| |
| |
| Mortgage & Refinancing Information | |
|
|
|
Fixed Rate or Adjustable?
Fixed rate or adjustable rate mortgages are two choices of mortgage loans that most lenders will offer you. Your financial situation, how long you plan to live in the home, the current interest rates, and what risks you are willing to take is the best way to decide which loan makes the most sense for you. Understanding the benefits as well as the risks of each loan will help when deciding if a fixed rate or adjustable rate loan works best for you. Fixed Rate Home Loan A fixed rate home loan offers you monthly principal and interest mortgage payments that never change for the life of your loan. A Fixed rate home loan is the most stable option with very little risk. That is why it is the most popular way to finance a home today. Fixed rate home loans are available as 30, 20, 15 and 10 year loans and they make sense if you answer yes to the following: Some fixed rate home loans can be converted into biweekly mortgages which shorten the life of your loan. By paying your monthly mortgage payment every two weeks, you make one extra payment a year for a total of 26 payments. You pay less interest on your loan and build equity faster. It makes sense to finance a home with a fixed rate home loan only if you plan to live in your home for 5 years or longer. That is because in the early amortization period of a fixed rate home loan, the biggest percentage of your monthly mortgage payment is applied toward interest. Only a small amount is applied toward the principal but that will gradually reverse itself as the loan ages. Adjustable Rate Loans Adjustable rate loans make sense if you plan to live in your home less than five years. Adjustable rate loans can also be easier to qualify for and that may make it easier for you to initially get into a home. You can always refinance to a fixed rate home loan later if your future income is going to increase. Adjustable rate loans start at a low introductory interest rate which is a lower than a fixed rate home loan. The low introductory rate makes your monthly mortgage payment lower than a fixed rate home loan. But the trade-off for lower payments of an adjustable rate loan is the uncertainty of the amount of your monthly mortgage payment. However, most adjustable rate loans have cap protections so your monthly mortgage payment doesn't go up too quickly. Adjustable rate loans make sense if you answer yes to the following: Everyone has different circumstances and only you can decide if the risks or advantages are right for you. These tips should help with your decision if a fixed rate home loan or adjustable rate loan works best for you. Copyright © 2005 Credit Repair Facts.com All Rights Reserved. This article is supplied by http://www.credit-repair-facts.com where you will find credit information, debt elimination programs and informative articles that give you the knowledge to correct your own credit and credit report. For more credit related articles like these go to: http://www.credit-repair-facts.com/articles_1.html
MORE RESOURCES: |
|
|
|
RELATED ARTICLES
Home Equity Lines of Credit Vs. Other Conventional Loans When it comes to getting money, you have two basic options. If you are a homeowner you can choose to take out a home equity line or credit (HELOC), or you can take out a conventional loan. Real Estate Lender - Get Approved For a Mortgage Loan Online Real estate lenders now offer mortgage loan quotes and application online. You can be approved for a mortgage loan online in a matter of a few weeks. Mortgage Advice To Make Mortgages A Really Smooth Ride Mortgages are easy as long as you understand them well. But how many borrowers can be confident of their knowledge of mortgages. Before You Buy Before you start looking for a home, figure out what you can realistically afford to pay per month. Check out the market in the area you want to buy. Poor Credit Home Mortgage Loans - The Role of the FICO Score If you have bad credit history and are looking to get a home mortgage loan, then chances are you are going to need to know all about how the FICO credit scoring system works.FICO - Fair ISAAC & Company - is the leading credit reporting agency that lenders turn to when it comes time to credit scoring your home loan mortgage application; so if you do have bad credit history, these guys will know. Recent Bankruptcy? Its Not Impossible to Obtain a Home Loan Because the new bankruptcy laws go into effect on October 17, 2005, more Americans than ever are filing for relief using the federal bankruptcy laws. The vast majority are simply overextended and cannot possibly repay the obligations they have open. Avoiding Foreclosure If you fall behind in your mortgage payments, you face the threat of foreclosure.Foreclosure means your lender can take over your home, and you must move out. Home Buyers Face Decisions that Affect Their Long-Term Financial Picture Taking the step for prospective home buyers.into home ownership is one of the most important financial decisions a person will make in their lifetime. Home Equity Loan - Beware of Equity Stripping Scam The market for mortgage refinancing has been brisk during the last few years. The boom in business can be attributed to interest rates that have been at or near historic lows, and to lenders who have more money to lend now that they aren't investing in risky tech stocks anymore. When is the Right Time to Refinance Your Mortgage? You've heard that interest rates are down and you think it could be time to refinance your existing mortgage, but the entire loan application process was so exhausting during the initial loan that you aren't sure it's worth the hassle. You could very well be right, but there are some things you can do to help decide whether it's time to refinance your mortgage. Bad Credit Home Loans - Pre-Approval is Still Possible With Adverse Credit History If you are among the millions with less than perfect credit, there are many sources available to you in obtaining a mortgage. Lenders that specialize in mortgages for those with bad credit are competing for your business. Home Mortgages: Does It Ever Make Sense to Pay Points? Interest rates on home mortgages are often quoted with and without points. A point equals one percent of the amount you are financing. First-time House Buyers: to Buy or Not to Buy; that is the Question Buying your first house is always a difficult time. There are so many important decisions to make, and problems to be solved, which combine to make it one of the most stressful events that will occur in most people's lives. Refinancing Your Mortgage Can Open Up A Lot Of Options For You And Your Family It can happen to anyone, the roof is leaking, the credit card bills are pilling up and it is almost time for a new car. But where are you going to get the money to do all of these things? The need for extra cash can be very frustrating and worrisome, however if you are a home owner you have a variety of financial options available to you that you may not even be aware of. Mortgage Prepayment Penalties - Just Say No One of the most common terms found in a new home loan is a prepayment penalty. This type of penalty says that if the borrower pays off the loan early, commonly during the first five years of the loan, then the borrower will be responsible for paying an additional amount of money, typically about six months interest on 80% of the mortgage balance. Kings Bay Saint Marys & Kingsland Georgia Real Estate - Getting a Home Loan with Damaged Credit So, you have made the decision that you would like to become a homeowner. As lenders, we have to perform a credit check. Reverse Mortgage - Be Sure You Need It Before Applying For One Reverse mortgages used to be considered the last resort of desperate retirees who needed to borrow against their home equity in order to pay for medical expenses. With home prices across the country rising at astonishing rates, more and more retirees, aged 62 and over, are taking out reverse mortgages to fund better retirement living. Adjustable vs Fixed Rate Mortgages Mortgage rates can either be fixed for the duration of your loan or can be adjustable. An adjustable rate mortgage is a loan that is set up with an interest rate that changes based on pre-determined criteria, primarily tied to the federal interest rate. The Best Way To Get The Right Mortgage Are you thinking of buying a home? If so, then there are many things that you need to research first. For example, do you know what a mortgage is and do you know all the details of getting a mortgage? The more you know before you get into it, the easier the whole process will be for you. Home Equity Loans - Research Your Lender Carefully Real estate prices are rising across the country, and Americans are tapping into their home equity like never before. Americans took out $431 billion in home equity loans in 2004, and that amount may increase in 2005.
|
| home | site map |
| © 2006 MortgageLoan.biz |