One of the biggest investments that an individual may have is his home. A home is where you relax after a long day’s work. It is where you spend time with your family. It is your home that provides you a lifetime shelter. Coming up with a decision to buy a new home is not easy. There are so many things that you need to consider. One is where to get the money to finance for it.It is good if you already have enough savings to buy a new home. After paying for it, you are not attached to any other obligations.But not everyone can really afford for a one-off payment to get a roof over their heads. Buying a home is very expensive. However, it is not a reason not to get one. There are a lot of ways that you can finance for a new home especially if you have a decent job.One way is through a mortgage. A mortgage is borrowing money from a bank or a lending company to finance for your new home. One good lending company is the Network Funding which helps people by lending them money to get a new home. They offer different types of Loan or mortgage programs that can be tailored depending on your needs and your capability to pay.One mortgage type that they have is their 15 to 30 years fixed rate mortgage. Its interest rate does not increase so you can very well manage your monthly income without worrying about sudden changes on your monthly payments for your mortgage. Its principal and interest does not change as well.Network funding also offer Fixed-Rate Balloons whose interest rate is noticeably lower than fixed-rate mortgage. It also allows you to refinance your home or sell it prior to the end of your balloon term if there is a need.They also offer a fixed-rate with temporary buy down which has decreased interest rate that also reduces the monthly payment.There are more mortgage types that they offer and you can choose from them as to whichever your think is convenient for you. They also offer counseling if you are a first-time buyer.Sine getting a roof over your head is definitely a necessity and it is understood that not everyone is capable of making a one-off payment for a home; Network funding is helping us to get a new home in an easier way. Through a mortgage you get to have a roof over your head now, and pay for it later.If you are a responsible borrower and you pay your dues regularly and on time, there would definitely be no problems with mortgage. You are in fact given the assurance that by the time your mortgage matures you can call it yours. You get to be detached from obligations as well. You are assured that your family would have a home to go to. Getting a home is not a luxury. It is a necessity, you need it and you deserve it. Network funding knows that that is why they help you get one.
When you consolidate your student loans you get significantly lower monthly payment fees and your monthly interest rates are also lowered. When these are a great help in managing your monthly budget, there are also disadvantages to consolidating your debts.What are the cons of college loan debts consolidation?You will end up paying for more than the overall cost of your loans. Why is this? When you consolidate your student loans your repayment term is extended so that your monthly payment and interest rate are lowered. But if you sum it up, you will actually be spending more instead of saving, and if your repayment term extends up to 30 years, imagine how much you will be losing.There are also some helpful borrower’s benefits that you might lose if you consolidate. These benefits include interest rate discounts and rebates. Federal loans can allow you to apply for payment deferment in case you decide to go back to school or loan forbearance if you encounter economic hardships. These benefits could be lost if you consolidate especially to a private lender.Since debt consolidation interest rate is the weighted average of your various loan rates, there is a possibility you’ll end up paying for a higher rate than if you pay your loans separately. This happens if you consolidate a high rate loan with other low rate loans.Consolidate your student loans only if you don’t have any other options. If you have mostly federal loans, check with your lender of college if you qualify for loan forgiveness. This is possible if you can work as a teacher, doctor or lawyer in low income areas in the U.S. If you belong to other professions, then perhaps you can do volunteer work for the Peace Corps or Americorps to lessen your college debts.
The amount of time you should wait to refinance your home depends on some key factors. Some deal with your type of mortgage and the lender you are currently with. Other factors depend on your financial situation and the market at the time you are considering to refinance your home. The type of mortgage you already have on your home determines refinancing timing more than anything else, so lets start there.Questions to Ask Regarding Your Current Mortgage
Does it have a seasoning period? A seasoning period is the time the mortgage company has written into the mortgage documents before which you cannot refinance your home. Some people buy foreclosure homes planning on refinancing once they get it re-appraised with enough value to eliminated the Private Mortgage Insurance. Many banks have time lines on mortgages that help them determine when they break even and will not allow the mortgage to be refinanced before then. If there is no seasoning period then any time is good.
Does your current mortgage have early payoff fees? Most mortgages now have eliminated these clauses because consumers caught on to them. However, if your home was mortgaged some time ago, it may have an early payoff penalty. This means if you pay off the mortgage early (even with a refinancing loan) you will pay a fee. If there is no payoff fee then you do not have to factor in those costs.
Is your current home loan fixed or variable? A fixed term mortgage gives you indefinite security with the current interest rate you have. You can wait out the market and your own personal financial situation to determine when the best time to mortgage will be. If you have a variable or adjustable rate mortgage (ARM) then when the fixed term portion of the mortgage (5 year ARM is 5 years fixed) is up, you may have a significant percentage increase if you do not refinance. If your ARM is getting ready to become variable it is a good time to refinance.
What is your current loan interest rate? Don’t look at the APR (annual percentage rate) since that counts in to your mortgage one time costs you have already paid and cannot recover (closing costs, points, etc). Look at the loan interest rate (the lower number you were likely quoted). Once you have figured out the above factors, and have the loan interest rate in hand you can move onto the next set of factors.Questions to Ask Regarding Your Financial Situation and the MarketThe mortgage market fluctuates interest rates for home loans daily. When that interacts with your personal financial situation and its fluctuations, a few months’ time can make thousands of dollars of difference. Here are some pieces of information you need to make an informed decision about when to refinance your home.
What is your FICO credit score? Do not pay or the vantage credit score, since it is not as well known and likely is not what banks will look at. Get your FICO credit score with a number. If your FICO score is above 700 then it may be a good time to refinance your home loan. If your FICO score is below 700, then you will likely want to repair your FICO score before refinancing since it could save you thousands of dollars to do so.
How much cash do you have on hand? To refinance a home loan you often need cash to cover closing costs (average cost is around $2500). You need to be sure you can cover the closing costs and still have a 3-6 months emergency fund in hand.
How long will you be in the home? If you plan on staying only a short time then the refinancing loan will have to pay for itself quickly. If you plan on being in the home for the foreseeable future then you can afford to take a few years for the refinance to pay for itself. Divide the total costs of refinancing by the savings per month over your old loan to determine how long it will take to pay or itself.
Is the APR for a new loan less than the loan rate for the current loan? You basically want to be sure that the costs of closing (assessment, points, origination fee and so on) when considered as part of the interest rate of the loan save you money over the loan interest rate you already have. Again, don’t look at the APR of your current home loan, that includes previous closing costs that you can’t change.
While you may be thinking of refinancing your home to save money, there are many considerations to keep in mind before selecting a mortgage company. The type of interest rate you have, the reputation of your current mortgage company or bank, and the amount of money left to pay off are just a few of the concerns you need to think about.If you have an adjustable interest rate, this might be the biggest reason to want to refinance. Some adjustable rate mortgages do not even have a cap on the highest amount your interest rate can climb. The wavering of your mortgage interest rate can make budgeting your monthly finances a nightmare! Refinancing to a fixed rate might be the best option if you need stability in your payment amount. Even though the amount of your fixed rate can occasionally be higher than current adjustable rate, you will be able to estimate your expenses. The current economy has driven down interest rates drastically, making this a perfect time to refinance.Loan consolidation can be another reason for refinancing your mortgage. If you are struggling with high interest credit card payments or student loans, refinancing might be a great option! Cashing out your home equity is another great way to save. You can use that cash to pay down credit card, school loan or medical debt. You could alternately use the additional money to pay off the first mortgage. Check with your tax consultant about the possibility of deducting interest payments.Another refinancing option to consider is whether the term of the loan will be longer than the original. Your mortgage might end up being longer, but your monthly loan payment could be significantly lower. Deciding should depend on how long you are planning to live in the house.Keep in mind, the better your credit rating – the better your chances of refinancing your mortgage. If you have been consistently late with payments or have any credit judgements on your record you might have a hard time negotiating decent loan terms if you can get a loan at all. Make sure your payments have been on time for at least the last year before making an appointment with a lender.You can find mortgage calculators online to let you see what your potential refinanced mortgage loan payments might be as well as the length of the loan. Always check the reputation of any mortgage companies to ensure their reliability. Many mortgage companies that promise to finance anyone will end up costing you a pretty penny!
There are a couple of reasons to consider refinancing. You may need additional cash right now in order to pay for a real need, such as paying college tuition or even remodeling your home, or buying a car (if you pay cash because of a ‘cash out’ refinance loan your mortgage interest is tax deductible…for now) or you may want to take advantage of the much lower interest rates that are available now. The VA has options for both of the above reasons.The first option is a VA Loan for Home Equity Refinancing. This refinance transaction requires repayment of your current mortgage directly from the proceeds of your new VA mortgage. This will be for the same borrower for the same property as on the original loan. A home-owner can refinance up to 90% of the appraised value, plus all closing costs, provided the property can stand up to the designated loan to value ratio. You do not have to own your home for any minimum amount of time, but your home has to have sufficient equity to quality for the loan. Equity is the difference between the market value of your home and the amount you actually owe on it, which includes both your first and second mortgages. You can use the extra money (the equity) to pay off high credit card debt, buy a car, remodel or whatever you need the additional cash for.The second option is a VA Streamline Refinance, sometimes referred to as an Interest Rate Reduction Loan. The sole purpose of this loan is to gain a lower interest rate in order to save money, not only on your monthly mortgage payment, but ultimately over the life of the loan. This program was created by the VA to make this happen with little or no out-of-pocket expenses for the home owner. Either the lender can pay the associated costs in exchange for a slightly higher interest rate or you can roll the closing costs into the new loan. The basics of this program are as follows:
This is only available to veterans who are refinancing their original VA mortgage and who have utilized their original eligibility for their current loan.
No assumptions are allowed
The homeowner cannot receive any cash back from the transaction.
All other liens must be subordinate to the VA’s lien.The VA will not require an appraisal, income or employment verifications, a credit report or a current termite report. The first qualifying criteria is that the current mortgage must have been paid as agreed for the prior 12 months and must not be in arrears at the time of the refinancing.As of July 15, 2010, the VA National Average Interest Rate was 4.617% APR for a 30-year fixed mortgage and 4.704% APR for a 15-year fixed mortgage. If you are currently paying at least half a point more in interest, this may be a viable option that can save you significantly, both on your monthly living expenses and over the life of the VA loan. You can also buy down the loan interest rate by paying points, which could make this an even more lucrative option.To get started, either contact your current lender, or another lender of your choice. This could easily be one of the smartest decisions you will make and the VA has made it so much easier for those eligible persons than what a non-veteran faces with the current economy. What are you waiting for?
On yearly basis, homeowners invest their money from hard work into their home. And when they have invested a big amount of money, they will use it for many essential problems, be it college tuition, home improvement, paying debts and many other things that needs a lot of money. FHA loan can be a great solution to use the home equity.But you have to notice that FHA loans only refinance the primary-residence house. They cannot be used for second investment, or vacation properties.There are few different choices for homeowners provided by FHA when are considering the FHA mortgage refinancing:FHA Cash Out Mortgage RefinanceThis is a good option for those who increased the house value since the purchase date. This way, you can have a bigger loan and you can save the difference. The improvement that you have done to your house can increase the loan and therefore it gives you a lot of money.After you have a decent amount of equity built up in your home, it is better to get cash out refinance. Homeowners should have 20% or more equity in their home to get cash out refinance to solve financial problems. This is much better solution with a good interest rate, compared a personal loan.Streamlined FHA Mortgage Refinancing OptionsThis is a simple option because you can rapidly decrease the interest rate without an appraisal. This option also decreases a lot of paperwork on the lenders side. It can save time and money.You need to have a FHA mortgage in good standing in order to use the quick option. It is important that refinance can reduce the interest rate. It does not give you a cash-back from home equity, but it reduces your payment and interest rate quickly. This is a good option because you will spend less money.
According to a Federal Reserve Bank report published in 2002 thirty-five percent, the biggest share, of home equity loan dollars goes back into the borrowers house through home improvements and maintenance projects. Considering the benefits and the ease of leveraging the equity you already have through a second mortgage or mortgage refinancing, this is hardly a surprise. ”The cake itself is the equity, and that is the important part of ownership,” Richard Wakelin, of Wakelin Property Advisory. If you are smart about building equity you can earn it even faster and with less investment. Some of the best ways to increase equity are simple such as:1. Buying a home in the right neighborhood is critical. If the real estate values are rising, you could build equity without doing anything more than holding on to the property.2. Curb appeal is key to raising a home’s value. It doesn’t take much money to install irrigation and landscape a property, but the first impression from the outside can be worth a lot. If you have some equity in your property already, a home equity credit line may be a better way to fund these smaller improvements than using a credit card. The interest is lower and so are the payments.3. Remodel the kitchen if you really want to increase the value. Buyers are willing to pay more for a home with a gorgeous cook-friendly kitchen. If you are looking to do a remodel, mortgage refinancing is a good way to cash out on the equity that you already have and invest in building further equity. (Likely with a tax break on the interest as well.)4. Master bedroom and bathroom improvements are also a good way to increase equity and can also be paid for through a refinance.5. Don’t forget small improvements with “sweat equity” either. Just a little bit of capital and a lot of muscle can greatly improve a home through painting, wall papering and other do-it-yourself upgrades.A little bit thought and effort can go a long way in making your property your best investment!
The decision whether to refinance your home is one that many Americans face everyday. Over the last 30 years interest rates have gone up and down numerous times. In the 80’s they were as high as 18%, and now some 30 year fixed rate loans are as low as 5%. Many homeowners who bought when interest rates were higher are now considering refinancing to reap the benefits of a lower interest rate.Some of the benefits of a lower interest rate are listed below:First, Lowering your interest rate will lower your monthly payment. With the economy in such terrible shape if you can lower your monthly mortgage payment could give some added relief to some homeowners. Even if it costs you some money to get a new loan you could save a great deal of money over the life of the loan.Secondly, changing the type of loan can be a possibility for you. Many homeowners may have flexible mortgages that have rates that can change, without very much notice. Also you may have a loan that has a balloon payment after a certain period of time. It may be very difficult for some people to come up with that payment in today’s touch economic times.Lastly, if you bought your house over 10 years ago, you may have equity in your home due to the appreciation of your home. Refinancing your loan and taking some money out of your homes equity is a good way of helping with your children’s education or making plans for a better retirement. If you are thinking about pulling out equity from your home make sure you discuss your plan with an experienced loan broker so you can be advised if you are making the right decision.
Before applying for a personal loan to pay for home repairs, wedding
expenses, or college tuition, carefully weigh the advantages and
disadvantages of a home equity loan. Home equity loans provide a lump sum of
quick cash for large purchases. Moreover, because your property secures
the loan, most second mortgage applications are approved.Advantages of a Fixed Rate Home Equity LoanHome equity loans are beneficial because they generally have a lower
interest rate. Using a credit card for home repairs, emergencies, etc is
very costly. Because of high finance charges, paying the balance on
credit cards is almost impossible. On the other hand, a home equity loan
has a low fixed rate, which allows you to pay off the balance within a
few years.Furthermore, home equity loans are available for individuals with poor
credit. Most bank loans and credit card companies will not loan money
or grant credit to individuals with a low credit score. In some cases,
it is possible to obtain a loan with adequate collateral or a co-signer.
If a bad credit applicant does not secure the loan with a piece of
property or have a co-debtor, lenders will not approve the application.Home Equity Loan DangersWhile low rate home equity loans have several advantages, there is one
major pitfall of getting a second mortgage. The loan approval is based
on your home’s equity. Hence, you take out a second loan against your
home. If you are unable to repay the home equity loan, the lender will
foreclose on your house. This is true even if you continue to pay your
first mortgage. Because the home has two liens, either lender has the
right to foreclose.Finding Low Rate Home Equity LoansGetting the best deal on a home equity loan requires work. To begin,
shop around for quotes from a mixture of lenders. These may include
banks, mortgage companies, brokers, credit unions, etc. Mortgage brokers
are extremely helpful. Moreover, contact your present mortgage lender for
a quote. Before applying for a second mortgage, review your credit.
Resolve credit errors, and improve credit blemishes. This will help you
get the best rate.
Having an education is a right, but sometimes after high school we would think twice if higher education is an option because of its cost. The US Department of Education offers financial aid to students who cannot afford an education due to low income. There are also pupil loans that can be obtained so that one can get the degree that they desire. With an education, young individuals are going to be more knowledgeable and become productive citizens. With higher education, they can get a degree in medicine or law that would greatly benefit them in the years to come.Getting a pupil loan is similar to a personal loan. Both are somewhat the same. The interest rate is dependent on the current prime interest rate and of course, credit history is also very important. Having a good credit score will increase your chances of getting approved and you can have lower interest rates. However, if some students have little or no credit history, their interest rate is usually the prime rate. It is quite tough to study and to take care of a loan at the same time. So pupil loan payments are often on a sliding time scale or are deferred for a number of years. This will give them the opportunity to have their career without the headache of loan payments or at least until they graduate.Sometimes, students will face heavy debts and this can be an annoying financial load. So there are pupil loan consolidation programs that they can avail of to help them with their debts. Go to a lender that can provide the appropriate program for you. Another option is to go to a bank and see if they offer better rates. Check online for their prime rates. The federal government offers better interest compared to private institutions. However, if the student loans that you currently have are federal then it follows that the consolidation program has to be federal too. That goes the same if you have a student loan that is private funding. Shop around for the best interest rates. Finding the right pupil loans or consolidation programs is just a matter of research.