My Florida Home Builder

Everybody would love to have a little more money in their pocket, and many people are finding out that home refinancing can actually give them some extra cash at the end of the month. But all to often people jump in feet first, and end up spending more money than they save when they refinance their loan. So let’s start by first looking at when refinancing is a good decision.

Clearly the first thing to look at is your current mortgage. If you have an adjustable rate, a fixed rate loan at a low rate can normally save you money in the long run. Adjustable rate mortgages are good if you get your loan when rates are high, but in current rate environment they just don’t make sense. If you can lock in a low rate, you will clearly save money over the length of the loan. When rates go back up, and they always do, you’ll still have a great rate on your loan.

Something else to consider is if you have a pending balloon payment. Maybe it snuck up on you and you’re not prepared or simply don’t have the money to pay. Refinancing could be your only option. Also find out if the rate you’re paying now is higher than the current market rate. If it is, you should definitely look into refinancing. All it takes is one-quarter of one percent difference in the rate to make a huge difference on a 30 year mortgage.

With all the potential good things refinancing can provide, there are some things you need to look at carefully before you go ahead with the deal. Refinancing costs money up front, and some of the closing costs can be pretty hefty. Once you know those costs, you need to see how long it will take you to get them back from the savings on your monthly bill.

Why is this important? Well if you plan on moving in the near future, refinancing may end up costing you money. Be sure you are going to stay in your home long enough to make up the difference, otherwise you’re just throwing money away.

Most newly refinanced loans will also come with pre-payment penalties. These can be quite costly, with an average cost of 2-5 years. If you want to pay off the loan early, you’re also stuck paying the penalties. And again, if you might move and need a new loan while paying off your old one, the penalties may apply. These penalties must be measured against your monthly savings.

Lastly, be sure to take a close look at your monthly payment. Even with a lower rate your payment could go up if you plan on taking advantage of a cash out option. Sure you’ll have more money in your pocket right now, but your new loan will now have a higher balance. So even at a lower interest rate your payment could go up. Of course if the new rate is much lower, your payment may be lower even with a higher balance. This is a good situation to be in. You’ll have cash in your pocket and be making lower monthly payments as well.

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.

Are you considering refinancing your mortgage loan? Did you know that choosing the wrong kind of lender will cost you thousands of dollars? It makes a difference refinancing with a mortgage broker, bank, or Internet lender; the difference is thousands of dollars in unnecessary interest payments. Here are several tips to help you choose the right mortgage lender when refinancing your home.

Mortgage Questions You Need Answered

If you’re like most homeowners you focus on finding the lowest mortgage rate or choosing the best lender when refinancing your home. This narrow focus works fine if you’re shopping for kitchen appliances; however, shopping for a mortgage is a completely different ballgame. You can’t simply compare mortgage rates and closing costs because these factors are based on estimates. The estimates you use to comparison shop for a home loan are always changing and are unreliable.

So if asking which lender is best is the wrong question, what should you be asking? If you’re focusing on refinancing mortgage rates when choosing a loan you’re on the right track. The question you should be asking isn’t who the best lender is, but who is the right person to arrange your next home loan. This person needs meet certain criteria in order to be in a position to offer you the loan you want; more on that later.

Who Should You Choose To Originate Your Mortgage?

First of all, should you pick an Internet mortgage site or a bank to refinance your home? Absolutely not! You should never refinance with a bank or credit union due to loopholes in the Real Estate Settlement Procedures Act that protects homeowners from abusive lending practices. The problem with those Internet mortgage sites you see on television is that you’ll be dealing with an inexperienced salesperson that does not have the authority to broker the deal you want.

Mortgage Brokers Are The Answer

If you want the best mortgage loan you’ll need to enlist the help of a mortgage broker; but not just any broker. You need to find a self-employed mortgage broker that owns their own business and does not employ a sales staff. The reason for this is that as the business owner your broke will have the authority to negotiate their commission and will not be splitting it with a salesperson. Why is this important? Because you’ll be refinancing your home with a wholesale mortgage rate and only paying a one percent origination fee. Sounds impossible? It’s not only possible but it’s much easier than you think for anyone that does their homework before shopping for a home loan.

Foreclosure is not something that should come as a surprise to most homeowners when they are aware that they have missed several mortgage payments. Deciding on foreclosure is something that a lot of people don’t really decide on, but resign themselves to.

Sometimes, foreclosure really is the right decision but in a lot of situations homeowners really don’t have to give up their homes. However because they do not have the proper guidance from the right subject matter experts, they don’t know what is best for them in their specific situation.

Homeowners that are looking at foreclosure should look into debt counseling. These debt specialists will be able to help homeowners decide if foreclosure is indeed the best decision, or if there are actions that they can take to keep their homes.

As every homeowner’s predicament is different, the debt counselors will be able to offer very good advice depending on the situation. Sometimes a debt counselor can help open that communication channel between the bank and the homeowner to see whether an agreement can be reached or, at other times help walk the individual through filing for bankruptcy or deciding that foreclosure really is the right decision to make.

Deciding on foreclosure is truly not an easy decision to make and it also has serious and lengthy implications. Bear in mind that other than the fact that you will lose your home and need to find somewhere else to live, having been foreclosed on will also affect your credit ratings for seven to ten years.

Your life will more often that not, change quite a bit in 10 years, and your buying power will be limited, even if you have changed your ways and your lifestyle. Foreclosure is indeed a big decision to make and one that is often best made with the help of a credit or debt counselor.

Debt - everyone has a different comfort level. There is no one-size-fits-all on how much debt you should take on. However, that does not mean there are not any guidelines to consider when looking at debt.

Financial lending institutions and credit card companies naturally are eager to loan any and all the money the think (backed up with credit scores and credit history) borrowers can afford to repay. The lending companies do take risk but they are very calculated. They factor in current interest, credit history along with default rates before granting a loan. Make sure you do your own calculations.

Before looking for a loan take a hard look at your financial position. Can you realistically handle the payments? Will the payments create a hardship?

Do you see an increase in income coming in the future? Factor that income in - a bank and business would. But make sure the increase is really going to happen. Promises and hopes do little in the way of guaranteed money.

Examine the present interest rates, what way are they headed? No one can know for sure what the future will bring but there are plenty of people who spend their days looking at trends. General trends do not happen randomly.

Take a serious look at the person in the mirror. Pretend you are a bank and take a hard look at your credit history. Put yourself in the banker’s shoes. Would you be willing to loan $15,000 to the person in the mirror at 6.5% for 60 months? Stop the excuses on late payments. Some do have a legitimate reason but it is possible you do not or have not developed the resources required to take on that debt at the present time.

Look over all of your income and realistically pour over your expenses. Can you meet your current obligations and take on the extra $500 per month in expenses without sacrificing essentials. Do not lie to yourself! You may discover that poor credit will make consumer loans impossible.

Only you can decide if taking on an extra $200 per month payment on your credit card at 12% to buy that 50-inch flat screen TV you cannot live without. It all comes down to how much value you put on the item against saving the money and paying cash all at once!

There is nothing wrong with buying items you want, but take the time to measure the cost. Buying on impulse is the how many people find themselves deep in credit card debt and must face a consumer loan with bad credit. Always examine the true cost. Plan your purchases.

Not facing the true fact of your current financial position and the fact that you cannot afford an item or the payments is a proven fast track to financial problems. A quick unplanned buying decision can take years to recover from.

Be realistic, think long term, measure the cost and you can make the right decision on how much debt - if any - is right for you.

HUD reverse mortgages add up to close to ninety% of all reverse home loans being initiated in the U.S. This kind of reverse home mortgage has become very common as it benefits the 2 parties in the dealing. It is a win-win bet for everybody.

You, the homeowner, win because FHA (the Federal Housing Administration,) an agency within HUD (U.S. Department of Housing and Urban Development,) oversees how this type of reverse home mortgages work. It guarantees that you don’t get charged high fees when applying for a HUD reverse mortgage. In addition, it audits the reverse mortgage lenders to make sure that they treat you in a fair way.

It also benefits the lender because it limits potential loses. Limiting potential loses also benefits you because it allows the lender to offer you better terms.

The Workings of a HUD Reverse Mortgage

A HUD reverse mortgage is a home mortgage for people over 62 years old and based on the equity on their homes. The owner needs to have accumulated enough equity in the home to qualify for the loan.

A HUD reverse mortgage gives senior citizens the chance to enjoy their retirement years in a more relaxed way because it offers tax-free “income” that doesn’t need to be repaid for as long as the borrower stays living in the house. Once the borrowers moves out or dies, the house can be sold to pay for the money owed to the bank. However, the borrower can never owe more money than the house is worth.

The most common kind of seniors revere mortgage is the one backed by the US Department of Housing and Urban Development (HUD.) In order to be able to provide HUD reverse mortgages, the lender must be certified to do so. In order to be certified, the reverse mortgage lender must meet some tough requirements.

In a HUD reverse mortgage, the Federal Government (through FHA) guarantees the lender that the loan will be paid off. This is important when the value of the home is lower than what is owed to the lender. It also ensures that you will keep receiving monthly payments (if that’s the payment method you have chosen,) even after you have got paid more than the house is worth.

Because of the backing of FHA, the reverse mortgage lender is able to offer you better terms because they know that their liability is limited to a set amount of money.

FHA may provide such a warranty as it counts with an insurance policy pool paid for by every reverse home mortgage borrowers. Each time somebody acquires a HUD reverse mortgage, 2 pct of the value of the home is committed in the pool. Additionally, a different one-half point is contributed annually into the pool.

As a borrower, you may want to know that none of these costs come out of your pocket. All costs are included in the loan balance. The only out-of-pocket you may have is the cost of an appraisal.

The added costs make this type of loan a more expensive mortgage than a traditional loan. Before you get a reverse mortgage, you may want to think about how long you plan to stay in the house. If you are planning on staying under 5 years, you may want to consider a different alternative. If you’re not sure, talk to your reverse mortgage broker or counselor for advice.

Governmental Agencies Overseeing Reverse Mortgages

Even though you may be getting a HUD reverse mortgage, the actual lending is performed by a private lender. Nevertheless, make sure you apply for a HUD reverse home mortgage.

There are many benefits to acting so. First off, you generate a good deal as the lender’s financial obligation is fixed. Second, in order for a reverse mortgage lender to become HUD licensed, it must abide by hard prerequisites dictated by HUD.

Always recall that although FHA does not really loan you the funds, it determines rigid policies that lenders must abide by. Lenders are continuously being scrutinized to guarantee that they stick to these policies.

One of the guidelines FHA has set for reverse mortgages is that anyone applying for a reverse mortgage is entitled to receive free counseling. During this session, the borrower can ask any questions related to a reverse mortgage and the different advantages and drawbacks related to getting this type of loan.

FHA also sets limits on the amount of money that can be lent through a reverse mortgage. This amount may vary slightly depending on the area of the country where you live.

The HUD Reverse Mortgage Process

As an increasing number of baby boomers reach the time in their lives to retire, they start searching for different ways to maintain their pre-retirement lifestyle. For many retirees, pension plan and social security payments are just not enough. Some of these seniors have turned to reverse mortgages to solve this problem.

Getting a seniors reverse mortgage is a simple process. Once you know you fulfill the basic requirements (you are over 62 years old and have enough equity in the home,) the process is very quick. An experienced reverse mortgage broker should be able to effortlessly guide you through the application process while answering any doubts you may have.

There are four basic steps involved in getting a reverse mortgage:

1. Familiarize yourself with this kind of home mortgage. Learn as much as you can about this type of loan. You may want to learn about how they work and in what circumstances they are a good solution for you.

2. Find a professional and experienced reverse mortgage broker. We strongly recommend a lender is FHA certified. Make sure the lender specializes on this type of mortgages.

3. Go to the required counseling. FHA regulations indicate that you must receive a free counseling session from a third party. During this session, you may ask any questions you want. To set up an appointment, just ask your broker about it.

4. Compile the needed documentation. This documentation is much less that if you were applying for a traditional mortgage because there is not need to prove income and your credit score is of no concern.

Although getting a reverse home mortgage is an important step, remember that hundreds of seniors are already applying for one on a daily basis. Just make sure you educate yourself and choose a good reverse mortgage broker who’ll be able to guide you throughout the whole process.

Application fees on the best buy fixed-rate mortgage deals have nearly doubled in the past year, according to current analysis.

Fees for the best two year fixed deals around have increased in the last year from 995 on average to 1,400 over the past year. The cost of three year deals has also gone up from an average of 580 to nearly 1,150.

If you go back to last October when the base rate was 5.75% the average two year fixed deal was at 5.68%. The base rate is now 5% but the 2 year rate is still 5.57%. Three year fixed rate deals are also more expensive compared to the base rate. They have gone down from 5.84% to 5.65% in the same period.

The recent, very high profile, problems in the banking and mortgage industry have meant that lots of people are jumping the gun a little and opting for the lowest interest rate deal they can possibly find. They should also consider the fees associated with these lower rate loans as when added together over a two or three year deal these are working out to be much more expensive.

The large increase in application fees means that they now form a much more significant portion of the cost of the loan and really need to be considered just as importantly as the actual interest rate, especially in a relatively short term mortgage deal.

There are still many good deals out there for people with substantial deposits or equity in their home and strong credit ratings. Unfortunately many people will not be eligible for them as lenders are increasingly taking a tougher line.

All brokers and intermediaries should reconsider their strategy in helping clients wishing to raise capital in the light of the recent credit crisis and changes to the Consumer Credit Act. The changes in the market and to the Consumer Credit Act mean that a secured loan could be a much better option for many clients.

These new changes changes to the act mean that all secured loans for residential purposes of any size come under the Consumer Credit Act and therefore every loan has to have a cooling off period, so the client is not pressured and an important factor is that early repayment charges are a maximum of two months interest depending when in the current month they notify the lender. When you add in that there are no upfront fees in the shape of application fees, booking fees and valuation and conveyancing costs then it’s pretty easy to work out that on a direct comparison secured loans work out to be better value for clients.

So if you’re tied in to your mortgage provider and wish to restructure some finance or raise money for a project then a better alternative to a re-mortgage could be a secured loan. Given the protection of the CCA and the lack of any upfront fees backed up by a simple one month’s interest to redeem a secured loan, clearly they are significantly, cheaper, easier to arrange, more transparent, and possibly more accessible than a re-mortgage.

For many home buyers, the only real decision they have to make is whether to have a 15 or 30 year fixed mortgage rate? Buying a home later in life means that many people want to have the mortgage paid off early. There are always things to take into account before signing documents. Over the period of the loan, it’s important to remember to make sure the interest rate remains the same.

It seems that some lenders are happy to offer deals that appear too good to be true and they usually are. A 15 year fixed rate mortgage means the interest rate remains stable for the life of the loan. If you are someone that wants a loan with a regular fixed repayment and no additional charges then this is the main benefit with this type of agreement. Both my wife and I decided to research fixed rate mortgages when we started looking at homes for sale.

Even though it was important for us to pay off our loan at the earliest possible opportunity, we didn’t want high, unrealistic monthly payments which we would have trouble maintaining. It became obvious that we had to look at fixed rate mortgages over a longer period and not just 15 year plans. The problem was that we weren’t very happy about having a mortgage close to when we both retired so it was our hope a 15 year fixed mortgage rate would still be available to us. It wasn’t easy for us because of the stress to pay the house off early.

After taking everything into consideration we decided on a 30 year loan instead. Many factors were taken into account when reaching this decision. The most important point was the fact I discovered my wife was having a baby. My wife decided she wanted to raise our child at home so I couldn’t be certain of her monthly financial commitment to our household expenses. The financial commitment per month on the 15 year fixed mortgage rate was just too high. We just decided we would probably get into trouble if we took this route. The monthly payments on a 30 year loan were quite a bit lower.

We are also able to make extra payments throughout the year to make the principal shrink quicker. Those few extra payments also help reduce the number of years you have to pay the loan over.

Our first choice would have been to go for the short term 15 year fixed rate mortgage solution but this did not help with our more immediate situation. In retrospect, everything worked out ok for us by going down this road.

We all have to face up to living with debt at certain times in life; this situation is sometimes the result of outside pressures. Despite the predicament you may find yourself in, don’t panic; there are companies that will be able to provide a bad credit loan.

Finance provided in this way is can be used by the applicant in the same way as a personal loan, they shouldn’t find any restrictions. By the way, having a poor credit score can be a result of your own actions, either accidental or deliberate. It could come down to missing a credit card payment due to an unexpected situation. Nevertheless, you do have a chance to improve your financial status.

There are many other reasons given bad credit loans may be required such as for emergencies, circumstances you did not see coming or for consolidating old debts. It is not uncommon for an individual to apply for a loan only in an effort to repair their damaged credit history. They may not be able to get a loan if their debt ratio compared to monthly expenses is evaluated. It is possible though they may not need the money for any specific situation.

There are a few options available, secured and unsecured loans, but with the secured option the amount of loan will be greater, up to 150,000 dollars and the repayment period can be extended to a period of twenty five years. Through the unsecured loan plan, an amount in the range of 1,000 to 50,000 dollars is available for borrowing but this amount must to be paid back in a short period of 6 months to 10 years.

There will, however, be either a car but usually some real estate like a home, for example, used as collateral to back the loan and this results in the lender offering loan rates with a lower interest; if not, the borrower could lose their possessions if they fail to make their repayments. When using an unsecured loan as an option, the borrower will almost always pay more interest over the long term as no guarantee has been provided. So it is important in finding a lender with a low lending rate on an unsecured loan.

To find out more about the available options it is best to carry out some research online as there are even a few lenders who will provide a bad credit loan even if there are outstanding debts and court judgments. Having said that, there aren’t many of these companies willing to provide a loan under these circumstances so the chance are that the only way to find one and apply is online.

These bad credit loans aren’t usually too hard to acquire even with a poor credit rating but they can make a huge difference to the individual who needs the money. You can find a lender online and, after paying the debt off with a loan arranged this way, you can live your life in peace without the fear of credit collectors calling.

In particular for someone with debts and a low credit rating, this is a chance to start rebuilding your credibility. This opportunity should not be forgotten or wasted.

College is likely the time when a person has their own credit card without direct supervision. This can be a dangerous thing. If a student doesn’t understand how fast credit card debt can rack up, they are in for a rude awakening. The credit card company doesn’t care who owns the card or their financial experience level. The credit limit on college student cards are lower, which helps to keep debt lower, at least. None of this debt has to do with student loans, though. When any credit card debt at all is mixed with student loans, it seems to magnify the effect. Paying back a student loan and credit card debt racked up while they were a student can be tough, to say the least.

Credit card debt is so common with students in college because of their inexperience with cards that there is a term simply called “college student credit card debt”. That is the main reason there is a lower credit limit on their cards. To avoid college student credit card debt, the student has to do essentially the same thing as anyone else trying to avoid debt.

First, you must know that a credit card is not free money. You will have to pay back anything that you charge. If you don’t pay it back when the bill comes in, you must pay it back later with a high interest rate attached, making it tougher to pay back. The credit card should not be viewed any differently than cash. In addition to this, spending habits in general should be conservative even with a zero percentage rate card. Don’t buy things just because they are on sale, etc. Only buy necessities.

To help avoid overspending, a monthly budget is a good idea. The student should create and stick to a budget. This will ensure that they will stay out of debt. Next, only one credit card is really needed, so a student shouldn’t get a second one. If the student gets multiple cards, they will have more money available to spend because the credit limit will be higher total. With a higher limit, the student is much more likely to spend more, not be able to pay it back, and get into debt. One credit card is plenty for a student.

A credit card for a college student should train them for how a credit card should be treated. It should help them to learn about how credit cards work. They should be instructed first, though. They need to learn about APR, annual fees, interest, and the pitfalls of not paying the bills in full and on time. Learning from a negative experience with debt is certainly not ideal.

Senior reverse mortgages are different from traditional home loans in several ways. Before you decide to get a reverse mortgage, it’s a good idea to learn as much as you can about them; learn such things as how they work, their benefits and even their drawbacks.

With a reverse mortgage, you never have to make monthly repayments for as long as you live in your home. As a matter of fact, the opposite occurs: the lender pays you money. You can get money from a bank when you have a reverse mortgage in one of three different ways: a lump sum, a line of credit or monthly payments.

Because you get payments from the lender, the debt in your home increases as time goes by and you get more money from the loan. At the same time, the equity in your house decreases as you get those payments.

Whenever the time comes to pay back your reverse mortgage - you move out of the home or you die -, the debt may be large and you may have little equity left in the house. However, no matter how much money you owe, it can never be more than the value of the home.

Since you don’t need to make any monthly repayments, you don’t need any type of income to qualify. You could have no income and still qualify for a reverse mortgage. Also, your credit history is of no concern.

The main requirements when applying for a reverse mortgage are that you are at least 62 years old, and that there is enough equity in your home.

How much money you can borrow depends on three factors:

How old you are

The current market rate

Your home appraised value or the FHA’s home mortgage limit for your area

As a general rule, the older you are, the more expensive your home is and the lower the interest rates are, the more money you can borrow with a seniors reverse mortgage.

You need to remember that since you keep ownership of your home, you are still required to pay your real estate taxes, insurance, maintenance costs, etc.

Senior Reverse Mortgage Benefits

A reverse mortgage has many pros associated with it. These are some of the main ones:

You won’t need to leave your home. You can stay living in your home for as long as you want.

You won’t need any income to qualify. The lender is the making the payments.

You don’t have to make any payments on a reverse home mortgage

You can’t ever loose your home because you don’t make mortgage payments.

You can never be thrown out of your home for as long as you stay living in it. However, you still need to make real estate, insurance and maintenance payments.

You can use the money from the seniors reverse mortgage for any purpose you want

The funds are usually tax deductible

Most senior reverse mortgages have no income limitations

Your Social Security and Medicare payments are for most people not affected

Senior Reverse Mortgage Drawbacks

As with any other type of mortgage, reverse mortgages have some drawbacks to using them. Of course, many of them are only potential and depending on your individual situation. Nevertheless, it’s a good idea for you to know about these drawbacks before choosing a reverse mortgage.

These are a few things you want to consider before choosing a reverse mortgage:

Most all reverse mortgages have variable interest rates. Your rates will vary as the market changes.

Since reverse home mortgages work by decreasing your home equity, you can use up the majority of your home equity, leaving few funds left from the sale of the house for you and your heirs. However, a “non-recourse” clause ensures that you never owe more than the home is worth.

Since you keep ownership of the home, you are still responsible for real estate taxes, insurance and maintenance costs.

Most lenders charge origination fees and other closing costs for a senior reverse mortgage. Banks may also charge servicing fees during the duration of the reverse mortgage. These fees are already included in the mortgage.

The interest portion of a reverse mortgage is not deductible in your tax returns until the home loan is paid off (in part or whole.)

There is usually a less expensive solution to your financial problems ( a credit line, refinancing your present home mortgage, etc.)

To reduce some of these drawbacks, make sure you apply for your reverse mortgage through a trustworthy company who will educate you throughout the reverse mortgage process and beyond.