Home Loans

New home sales are coming off the torrid pace of the last couple of years and mortgage interest rates for new home loans remain very favorable for homebuyers. Simply put, now is a very good time to look into buying a first home or moving up to a larger home.

While real estate experts report "location, location, location," remains the venerable first rule of real estate, other buyer priorities are shifting with the times. One priority shift is that where once buyers looked to purchase a home for the long term - a place to work and raise their family - today's homebuyers want a residence with appreciation potential. Many people seeking new home loans in today's market want to buy a home in that will quickly increase in value.

The way today's buyers look at home loans, especially loans for new homes, has changed. Years ago, price was a big issue and people were more concerned about what their monthly payments would be on a 15- or 30-year mortgage. Today, there are all kinds of options for new home loans, especially adjustable-rate loans with low payments in the first few years. Many people have successfully purchased homes this way, made the low payments and when the equity in their home rose - in some cases significantly - the moved up to a larger home.

When selecting a mortgage for a new home, have a plan in mind. How long do you plan to live in the home is a major factor, then search MortgageLoan.com for a plan that suits your plan and meets your budget.

By MortgageLoan.com

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Home Refinancing Basics

In recent years, millions of homeowners have taken advantage of low rates and refinanced their mortgages. This article describes the advantages and possible pitfalls associated with a "refi."

Home Refinancing Basics

In recent years, Americans seeking to take advantage of low interest rates have lined up to refinance their mortgages. In fact, refinancings hit an all-time high in 2003, and remained high in both 2004 and 2005, according to the Mortgage Bankers Association of America.

But while it's true that refinancing has the potential to help you reduce the costs associated with borrowing money to own a home, it is not necessarily a strategy that makes sense for every individual in every situation. So before you make a commitment to refinance your mortgage, its important to do your homework and determine whether such a move is the right one for you.

To Refinance or Not

The old and arbitrary rule of thumb said that a refi only makes sense if you can lower your interest rate by at least two percentage points for example, from 9% to 7%. But what really matters is how long it will take you to break even and whether you plan to stay in your home that long. In other words, make sure you understand -- and are comfortable with -- the amount of time it will take for your overall savings to compensate for the cost of the refinancing.

Consider this: If you had a $200,000 30-year mortgage with an 8% interest rate, your monthly payment would be $1,468. If you refinanced at 6%, your new monthly payment would be $1,199, a savings of $269 per month. Assuming that your new closing costs amounted to $2,000, it would take eight months to break even. ($269 x 8 = $2,152). If you planned to stay in your home for at least eight more months, then a refi would be appropriate under these conditions. If you planned to sell the house before then, you might not want to bother refinancing. (See below for additional examples.)

Remember -- All Mortgages Are Not Created Equal

Don't make the mistake of choosing a mortgage based only on its stated annual percentage rate (APR), because there are a variety of other important variables to consider, such as:

The term of the mortgage -- This describes the amount of time it will take you to pay off the loan's principal and interest. Although short-term mortgages typically offer lower interest rates than long-term mortgages, they usually involve higher monthly payments. On the other hand, they can result in significantly reduced interest costs over time.

The variability of the interest rate -- There are two basic types of mortgages: those with "fixed" (i.e., unchanging) interest rates and those with variable rates, which can change after a predetermined amount of time has passed, such as one year or five years. While an adjustable-rate mortgage (ARM) usually offers a lower introductory rate than a fixed-rate mortgage with a comparable term, the ARM's rate could jump in the future if interest rates rise. If you plan to stay in your home for a long time, it may make sense to opt for the predictability and security of a fixed rate, whereas an ARM might make sense if you plan to sell before its rate is allowed to go up. Also keep in mind that interest rates hovered near historical lows in recent years and are more likely to increase than decrease over time.

Points -- Points (also known as "origination fees" or "discount fees") are fees that you pay to a lender or broker when you close the deal. While a "no-cost" or "zero points" mortgage does not carry this up-front cost, it could prove to be more expensive if the lender charges a higher interest rate instead. So you'll need to determine whether the savings from a lower rate justify the added costs of paying points. (One point is equal to one percent of the loan's value.)

How Much Would You Save? A homeowner with a 30-year, $200,000 mortgage charging 8% interest would pay $1,468 each month. The table below illustrates the potential monthly savings and the various break-even periods that would result from refinancing at different rates.

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Remodeling Home Loan

Remodeling home loans are home equity loans that are used to 'spruce a place up'. Someone may choose this when they want to lay new carpet, change the wall color, or put up crown moulding. These are simple low-cost projects that don't need a large sum of money. The reason to distinguish between these and home equity loans is that there are some different risks and requirements for each.

This financing is similar to a personal loan. It does not have much, if anything, to do with the overall value of the house. On the other hand, the value of the house now, versus when first bought will have a factor in, if and how much financing can be obtained with a remodeling home loan. Both types of financing are used to enhance the value and visual appeal of the property, but are handled differently.

When considering obtaining some financing to remodel, start the research with the financial institution that holds the mortgage for the house owned. They may give special rates knowing that they are enhancing their own property. Using the bank that is holding the mortgage is not always the best opportunity for remodeling home loans though. Shop around on the internet and through the telephone book or ask friends or neighbors who they used and why. The 'why' is an important question. There are many financial institutions out there that offer remodeling home loan options, but what is right for the goose may not be right for the gander, so to speak. Take in all the information available and figure out what is important.

Once armed with a handful of options, fully examine their qualities. Each is going to have its 'shining star', the reason this should be the deal. Evaluate all of the remodeling home loans individually and when there are only 2-3 left on the list, compare them. Figure out which has the best interest rate and the least overall fees during the life of the financing. Lastly, but most importantly, figure out which has the best customer service. If a problem arises there will be the opportunity to talk to someone (a real person).

After going through all this research and decision making about remodeling home loans, choosing the style of carpeting won't be so bad, and the decision to update the home won't be regretted either. Take the same time and consideration choosing the remodeling home loan as for the carpet color. If something doesn't feel right or the right opportunity just isn't presenting itself right now, wait a few months and look again. "But let patience have her perfect work, that ye may be perfect and entire, wanting nothing." (James 1:4)

For more information: http://www.christianet.com/homeloans

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Residential Construction Loans

Residential construction loans will be a huge money maker the next year because more and more people want to take these contracts out on their homes. Many people would rather take out a residential construction loan to add on or fix up their house rather than going through the hassle of the real estate maze. However, the homeowner needs to follow a step by step process in securing the right terms and interest rates.

The first step that the borrower must take is to determine the type of remodeling he wants to do on the house. This must be done before the applicant fills out the firms for a residential construction loan. The amount of money needed, the length of the construction process, and the availability of hired laborers are essential items to consider. Because remodeling and other types of home construction can entail unexpected expenses, the borrower needs to consider applying for more funding than he presently has on his budget. No one likes to be in the middle of a construction project and run out of money. Drawing up plans and consulting building experts is an essential part of this process.

The second step for a wise borrower is to consult a debt counselor. This step allows him to uncover all the facts about what is needed in residential construction loans. The terms, fees, and repayment plan are all important elements of the contract to consider. Because a borrower can find so many lenders through the Internet, he can do comparison shopping before he decides to sign any one contract. The wise borrower will keep narrowing down the search until the best one emerges for the residential construction loan for that particular project.

The final step in taking out residential construction loans is submitting an application. This is a simple process for the borrower if he has taken the time to complete the earlier steps. Proverbs warns us against rushing hastily into decisions. "The wisdom of the prudent is to understand his way: but the folly of fools is deceit" (Proverbs 14:8). God doesn't excuse Christians from making mistakes when they don't prepare when making decisions. We are created in the image of God, and our God is a God of knowledge. When we apply for a residential construction loan, we will do our best to consider all the angles and take our decision to God in prayer.

For more information: http://www.christianet.com/homerefinance

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Residential Refinance Mortgage Loans

With residential refinance mortgage loans, homeowners can refinance their mortgages for a number of good and solid financial reasons. As interest rates have dropped, homeowners with a locked-in high interest rate loan are turning to the Internet to get competitive deals. On the Internet today, there are hundreds of mortgage companies competing for the applicant's business, and these companies are offering good terms, low rates, and closing costs that can be negotiated. Those who are stuck with an adjustable loan that is beginning to cost more monthly also should investigate applying for a more equitable mortgage. Many lenders offer low rates for fixed rate mortgages with various lengths for repayment. If a borrower has a debt problem in his family, then residential refinance mortgage loans can help with the unsecured accumulated debt by consolidating all the amounts under a new mortgage.

Now consumers can save thousands of dollars in interest rates. Residential refinance mortgage loans can give a consumer the opportunity to lock into a lower interest rate, which will cut the price of the overall loan and lower the monthly payment. With a lower interest rate, the borrower may be able to purchase a contract for much less time, such as turning a 30-year contract into a 15-year contract. Also, customers can receive cash for the equity in the home, allowing them to take care of any urgent cash needs, such as medical bills or home repair, take that long-awaited vacation, or even buy expensive items such as a vehicle without taking out higher rates on unsecured loans.

The Internet today is changing the process and methods that we use to operate our banking and financial decisions. The traditional banking system of loan officers, lengthy applications, and weeks of waiting are of days gone by. Instant applications online, credit reports, and competition have brought a new face to residential refinance mortgage loans, and customers are having the opportunities to comparison shop within the ease of their own homes. Within days, a customer can get quotes from lenders advertising online, competing for their business, and offering better deals. But a Christian prepares for any decision, even financial ones, through prayer. The psalmist implores us, "Give ear to my words, O Lord, consider my meditation. Hearken unto the voice of my cry, my King, and my God: for unto thee will I pray" (Psalm 5:1-2). All the along the pathway of choosing a lender and a contract, stay in intimate contact with God.

For more information: http://www.christianet.com/homeequityloans

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Single Parent Home Loan

A single parent home loan can be a blessing to parents who carry the responsibility of providing shelter, food, clothing and the myriad other needs of their children. It is not so easy to provide all of these needs alone as a single parent. However, it is possible to get into a positive financial position in order give children what they need as well as secure a reasonably priced house through a single parent home loan. " But my God shall supply all your need according to His riches in glory in Christ Jesus." (Philippians 4:19) Financial planning is one of the keys in paying for a house and there are many sources that can help to achieve this goal.

Good money management as a single parent is critical in securing financing. A single parent home loan will be a good reward for the effort. In order to secure this money, it is necessary to establish a credible financial history through good financial dealings. If divorced, it is important to request credit reports from all three credit bureaus in order to determine what the credit history shows. Approval is heavily influenced by the credit score. In order to receive this financing, make sure there are no unresolved financial issues that reflect negatively on the credit report.

Without knowing exactly what will show up on the credit check, there may be an unwelcome surprise that ends in the denial of a loan. Make every attempt to resolve any financial issues stemming from a past marriage before applying for single parent home loans. Even if the financial negative was caused by someone else, it will reflect negatively on the financial history of the person applying for the financing. Before applying also make every attempt to establish a workable household budget and make the budget work by saving money and paying off outstanding debt.

There are many loan websites that offer free loan quotes and can easily be found. Spend as much time as needed to locate a lending source that will offers the lowest interest rates for single parent home loans. Good interest rates will also depend on the credit history and present financial circumstances. It may be wise to also check with non-profit financial management ministries and other sources that can help to devise an effective plan of applying for single parent home loans as well as other important financial information.

For more information: http://www.christianet.com/homeloans

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Home Equity Loan Comparison

You can access your home equity without the cost of refinancing with two financing options. A second mortgage will give you a lump sum check with a fixed or adjustable rate. A home equity line lets you tap into your equity when you want to. Both options allow you to write off interest on your taxes and avoid high financing costs.

Benefits Of A Second Mortgage

A second mortgage allows you to borrow up to 90% of your home’s value. The lender, which doesn’t have to be your primary mortgage lender, writes you one check. You can choose to pay off credit cards or make a major purchase.

Fees are none to minimal with a second mortgage. Rates are usually fixed and last 15 or more years. A 15 year loan lets you pay off the debt quicker, saving you cash on extended interest payments.

Benefits Of A Home Equity Line

A home equity line is like a secured credit card, only you are borrowing against your home’s equity. You can choose to borrow a lump sum or only as needed. Most lenders issue checks and a credit card.

Rates are adjustable and are based on when you borrow the money. You can choose to never use the equity, but just know it is there in case of an emergency.

One option for new homebuyers is to put down a large down payment, securing low rates, and then apply for a home equity line. It’s like a safety net, ensuring that you can still access your cash if needed.

Picking The Right Financing

Each type of home equity loan has its own advantages. A second mortgage offers secure fixed rates with small payments over a longer period. It makes sense for large projects, such as remodeling or paying off credit cards. A home equity line offers flexibility, better suited for smaller purchases.

With both types of programs, you still want to investigate lenders before applying. Be sure to look at financing companies other than your current mortgage lender. You want to find the lowest rates with the best terms by asking for quotes on both rates and fees. By investing a little bit of time, you will save yourself hundreds.

View our recommended home equity line of credit lenders online here: Recommended Home Equity Loan Lenders.

Carrie Reeder is the owner of ABC Loan Guide, an informational website about various types of loans.

Article Source: http://EzineArticles.com/?expert=Carrie_Reeder

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