Refinancing Guide

Do not take out savings plan to pay back the loan as this is not your plan. However be advised that if your plan changes you may have to pay more to save over a shorter period. If your building society will not lend you the money without a policy to back it up then try another. It is not bad advice to have an interest only mortgage but you have to be careful. Speak to a mortgage broker and ask their advice.you can get an interst only mortgage at standard rates contact leeds building society.

Interest-Only Mortgage Cons:

Interest-only mortgages are considered risky, as they do not provide the borrower with a complete outline for how they will pay off the capital they owe, and this can cause problems when the mortgage term ends if there is outstanding debt and no alternative means of repayment.

While a repayment mortgage may be more expensive in the short term, in the long term you will be reducing the total capital owed which will, in turn, reduce the interest paid as well. With an interest-only mortgage deal, however, the capital will still be payable in full right up until the end of the mortgage term – often 25 years later.

Interest-Only Mortgage Pros:

With interest-only mortgage deals, you can choose a savings account or repayment vehicle which gains the best interest rates and is tax-efficient. If you can manage this well alongside the mortgage and keep up the payments (and not spend the money you have saved), this option could even save you money in the long run.

you will keep more of your income each month to spend on yourself, or on home improvements, for example. In fact, with a very low base rate, an interest-only mortgage deal can seem almost impossibly cheap to maintain, depending on the type of mortgage you have.An interest-only mortgage is also sometimes considered to be preferable in the eyes of buy-to-let investors.

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Q:Im interested in an Bank of America Fha home loan,but im told that the minimum credit score is 620,but which score do they go by?

A:The FHA imposes NO certain score- they have no minimum. its the lender’s personal choice as to what score they will accept. In general its 620 for an automatic underwriting and 580 for a manual underwriting.

Q:I  and my husband are searching for home loans (were first time home buyers) but I discovered our credit scores aren’t the best (both of ours are under 600). I keep getting rejected for the FHA loan because they require a minimum of 600.

A:Some lenders can do FHA under 600. Bank of America is one of them. You’re seriously interested feel free to email me and I can give you my office line. Its not a guarantee but I’ve gotten approvals around 550 a number of times

Q:How long does it take to close on an FHA with BOFA?I’ve been waiting for 45 days on an FHA for closing. I gave the loan officer all the papers he asked me and we already have the appraisal. He sent some questions from the underwritter some days ago and then …nothing. We send him emails, call him..and nothing. Does it normally take that much? How long could it take until closing with this bank?

A:FHA loans can close as fast as the appraisal and title work can get back, and the borrower gets the proper documentation into the underwriter. 45 to 60 days is not highly unusual. Beyond that is and you should start insisting on some answers. FHA loans directly from banks and not from a mortgage broker typically have shorter turn around times.If your loan officer won’t communicate with you, I would seriously consider going through a different bank for your loan.

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I have an FHA Mortgage with Wells Fargo – originally taken out in August 2006. Started having problems making payments begining of 2008. Wells Fargo started the foreclosure process late 2008, with a sale date of my home set for January 2009. After several months of trying to get a loan modification with the loss mitigation folks, I got nowhere. The only option offered by Wells Fargo was a forbearance agreement with a large upfront payment of over $4,000 to stop foreclosure, followed by 3 other monthly payments.

I was able to come up with the large payment but couldn’t make the first of the 3 because they refused to budge on a due date (I wanted the 30th of the month, they insisted on the 20th and they sent my $4,000 plus check back to me. Then I did a little research on FHA loan servicing requirements from HUD and found out that HUD notified loan servicers in August 2008 to stop requiring this upfront payment to stop the foreclosure – that the amount could be rolled into a loan modification.and this large upfront amount should not be used to reject borrowers from getting a loan Modification.

Armed with this information, and the phone number for the Wells Fargo executive team , I contacted Wells Fargo execs and gave them my story. They actually gave me a direct phone number to a real live INFORMED person to talk to, who was pleasant and smart. On April 2, 2009 I faxed her all of my financial information, pay stubs, hardship letter, etc.. along with the info I got from HUD. I called a few weeks later and was told the file had been turned over to a negotiator and to be patient. At the end of April I received a letter stating they were reviewing my file, and apologizing for the delay . And today, out of the blue, came the loan modification paperwork! They actually lowered my interest rate (from 6.6 to 5.00), saving me a about $200 per month which is fantastic news! First payment dute July 1. I am so relieved and happy.this has been one hell of a rollercoaster ride

Most lenders will accept payments until you are in foreclosure. Once you go into foreclosure they will not accept payments. How many payments you have to miss to be foreclosed on depends on what state you live in. If you don’t make your mortgage payments you should be saving whatever you can as there is going to be a contribution, or down payment, required to start the plan.

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Some tips in One West Bank Loan Modification Principal Reduction:

1.You can take expert advice in case you have no knowledge regarding the procedure and process that needs to be adopted for loan modification and refinance.

2.You can request the One West Bank refinance and loan modification team for an application form. The same can be submitted online in order to minimise the processing time.

3.Ensure all the calls made by One West Bank representatives are answered and key information pertaining to mortgage modification is provided on time. This helps in quick loan processing.

4.Before jumping to conclusions and sending across the application form for loan modification and refinance, borrowers need to ensure that they is fit and meets all the requirements of mortgage modification and refinance program.

5.Make sure that you attach all the required documents along with the application form so that you can avoid unnecessary delay in its processing.

Some sample for One West Bank Loan Modification

1.I made my second trial mod payment a couple of weeks ago (May’s payment) and will make my third payment at the end of this month. I hope they don’t ask for any more documents but it wouldn’t surprise me if they did, even though they really aren’t supposed to per HAMP rules.

I am hoping my nightmare will be over in about a month and I can permanently retire my modification file, which has grown about five inches thick during the past year I’ve spent fighting to save my home.I hope everyone here gets their permanent mods as well.

2.I got phone call from my kid who is home from school that package arrived from One West Bank.so just got home breathing .I am hoping it isn’t a foreclosure notice.

Its the permanent modification.I can’t believe it after fighting for a year!it is the traditional HAMP modification.at 2% for year 1-5.and then so on…I don’t even know what to say.it is just so amazing to me.I can’t even believe this has finally happened..the end to sleepness nights.For those still waiting don’t give up hope…keep on fighting.. and I hope that you get your package arriving soon

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Pro’s and Con’s of a CalPERS Home Loan

Cons:
1.No longer do loans over $729,750.00
2.Can’t borrow money from retirement if the first loan amount is over $350,000.00
3.No longer offer rate float downs

Pros:
1.Competitive rates- CalPERS offers both purchase and refinance mortgages at great rates.
2.Discounted lender fee, most lenders will charge you a substantial processing fee of $600 – $800 and a admin fee of another $600-$800 CalPERS will not allow more than $350.00 to cover both those fees, a great value to clients.
3.CalPERS won’t let you get taken advantage of by a loan officer trying to overcharge you with points/origination fees, we max out the origination/points to 1% on FHA loans and 1.25% on all other loans, the amount charged is up to the CalPERS loan officer but cannot exceed the above percentages.
4.CalPERS members also have a benefit when it comes to real estate agents that participate in the program; a percentage of the Realtor’s commission gets credited back to you to cover some of the closing costs.

Compare the interest and fees. Do you have to pay MIP (mortgage insurance premium) on the CalPers loan? Compare apples and apples and by all means shop your FHA loan. Same loan (FHA) but the fees the first lender was charging were over $4000! Needless to say, the buyer went with the other FHA lender whose fees were 75% lower. There are some unscrupulous people out there.

As for closing costs, most sellers are willing to pay them in this market. Certain REO properties have a limit that the seller is willing to pay, such as Freddie Mac’s 3%.

When your Realtor structures your offer, they will put the amount of requested seller-assistance in your offer. This amount may be countered by the seller. IF the Seller counters…you are free to accept, counter back or not respond. Your obligation ends if the Seller counters you back. Think of it as a new offer. If the numbers don’t work for you, you counter back and see what happens. Keep in mind that during the countering process, the seller is free to accept another offer. Don’t get emotionally involved until your offer is accepted! You may need to write several offers on several properties before one gets accepted. In this market there are often multiple offers and your FHA loan with closing costs may get blown out by a conventional buyer with 20% down. Be patient and don’t get discouraged!

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Homeowners have questions about how long they have between when they miss a payment and when the bank actually forecloses. If you’re wondering how long you have before you have to leave, it depends on whether your case will be handled in a judicial foreclosure or in a non-judicial foreclosure.

For all Foreclosure You miss your first payment ,Your grace period expires (usually 15 days) and you haven’t paid. Your payment is now considered late by your lender. It’s not uncommon to begin getting letters or phone calls from them at this point. Don’t ignore these phone calls.At most lenders, once you’re 60 days late (September 2 in our case), your loan is considered in default and the lender can begin either the Judicial or Non-Judicial foreclosure process. To bring your loan current at this point, you’ll usually be required to pay all past due amounts (your July and August payments), all late fees, and your September payment.

Some Sample of How Long They might be able to live in their home before the foreclosure is finished.

1) State: California
2) Last payment: Feb 1 st late on the 15 th.
3) Bank: Chase/Fannie
4) Got a notice of intent to accelerate April 30

1. State – California
2. Bank – Bank Of America
3. February 2009
4. Date of foreclosure. Notice of Default was filed on Feb 23, 2010

1. State: Georgia
2. Bank: Wells Fargo
3. First missed payment: 12/1/09
4. Notice of Default: 4/19/2010, trustee sale set for June
5. Intent to accelerate: 1/29/2010

The foreclosure sale happens and your house is sold. In approximately 90 – 95% of cases, the owner of your first mortgage wins the auction because they bid the amount that you owe on that loan and usually no one else will go higher than that.

The owner of your home then contacts the county sheriff who posts a notice of eviction on your door. This notice gives you 24 – 72 hours to leave the house and have all of your possessions out. If you’re there when the sheriff returns, he will escort of off the premises and anything left on or in the property will then belong to the new homeowner.

Going through foreclosure is tough and finding trustworthy information is even tougher. Truth in Foreclosure puts out news you can use every day in your foreclosure fight.

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Usually the Interest Rates for a commercial mortgage is Depends on your credit score but around 10 to 12%.

Commercial Mortgage Calculation Methods

My bank wants to use the 360/365 method to calculate mortgage interest:

Rate ÷ 360 × Loan Balance = Per diem interest

But some of my research indicates that the 360/365 method, while widely used for business loans, is not used for mortgages. Instead, commercial mortgages use the 360/post method, which although more complicated, saves the borrower both principle and interest over the life of the mortgage.

My bank says the 360/365 method is their usual method.

Is it considered accepted practice for commercial banks to use this mortgage calculation method?Is there anyone knowledgeable out there about this who can shed some light?

An interest only mortgage,is a loan type that allows a borrower to make payments that consists only of the interest. The borrower is given the option to pay only interest for a certain period of time. Usually the interest only period is for the first few years, but borrowers are allowed to pay back parts of the principal if they have the money to do so.

Interest Only Mortgage loans are not to be taken if you do not have the need to. You must layout a plan of payment before taking this type of loan in order to minimize the risk. This type of loan has many benefits and will help you do a lot more with your business if you know how to use it.

Interest only mortgage loans are not suitable for every kind of borrower. It should be only used if you have a proper reason to pay the interest at first. This is suitable for people who have incomes that are not stable. When they do not have enough money to pay principal and interest, they have the option of paying just the interest. When they do get enough money they can pay back as much principal as they like.

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The fee for mortgage insurance is because the bank is taking on more risk if your down payment is not enough (less than 20% down payment). They want some assurance that they will get their money if you do not make your payments. The 20% cushion is because there are other legal fees involved in foreclosure, and prices can fluctuate, especially since they would likely get less at a foreclosure auction than if they had more time to sell it normally.

Do I need to buy a life insurance because of mortgage?

I guess it’s partly down to how much of a contingency versus risk couple you are. The insurance may be an additional burden that you don’t fancy much but then how much more of a burden is losing a partner unexpectedly who isn’t as fully insured as they could be…..therein hangs the tail. I don’t like to rain on any ones parade but having been put in a similar position, while money does nothing to change outcomes of loss, it goes a quite a long way in terms of increasing security in the ability of the surviving partner to maintain the family home without unnecessary financial worry.

My advice would be that if you think you can afford it then take out the level of cover you need, sit down with your partner & do the math. For example if you have kids and you’re the main carer, then could your partner afford child care if you died and he still had to work?

Make the list of pros & cons and talk it through face to face with an expert then you’re making an informed decision

Q: Can mortgage insurance come off of an FHA loan?If you pay down 20% of the principal balance on an FHA loan, can the mortgage insurance come off?

A: Generally YES, but may require you to wait set time or to get professional appraisal
It’s an extra expense, and one avoided by putting down 20%

PMI? Private Mortgage Insurance cost?

With 10% down – if you qualify (0% down days are long gone).You’ll pay $219.33 monthly on PMI Remember that this money is not tax deductible and does not apply towards principal or interest.

PMI is also hard to remove once you reach 80%,You may have to get appraisals or reach 25% equity to have this removed.Do everything you can to come up with 20% down – you’ll thank yourself.Consider buying a smaller home.

Q: We have a lot of debt and would like to take out a secound mortgage. Where could I look with somewhat bad creidt?

A: Currently banks are not likely to lend with bad credit. I would advise talking to a credit counselor with a non-profit group to try to avoid the second mortgage. You don’t want to get in with a shady group and take out a 2nd that you can’t afford and lose the house.

Tips on Get a secound Mortgage With bad Credit

You should seek secondary mortgage from the same lender who gave the first mortgage loan,the lender will check the 3 facts- current market value of the property, outstanding amount from the first loan, and the credit history.Only after analyzing these 3 factors will the lender decide upon the loan.

The lender is taking a big risk to finance you a secound Mortgage,Obviously, the 2nd mortgage rate will be high than the previous one.Another reason is poor credit. Poor credit home loans are available but they are obtained only after careful scrutiny of past credit history and credit rating.

If applying for a 2nd mortgage with poor credit, your choice of lenders may be few. Some homeowners obtain their loan from the existing lender. However, if you applied for the original loan with a high credit score, and your credit score has since decreased, the lender may not approve the request for a 2nd mortgage.

In this case, homeowners would need to find lenders willing to approve loans to persons with less than perfect credit situations. These include sub prime or high risk mortgage lenders. Even though applicants will pay more interest due to their low credit rating, they may have the opportunity to refinance the 2nd mortgage, and obtain a lower rate when credit improves.

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1.Cut out all the extra expenses that don’t really matter as much,Take all this extra money and apply it towards your mortgage payments.

2.Consider increasing your income. For most people, the easiest way to do this will be to get a part time job. Take the earnings from this extra job and apply it towards paying down the mortgage.

3.Look at improving your credit score by eliminating any mistakes that are on it.You could qualify for a shorter term loan with a much lower interest rate. If it makes financial sense to do this, you can save money on the interest and end up getting your home paid off much earlier.

4.Sell of some things that you really don’t need.There could be thousands of dollars of items in your home that you could sell and apply towards your mortgage to get it paid off months earlier.

Some question on Pay Off Your Mortgage Early

Q: Does paying off your mortgage early reduce interest?I have owned a home for 6 years. We are now building a new house and will sell our current house. Since we have been paying interest based on a 30 year note, when the mortgage is paid off after only 6 years and sold to someone else, do they recalculate interest so that the actual amount you still owe is less?

A: Yes it will be much less because intrest is only charged to you on the amount of time you had there money so if you pay it off early you can save thousands.

Q: What amount needs to be paid to principal each month to pay this off early? Mr.Gold just got a 30-year mortgage, and plans to pay $200 towards the principal each month. Tp pay the mortgage off 10 years early, how much does he have to pay on principal each month? (Do not consider interest expense in your response.)

A. $400.00
B. $300.00
C. $100.00
D. Other

Please give the correct answer and explain.

A: Since we’re dealing with the principal only it’s relatively straightforward arithmetic (and also unrealistic situation!)

30 years * 12 months/year * $200/month = $72,000 is the cost of the house.
To pay this off in 20 years:

$72,000/(20years*12months/year) = $300/month

In fact it’s even more obvious than that because it should be clear that 30 x 200 = 20 x 300

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