Posts Tagged ‘mortgage’

When Is Home Refinancing The Right Decision?

May 20th, 2017 Comments off

Homeowners it seems are forever on the lookout for ways to cut down on their bills. And home refinancing has become the method of choice for many. But be careful before you jump into any deal. There are times when refinancing can end up costing you more than you save on your monthly bills. Let’s begin by examining when a new loan makes sense.

Start by looking carefully at your current loan. Do you have an adjustable rate? If so you may end up saving money by locking in a low fixed rate. The only time an adjustable rate is good is if you get the loan when rates are high. Having or getting one now however, with rates the way they are, is probably not a wise choice. Shifting to a low fixed rate can save you thousands over the course of the loan. Make no mistake, the rates will go back up eventually. That’s not a prediction, just a fact that rates change. When they do go up, it won’t bother you because you’ll be locked in at a great rate.

Another good time to refinance is if you have a balloon payment that will be due soon, and you simply don’t have the funds available. Finally, if your current mortgage has a rate higher than the current market, then seriously look into refinancing. Even a savings of 0.25% can make a huge difference over the course of a 30 year loan.

Of course that all sound great but naturally there are some things to look out for as well. Carefully examine the closing costs. Refinancing is not free and some of the costs associated with it can be pretty significant. Once you know the costs, do some figuring to determine how long it will take to to recover that money from the savings you see each month.

The reason this is so important is because people rarely stay in one house for the duration of their loan. If moving is something you might be doing in the near future, you’re simply giving away money. You should be reasonably sure you’ll be in your current house at least long enough to make up what you spend in closing costs.

Also determine if your new loan has a pre-payment penalty. Most of them will, at an average cost of 2-5 years. This can hurt your bank account in two ways. Again if you are moving and will be taking out a new loan, or if you simply decide you want to pay it off early. Either way, you have to consider the money you will spend in penalties and compare it to how much you are saving monthly.

Of course the most obvious thing to look at is your monthly payment. Many people choose a cash out option when refinancing. This means money in your pocket now, but it also means a higher balance on your loan. Even if your interest rate goes down, it is conceivable that your monthly payment will actually go up. The best situation is to get a rate significantly lower while using a cash out option. This means money now and lower payments, even with a higher balance.

Home refinancing can be a great way to cut down on your monthly expenses, and also give you some spending money if you need it. But doing it at the wrong time and under the wrong conditions can cost you money that we’re sure you don’t want to give away. Always check your savings against any fees and penalties, as well as other factors such as a potential move. If everything checks out in your favor, don’t just go with the first offer you receive. Shop around. You’ll be surprised at the difference in rates in terms that exist. And get recommendations from friends and relatives as well.

Good decisions can be extremely beneficial to your financial well being.

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Payoff Mortgage – Turn Your Home Into An Asset 109

April 16th, 2017 Comments off

Home equity in most areas of the country has declined by 40% or more and it probably would take some time before the value would increase just like the stock market.

You may be considering selling your home and taking advantage of the low prices in your neighborhood. But that could be a mistake.

Your home is nothing like a stock market investment. While you can trade stocks, you will find it quite hard to trade homes as these are considered capital investments. The tax consequences that come with you giving up your home would also be quite costly.

If you are considering selling your home there is one negative side to this. The right time to sell a home was approximately 2 years ago and you are just caught up in an unfortunate situation. Like the stock market, home prices will stabilized and your home value will continue to grow in the future.

How to turn your home into an investment and able to use this to get money?

Your home is an investment. Your home equity will most likely increase in the future and you will be able to leave the house to your kids as inheritance or even tap into its equity upon retirement.

If you still have enough money to make monthly mortgage contributions and you do not have an immediate need to get cash, time is surely on your side and now is the perfect time for you to be consistent in paying for your mortgage.

So what are the best ways to turn your home into an investment?

One, you can allow your home equity to build up. Once your home is fully paid off, you may apply for a reverse mortgage on your property and use the money when you retire.

Paying off your home before you retire means you have to spend more or follow the biweekly method to accelerate payments.

Another way of looking at you home as an investment is to fully pay off your home and rent this out. You can then think off buying a second property. In this way you could collect cash for life.

Three, your retirement savings does not necessarily have to suffer when you work on paying off your mortgage early. If you plan your finances well and the value of your home increases through time, you can sell your home when you retire, buy a new one at a lower cost, and save the difference as extra funds.

It is understandable that sometimes given your lifestyle, at the end of the month, there almost is nothing to save. When you pay off your mortgage before you retire and buy a cheaper property when you retire automatically generates savings.

This may not be the best financial strategy but is certainly one way of accumulating retirement savings.

Finally the best way to pay off your home before retirement is using a mortgage acceleration strategy.

B y making use of this strategy, you will be able to get 13 years off your mortgage account and save a huge amount without having to refinance your home or change your lifestyle. Thats as good as spending less and getting rid of your mortgage dues sooner. Now tell me if that is not a great investment! With your home fully paid off, you wont have to use your retirement savings in paying for mortgage at all!

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Issaquah Real Estate – Investing In Your Future Today

February 5th, 2017 Comments off

You have probably been hearing over the news that mortgage and real estate market is depressing. People are losing homes, which is bad but instead of dwelling on the negative effects of this in our economy, we should start thinking that this can also be good for you.

And how can this be good to you? Housing prices are getting lower. When we talk about investment, for some people it’s pretty simple – “buy low, sell high”. Since homes are being sold in lower prices, you can sell them in the future higher than the amount you’ve paid for.

If you have not yet bought your first home, then right now could be the chance of a lifetime while prices have dropped to lows they may not see for years and years to come. So if you want to get a great deal on a house, right now could be your opportunity.

Don’t waste your opportunity and wait for a year to buy your dream home. Prices can go back up to 20% or you can just lose your return of investment. In this case, you wouldn’t be able to afford the house you’ve always dreamed of.

Now can be the best time to for you to look around and get your dream home in such a very low price. It is important that you keep in mind that it’s easier for you get a mortgage right now because the interest rates are also getting lower.

Even if you already own a home, you may be able to move out of the home you have right now, rent that home, and then buy your dream home to live in. Renting to someone else is a great option if you don’t want to sell your home yet.

Even if you already have your own home, you can still invest and buy a new one to live in. If you don’t want to sell your home yet, you can have it rented and have your investment return to you.

So don’t waste your time! Don’t wait until the prices go back up again, don’t buy high then sell low; it’s best if it’s the other way around – buy low and sell high! Hurry! Grab this opportunity while the prices are still low.

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The Most Common Types Of Mortgages

January 14th, 2017 Comments off

The first thing that anyone searching for a mortgage loan will notice is that there is more than one type of mortgage available. If you have never had a mortgage before, it is easy to become confused when trying to determine which type is right for you. Your mortgage lender is the bet resource for this, but it is always helpful to research in advance before consulting with them. This article will provide you with some of the most common information about mortgage types.

Years ago, borrowers were presented with one mortgage loan option: the 30-year fixed rate mortgage, which is still the most popular mortgage option today. There are two basic mortgage types today, the fixed rate, and the adjustable rate mortgage, but within these two types, there are several different sub-types, each one with its own risks and benefits.

Another common type of fixed rate mortgage is the 15-year fixed-rate mortgage, which allows borrowers to pay less total interest and gives them the ability to own their homes in a shorter amount of time, but requires higher monthly payments. While fixed rate mortgages have higher monthly payments, they sometimes end up costing borrowers less money in the long run because of their stable payment structure and typically lower interest rates.

Adjustable rate mortgages have their own drawbacks and advantages as well. As their name implies, adjustable or variable rate mortgages have interest rates that fluctuate depending on increases and decreases in national interest rates. Most variable rate mortgages have the same amount of monthly payments but the amount of the final payment may be different due to the fluctuating interest accrued over the term of the loan term.

Determining which type of mortgage works best for you is directly correlated to your credit score, since this will be an important factor in the rate that you are able to qualify for. If your credit score is in need of repair, be sure to take the time to do so before you speak to your mortgage lender and begin the qualification process.

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How to Rent to Own Homes

December 25th, 2016 Comments off

Have you thought about home ownership but not quite ready to take the plunge in getting a mortgage? If so, then rent to own homes may be an option for you. Rent to own homes is a way for people to try out home ownership and they have the option of purchasing the house after some time.

The way rent to own homes works is the seller will act like a lender to the buyer. The seller and the buyer agree on a final purchase price of the home. The buyer makes a down payment on the house, and makes monthly rent payments. A portion of the rental payments will go towards reducing the final purchase price. At the end of some time, the buyer should get a loan and purchase the house.

Rent to own homes is a great way to purchase homes immediately if you do not have a good enough credit score to get a mortgage. You lock in the home and its price while you work on your credit score and get it back to a level where you can get a home loan.

Rent to own homes is a method that people use especially during times of tight credit. Property investors like this because they can buy multitudes of houses without ever having to get a loan and damaging their credit.

Locating rent to own homes can be kind of tricky. Few people are aware of this method of buying and selling homes. You as a buyer should inform sellers of this method and hopefully have them go along with it.

To search for rent to own homes, go online and use any homes for sale website. Make sure the homes are being sold by owner so that you can just contact the owner and ask if they would like to sell their home by rent to own. Tell the owner that you are unable to get a loan right now but would like to acquire the home through rent to own. Then later on down the road, you will purchase the home with a loan.

When purchasing rent to own homes, you can bargain on many different items. For example, you can try to lower the down payment, the rent, and the purchase price.

Once you rent to own homes, you have to take care of the property just as though it was your own home. When the contractual period ends and you decide not to get a loan and purchase the home, you will not be able to recover your down payment or and of the extra rent that you paid.

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