Home Mortgage Refinancing Guide

Mortgage experts say the many loan options available for homebuyers today, many of who wouldn’t otherwise be able to purchase, should be looked upon with caution. In the real estate market today there is literally a home for any buyer. However, that does not mean that everyone should buy a home.

Potential homebuyers should asses their financial situation before shopping for a home mortgage. Doing your homework first will save you money; more importantly finding the right mortgage will keep you out of financial hot water down the road. Key factors to consider when financing a home mortgage are will the potential homebuyers be able afford the mortgage payments over time, how much will the home appreciate, as well as how much risk is acceptable. The mortgage market today has many new loans; there are mortgage products for people of all incomes and credit ratings. Homeowners need to be careful, realistic with their spending habits, and have a backup plan should pitfalls arise that could lead to foreclosure.

The problem is picking the right mortgage loan; this can be tricky.

Until recently, potential homeowners had a choice of fixed interest rate, 30 or 15 year mortgages, and some adjustable rate mortgage loans (ARM). However, spurred on by increasing competition, not to mention the fact that almost half of Americans have lousy credit ratings, there has been an onslaught of new types of mortgage loans. Ordinarily, the high prices of homes today would keep many buyers out of the market. The mortgage industry has evolved and found ways to finance people that did not exist a decade ago. These new types of mortgage loans allow homeowners to make little or even zero down payments, they include interest only mortgage loans, and there are mortgages loans with variable interest rates, as well as loans with interest payment options. In spite of all the choices, most mortgage brokers say the traditional 15 or 30 year fixed interest rate mortgage loans are still the most popular.

To learn more about financing your mortgage loan, including what type of loan is best for your situation sign up for our free guide, “Five Things You Need to Know About Your Mortgage Loan.”

Predatory lending practices may be contributing to the increases in mortgage foreclosures seen across the country. A recent survey of mortgage lenders shows that many homeowners are borrowing several times more than their annual income or using interest only mortgage loans with payments that balloon up after a few years. Mortgage brokers and home appraisers that profit from risky loans on a commission basis regardless of whether or not these loans default are setting homeowners up for foreclosure. Comprehensive mortgage reform is a hot topic in several states right now; however, some feel the steps being taken are too little too late. Many predatory lending laws on the books today fail to address mortgage brokers and a loophole in the records laws hides broker complaint files from the public. How do you choose a reputable broker? Do you homework when shopping for a mortgage lender or a mortgage broker.

To learn how you can protect yourself from predatory lending practices sign up for our mortgage guide.

Five Things You Need To Know Before Refinancing Your Mortgage

Our free mortgage eZine is designed to help you through the process of financing your home. The tips and strategies you find here will save you thousands of dollars; whether you are purchasing a home, refinancing your mortgage, or taking out a second mortgage, it pays to do your homework first. Our guide is divided into five sections, followed by our weekly eZine delivered in your email:

I. Should You Refinance Your Mortgage?
II. Your Mortgage & Your Credit
III. Refinancing & Mortgage Expenses
IV. How To Shop Around
V. Common Pitfalls You May Encounter

Our weekly eZine features news from the industry, articles, and other helpful information to save you money. This information is provided free, with no obligation and nothing to buy. Your privacy is assured…we will never share your information with anyone.

To sign up for our mortgage eZine click the link to the right under the welcome message.

If you are in the process of refinancing your mortgage or taking out a second mortgage you many be required to make payments to an escrow account. What the heck is escrow anyway? If you’ve made escrow payments before, you might think that escrow payments are a method for letting someone else take your money and spend it on your behalf. Just when you’ve gotten used to this idea, the payment you make to the escrow account goes up. Where does this money go anyhow, and how do they determine the amount?

An escrow account is set up for you to deposit of money into, used by one party for payment to another for a particular event or condition. Most of the time escrow accounts serve to ensure property taxes and insurance premiums are paid on time. In some cases the escrow amount will be rolled into your monthly mortgage payment. The escrow company will hold this money for you in a separate account and use it to pay the mortgage, taxes and insurance on your behalf. If you utilize more creative means of financing to secure your mortgage you may be required to make your payments via escrow. The exception would be if you have excellent credit or satisfy the lender requirements you may be able to handle property tax and insurance payments on your own.

A new survey by the government shows that many minorities have paid more for mortgages than whites have. Government representatives and civil rights groups are blaming racist practices and calling for mortgage lending reform. The government data show that one minority group, namely Asian-Americans, get better mortgage deals than whites. They typically have better credit scores than any other group of Americans today. Your credit is the main factor a mortgage lender will use to set your interest rate.

Forgotten in the civil rights outrage over the government lending report that mortgage lenders use predatory lending practices with minorities, is the fact that almost have of Americans today have lousy credit. These individuals represent the largest risk for banks and other lenders. A measure of wealth seems to have little bearing as to whether or not they will be late on payments or default on a loan. Asian-Americans tend to have better credit ratings and as a result get better deals on their loans. This is not racism, it is safe business practices. If you are a person with poor credit you will not get a good deal on a loan. If you have a credit score over 700 you probably will qualify for a better rate on your mortgage loan regardless of your skin color: white, green, or purple.

If you are currently one of the many Americans with a poor credit today, there may be other ways to get a better deal on your loan by being a smart shopper. To learn more about shopping for the best mortgage loan, sign up for our free eZine: “Five Things You Need to Know.”