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Archive for March, 2009

Mortgage rates predictions have been plumbing new depths, as the US government bails frantically to stop the US economy from sinking under the accumulated weight of the reckless lending chickens coming home to roost. Negative real interest rates are well and truly entrenched, held in place by political rather than economic forces, but held in place nonetheless.

Real interest rates are the nominal interest rates less the rate of inflation. Nominal interest rates are the mortgage interest rates quoted by banks and other lenders – the percentage rate per annum which you will pay the lender as interest. While most mortgage interest rate predictions will be made in terms of nominal interest rates, the real interest rate is the interest rate of real interest to economic observers.

Why does an academic exercise like calculating real interest rates matter for home mortgage interest rate predictions?

The answer is simple – home mortgage rate predictions will take into account tensions between the current real interest rate and the normal, or sustainable real interest rate. If the real interest rate is below normal, mortgage rates predictions will trend upward. If the real interest rate is noticeably above normal, mortgage rates predictions will trend downward. Economic pressures work to pull real interest rates back into the normal range, eventually.

Real interest rates are likely to remain negative for a while yet, which means that mortgage rates predictions are still looking at historically low nominal interest rates.

If you want to take advantage of the once-in-a-lifetime opportunity, lock in a 30-year mortgage at a really low interest rate, while you still can. Mortgage rates predictions are definitely going to rise, and if you have secured yourself a golden seat in the low-interest carriage, you will ride out those rises without risking a penny of your hard-earned cash.

As a home owner, you need to stay alert during this crisis. The Chinese character for “crisis” is a combination or the characters for “danger” and “opportunity”, and that is indeed the situation for home owners in the US today. The decisions you make now will determine whether you suffer or profit from the global economic crisis. Mortgage rates predictions are telling us that now is the best time to secure a 30 year mortgage at an all-time bargain rate of interest. Rates must rise at some point in the next couple of years, and you don’t want to be caught out when they do.

We’re living in a bit of a fantasy world at the moment, where our economic actions don’t have the normal consequences. If you can, make one part of the fantasy world – low mortgage rates – a permanent feature for the next 30 years. But beware – mortgage interest rates predictions must rise eventually, along with credit card interest rates and auto loan interest rates, so make sure your budget can handle it when they do.

The Home Mortgage Disclosure Act was enacted in 1975 by Congress and then implemented by the Federal Reserve Board. Essentially, the act requires mortgage lenders to report public loan data. For answers to some frequently asked questions about the Home Mortgage Disclosure Act, keep reading.

Why do Mortgage Lenders Have to Report Loan Data?

First, the purpose is to make sure that financial institutions and mortgage lenders are serving the changing housing needs of their community. Second, it helps public officials can see where public-sector investments are needed. Third, enforcement can identify potentially discriminatory lending practices and patterns related to mortgages.

Finally, this data allows financial analysts, government economists and others to obtain statistics on loan data, housing sales, and mortgage interest rates that are very specific to each geographical area.

Do I Have to Give a Lender My Ethnicity, Race or Sex?

No, you can decline to provide that information, whether you’re applying on the phone, over the Internet or even in person. While that information helps the government recognize lending patterns and practices, it’s your choice whether you wish to volunteer that information to your mortgage lender.

How Can the HMDA (Home Mortgage Disclosure Act) Expose Discrimination?

If a lender continually turns down an unreasonably high number of applicants of certain races, ethnicities or gender, then there may be reason to suspect this lender is discriminating against this particular group of people. Whether it’s an institutional decision or an unintentional, subtle discrimination, it’s still illegal in the United States.

Another way the HMDA can expose discrimination is to look at where the applications are coming from as well as where they’re being approved. If one neighborhood is not receiving any financing, the institution may be practicing what’s called redlining – that is, when a bank or financial institution denies services to one particular neighborhood, typically an inner-city neighborhood.

Finally, if there’s a disproportionately low number of applicants from a variety of races, ethnicities and gender, then the lending institution may be discriminating by actively discouraging these borrowers from applying for a loan.

Do Second Mortgages Need to be Reported As Well?

Yes, all refinancing, second mortgages and any loans based on the equity of a home are reported. However, home equity lines of credit do not need to be reported.

As a Consumer, Do I Need to Do Anything?

Typically, no. The responsibility of coding HMDA (Home Mortgage Disclosure Act) data and submitting it belongs to the lending institution.

If you have debts, collections, late pays, or a bankruptcy that is affecting your credit scores and your ability to buy a home, a car, or get a personal loan at a reasonable rate, etc… If you have these issues, there are really only have 3 choices…

1. Pay Your Creditors– Much easier said than done.
2. File Bankruptcy– but should be a last resort.
3. FIX YOUR CREDIT

Remember, The worst thing you can do– is DO NOTHING! Credit issues do not fix themselves.

If you’re serious about repairing and bringing up your credit scores, you NEED a current tri-merged report, and you should have credit monitoring. Without Credit Monitoring, there is no way to effectively track your progress. You can either do it yourself with the help of a free Credit repair kit, OR eliminate the headache and let a company handle it for you, or even let another company take on the responsibility of restoring your credit. But remember, the worst choice you can make is the choice to do nothing.

Keeping you confused about your credit score is the game of the credit bureaus. Mystery is not a good thing. You need clear, accurate information.

By following some useful guidelines, you can:

Remove ANY negative information from your credit reports on your own legally!

Improve your Credit Scores by as much as 200 points within 45 to 60 days.

Stop ANY collection agent from calling and harassing you at home or at work. Without filing bankruptcy.

Rebuild your credit to a positive standing WITHOUT borrowing more or applying for any loans or credit cards.

Use the law to force the credit bureaus and creditors to comply with your wishes.

The credit bureaus are publicly traded companies in business to impress stockholders. They are not government agencies. They are one of the most heavily regulated industries. The strict regulations stem from a public out cry of abuses and mistakes. A recent survey by an independent research group revealed more than 70% of credit reports contained mistakes or errors. The prevalence of errors has lead to consumer protection legislation that allows consumers to challenge the bureaus and force the removal of inaccurate, outdated or unverifiable information.

The Fair Credit Reporting Act was designed specifically to provide a way for consumers to force the removal of erroneous, outdated and unverifiable information from their report. Additionally, The Credit Repair Organization Act was passed to govern credit repair companies.

Again, you can either do it yourself with the help of a free Credit repair manual, where you get details of the relevant federal laws that were enacted to protect you, OR eliminate the headache and let a company handle it for you, or even let another company take on the responsibility of restoring your credit.

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The house payment is the largest monthly expense in the budget of most homeowners. Financial advisors recommend a maximum of 33% of the households’ net income be allotted for this monthly outlay; ideally house payments are left around twenty-five percent.

Rocky financial times are experienced by most of us at some time in our lives. In the midst of this challenging economic time even more people are fighting to maintain. Many have already lost their homes due to the financial struggles our country is facing. Those of you that have been hit hard by unplanned medical bills, reduction of income, unemployment or another economic problem, then you may want to try one of these ideas to get your mortgage payment lower.

If your family has had a cut in pay one of best choices for you is a mortgage modification. During this process the borrowers’ representative contacts the mortgage company and discusses new terms for the mortgage to make it better fit the budget of the homeowner. This is a detailed and time consuming process that is best performed by legal professionals. You may be tempted to attempt to get your mortgage payment lower via a mortgage modification by yourself but you will likely wind up frustrated not having gotten anywhere.

Another method to get a lower mortgage interest rate is the refinancing of your existing mortgage. Mortgage interest rates are especially reasonable at the time of this writing and are expected to remain so for several months. If you owed $200,000 a one percent decrease would save you $250 a month. A $150,000 debt, with a one percent reduction in the interest rate, would put your mortgage payment lower by approximately $100. It will cost you some money upfront but if you shop around you should be able to minimize your application fees and closing costs. In addition the savings you get will far out weigh the cost of refinancing in a few years. One should note that this method of getting your mortgage payment lower is more practical for those planning on living in their home for enough time for the monthly savings to pay off.

Another option is downsizing, finding a smaller and less costly house. Often you can locate a less expensive home that matches the size of your existing house if you are willing to live without some features or in a less prestigious neighborhood. You may have to perform some maintenance work or sprucing up but good deals can be found. Consider a suburb if you are living close to the heart of a metropolitan area since land values are usually lower there.

Some folks have decided to buy multi-family housing to live in a portion of it while renting the rest. For example, a duplex would let you to live in one unit and rent the other which would contribute to the monthly loan payment. In time you could sell the property and move back into a single family dwelling. This option can be viewed more an investment and, depending on the market, the rent you charge could lower your house payment.

The next method could seem contradictory, still it is worth listing: Pay extra toward your loan every opportunity you get. As all extra payments go straight toward your principal it decreases the overall amount you owe. Since your mortgage insurance is based on the principal you still owe, as you pay down your mortgage your insurance cost goes down. Another advantage to paying more than the minimum and always on time is that loan companies are more willing to work with you if you experience a financial problem and need to skip a payment or want to apply for a loan modification.

Most mortgages are thirty-year loans. Be certain your due diligence is comprehensive and you are getting the best deal available regardless of which option you choose to get your mortgage payment lower. Choose wisely and you could be saving tens of thousands of dollars throughout the life of your mortgage.

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The best method for mortgage marketing resembles an octopus. An octopus is awfully useful at catching food with 8 limbs. If the octopus loses one limb it may briefly lose some strengthbut it evolves on as a dangerous skilled predator.

Few mortgage consultants understand that there may be more than a hundred mortgage marketing strategies for getting more new clients, for growing website leads, for marketing clients, and for generating repeat sales that their competition are now not using. Mortgage brokers essentially imitate worms in their mortgage marketing campaigns. Unlike an octopus, there’s hardly any strategies. The best thing about this is that most competitors are making this same error. They could be too busy, too shorthanded, or too myopic to do far more than hand out bushels of flyers and sit around chatting ‘fish stories’ of the one that got away. Do not just settle for an ad in the yellow pages, your local paper, or on the radio.

The more mortgage marketing you use simultaneously the more successful you can achieve and the simpler it is to keep on growing your company. You will continue to prosper regardless of the issues that you may face. No problem in any one mortgage marketing approach will ever devastate you or pose major issues. Regardless of the plenty of options available most mortgage consultants use no more than two or 3 strategies for their mortgage marketing at best to increase loans.

Example, NBC digitally inserted commercial “billboards” into advertising content broadcasted in the winter Olympics – essentially a commercial within a commercial. Or a well-crafted mortgage marketing brochureshould be one page and supply just baseline info, without any hyperbole.

Giving away free credit reports is a great idea. This freebie helps you get potential leads. Once you have a copy of their report you can help them improve their credit score which could lead to a refinance opportunity. It’s a practical and useful marketing technique. You need to remember that others are in the same ship as you, like appraisers, inspectors, title & escrow folks. You can opt to network with people who have similar selling concepts.

When networking you’ll be able to share and refer purchasers to one another. You must be extraordinarily wary when choosing a networking partner as everything that you suggest is a mirrored image of yourself or your product and thus, you should be certain that your networking partner is a credible source of info.

Look at your mortgage marketing and ask yourself how many arms, like an octopus, does it have? If you can only identify 2 or 3, than you have many opportunities to improve it and when you do you know you can produce more leads because of it.

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Bankruptcy can have negative effects on your credit score, your credit file and your personal financial history for up to ten years until it has been deleted from the registers. Contrary to general opinion, it is doable to get a home mortgage loan, without a sky high interest rate after you have gone bankrupt. It is positive news for those borrowers that have claimed in the past as it allows potential homeowners to realize that there is indeed light at the end of the tunnel of bankruptcy

There are methods that can be used to boost the credit score and consequently re-build what the claiming of bankruptcy has taken down! As an example, by making use of secured credit cards needing down payments you can get your credit rating enhanced in just 6 months to up to twelve months. Secured credit cards are reported to the important reporting agencies every 30 days, thus letting you to improve your credit rating but nobody said it was going to be easy.

Because you have gone bankrupt in the past, you are going to appear unreliable to future financial institutions. High-risk home buyers are often charged a higher interest rate than those home buyers that have a higher credit score. This higher interest rate can be renegotiated when the home mortgage loan term is up for renegotiation, but the homeowner may have to pay for a higher interest while they are in the process of re-building their credit.

The only way make certain that you will be guaranteed for credit approval in the home mortgage process after having gone bankrupt is to begin the process of rebuilding the credit rating. Rest assured this can take time; rebuilding your credit after bankruptcy will not happen within one night and will certainly not happen from developing credit with just one lender. The credit rebuilding process is a demanding process and necessitates not only financial investment from the consumer, but also personal investment.

Getting home mortgage loan approval job status. Have you worked for the same company for an long period of time? Is your job situation secure in the future to ensure that monthly payments are done towards the home mortgage loan in a timely manner? When you apply for a home mortgage, lenders establish these facts as your ability to pay the loan.

There are many loaners that specialize in according home mortgage loans to customers that have declared bankruptcy in the past and are confronted by credit repercussions that come with the claim. These lenders are specialized to treat with troubles that may happen because of the past financial history and have measures that can overcome the obstacles that these customers face.

About the author:
D. Hallet acquired a home as a single mother and experienced how applying for a mortgage loan difficult is to get a home mortgage particularly if you don’t know where to start. So, if you want more information on home mortgage loan approval after gone bankrupt, feel free to visit Home Mortgage A to Z, your Online Guide.

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Residents of Texas, and particularly our local markets of Spring, Tomball, Conroe, The Woodlands and Houston, have been largely spared the pain of the national housing decline. There is good news and bad news associated with this stable housing market when it comes to refinancing your mortgage to a low rate.
The stability of our housing markets housing markets can be partially attributed to Texas state laws. It was only in 1997 that Texas opened the doors to home equity loan financing, and with it came some specific restrictions. Among them:

• The aggregate outstanding loan amount, including home equity loan debt, may not exceed 80% of the home’s value on a cash-out refinance (50% for home equity lines of credit).
• Closing costs are capped at 3% of the loan amount.
• A loan may only be refinanced one time per year.
• Prepayment penalties are prohibited.
• In addition to a three-day right of rescission, Texas law also instituted a 12-day waiting period before closing to allow borrowers time to read and understand their Good Faith Closing Cost Estimate.

All of these regulations served to limit the amount of leverage available to consumers secured by their homes. While home equity loans in other states permitted leveraging one’s home to well over 100% of its value, Texas law strictly prohibited these practices. This effectively protects the consumer from the temptation to go out and leverage their home to the hilt in order to buy a flat screen television and a new car.

Here’s the bad news. Because of the 80% limitation, homeowners are not fully able to tap into the equity, or ownership, in their home. This becomes troublesome when a homeowner is faced with cash flow challenges and has run out of other sources of ready cash. Their only way to tap this equity is to sell their home; not a particularly attractive option in a weak housing market.

In addition, the 3% closing cost rule makes refinancing small loans prohibitive for many mortgage lenders, as the closing costs on a $40,000 loan may exceed three percent simply due to the costs of title insurance, survey, appraisal, recording fees, and credit and flood reports; all of which are required by lenders as risk mitigation tools. A lender is typically not going to waive their requirements and increase the risk in an already weak loan portfolio for the nominal interest generated by a $40,000 loan.

If you are considering a cash-out refinance, weigh the benefits of both a traditional mortgage refinance and a home equity line of credit. The line of credit will typically come with an adjustable rate that can rise, but offers the flexibility of paying the line down and tapping it again in the future without additional closing costs. A traditional refinance might be best for homeowners who desire a fixed rate, believe they may move within the next 5-10 years, or do not anticipate tapping their home equity again down the road.

To find out more about mortgage refinancing in Houston, Spring, Tomball, The Woodlands, or Conroe Texas, speak with your mortgage professional about your options and keep in mind the costs involved in increasing your loan amount. The interest an on increased loan can easily amount to tens of thousands of dollars over the life of a loan.

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If you are urgently searching for some quick and easy ways to save some decent amount of cash this year, then here are a few tips of simple money saving pointers that you might like to consider.

Make Your Own Lunch
Do you eat your lunch in the staff canteenevery day, or buy prepacked sandwiches from the local takeaway shop? How much in total is that costing you each lunchtime? Add it together over the course of aworking week, or even a full year, and the amount is quite significant. Yet compare that to the lower cost of the same meals prepared at home, before work. Maybe the night before throw extra pasta or rice into the pan and take the surplus food to work in a Tupperware container? Cold pasta or rice dishes make a tasty mealtime treat . Or just take the easy, traditional, option and make a few sandwiches and take some fruit.

Meals such as this might even allow a bit more free time over your lunch hour so that you can escape outside for a walk. Add to that the fact that home prepared meals are probably a lot healthier, using a lot less salt etc, then the self prepared food might not only be cheaper, but more healthierat the same time.

Time Your Shopping
And whilst you are out in the shops buying your packed lunch, watch what time you are going to the supermarket. Many will offer food that is about to become out of date at a reduced rate shortly before the end of the day. So if you time your shopping visit carefully for late in the day, you might also be able to pick up some of your usual favouriteitems at a knocked down price.

Review Your Mortgage
How much have you currently got borrowed in your mortgage and with the recent collapse in mortgage interest rates is your mortgage serving you as best it can? Have a quick word with a local mortgage broker who can understand and review your financial circumstances and ask them to compare all mortgage rates for you. Is the current mortgage deal you are on the best and what would it cost to move to something cheaperon the market? It may be cheaper for you to stay put if you have high exit penalty fees, but if there aren’t penalty charges or they aren’t too great, then you might save yourself a tidy sum by movingto another lender. When your mortgage advisor compares mortgage rates for you, they should also be able to tell you how much it will cost to moveto a cheaper mortgage.

That’s just three quick and simple ideas to save you potentially hundreds per year. But if you want to reduce your outgoings in the short term, then you can start saving straight away.

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Loan modification, which is also called mortgage modification, is quickly becoming one of the most popular ways to prevent foreclosure in the US. Since it is so effective in relation to the expense one should not be surprised. Communities in California have recorded over 53% of their home sales as foreclosure sales. It is clear the need for solutions like as mortgage modification is strong.

A person who is thinking about applying for a loan modification needsto be certain they locate a reputable service provider that possesses the resources and experience needed to represent them. Also they need to be sure that they will get what they are paying for. It is all too common that either inexperienced people or companies are offering a service they are incapable of providing or dishonest people or entities are running mortgage modification scams.

Here we have listed four important traits a mortgage modification provider needs to possess. You may want to take notes so that you do not become a victim of a mortgage modification scam.

Free for a Financial Evaluation
Find a mortgage modification firm that is honest and offers a free evaluation with no obligation to determine if you will qualify. The mortgage modification firm that is able to offer this service will also be able to back up their evaluation. This service is offered because they know they will recognize an eligible candidate and are able to produce a mortgage modification for them. Only an experienced firm can do this effectively.

A Full Refund Guarantee
A mortgage modification provider can afford to offer a free evaluation for 1 reason only; because their experience and knowledge allow them to be certain they will be able to negotiate a mortgage modification for people they qualify. This confidence allows them to offer a 100% money back guarantee. Only a loan modification firm that has a great success rate will have sufficient confidence to give you, in writing, a 100% money back guarantee if they are not successful in obtaining a mortgage modification for you.

Legal Representation From an Experienced and Licensed Professional
There are not many loan modification firms who can truly claim they have a staff of trained experts in the fields of negotiation, real estate law, the intricacies of mortgage loans, loss mitigation and arbitration, all required to efficiently get a mortgage modification. Certain processes are necessary when getting a mortgage modification for a client and this is best accomplished by a legal professionals. The provider you select has to be licensed in your state

System to Track Progression of Your Mortgage Modification Online
If you employee a company for a job you need to be able to track the progress. Respectable mortgage modification providers will provide this service for your convenience. You should be provided a way to track each move of your mortgage modification void of guessing or wondering what progress is being made toward obtaining your mortgage modification.

Someone who needs a mortgage modification is already stressed out. Finding a reputable provider to represent them should not add to that stress. If you want your lower mortgage interest, just look for these four characteristics and you will soon find a mortgage modification provider that not only will provide a great service but will also allow you piece of mind.

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There are several different factors that can influence how interest rates are calculated once it is time to begin the home mortgage loan approval procedure. To provide you with a rate that comparable to other companies and influenced by your personal history, all of these factors are taken into account by the bank that you are working with. You will find below the factors that will make you understand how your bank decides on your home mortgage loan interest rate.

Your Credit Score.

The first of the factors that has an impact on your home mortgage loan interest rate is your credit score. Loaners will normally offer a lower interest rate to home buyers that come with a high credit score as they are supposed to pose less risk to the lending company. On the other hand, if the credit score is lower than the consumer is often faced with a higher interest rating which will be reflected in the rate of the mortgage when your credit score is associated with the other factors that determine a mortgage rating.

It is consequently advisable to take measures in order to inflate your credit score so that you will get a lower home mortgage loan interest rate. Making payments on time and using variable types of credit can create a high credit score that will allow you to acquire a credit rating that will help you get the best rates with bank.

The Market.

The market depends on several different factors – the interest rate of the economy and the stock market as well as the international rates. On one hand, when the market interest rates are low, a lesser interest rate is applied to the consumer. If the market interest rates are high then the consumer is normally charged with a higher interest rate. In order to determine the home mortgage loan interest rate that will be proposed, the state of the market is combined with the credit score of the consumer.

Trends and History.

Two additional factors that can influence the home mortgage loan interest rates that are being offered by banks are trends and history. The history is used to calculate the future home mortgage rates. This is combined with the state of the economy to create an interest rate that is reasonable to the loaners and to the home buyers that are applying for home mortgage rates.

To save up to 2 % on the cost of your home mortgage loan interest rate, it is advisable to do several comparisons between the rates offered. While 2 % may not appear as a big sum, it is important to realize that too many home mortgage loans are in excess of two-hundred thousand dollars, which could represent thousands of dollars worth of savings over the entire life of the home mortgage.

About the author:
D. Hallet acquired a house as a single mother and experienced how applying for a mortgage loan difficult is to become a homeowner particularly if you don’t know where to begin. So, if you want more information on how to calculate a mortgage, feel free to visit Home Mortgage A to Z, your Online Guide.

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