Sunday, December 15, 2013

Refinance Advice & The Math Behind It

The arithmetic of a mortgage refinance:

Most home owners refinance to save money month-to-month, but unless you do the math before you trade in one home loan for another you could be wasting both time and money.

What you truly save is based on how much the new loan costs and how long you'll be in the home.

Here's what you've got to consider:

Costs:  Add up ALL the costs, which could include points, and fees for the application, loan origination, appraisal, attorney, credit report, extra insurance, inspections, private mortgage insurance, recording, survey, title insurance, underwriting and others.

Monthly savings:  Figure your monthly savings by subtracting your current monthly payment from your refinanced mortgage's monthly payment.

Tax cost:  Multiply your monthly savings by your combined state and federal tax rate.


Net savings:  Subtract your tax cost (because the cheaper loan gives you a smaller tax benefit than the previous loan) from your monthly savings.

Break-even point:  Divide your total costs by your net savings to determine how many months it will take to pay off the cost of refinancing.

For example, if you will save $100 a month on the refinanced mortgage and the refinanced mortgage costs you $2,500 it would take you just over two years, 25 months, to break even and start enjoying that savings.


If you plan to move within two years, that loan might not be for you:

Hidden costs:  Also, if your current loan contract includes a prepayment penalty you've got to factor it in too. Some penalties can be as high as six months interest on 80 percent of your balance, but diminish the longer you hold the loan.


The points vs. interest rate: also presents a mathematical quandary and, but again, do the math.

Generally, lower points (each point is 1 percent of the amount financed) produce a higher interest rate. Higher interest rates mean lower points.


If you know you'll stay in your home for a few years, a zero-point loan option would likely be a better deal because you may not have the opportunity to recoup those costs.  If you are staying longer with more time to recoup costs, consider a cheaper interest rate with points.

Watch out for some no-pointers. They can be useful if you are cash poor, but in addition to the higher interest rate, some come with prepayment penalties that kick in if you refinance again too soon.

To obtain bottom-line precision on calculating your savings, especially when you shorten the term, you need loan-amortization schedules available on Web-based mortgage calculators or a patient mortgage broker or lender who'll churn out all the numbers.

To find the best deal, start with your current mortgage lender.  Some lenders have marketing programs designed to retain current borrowers by offering them special low-rate, low- or no-cost refinance packages.

Even if your current lender makes a deal you like, use that loan as a benchmark and shop around for your best deal.  To get shopping around help, consider references from family members, co-workers, real estate agents and other people you trust, especially those who've recently refinanced.


Please visit Peak Home Loans.  They offer 2.87% home loan mortgage refinancing, home purchasing, home equity loans, debt consolidation loans and more. A $100k loan is only $415/mo. 4 in 5 will qualify.  Rates are near all-time lows, but rising quickly, so apply today!



Saturday, November 2, 2013

Home Refinancing Explained

To Refinance Your Home means getting a new mortgage and using some or all of the proceeds to pay off the old mortgage - good credit refinance, poor credit refinance or fair credit refinance.  Homeowners may home refinance their mortgage for several reasons:
  1. To take advantage of lower interest rates and lower your monthly payment.
    If interest rates have gone down since you got your original mortgage, you could save money over the life of your loan, while reducing your monthly mortgage payment.
  2. To switch mortgage types.
    You may want to switch from a variable to a fixed interest rate, or vice versa. If you have a balloon/reset mortgage, you must either pay the mortgage in full at the end of the 5- or 7- year term, contact your Service Provider (the organization to which you send your monthly mortgage payments) to start procedures to reset your mortgage to a fixed-rate of interest, or refinance with a new mortgage.
  3. To shorten mortgage terms.
    You may want to refinance to shorten the term of your loan. This would allow you to pay less interest over the life of the loan because the money is borrowed for a shorter period of time, and more quickly builds up equity in your home.
  4. To get "cash out."
    Some lenders will let you borrow more money than the balance of your original mortgage, based on the equity you have in your home. A portion of the money left after the original mortgage is paid off goes to you to use for things like paying for a child's education or home remodeling.  However, remember that you'll have a new mortgage, at a higher amount, that will eventually need to be paid off.
Home Refinance Programs:

Fixed Rate Loans - Both interest rate and payment remain the same over the term of the loan. Loans can be amortized over the following terms: 10, 15, 20, 25, 30, and 40 years. The advantage of a fixed rate program is that it allows you to get a fixed rate, over a specified period, without being concerned about market fluctuations. This type of financing is recommended for borrowers who intend to stay in their house for a long period of time.

Fixed Rate Balloons - Both interest rate and payment remain the same until the loan is due. Typically, the entire loan amount is due in either 3, 5, or 7 years. The advantage of balloon programs is that they tend to have the lowest rates, due to the fact that the entire balance must be paid off or refinanced at the end of the term. This type of financing is recommended for borrowers who know they will be leaving their current house in either 3, 5, or 7 years.

Adjustable Rate Mortgage (ARM) - Both interest rate and payment remain the same for a fixed time period, usually 1, 3, 5, 7, or 10 years. At the end of that period the rate can rise at fixed intervals. The amount the rate can rise, or margin, is predetermined (normally 1/2% to 2% per rise). The intervals are normally 1, 3, 6, or 12 months. Typically there is a cap on the margin, which determines the highest the rate could ever go. The advantage of an ARM is that it allows you to get a lower rate, for a known period of time, while you watch the market to see if and when fixed rates get better. Some feel that although they may have gotten a better rate with a balloon, an ARM will adjust at the end of the "fixed period", whereas a "Balloon" has to be refinanced or paid in full. Arm's are recommended for those borrowers who intend to stay in their house for a fixed period and have taken the time to factor in the margin, to determine that they would not be better off with a Fixed Balloon or even a Fixed Rate.

Buy down - Both rate and payment remain the same for a fixed period, at the end of which, the rate and payment increase. The rate and payment may increase once, twice, or even three times, depending on whether the Buy down is a 1/1, 2/1, or 3/1. The percentage of increase, as well as number of increases is predetermined. Once all of the increases have occurred the new rate and payment remain fixed for the term of the loan. Also, lenders will typically charge a fee to "buy the rate down" for the first 1, 2, or 3 years of the loan. The advantage to a Buy down is that it offers a lower rate and payment during the first few years of the loan. Buy downs are recommended for those borrowers who are having trouble qualifying for a Fixed Rate Loan or those who need a more affordable payment at present.

Kindly visit Peak Home Loans we can help with Home Mortgages!

Home Refinance Loan Types:

Conforming - Conforming loans refer to loan amounts that conform to government service standards as determined by Fannie Mae & Freddie Mac (the original government agencies, set up in the early 1940's, established to help people finance new homes). Conforming loans range in amount form $1 to $275,000. Although not all conforming loans are serviced by these government agencies, the mortgage industry has adopted the term to express loan amounts in this range.

Jumbo (Non-Conforming) - Jumbo loans refer to those loan amounts outside of the "conforming" range or, above approximately $300,000 (different from state to state.)

Government Loans - Government loans refer to those loans that are guaranteed by one of two federal agencies. The two types of government loans are: Federal Housing Administration (FHA) loans, and Veterans Administration (VA) loans. The advantage of financing using FHA loans are that they are easier to qualify for and allow a borrower to finance more of the loan amount than non-government loans. Whereas with a Conforming loan a borrower may only be able to finance 80% of the loan amount, a FHA loan allows a borrower to finance 97% of the loan amount. FHA loans are recommended for those borrowers who are first-time buyers, have little money to put down, have a short credit history, or are having trouble qualifying for a Conforming loan. The two main advantages of financing using VA loans are that the VA allows borrowers to finance 100% of the loan amount, and that, the VA only requires proof of veteran status to qualify for the loan. The only drawback to government loans is that mortgage insurance is required at all loan to values (LTV), unlike Conventional and Jumbo loans where payment of mortgage insurance is determined by the amount of equity a borrower has in his home.  WE ARE VA AND FHA FRIENDLY!

Investment Properties (Non-Owner Occupied) - These types of homes are normally acquired specifically for investment purposes or are owned as a result of moving to a new house without selling or being able to sell the old house. Financing for investment properties can be achieved using any of the above described programs. Typically, the rates for financing on investment properties are higher than owner occupied homes and the LTV's allowed are lower, due to the fact that default rates tend to be higher on these types of loans.

B, C, D Credit - Just because your credit isn't perfect does not mean you can't obtain financing. Most, if not all of the above described programs can be utilized even if a borrower does not have perfect credit. In these cases the rates will be higher and LTV's allowed will be lower. Most lenders have special divisions specifically created for the marketing and sales of sub-prime products. Also, most lenders will offer special limited programs as incentives, when they recognize an area where there is a need.

No Document or Low Document Loans - In certain situations it is either difficult or impossible for potential borrowers to show a lender their income on paper. In these instances any of the above described programs can be used, but under circumstances called NIV or No Income Verification. All of the other program parameters must be met, however, in the case of income, a borrower may only be required to show a operating license or business license and/or limited income information. With this type of financing, rates offered tend to be slightly higher. This type of financing is recommended for self-employed borrowers or borrowers who have difficulty showing their income on paper, for one reason or another.

Cash-Out Refinances - Occasionally, when refinancing a first trust, a borrower wants to "cash out" some of the equity that has been built into the loan. Under specific conditions, established by the lender, a borrower can actually receive a check for an amount of money that meets those conditions. Cashing-Out is not normally limited to any Your Type Of Loan Desired program, it can be done with most of the described programs.

Kindly visit Peak Home Loans we can help with Home Loans!

You should visit Peak Home Loans for refinance mortgage help and advice.  They offer 2.87% home loan mortgage refinancing, home purchasing, home equity loans, debt consolidation loans and more. A $100k loan is only $415/mo. 4 in 5 will qualify.  Rates are at an all-time low, apply today!


Sunday, September 8, 2013

How To Find The Most Up To Date Home Refinancing Advice

There is no denying the fact that most homeowners in the United States are struggling when it comes to maintaining their monthly mortgage payments in addition to their general living expenses and other bills such as credit card debt. Many people feel that the only way that they will acquire financial relief is to file bankruptcy. However, others have relied on mortgage refinance advice and have quickly learned that they can acquire low home refinance rates that will allow them to pay off their current mortgage and that will then lower their monthly payment on their new mortgage. This is one of the most financially savvy options that you can choose to take advantage of in order to maintain your way of life without having to struggle to make ends meet each month.

Apart from home refinancing advice others have also relied on debt consolidation options in order to take other bills such as their credit cards and to combine the payments into one monthly bill. This option once again allows homeowners to free up their finances so that they are keeping more money in their bank accounts each month. This allows these individuals to quit living from paycheck to paycheck.

Don’t believe that your only option is to get rid of your home or to file bankruptcy. This is actually a last resort for most people. In fact many people that attempt to file for bankruptcy quickly discover that they don’t even qualify because they don’t have enough debt to do so. Therefore, you should consider all other options in order to save yourself time and so that you can acquire immediate debt relief.

The best part about acquiring home refinancing advice is that you can easily do it from home. By making use of the internet you can focus on searching for those companies that specialize in providing users with latest mortgage refinance advice that is available. You will want to do this instead of visiting lenders in your area. That is because lenders will generally tell you what they want you to hear and what they want you to believe. If you were to visit five lenders in your area you would hear five different stories as to what you qualify for. Whereas if you make use of the internet for your research purposes you can find the truth immediately in regards to your current situation.

Just be cautious when choosing an online resource to rely on for such information. The main thing you want to realize is that laws vary from one state to the next and one country to the next when it comes to refinancing. Therefore, you will need to find an online resource that actually provides information based on your area. That way you can truly learn what you are entitled to and how refinancing truly works in your area.

Peak Home Loans is one of the most professional and reputable information services of its kind. If you want to learn what your refinancing options really are you should immediately make use of their free online services.

Do you desire to acquire the most professional home refinancing rates? You can acquire the best mortgage refinance advice at Peak Home Loans.

You should visit Peak Home Loans for refinance mortgage help and advice.  They offer 2.87% home loan mortgage refinancing, home purchasing, home equity loans, debt consolidation loans and more. A $100k loan is only $414/mo. 4 in 5 will qualify.  Rates are at an all-time low, apply today!


Sunday, July 28, 2013

Where Can I Find The Latest Home Refinance Rates?

There is no shame in struggling to maintain your current mortgage payments along with your general monthly living expenses. Many people struggle with making their payments due to the fact that the home refinance rates that they originally acquired were too steep for them to manage. That is why many people are relying on home refinancing advice and are learning how they can take out a new mortgage on their home in order to acquire decreased rates. They can then pay off their original mortgage and lower their monthly payments. Though this may require them to extend the extent of their mortgage it frees them up to live a more hassle free and flexible lifestyle.

One of the main mistakes that homeowners make when they discover that they are unable to maintain their current bills and mortgage is falling into the trap of believing that they are going to have to foreclose on their home or file bankruptcy. However, if you are diligent in your research you will quickly discover that filing bankruptcy should not even be an option.

Most people that file bankruptcy quickly realize that it will take them years upon years to build up their credit. In fact, most people that file bankruptcy struggle just as much as they did prior to filing. That is why most people focus on acquiring home refinancing advice so that they can learn how to lower their payments while also focusing on debt consolidation services for their other outstanding bills.
The next problem that people face is determining where they should turn to in order to acquire current home refinance rates and how to go about the process. That is because most homeowners are pressed for time and simply don’t have the means to visit bank and lender after lender in order to acquire the information that they need. That is because most people work two or more jobs in order to make ends meet.
The good news is that you can easily acquire this type of information online. There are numerous online resources that specialize in assisting consumers in finding the information that they need to determine what refinancing rates are available and if they will qualify to refinance their home. This allows you to conduct all the research and to carry out all the investigative work from the comfort of your home.

One of the very best online resources that you can choose to take advantage of in order to acquire this type of important information is Peak Home Loans. They are a leading online resource that specializes in providing consumers with refinancing information. They can provide you with all the information that you require in order to determine what current rates are available and what types of programs that you qualify for.

The good news is that Peak Home Loans is a free to use resource. You can also choose to speak with one of their specialists on the phone seven days a week to acquire the information that you need.

Resource Box: Want to learn what current home refinance rates are? You can acquire the latest home refinancing advice from Peak Home Loans.

You should visit Peak Home Loans for refinance mortgage help and advice.  They offer 2.87% home loan mortgage refinancing, home purchasing, home equity loans, debt consolidation loans and more. A $100k loan is only $415/mo. 4 in 5 will qualify.  Rates are at an all-time low, apply today!



Thursday, March 28, 2013

Biggest Mistakes Of First Time Home Buyers

There are several potential blunders you’ll want to side step as a first time homeowner. Three of the biggest mistakes that many first timers make are:
  1. Purchasing the wrong home – Make sure the home you want is one that you can realistically afford, is located in a good area, and has all of the features and benefits that are the most important to you. It is highly unlikely that you will find a home that will have absolutely everything you want and fit in your price range, so be prepared to make compromises. It’s the difference between knowing what you must have/need and what you can live without. Things to think about include, but are not limited to:
    • The number of rooms and bathrooms you require for a comfortable and manageable living space.
    • The safety of the neighborhood.
    • How busy are the streets?
    • Etc.
    Don’t make a fast decision. Even if you fall in love with a home and everything seems to fit, view it from every angle with a critical eye. Some homes really are too good to be true.

  2. Altering your credit score prior to closing – Once you have completed your loan application, do not make the huge mistake of making purchases on credit or with a credit card. Although it may be tempting to make big purchases for your new home, such as buying furniture, appliances, or other equipment, you need to put buying on hold until after closing.

    Making purchases with credit can alter your credit score and lead to an underwriter cancelling your loan. On the other hand, in the event your loan contingency has been removed or expired, in addition to losing your home, you could forfeit your earnest money deposit. The bottom line is: don’t buy on credit before closing and keep your credit score the same, and, if possible, work on improving it.

  3. Not being upfront and honest with your real estate advisor – Your advisor, whether it is a real estate agent or a real estate lawyer, has a fiduciary obligation to represent your best interests. Real estate professionals work for you and with you, to help you obtain the home that is the most ideal for you. However, they can’t help you if you withhold information from them. You need to trust your agent and be open and honest with them about what you are thinking and your feelings about buying. Even if you have thoughts about backing out of a deal bring this to your agent’s attention. If you do not like your advisor or do not have confidence in them, find another one to represent you who you like better.
The bottom line is that there are lots of factors you need to consider, professionals you need to consult, and plenty of research to be done if you want to avoid making big mistakes that could cost you money and even your home.

Anthony Myers is a seasoned entrepreneur and mortgage industry veteran with over 15 years experience in managing and loan consulting. Prided in establishing successful Mortgage Consulting teams that create and foster long-term relationships with clients. Contact www.peakhomeloan.com.

For First Time Home Buyers please contact Peak Home Loans. Peak Home Loans is a community of seasoned home loan experts with a passion for educating home buyers. With experts representing decades in the mortgage banking industry, America Direct’s mission is to educate consumers on every aspect of financing or refinancing a home. They come highly recommended!