 6, 2009

How The Credit Crunch Is Affecting Mortgage Lending In 2009

The current economic crisis has had a profound affect on UK property developers and landlords alike. A causal relationship between the two means that whilst prospective landlords are not eager to buy property at a time of low lending and credit, companies and individuals at the beginning of the building chain are also not inclined to invest any money in the construction of houses that are likely to remain empty for a long while. Over the last month there have been many announcements and changes within the mortgage lending industry, and so I thought I would discuss the major ones in a simple article.

In the middle of February there was a significant amount of news concerning house prices in the country. Despite the presumption that they would fall, it seems that different (but well-regarded) sources such as Nationwide and Halifax were giving very different statistics on the matter. The problem here is that both banks have varying criteria for their mortgage products and so their results can differ significantly. As a result, Halifax reported that UK house prices had increased by 1.9 percent, whilst Nationwide had shown a decrease by 1.3 percent. Similarly, both banks publish their results at different times during the month (Nationwide publish during, and Halifax at the end), meaning the results are not from exact same time period.

At about the same time, a more certain set of statistics were released by the Department of Communities and Local Government concerning a countrywide lull in building new houses. They reported that the amount of houses set for development (just over 16,000) in December 2008 was 58 percent lower than it was a year before, whilst the private sector statistics were even worse (at 64 percent lower). As expected, lack of finance has been to blame for the biggest decline ever in this area, with little being available for residential and buy to let mortgages also.

More recently however, there has been some good news coming from such banks as Northern Rock and Lloyds/HBOS. In late February, the former announced they had £5 billion to lend in 2009 for residential mortgages, which increases competition in the sector and may be an incentive for others to offer more on the buy to let front. Following this, at the beginning of March Lloyds/HBOS announced they would increase their mortgage lending budget from £9 billion to £12 billion this year displaying a gradual shift in the accessibility of credit for borrowers.

By: David John Martin-11606

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Saturday, April 4, 2009

Washington Mortgage Lenders: Know The Facts

Most people search the internet for authentic mortgage options. Most first time businessman or a person in a financial crisis looks out for easy mortgage options. Mortgages play an important role in raising the requisite money in the market. It is the source of easy money and credit in the market. Often big business plans or growth is stopped because of financial crisis.

One of the ways to ride over this problem is mortgage. Mortgages work wonderfully when you have a fixed asset. It is vital to possess affixed and valuable asset like estate, properties or houses. In this issue Washington Mortgage lenders can help you. Some people also mortgage their lands deeds and even their company to borrow money. Liquid cash is vital for the running of the market. When there is lack of this liquid money people go for mortgages.

Washington mortgage is actually a type of loan forwarded by an individual or an organization to you. This loan is given for a fixed term. This term given by Washington Mortgage lenders is normally big because it takes many years to repay the loan. There is also a fixed or variable interest charged on the amount given to you. So after the loan expires you will pay back the principal with the interest. The interest is actually the profit of the lender. The principal can be returned after a fixed duration or in installments over a period of time. Most borrowers try to repay the loan as quickly as possible to avoid piling of interest rates. But before the loan amount is written to you the lender normally takes something from you as a guarantee that you will pay back the amount. This is normally a fixed asset like gold or property. Some also take loan on their personal credit (which can be dangerous) and the industry itself.

If you stay in the state of Washington then the process of mortgage is even simpler for you. There are plenty of profitable Washington Mortgage lenders here. You can search the internet for the best Washington mortgage companies in this state. But remember along with the good ones there are also the tricky ones whose main interest is in taking away your asset through heavy rates and hidden costs. There are also some great Washington mortgage lenders who get you the perfect mortgage quickly to you. What you need to do is, first fill out their detailed form provided online. They will then understand your requirements and match it with the long list of Washington based mortgage money lenders. You are introduced with this lender and you can have a free consultation with him. If you are not satisfied with the terms of lending them you can quit or search again for other lending options.

But first try to understand the type of loans that you need. You can go in for ‘First Mortgage’ where the value of the asset is given to you as a loan amount. ‘Refinance’ is actually taking the first loan again on the same asset. Then there are equity loans and credit loans where the business or personal credit is considered as collateral. Before you go in for mortgage loans it is important to know your credit ratings in the market.

By: Bill Schuster

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Thursday, April 2, 2009

Managing Your Debts Without Borrowing

In case you feel that you aren't able to repay the rent or mortgage on time (and this, sadly enough, happens quite often this days, thanks to the crisis), it is wise for you to speak with your creditor. Some lenders are being more flexible these days and will allow you to stretch out your due date to the time you will be paid by your employer. In case the credit doesn't have any interest with it, you can also consider working out a repayment schedule to help you cover the debt in a less stressful fashion. But before you consider such measures, you have to make sure that there are no additional fees for such things. You also have to keep in mind that this being late on your payments will affect your credit rating.

Some employers allow their workers to get cash advance on their paychecks before the pay date. If speaking technically, it's not a loan as it is, but simply a part of the sum you will receive with your paycheck that will be subtracted from it. Before applying for such an advance, you have to make sure that your employer doesn't have any special restrictions or limits on how often you are able to take such measures.

Of course, in case you are experience financial trouble, it is not very bright for you to buy expensive things, even if you need them. If your car needs a repair, you can take public transportation or ask your trusty co-workers to give you a lift for some time, until you're through with your repayments. This will save you much money on gas, and allow you to accumulate enough cash to perform the repair or reimburse your debt.

Consider using your savings or deposit account instead of borrowing money or taking another credit. Of course, you will have to repay the account just like you will repay the debt.

Your community can host special assistance problems to households experiencing financial problems, so you should check if there's one in your area and you apply for it. Sometimes the conditions with such programs are very advantageous and can help you out with your debts.

Think about selling some things you don't really need. Of course, you can be emotionally attached to that expensive couch or the painting on your wall, but sometimes it's the necessary cost of getting out of debt you should consider sacrificing. You can also work some extra hours to get extra money, especially considering that overtime rates are higher. However, some employers discourage overtime workers thanks again to the economical crisis.

You can also consider speaking to your family or friends regarding financial support. Of course, no one wants to mix finance with relations but sometimes it is necessary. Borrowing from your friends is still a better option than going for payday loans. Of course you can consider the latter if you are sure you will pay out the loan pretty quick. Still, it's not recommended to run into more debts just to repay the previous ones – it is quite dangerous finance-wise.

By: David Mayer

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Basic First Time Buyer Mortgage Transactions

In order to get a suitable first time buyer mortgage, you need to explore different mortgage options. But before that, you will need to know about how lenders review your application and decide whether or not to approve your request for a mortgage.

Before considering your application, the lenders will evaluate your ability to pay back a mortgage. This is done on the basis of your total monthly income and total monthly debt. In general, a monthly income to debt ratio of 36 to 40% is generally considered acceptable. You can also expect them to check your willingness to pay by checking your credit rating. It goes without saying that if your credit score is low or the higher your income to debt ratio, your chances of getting approved for a conventional mortgage is less. In such cases, if you are grated a loan the interest rates will be higher with less attractive terms and conditions to cover the higher risk perceived by the lender.

However, if the lender is satisfied with your financial credentials, you can confidently expect to get loan with various benefits such as lower rate of interest, smaller monthly installments, smaller monthly outgoings, longer repayment duration, flexible repayment options, lower fees and penalties, among others. In case of an adverse credit record you neednt worry much because there are many creditors who provide mortgage to bad credit borrowers. Bad credit mortgages are especially designed to help people having a poor credit record.

There are a number of popular first time buyer mortgage options available in the market. The first among them is fixed rate mortgage which has a fixed interest rate for a specific period of time for a period of up to one to five years and after this period the interest returns to the lenders standard rate. Fixed rate mortgages allow you to successfully plan your finances, as you know the mortgage repayment won't increase for the defined fixed rate period. However, when interest rates fall you do not benefit from reduced payments.

Another option is variable interest rate that goes up or down as per market flexibility in the rates. So, first time home buyers may prefer to keep away from this option because if they cannot adjust with an increase in rates they may end up having trouble making payments. Other common options are tracker mortgage, discounted mortgage, and capped rate mortgage. The tracker mortgage follows the interest base rates. In most cases your mortgage interest rates is set at a certain percentage above the base rates. The main advantage is that when the base rate falls then so do your repayments. And the reverse will also happen when the base rates rise.

Discounted mortgages work in a similar way to tracker mortgages in that they are variable loans. Unlike a tracker, a discounted mortgage doesn't follow the base rate. Instead, there is a reduction in the lender's standard variable rate for an agreed length of time. Your repayments will fall when the interest rate falls and they tend to be some of the cheapest first time mortgages available. Capped Rate Mortgage is guaranteed not to raise the interest rate above a certain percentage, normally for one to two years, after which the interest rate returns to a fixed or variable rate.

Other versions are repayment mortgage and interest only mortgages. In the former, you will see each monthly payment go towards paying off the underlying debt, as well as the interest on the loan. At the end of the term, the mortgage is cleared. The latter, on the other hand, expect you to pay off the loan's interest, not the loan itself. At the end of the mortgage term, however, you are expected to repay the capital.

About the Author

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