Best-Financial-Advice.com
Lowering Mortgage Costs:
If you are a homeowner or interesting in buying a
home, one of the biggest concerns you probably
have is to find an affordable mortgage. Mortgage
rates will generally vary over time, moving up or
down for all participants in the market. Within the
market range, your mortgage rate will depend on
1) the mortgage product one chooses, 2) the
credit score and credit profile of the individual
borrower 3) the amount of down payment or
equity in the home if a refinance and 4) the
property being purchase/refinanced. Here are
some tips on how to ultimately lower your
mortgage costs.
Choose a Low Interest Rate Mortgage
Obviously, one of the biggest factors in
determining the size of your mortgage payment
(besides the size of the loan) is the mortgage
interest rate. Before you sign on the dotted line,
make sure you shop around, finding the lowest
mortgage rates available. In this regard, the
Internet can be very helpful. There are several
sites that can help you find the lowest rates for a
mortgage that fits your needs. You can easily
search dozens of lenders, but I recommend
finding 2 or 3 that you trust and proceed to
compare from there.
Fixed Rate vs. Adjustable Rate Mortgage
Normally a fixed rate mortgage is better for a
borrower, especially when interest rates are at
relatively low levels historically - which they are
now. The advantage is that they have locked in a
rate that won't change even if interest rates go up
generally. They will not benefit if interest rate go
lower, however. They do have the option to
refinance if interest rates go down, but this also
involves incurring new closing costs.
An adjustable rate mortgage rate makes sense
when a person knows that they will only be in a
home for 3 to 5 years. They can get a mortgage
with a lower interest rate that will only adjust when
they at the end of that period, eliminating the risk
of the rate change. Generally, only more
sophisticated borrowers should take an
adjustable mortgage under when they intend to
stay in their home for longer periods.
Exotic Mortgages: Over the past few years, other
mortgage types such as interest only or option
mortgages have become available. The headlines
scream of the dangers of these mortgages, as
many who borrowed under them were unaware of
the consequences of them. Even if available, I do
not recommend to anyone except the most
sophisticated borrowers and investors.
Your Credit Score Matters
It should be noted that although mortgage lenders
offer low rates to their customers, these offers
can depend on many variables. Those with good
credit scores will normally qualify for the lowest
rates available. Those with poor credit will have to
pay more and in some cases you may even be
unable to get a mortgage.
Choose a Term that is Right for You
Look at the term of the mortgage and decide if it is
right for you. For those with more income, you
can choose to pay off your mortgage in less years
(e.g. taking out a 15 year mortgage instead of a 30
year mortgage).
Pay Off Your Mortgage Quickly
One strategy to lower your mortgage costs is to
pay off your mortgage more quickly. For instance,
pay your mortgage bi-monthly instead of monthly.
With a 30 year mortgage, you can cut off 30
months worth of payments. You can also round
up and pay a little more and save tens of
thousands of dollars (e.g. on a $1,415 monthly
payment, you can choose to pay each month
$1,500).
How to Save Big Paying Off Your Mortgage
If you are a homeowner and currently paying off a
mortgage, you should know about the many tips
and tricks to save lots of money on the repayment
of your mortgage and how to pay off your
mortgage more quickly than the stated terms.
There are plenty of ways that many homeowners
can save tens of thousands of dollars off the cost
of their mortgage, here are just a few.
One way to save big when paying off your
mortgage is to pay off your mortgage bi-monthly
instead of once a month. Believe it or not, paying
off your mortgage bi-monthly cuts your mortgage
term by several years because of the fact that
there is an extra pay period within each year.
Instead of paying off your mortgage in 30 years,
you can pay it off 30 months sooner due to the
extra payment month. While some banks charge a
small fee if you would like to pay bi monthly, if
they do, you can always send them a payment on
your own.
Another strategy is to pay a little more extra than
is requested by your bank. For instance, if you
have a 30 year mortgage on a $150,000 home,
with a 5.76% fixed interest rate, you would pay
approximately $876 per month. However, if you
raised the amount you pay each month to $976,
you would pay off your mortgage 6 years early
and save yourself approximately $40K+ dollars in
the process.
Another way to save big when paying off your
mortgage is to look to refinance your mortgage
when the rates are lower. Giving the fact that
homeowners usually pay off their loan for up to 30
years, there can be times when the interest rate
drops below what your current mortgage interest
rate is. This means by simply refinancing your
home at a now, lower interest rate, you can
possibly save thousands of dollars over the life of
the new mortgage.
Another way to save big on your mortgage is by
choosing mortgage terms that are more
advantageous to your specific financial situation.
For instance, for those with high incomes that are
not living beyond your means, you can easily take
out a mortgage for a home for 15 years or even 5
years. Fewer years, means less interest
payments. While your mortgage payments will be
higher, if you can afford it, you can save a lot of
money in the long run.
Refinancing:
You have ave probably heard that the housing
market isn’t doing too well - in fact, it has seen
historic drops. However, even with these historic
drops in the values of homes, it is possible to
refinance. Refinancing your home is when you
take out a new mortgage on your home. This
usually includes a change in interest rate, terms
and in many cases if a home has increased its
value or equity since its initial mortgage it can
include a withdraw of cash.
Refinancing is not for everyone. In fact during the
real estate boom, many people over-used it,
placing them in a tougher position now that real
estate values have dropped in many areas.
However, for home owners with a certain profile
and needs, refinancing can still be an attractive
option.
Who Should Refinance
Thinking about refinancing your home, some of
the things that you should take into consideration
include the amount of money you still owe on your
home, the current value of your home on the
market, your credit rating, the current interest
rates and the terms of your mortgage, whether it is
fixed, an adjustable rate, etc.
If you have built up a lot of value in your home
(even with the current decline in prices), your
credit is in good shape and you are looking for a
loan to make a big purchase such as college or an
investment, then refinancing your home may be a
good idea. However, take into consideration the
amount of money you would like to borrow when
you refinance, how much equity you have built up
in your home and the terms of the new mortgage
offered by the lender.
Who Should Not Refinance
Home owners that should not refinance are those
that are happy with their current mortgage terms
and rates and do not need the money for a
productive purpose, such as remodeling their
home. Also, those homeowners whose homes
dropped in value making their mortgage upside
down (meaning that you owe more money on
your mortgage than your home is worth), those
that have a poor credit rating, and those
homeowners in areas where prices are expected
to continue to drop.
Credit Reports
Before you apply for a mortgage, you should have
a good idea of your credit score and what it
means.
f you are interested in having a good credit score,
then one resource you will need to be familiar with
is the credit report. Credit reports about your
personal credit history are compiled by three
different companies in the US. They include;
TransUnion, Equifax and Experian. Each of these
companies continually update information
provided by banks, lenders, etc on how much
debt you have outstanding, new loans you have
recently taken out and your repayment history.
Using this information, these credit reporting
agencies assign each individual a score which
tells banks generally how much of a risk you are
when lending money.
While credit reporting has made it easier for banks
to lend money whether it is a mortgage, car loan or
new credit card, a person with a bad credit history
and thus a bad credit score can be denied low
interest loans or worse - denied a loan. Here is
some information regarding credit reports that
can ultimately help you increase your credit score.
Request Your Credit Report Each Year
You should request your credit report from at least
one of the big reporting agencies each year and
look it over thoroughly. By checking your credit
report, you can evaluate your credit score, look for
errors in reporting and guard against identity theft.
In the case of identity theft, if a loan was opened
that you are not aware of, you can contact the
lender, credit reporting agency and the police to
minimize the damage done to your credit score.
Reduce Your Debt
An easy way to increase your credit score is to
reduce debt. While having a small amount of debt
can be helpful when establishing credit history, if
your credit score is good to excellent, you no
longer have to carry debt to show lenders you are
at low risk. On the other hand having high debt
relative to your maximum debt allowed will lower
your credit rating.
If you owe a lot of money as compared to your
total income (not including a mortgage or student
loans), most lenders will be willing to lend you less
and / or at higher interest rates. Remember the
more debt you have, even if you pay it off in a
timely manner, ultimately means the more risk you
are to lenders. By lowering your debt, you can
raise your overall credit score.
Back to Top
If you are a homeowner or interesting in buying a
home, one of the biggest concerns you probably
have is to find an affordable mortgage. Mortgage
rates will generally vary over time, moving up or
down for all participants in the market. Within the
market range, your mortgage rate will depend on
1) the mortgage product one chooses, 2) the
credit score and credit profile of the individual
borrower 3) the amount of down payment or
equity in the home if a refinance and 4) the
property being purchase/refinanced. Here are
some tips on how to ultimately lower your
mortgage costs.
Choose a Low Interest Rate Mortgage
Obviously, one of the biggest factors in
determining the size of your mortgage payment
(besides the size of the loan) is the mortgage
interest rate. Before you sign on the dotted line,
make sure you shop around, finding the lowest
mortgage rates available. In this regard, the
Internet can be very helpful. There are several
sites that can help you find the lowest rates for a
mortgage that fits your needs. You can easily
search dozens of lenders, but I recommend
finding 2 or 3 that you trust and proceed to
compare from there.
Fixed Rate vs. Adjustable Rate Mortgage
Normally a fixed rate mortgage is better for a
borrower, especially when interest rates are at
relatively low levels historically - which they are
now. The advantage is that they have locked in a
rate that won't change even if interest rates go up
generally. They will not benefit if interest rate go
lower, however. They do have the option to
refinance if interest rates go down, but this also
involves incurring new closing costs.
An adjustable rate mortgage rate makes sense
when a person knows that they will only be in a
home for 3 to 5 years. They can get a mortgage
with a lower interest rate that will only adjust when
they at the end of that period, eliminating the risk
of the rate change. Generally, only more
sophisticated borrowers should take an
adjustable mortgage under when they intend to
stay in their home for longer periods.
Exotic Mortgages: Over the past few years, other
mortgage types such as interest only or option
mortgages have become available. The headlines
scream of the dangers of these mortgages, as
many who borrowed under them were unaware of
the consequences of them. Even if available, I do
not recommend to anyone except the most
sophisticated borrowers and investors.
Your Credit Score Matters
It should be noted that although mortgage lenders
offer low rates to their customers, these offers
can depend on many variables. Those with good
credit scores will normally qualify for the lowest
rates available. Those with poor credit will have to
pay more and in some cases you may even be
unable to get a mortgage.
Choose a Term that is Right for You
Look at the term of the mortgage and decide if it is
right for you. For those with more income, you
can choose to pay off your mortgage in less years
(e.g. taking out a 15 year mortgage instead of a 30
year mortgage).
Pay Off Your Mortgage Quickly
One strategy to lower your mortgage costs is to
pay off your mortgage more quickly. For instance,
pay your mortgage bi-monthly instead of monthly.
With a 30 year mortgage, you can cut off 30
months worth of payments. You can also round
up and pay a little more and save tens of
thousands of dollars (e.g. on a $1,415 monthly
payment, you can choose to pay each month
$1,500).
How to Save Big Paying Off Your Mortgage
If you are a homeowner and currently paying off a
mortgage, you should know about the many tips
and tricks to save lots of money on the repayment
of your mortgage and how to pay off your
mortgage more quickly than the stated terms.
There are plenty of ways that many homeowners
can save tens of thousands of dollars off the cost
of their mortgage, here are just a few.
One way to save big when paying off your
mortgage is to pay off your mortgage bi-monthly
instead of once a month. Believe it or not, paying
off your mortgage bi-monthly cuts your mortgage
term by several years because of the fact that
there is an extra pay period within each year.
Instead of paying off your mortgage in 30 years,
you can pay it off 30 months sooner due to the
extra payment month. While some banks charge a
small fee if you would like to pay bi monthly, if
they do, you can always send them a payment on
your own.
Another strategy is to pay a little more extra than
is requested by your bank. For instance, if you
have a 30 year mortgage on a $150,000 home,
with a 5.76% fixed interest rate, you would pay
approximately $876 per month. However, if you
raised the amount you pay each month to $976,
you would pay off your mortgage 6 years early
and save yourself approximately $40K+ dollars in
the process.
Another way to save big when paying off your
mortgage is to look to refinance your mortgage
when the rates are lower. Giving the fact that
homeowners usually pay off their loan for up to 30
years, there can be times when the interest rate
drops below what your current mortgage interest
rate is. This means by simply refinancing your
home at a now, lower interest rate, you can
possibly save thousands of dollars over the life of
the new mortgage.
Another way to save big on your mortgage is by
choosing mortgage terms that are more
advantageous to your specific financial situation.
For instance, for those with high incomes that are
not living beyond your means, you can easily take
out a mortgage for a home for 15 years or even 5
years. Fewer years, means less interest
payments. While your mortgage payments will be
higher, if you can afford it, you can save a lot of
money in the long run.
Refinancing:
You have ave probably heard that the housing
market isn’t doing too well - in fact, it has seen
historic drops. However, even with these historic
drops in the values of homes, it is possible to
refinance. Refinancing your home is when you
take out a new mortgage on your home. This
usually includes a change in interest rate, terms
and in many cases if a home has increased its
value or equity since its initial mortgage it can
include a withdraw of cash.
Refinancing is not for everyone. In fact during the
real estate boom, many people over-used it,
placing them in a tougher position now that real
estate values have dropped in many areas.
However, for home owners with a certain profile
and needs, refinancing can still be an attractive
option.
Who Should Refinance
Thinking about refinancing your home, some of
the things that you should take into consideration
include the amount of money you still owe on your
home, the current value of your home on the
market, your credit rating, the current interest
rates and the terms of your mortgage, whether it is
fixed, an adjustable rate, etc.
If you have built up a lot of value in your home
(even with the current decline in prices), your
credit is in good shape and you are looking for a
loan to make a big purchase such as college or an
investment, then refinancing your home may be a
good idea. However, take into consideration the
amount of money you would like to borrow when
you refinance, how much equity you have built up
in your home and the terms of the new mortgage
offered by the lender.
Who Should Not Refinance
Home owners that should not refinance are those
that are happy with their current mortgage terms
and rates and do not need the money for a
productive purpose, such as remodeling their
home. Also, those homeowners whose homes
dropped in value making their mortgage upside
down (meaning that you owe more money on
your mortgage than your home is worth), those
that have a poor credit rating, and those
homeowners in areas where prices are expected
to continue to drop.
Credit Reports
Before you apply for a mortgage, you should have
a good idea of your credit score and what it
means.
f you are interested in having a good credit score,
then one resource you will need to be familiar with
is the credit report. Credit reports about your
personal credit history are compiled by three
different companies in the US. They include;
TransUnion, Equifax and Experian. Each of these
companies continually update information
provided by banks, lenders, etc on how much
debt you have outstanding, new loans you have
recently taken out and your repayment history.
Using this information, these credit reporting
agencies assign each individual a score which
tells banks generally how much of a risk you are
when lending money.
While credit reporting has made it easier for banks
to lend money whether it is a mortgage, car loan or
new credit card, a person with a bad credit history
and thus a bad credit score can be denied low
interest loans or worse - denied a loan. Here is
some information regarding credit reports that
can ultimately help you increase your credit score.
Request Your Credit Report Each Year
You should request your credit report from at least
one of the big reporting agencies each year and
look it over thoroughly. By checking your credit
report, you can evaluate your credit score, look for
errors in reporting and guard against identity theft.
In the case of identity theft, if a loan was opened
that you are not aware of, you can contact the
lender, credit reporting agency and the police to
minimize the damage done to your credit score.
Reduce Your Debt
An easy way to increase your credit score is to
reduce debt. While having a small amount of debt
can be helpful when establishing credit history, if
your credit score is good to excellent, you no
longer have to carry debt to show lenders you are
at low risk. On the other hand having high debt
relative to your maximum debt allowed will lower
your credit rating.
If you owe a lot of money as compared to your
total income (not including a mortgage or student
loans), most lenders will be willing to lend you less
and / or at higher interest rates. Remember the
more debt you have, even if you pay it off in a
timely manner, ultimately means the more risk you
are to lenders. By lowering your debt, you can
raise your overall credit score.
Back to Top
| Mortgages |
Mortgages provide an essential tool in achieving
homeownership for many people. Although the
selling and securitization of them has become the
subject of controversy recently, they remain a
basic financial tool to acquire real estate. Here
is the information to determine what your needs
are and what type of mortgage product you may
need.
homeownership for many people. Although the
selling and securitization of them has become the
subject of controversy recently, they remain a
basic financial tool to acquire real estate. Here
is the information to determine what your needs
are and what type of mortgage product you may
need.
Have Questions? Our consultants are available to help you with any financial
question. We can also provide in-depth consultation concerning any financial
issue facing you. We can help. Please contact: Best-Financial-Advice.com
question. We can also provide in-depth consultation concerning any financial
issue facing you. We can help. Please contact: Best-Financial-Advice.com
 | |  | |  | |  | |  | |  | |  | |  |
Have Questions? Our consultants are available to
help you with any financial question. We can also
provide in-depth consultation concerning any
financial issue facing you. We can help. Please
contact: Best-Financial-Advice.com
help you with any financial question. We can also
provide in-depth consultation concerning any
financial issue facing you. We can help. Please
contact: Best-Financial-Advice.com
 | |  | |  |
Have Questions? Our consultants are available to help you with any financial
question. We can also provide in-depth consultation concerning any
financial issue facing you. We can help. Please contact:
Best-Financial-Advice.com
question. We can also provide in-depth consultation concerning any
financial issue facing you. We can help. Please contact:
Best-Financial-Advice.com
Have Questions? Our consultants are available to
help you with any financial question. We can also
provide in-depth consultation concerning any
financial issue facing you. We can help. Please
contact: Best-Financial-Advice.com
help you with any financial question. We can also
provide in-depth consultation concerning any
financial issue facing you. We can help. Please
contact: Best-Financial-Advice.com
Have Questions? Our consultants are available to
help you with any financial question. We can also
provide in-depth consultation concerning any
financial issue facing you. We can help. Please
contact: Best-Financial-Advice.com
help you with any financial question. We can also
provide in-depth consultation concerning any
financial issue facing you. We can help. Please
contact: Best-Financial-Advice.com
Have Questions? Our consultants are available to
help you with any financial question. We can also
provide in-depth consultation concerning any
financial issue facing you. We can help. Please
contact: Best-Financial-Advice.com
help you with any financial question. We can also
provide in-depth consultation concerning any
financial issue facing you. We can help. Please
contact: Best-Financial-Advice.com
Have Questions? Our consultants are available to
help you with any financial question. We can also
provide in-depth consultation concerning any
financial issue facing you. We can help. Please
contact: Best-Financial-Advice.com
help you with any financial question. We can also
provide in-depth consultation concerning any
financial issue facing you. We can help. Please
contact: Best-Financial-Advice.com
Have Questions? Our consultants are available to
help you with any financial question. We can also
provide in-depth consultation concerning any
financial issue facing you. We can help. Please
contact: Best-Financial-Advice.com
help you with any financial question. We can also
provide in-depth consultation concerning any
financial issue facing you. We can help. Please
contact: Best-Financial-Advice.com