Getting a Home Inspection

If you are in the process of purchasing a new home, it will definitely be in your best interest to have a home inspection done.
Not only will you want to have a home inspection done for your own sake, and peace of mind. But most lenders will require that you have a home inspection before they will proceed with the loan. The lending institution has just as much interest in the home as you do, so that is why they require a home inspection.
Getting a home inspection requires hiring a company to send out a home inspector to go through the home you are going to purchase. With you present, the home inspector goes through the home, and thoroughly inspects to make sure nothing in is need of major repair that cannot be seen with the naked eye.
Basically, a home inspector goes through a home and checks wiring, fixtures, plumbing, and the foundation of the home to make sure it is structurally sound. He will also inspect the outside of the home along with the roof to make sure there isn’t any exterior damage.
Along with the home inspection, it would also be in your best interest to inspect for wood boring insects, such as termites and beetles.
A pest inspection is also required by the lender before they proceed with a loan.
A pest inspection is done separately from the home inspection and is done through a different company that specializes in pest inspections.
Not only are home and pest inspections required by the lending institutions, but it would be in your best interest even if they were not. They cost anywhere from $300.00 to $400.00 depending on the size of the home, and you are aloud to be present and ask questions through the entire inspection.
Imagine if you found your dream home and loved it so much that you purchased it without having the home inspection done. On the day that you and your family move in, it is the happiest day of your lives. Than, three days after you move in, you get your first rain fall while in your new house. Than, the next thing you know, you have rain coming through the ceilings up stairs.
After something like this, you’ll be wishing you had the home inspected. Trust me.
Believe me, this stuff happens. So be smart, and get a home inspection. It beats paying $15,000.00 to $20,000.00 for a new roof.
In addition, once you have a home inspection done, you will have peace of mind that the house is sound and in good living condition. However, should anything happen to go wrong after you move in that was covered under your home inspection, you will have the home inspection company to hold accountable for the damage, and not have to pay it out of your own pocket.
To summarize, the home inspection is very important to both you and the lending institution. You both have an interest in the property, so have the home inspection done, you will sleep a lot easier.

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Locating a Down Payment

Locating a Down Payment
If you are a saver, and many of you are, than the need to locate a down payment will not be an issue for you.
But there are also many of us out there that have not had the luxury to save as much as we would have liked for various reasons. With this challenge at hand, we will need to track down a source for a down payment.
If you have excellent credit, and when I say excellent, I mean your credit history is perfect without a blemish on it, you will most likely be able to apply for a mortgage with 100% financing, if you choose to go that route.
A lot of lenders offer this product, and if you can swing it, than you won’t need to come up with any cash for a down payment, and you will only be responsible for closing costs.
If you are unable to go with 100% financing, here are a few ideas you might look into to come up with a down payment.
Retirement Plans
If your employer offers a retirement plan such as a 401k, you might want to consider borrowing from it to help out with your down payment. Most 401k plans offer this option for home purchasing reasons. You do however have to pay this money back on a monthly basis.
The down side to using a 401k plan is that when you pay the loan back, you are doing it with after tax dollars.
With that being said, it is still worth looking into, and a lot of people consider this option.
Family
When all else fails, ask family members to give you a helping hand. This is not an uncommon practice among newlyweds who often approach their parents for assistance with their down payment.
If this is not for you, I understand. It can be tough to swallow your pride and approach family members to help you out.
Save
If you are at the end of your rope, and there doesn’t seem to be any down payment money in sight. You just might have to bight the bullet, start saving, and wait it out.
A great way to jump start your savings is with your tax return money. Depending on what your return is and what percentage the lender requires you to put down, your tax return could have you in the door sooner than you think.

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Do You Know How To Find The Best Mortgage Deal?

People will spend months or even years planning to buy their own home. They will work hard to build good credit. They will save a sizable down payment. They will search for the perfect house. Then they will settle for the first mortgage they see.

What is wrong with this picture?

It is important to remember that if you have good credit and a down payment then you are in the driver's seat when it comes to negotiating a mortgage. You are the dream customer that lenders want on their books. Even if your credit is not perfect and your down payment is nonexistent you are still an attractive client for many lenders.

Repeat this mantra whenever a lender acts as if they are doing you a favor by lending you money: I am going to give them a lot of money. Yes, you are. Over the next five to 30 years you are going to pay a lot of interest to this lender as well as repay the principal they originally put up. They are not giving you anything. This is a business deal and the lender stands to make a lot of money so you need to protect yourself to get the best deal you can.

While most lenders tend to make you think you should be grateful to them for taking this huge risk on you, it really is the other way around. A mortgage lender can't lose. If you honor the deal they will make a lot of money and if you don't honor the deal then they simply take your house back and keep the interest you paid in the meantime!

However there is an even bigger fallacy that lenders like to perpetuate. They don't want you to know how desperate they are for your business.  Look around and you will realize the truth of this. Check out the television, radio, and print ads that abound and you will see the mortgage lenders are getting pretty competitive.

That is why you simply must shop around to find the best mortgage deal available for you. In the end you could save yourself thousands of dollars. Here are five ways to help you find the best deal:

   ~ Shop around - Get quotes from various lenders. Look at local and national lenders and don't overlook the internet.
   ~ Compare terms - Interest rates vary from lender to lender but lenders offer different interest rates depending on the terms of the mortgage. How long will it be (15, 20 or 30 years)? Will it be variable or fixed?
   ~ Tweak some of the optional items that you control, such as the type of insurance you will carry and whether or not you will use escrow for taxes etc.
   ~ Adjust your down payment - Sometimes being able to increase the percentage of what you are putting down can make a difference in the lenders terms (similarly buying a less expensive house will work the same)
   ~ Haggle - Yes! Lenders often act as if their rates are written in stone but this is not the case. This is where shopping around can really come in handy. If you can show that you've got a slightly better deal with another lender then sometimes another lender will lower their rate to beat the competitor. Hey it's worth a try!

Just remember that you are in control of your future. You can choose whether or not to accept a mortgage lenders terms. There are a lot of lenders out there so you do not need to sign with the first offer you receive.

One last hint: It might be best to go through this process before you've found the home of your dreams! You can get preapproved for a mortgage with most lenders and that removes the pressure and worry of losing the home of your dreams while you negotiate with a lender. It also puts you in the driver's seat when you are negotiating to buy that dream home when you finally find it if you already have a mortgage ready to go.

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Don't Be Afraid Of Getting A Mortgage Online.

No matter what your credit history is, or what your circumstances are, the Internet has made the home loan process much easier. This article will outline a five-point plan to assist you in your pursuit of financing online:

Step 1: Don't be afraid to go shopping.

Discussing personal mistakes in life can paralyze us with fear, namely, getting into the "bad credit" issues. But getting into this "stuff' is completely unnecessary in the preliminary phase of shopping for a loan, beyond the basic information provided in an online short-form.

In other words, you don't really have to talk about the nitty-gritty details, until after a loan offer has been presented to you. So don't fret about it at first.

Because we're on the subject, if you are a consumer with credit history issues, let me briefly take this opportunity to state the obvious:

1. You're no different than anyone else. We all live imperfect lives.

2. Credit problems do not make you a bad person, and are really just reference points.

3. There are loan products designed for you.

4. There are lending institutions that are interested in earning your business.

5. There is nothing wrong with you, or your credit, or your situation. You can find a loan.

First, get into the right frame of mind. Don't be afraid to ask questions, and don't be intimidated by your credit history. Be honest. Give truthful information. But don't feel shame or regret for your past or present personal circumstance. They make you who you are, and that earns you respect.

Step 2: What's the going rate?

Information is free, so why not be informed? Many resources are available on the Internet to get current interest rates, and it's easy to compare them.

So to start with, take a look at two pieces of information:

1. Current Interest Rate, 30-year fixed

2. 6-month trend graph

A little exercise: Do you see the current rate? What about the 6-month graph? Are rates going up, down, or staying about the same? Is the current rate higher than it was 6 months ago? Lower then 6 months ago?

Now don't feel the need to analyze this information too much. For now, just look at it, and perhaps, check it several times a week to stay informed. If you do this, you're already 10 steps ahead of the game!

You are now an informed shopper. When an offer is presented to you in the near future, you'll be able to ascertain how good an offer it actually is by knowing how it compares to the "going rate". (Hint: Don't forget to check terms and fees, also known as "points", and conditions relating to your loan offer. Often times you will see higher points or less favorable terms, in exchange for a lower rate.)

You will be able to assess if you think rates are declining or on the rise, which may help you to decide if the present is the right time to make a purchase.
Step 3: Obtain several offers.

When you buy a car, do you seek out the best deal? When you go grocery shopping, do you consider which store offers the best prices? Shopping for a mortgage should not be seen any differently, and the best way to do this is to obtain several preliminary loan offers online.

1. Preliminary loan offers are simple, painless, and easy to get.

2. They contain the terms, rates, and pertinent information you need to assess the lenders.

3. They will take all the guesswork out of where you stand.

Get three or four offers and compare them. How do they compare to each other, and to the going interest rates mentioned in Step 2?

Many companies conduct searches for thousands of lenders, a lot of them in your local area, and they provide you with four loan offers almost instantly. Take advantage of this! These are no obligation services, and for the most part, the online application forms are simple. They take only a few minutes to complete.

You don't need to get into your credit history at this point. Completing the simple form is all it takes. If you qualify, and a lender is located that wants to do business with you, then you'll go to the next step, which is to discuss this possible opportunity over the phone.

Step 4: Remember this.

1. Lenders should never ask you for personal or private information during this preliminary phase. Of course they'll need to know some basic information about you and your situation, but never give out information you feel uncomfortable disclosing (such as your social security number), and look for a "privacy policy" on their website.

2. Remember that these are "preliminary" loan offers, which means no immediate commitment on your part. You complete a simple, on-line short-form, and then you get several offers in return. The lenders that made the offers may wish to talk with you over the phone, but that's where the preliminary process ends. The ball is in your court to choose a product that meets your needs, or to keep shopping.

3. These services are offered for free and you should not be asked for any service charges any time.

Step 5: Understanding your Options

If you've followed this simple plan, you will discover that there are consumer loan products tailor made to meet everyone's needs. Remember to examine the terms and rates, obtain several loan offers, and then talk to the lenders over the phone. Find out who they are, and whether or not you'd like to do business with them. Throughout this process, stay informed by checking interest rates, and settle for nothing less than what is attainable.

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Getting the right mortgage

Selecting a mortgage can be a difficult task. First of all, you need to decide which mortgage would suit your needs best.

For those who want to know what their monthly outgoings are going to be, should look at a fixed rate mortgage, as these are mortgages that are set at a fixed price for a certain period, which can be anything from 1 year to 5 years.

A variable mortgage is just that, it’s a mortgage rate that changes (or varies) with the base rate. So if the base lending rate increases so does your mortgage rate, however the positive aspect of this type of mortgage is that if the lending rate lowers so does your mortgage repayment. This is not for all – as there is an element of risk involved (this was true back in the late 1980’s, when unfortunately rates rocketed as house prices tumbled)

You may also need to think about a repayment mortgage or an interest only mortgage.

The difference is that the latter does just that, it only pays the interests, so whilst your monthly payments will be less, you will still have the capital to settle at the end of the mortgage duration. However a repayment mortgage will be a little more expensive, but at least you will be paying off both the capital and the interest, which means ultimately your mortgage is reducing.

When you have agreed which type of mortgage suits your lifestyle then don’t be afraid to shop around whilst you are  still tied to a contract – as there is usually a set time when you have the ability to negotiate another rate and/or go to another lender who is offering you something cheaper.

I would always suggest that in today’s competitive market that you shop around, as there are lots of different lenders with differing rates, and you need to find the right one to suit your budget and lifestyle.

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Don’t Let Bad Credit Stop You

When I worked as a loan officer, it wasn’t unusual for me to come across people who thought they were out of luck because they had bad credit.

This is really not the case, although it is fair to say that you would not be able to walk down to your local bank, have a seat in the branch manager’s office and walk out with a mortgage.

However, there are alternatives, and you do have choices.

If you contact a broker, tell them your situation, be completely honest and up front with them, otherwise you are just wasting their time as well as your own, and believe me, whatever your situation may be, they have heard worse. Nine times out of ten they will be able to help you.

Conventional banks are not the only ones that lend money. Brokers have access too literally hundreds of banks with a wide variety of programs for people in unique situations from foreclosure buy outs, to 100% financing with poor credit scores.

I speak from experience, because when I was a loan officer I did mortgages for people in unique situations.

Foreclosure buy outs, bankruptcy, late payments on prior mortgages, the list goes on.

I would sit down with my customer, take down as much information as possible, than present their information to many different lenders for them to review. Most times I would find one with a program to help my customer.

Keep in mind, with unique situations, there is risk involved on the part of the bank, so you can’t expect to get the best rate in the world.  But if it is reasonable, and can put you into the situation you want to be in, than it is well worth it.

So if you think your credit, or a bad situation is preventing you from getting a loan, think again, there is probably a program out there for you, you have nothing too loose.

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Finding a Mortgage Refinance Advisor

Finding a Mortgage Refinance Advisor

If you are looking to refinance your home for a lower rate, or you are interested in a refinance with cash out to do some home repairs, buy a new car, etc., you may want to consider finding a mortgage refinance advisor.

There are actually two ways you can go about refinancing your home. The first would be to do the shopping around for a refinance on your own. The second way would be to locate a mortgage refinance advisor.

A mortgage refinance advisor. Otherwise, known as a mortgage loan officer or mortgage broker are not at all hard to find.

The internet is perhaps the best resource for tracking down a mortgage refinance advisor. There are literally hundreds of them right in your own back yard, and the internet would be by far the best way to begin your search.

Once you have found a mortgage refinance advisor, don’t stop there, shop around. By shopping around with a few different loan officers and brokers, you will give yourself the ability to compare rates and prices.

Think of it the same way you would go about purchasing a new car. Shop around, test drive a few by going to different dealerships. Once you have test driven a few cars and compared pricing, base your decision on the best and most reasonable deal.

By shopping around as opposed to committing to the first mortgage refinance advisor you come across could mean the difference of thousands of dollars in closing costs and interest fees’ over the life of the loan.

By allowing no more than four loan officers or mortgage brokers to assess your situation, you are putting yourself in a much more ideal situation. Especially if your credit is challenged or your situation is unique, not only will the mortgage refinance advisors’ expertise come into play, you will be in a position to compare rates and pricing.

Remember, the majority of mortgage refinance advisors are paid on commission, so it is just as important to them as it is to you to get to the closing table. Good luck.

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Refinancing with Home Equity Loans

If you have lived in your home for a reasonable amount of time, you may be considering refinancing.

Refinancing can be done in a few different ways. One of the most popular recently has been the home equity loan.

A home equity loan is a loan used to pay off your existing mortgage at a lower rate.

Also, when refinancing with a home equity loan, you have the option of liquidating some of the equity you have established in your home through monthly mortgage payments and appreciation.

Lets suppose you owe $125,000.00 on the mortgage to your home, but your home is worth $200,000.00. This means you have $75,000.00 worth of equity that you can liquidate.

Realistically, you could get a home equity loan for $150,000.00, pay off your existing mortgage, and have $25,000.00 left for home improvement, a new car, college tuition, etc.

Home equity loans also come in the form of a line of credit, better known as a home equity line of credit.

The difference between a home equity loan and line is that the line comes with a variable rate, which means it will adjust with the prime rate, so be careful when deciding.

The home equity credit line can also be re-tapped once it has been partially paid off, or paid off in full, which makes for much convenience.

Before deciding on how you want to go about doing your refinancing, be sure to educate yourself as much as possible about the mortgage industry.

Also, shop around for the best rate and program that fits your needs and budget. The mortgage industry is a competitive one, so let them fight for your business. Good luck.

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Purchasing a Home with Bad Credit

If you would like to purchase a home but believe you are unable to because your credit has gone through some challenges, think again, there just may be some hope for you.

The mortgage industry is a very diverse one. And these days it is no longer a requirement to have perfect credit in order to purchase a home.

And no longer is it necessary to go down the street to your local bank in order to apply for a mortgage.

There are many lenders out there across the country known as wholesale lenders who specialize in different niches with specialty programs for people in all types of situations such as yourself.

The most important thing for you to do is to educate and familiarize yourself with the mortgage industry. This way you will have somewhat of an idea of what you are getting into, and a better understanding of what the people in the industry are talking about once you start to deal with them on a daily basis.

One thing you may want to consider is speaking with a broker if you are not comfortable finding a program for your needs on your own.

A broker is not a lender. They work as a liaison between the lender and the consumer. It is their job to find you a program to fit your needs and budget. They also will council and educate you through the entire mortgage process.

Remember, just because your credit is poor, it does not mean that you are at the mercy of the broker or the lender. Allow for a few of them to compete for your business, than base your decision on the one that best fits your needs and budget.

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