Finding a Mortgage - Top Ten Tips [mortgageprotectiontips.blogspot.com]
Wednesday Jul 18, 2012 10:47 AM PT. °. (change). Today. /. /. Traffic ... He is the author of the widely acclaimed book - "First Time Home Buying 101" and he writes one of the top mortgage blogs in the country - "Lending Expert Blog". He is a sought ... Fremont Mortgage News - Arcus Lending Opens a New office in Fremont, CA
In the last year the economic downturn has changed the face of the mortgage industry some claim for good. Banks and other lenders have cut mortgage lending severely and finding a mortgage is no longer an easy task.
Buying a house is one of the biggest purchases we make in our lives and picking the right mortgage is essential. Here is the conundrum: fewer lenders mean lesser choices, so in these tough economic times how do you still get the best mortgage deal. Below we will provide you with 10 valuable tips that will help guide you to your dream home and help find you a suitable mortgage.
1. Do your research well
There are some really good mortgage brokers that will tailor-make a suitable mortgage plan for your needs. However, before you go to one of these brokers do a little research on the internet to see what your options are, in addition, this gives you a better understanding of how things work.
2.
Check mortgage fees closelyIt is extremely important that you understand and calculate the percentage interest fees on your mortgage but also other costs associated with taking out the specific mortgage.
3. The bigger the deposit the better your options
In these tough times to make your lender feel safe and to be able to give yourself as many options as possible, it is better for you to have a large deposit, preferably 25% of the total mortgage. A bigger deposit sum almost guarantees a wide variety of choice.
4. Clean credit rating
The worst affected area due to the credit crunch is the higher risk mortgage market. What does this mean? It means that people with a bad credit rating will have a tough time getting a suitable mortgage deal.
So, before you start hunting for a mortgage check your credit rating with the various credit reference agencies, if there are dark patches try and clear them, this will immensely improve your choices. Voting helps. Make sure that you cast your vote in the next election, absence from voting can also effect your credit rating.Â5. Check for flexibility of the mortgage
There are many different types of mortgages, some allow you to overpay and with some you can underpay or even take a payment holiday. If you have a choice, choose what suits your future needs the best.
6. Type of financing
Decide on what type of financing you are looking for, short term or long term, interest-only or capital payment, fixed or flexible rates. If you are looking for security and a guarantee of what your payments will be for the set period; choosing a fixed rate mortgage may not be a bad option. The market is still very vulnerable and flexible rates can be viewed by some as risky.
7. Time Duration of the mortgage
The shorter the term the better it is for you in respect to the amount of interest you will pay. If you choose a longer term mortgage it means that you will also be paying a lot more in interest, making the total cost higher.
8. Overpayments
Flexible mortgages allow overpayments which can substantially reduce the term. If you can afford to make overpayments whilst interest rates are low you will reap the rewards in years to come. Some mortgage lenders have overpayments suspended in their accounts for an entire year and at the end of the year they credit the money to your account. Using this method they earn extra interest on your money. So check your policy well.
9. Never lie
If you lie about your credit history, chances are the mortgage lender will find out about it and that will significantly reduce your chances of getting the mortgage. Honesty is the best policy, address the issues you may have and provide evidence to support your suitability.
10. Application process
Make sure you read everything on the application form. Mortgages remain with you for a long time, so take your time and read and understand everything before you commit.
It is possible to still find the correct mortgage for your personal circumstances though may require a little more researching than in times gone by.
More Finding a Mortgage - Top Ten Tips TopicsQuestion by Trudy G: Do you a list of the top ten mortgage lenders in California? Best answer for Do you a list of the top ten mortgage lenders in California?:
Answer by Reapor-ted!
best not to go with lenders, go with brokers instead. better options.
Answer by Price is what you pay for value.
As housing market continues to slump, if you don't plan to delay your plan, please interview several and pick a good realtor or agent. Bad ones will talk you into buying the largest property at your credit limit. Good ones will find you a good deal (Sellers are offering discount and incentives now). Try to stay away from Adjustable Mortgage, because 30 year fix mortgage rate is very low right now. There is no reason to use Adjustable loans except fatter commission for loan agents. Interests only loans are not good iether. Mortgage payment consists of two parts: interests and principal. Interests are like rent, which doesn't add to the equity to your house. It simply disappear as your pay it. If you want to use interests only loans, might as well rent, especially during market downturn, because housing price won't appreciate. Finally, for tax benefits, talk to your CPA or tax accountant. Do not consult finance with realtors or agents. They get commissions when you sign the check! Good luck! http://biz.yahoo.com/brn/060909/19463.html http://money.cnn.com/2006/09/08/real_estate/caught_in_the_bubble/index.htm?postversion=2006090814 http://money.cnn.com/2006/09/05/real_estate/Ofheo_home_prices/index.htm?postversion=2006090514 More on loans.... Options ARMs are ideal for rich people who has enough money to pay off the loan anytime, but wants to use the introductory low interests rate to delaying paying off the property. While the loan is delayed to be paid off, he or she can use that money to invest else where. Options ARMs, for less wealthy people, are double edged swords. If things continue to be fine, then everyone happy. If housing market continues to slump, then those home owners will face larger debt with no equity and lower housing price. The worst combination of all. People have this misconception that paying off mortgage bills are adding equities to houses. However, mortgage payment consists of two parts: interests and principal. Interests are like rent, which doesn't add to the equity to your house. It simply disappear as your pay it. Most people who apply for Option ARMs are those who can't afford paying the principal. So, they can only pay the interests, which is like paying rent. The worst part is, .... the amount is usually larger than rent. For example, let's buy a $ 500,000 condo with 0% down and apply interests only loan (just like renting a place). Mortgage payment would be $ 3250/month. It is a bad buy, because you can enjoy same property for $ 2000/month. Please note that I assume the tax benefits from home cancel out fees from home association and property tax. For more accurate calculation, consult with your CPA or accountant. But NOT your realtor, whom will say anything to get the deal to go through.
