Tag-Archive for ◊ Money ◊

Author: admin
• Wednesday, February 09th, 2011

What about get rid from your monthly high payments to a lower one? How that would be if on the same time you get some extra cash to spend? Well, for this big advantage one simple thing you need to do is refinance mortgage.

Refinance is paying off an existing loan with the money from a new loan. Refinance Mortgage is generally gaining a secured loan designed to replace an existing loan by the same property.

There are two options to refinance mortgage -

(i)No-Closing Cost Refinances: It offers low upfront fees, with little refinancing costs.

(ii)Cash-Out Refinances: It offers extra cash to spend, with less monthly reduction.

There can be various reasons and benefits to refinance mortgage. The money can also be used to pay of any debt, to reduce periodic payment obligations, to reduce risk, to liquidate the equity of the property.

There are few certain benefits to refinance mortgage -

-By refinancing mortgage when the interest rate is low, you can shift from a higher to lower interest rate. Thus you can save from your monthly payment.

-Same way, you can shorten the mortgage term period.

-By refinance you can exchange an adjustable rate for a fixed rate of interest. This will give you more security at monthly expenditure.

-By a cash-out refinancing you can get access to extra cash to spend on anything you desire.

-For those who have to pay Private Mortgage Insurance, a refinance mortgage can free them from this.

Before deciding to refinance, you should consider every pro and con and know exactly what advantages it would give to you. It is important first to determine whether the amount saved on interest balances the amount of fees payable during refinancing.

On this process you also need to be aware of the dangers to refinance mortgage. Churning can be a danger where lenders or brokers refinance your mortgage even if the benefits do not outweigh the drawbacks for the borrower. You need also to be very careful with the monthly payments.

To understand the financial detail to refinance mortgage, you need to know about the different interest rates -

(i)Adjustable Rate: This type of loan has changing interest rates depending on the market condition.

(ii)Fixed Rate: Here, the interest rate on the base amount is fixed through out the years of the payment of the loan.

(iii)Balloon Home Loan: The interest rate here is fixed for a set period of time. Afterwards, it works as an adjustable interest rate.

(iv)Home Equity Loan: This is a fixed rate loan allowing you to tap into your equity while giving you a fund to spend.

With this basic information at your fingertips you can now be prepared to refinance mortgage. Along with the interest rate, many refinancing lenders ask for an upfront payment of a particular percentage of your loan amount. This is called ‘points’. Along with interest rate and points you need to pay some fees and charges to refinance mortgage.

Author: admin
• Tuesday, January 18th, 2011

Million of Americans have credit problems. Those who own homes can use a mortgage refinance to help with credit repair. Mortgage refinance involves taking out a new mortgage to pay off the original loan. Depending on your equity, the new mortgage can be for more than the amount of the old loan. This money can then be used to for debt consolidation, which can improve your credit rating.

The mortgage refinance business is very competitive. Make sure you don’t get conned by unscrupulous lenders. Jack Guttentag, the Mortgage Professor, cautions, “The refinancing market is something of a jungle, but you are safe if you observe one basic principle: You cannot save money on a refinance unless the interest rate on the new mortgage is below the rate on the existing one.

“Some con artists will show you that your total interest payments will decline if you refinance into their higher-rate loan. However, they get that result by assuming that you will repay your new mortgage (but not your old one) on an accelerated (biweekly) schedule.

“Some others … get (a lower) result by extending the term. If your current mortgage does not have many more years to run, an extension of the term can reduce the payment by more than the higher rate increases it. If you do it, you pay for it big time in the form of a higher loan balance in future years.”

To learn about two other steps you can take to help with mortgage refinance credit repair [http://www.badcreditmortgagerefinancingnow.com/articles/YM70P/mortgage-refinance-credit-repair.html] or to receive a free mortgage quote, visit Bad Credit Mortgage Refinancing Now [http://www.badcreditmortgagerefinancingnow.com], a site that can help you determine if refinancing makes sense for you.