Posts Tagged interest rate
How does your Credit Rating Effect your Mortgage?
Posted by Top Home Loans in Credit Information, Mortgage Advice on September 3, 2010
If your a good credit user, then you should have a rough estimate of what your credit score is. For many, they do not know what their credit score is; however, it is critical that you know what yours is because it can make many differences on your mortgage.
All banks have credit requirements. If you are under a certain requirement on your credit report, then the bank will not even consider you. The bank will just automatically decline your mortgage with no questions asked. Banks with the best rate will require a higher threshold for the client’s credit bureau rating. If you have a bad credit score, then you can usually still get approved for a mortgage, but you will have to pay a premium on your interest rate.
Credit Scores can Impact Programs you Qualify for
For many borrowers, they want to be approved for their mortgage while providing as little documentation that is required. It is a hassle to look for old income documents that you may no longer have, so it is easier not to have to collect these documents. If you have a higher credit score, then the bank can sometimes waive this condition; however, if your credit score is very bad, then you will need to collect your income documents everytime that you apply for a mortgage. It is best to keep your credit in good standing to avoid extra work.
Getting Approved, and being Declined
Credit scores have the greatest impact on whether you will be approved or declined for your mortgage. If your credit score is too low, then you won’t be able to get approved anywhere. The higher your credit score, the more doors you will have open and available to get your mortgage approved.
Special Programs, What are they?
Many mortgage insurers have special programs that you may want to take advantage of. These programs can range from renovating your property to getting discounts on your mortgage insurance premium. You want to be able to get access to as many programs as possible, so make sure that your credit rating is very strong.
A strong credit rating is essential to getting a mortgage approved. It is also essential to getting the best mortgage rates. Make sure that you are constantly improving your credit score.
What is your credit score rating? How do you keep your credit score at the level it is at? Leave your response in the comments below.
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Secured Line of Credit or a Mortgage Refinance? What is better for you?
Posted by Top Home Loans in General Banking, Mortgage Advice on August 10, 2010
When deciding if you want to get a secured line of credit or a mortgage, the first thing that you need to decide on is what is important to you. Do you want to have lower monthly payments, or do you want to decrease your interest and pay off your debt faster? These choices are the most important choices, and they have a huge impact on how you manage your mortgage. What is a secured line of credit?
A secured line of credit is a low interest line of credit. The only difference between a regular line of credit and a secured line of credit is that it is secured against your house, and it is a lower interest rate than a regular line of credit.
A secured line of credit is also a variable rate, whereas a mortgage can be a fixed rate or a variable rate. The secured line of credit does not have a defined repayment time, and you can keep the secured line of credit open for as long as you own a house. The minimum payments on a secured line of credit are interest only. The setup fees, on a secured line of credit, are very low in comparison to a mortgage. However, a true comparison between the two puts the secured line of credit at a clear disadvantage if you intend on using it.
What benefits does a Mortgage have over a Secured Line of Credit?
A mortgage has a higher monthly payment; however, this is a good thing because you will know when you can expect to pay off your loan. You will be provided with a certain time frame to have it paid off by, and certain fixed payments. A mortgage acts similar to a loan whereas the secured line of credit is a line of credit. The mortgage can also offer a lower variable rate on your mortgage. As of right now, the secured line of credit features a prime plus rate and the mortgage features a prime minus rate.
If you intend on holding a balance on your secured line of credit for several months, then it may be in your benefit to choose a mortgage over a secured line of credit. Even though secured line of credit may seem more advantageous with some of the features available on the secured line of credit, it is designed to put the borrower into perpetual debt. It is a good idea to not have a revolving balance on this account.
What is the Better account, a Mortgage or a Secured Line of Credit?
What is better depends on how you intend to use the account. If you goal is to pay off your outstanding balances as quickly as possible, then you may want to consider the mortgage. If you are not concerned with how long it takes you to pay off your accounts, and you would prefer the lower payments, then you would rather choose secured line of credit over the mortgage. However, many people also choose both. You do not usually need to pick either one or the other. Some borrowers with plenty of equity can choose both products.
What do you think is better, a secured line of credit or a mortgage? How did you come up with your decision? Leave your response in the comments below.
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Save more with the Strategy of Refinancing Mortgage
Posted by Top Home Loans in Mortgage Advice on August 6, 2010
Guest Post from MortgageFit.com
The ease of refinancing mortgage has made more people to opt for this available option. There are many mortgage companies online that can provide with some quick quotes and some added advantages. Refinancing simply implies getting a new loan that is more affordable and comes with lower interests rates. The new loan would be secured on same property as the old loan. Refinancing mortgage comes as the best option for all those who wish to stay in their current home for a period of more than three years.
Many sites are now offering a mortgage calculator, which makes it easy for anyone to calculate how much they can save with the refinancing deal.
Advantages of mortgage refinancing
Refinancing mortgage has many advantages that certainly tell us why people are opting for this option.
1.A lower interest rate: If you are going for refinancing mortgage, it helps you to lower interest rates and you save a lot.
2.Fast payments: The other benefits of refinancing mortgage would be that it could help you pay your mortgage quickly though it would come up with higher interests.
3.Various options: Mortgage refinance comes with many options and it is up to an individual to choose the one that fits best on their current economic status. For instance, to save from the burden of paying monthly installments on two separate loans refinancing mortgage could combine them into single loan with less installment then the two individual loans combined.
4.You can borrow more: The other benefit that lures people into refinance is the option to borrow more than current loan. The extra money can be used to pay off installment loans or credit card balances. Refinancing mortgage thus, helps an individual to cash on their equity as well as modify the terms of the current loan.
Types of mortgage refinancing
There are a number of ways through which the mortgage can be refinanced, which can be categorized into- low credit refinance, streamline refinancing, mobile refinance, cash-out refinancing or term rate refinancing.
Depending on the particular need one can decide the most favorable loan program. Buying a vacation home would require a 30 year fixed rate loan while adding a room can be done conveniently with cash- out refinance.
Even a low or bad credit can qualify for refinancing mortgage. However, a bad credit can invite higher interests rates than the one on a favorable credit. Before opting in for any refinance option, it is advisable that you get to know all the terms of your new loan. Be aware of the trends and rates prevailing in the refinance market. With so many options, it is best to get quotes from a number of lenders.