Thursday, October 4, 2007

real estate investment loan : refinance - "Home Mortgage Refinance Is A Popular Subject These Days"

The real estate industry has been going like gangbusters for several years now across the United States. This strong market has been fueled by several different factors that have all come together at the same time. More buyers than sellers, a shortage of land and new houses as well as record low interest rates are a few of the main reasons this is true. These factors have all made the prospect of a refinance home loan very inviting for anyone who has been making regular mortgage payments on a home for at least a few years. The people who have built up good credit and equity can now take advantage of the many different things that home mortgage refinance has to offer them.

The real estate industry is currently one of the strongest in the country. While some areas west of the Rockies are showing a small slowing down pattern, things out West in places like California are still very good. The ROI (return on investment) percentages are through the roof in most areas. People who invest money are making big profits in very short amounts of time. This is due to the fact that most places have more buyers than sellers and houses are selling very quickly. In some areas like Los Angeles County most houses are selling within one or two days after being placed on the market.

Developer/Investors are not the only people making money in the real estate industry these days. Many people who bought their homes before this sudden rise in housing prices are discovering that the home they live in is a goldmine. They realize that the property they bought ten years ago is now worth four times more than it was a decade ago. This means that they now have a significant amount of equity because any increase in your house price is basically money being deposited into your equity account.

Ambitious homeowners have been cashing out some of this increased equity with a refinance home loan. A lot of these people are then putting most of that money back into their most important investment (their house) by remodeling, adding on a room or two, a pool or anything that will bring up the appraised value of their house. Often times this rise in value will pay for the loan and then some, depending on the area where the house is located as well as the state of the real estate market.

Another smart thing that a lot of people are doing with their recently gained equity is consolidating their credit card and personal loan debts with a refinance home loan. This can be very helpful to lower the amount of money you pay each month in payments and it will also save you time by putting all those debts into a single payment each month. The interest rate on your refinance home loan will be significantly lower than the interest rates of any credit card or personal loan. You will not only save money each month but you will also have your stress level reduced by eliminating those high interest credit cards and/or personal loans. In this case, not looking into home mortgage refinance to reduce your debts would be like throwing money away every month on high interest rates.

If you have been making regular mortgage payments each month for several years and you have not been delinquent with any other bills then your credit should be a lot better than it was when you signed your first mortgage. With your good credit and the low interest rates these days you will benefit greatly with a home mortgage refinance. The increased equity in your house that you may be enjoying due to the current hot state of the real estate industry nationwide can be used to your advantage. Cashing out some equity with a refinance home loan could be a very useful tool to save/make you money and reduce your stress level each time you sit down each month at your desk to carry out the dreaded chore of your monthly finances.



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real estate investment loan : refinance - "What You Need To Know Before Refinancing Your Mortgage"

Today it is becoming more and more popular to refinance your original mortgage. But, is this right for you? How do you know whether you’re taking advantage of a great deal or letting yourself in for financial problems? Read on for tips to help you make an educated decision.

First, understand that refinancing your mortgage means you take out a new loan on the amount of money you owe on the existing mortgage based on new terms and pay off the old loan with the proceeds from the new loan.

Depending on the terms you obtain for your refinanced mortgage you may be able to obtain a lower interest rate than your original loan. This can be advantageous in a number of ways. First, it means you may be able to lower your monthly mortgage payments, which can be handy if you need to lower your monthly debt obligations. If you wish to keep your monthly mortgage payments the same, you could also pay off your home sooner with a lower interest rate. Over the course of your loan this could translate to major savings.

In addition, with a lower interest rate you may also be eligible to receive cash back. This money can be used to make repairs on your home or consolidate higher interest credit cards.

Before you refinance your mortgage you should understand there will typically be closings costs involved in the process. Depending on the lender you go with you may be either required to pay for the costs up front or include them in your loan and pay them off in your new payments. Costs that may be included in these fees are an application fee, cost of a new survey and title search in addition to fees for an inspection and appraisal. In addition, if you have less than 20% equity in your home you may also be required to pay private mortgage insurance just as you would if this was your first mortgage.

Given these costs, at least in the beginning, you may actually end up paying more for your refinanced loan than you paid for your old mortgage. This is why it is important to do a comparison between the two loans and make sure you will really be coming out ahead with a refinanced loan. When you do the comparison make sure you figure in how long you think you’ll remain in the home because this can have a tremendous impact on your overall savings. This is important to help you determine where you will break even and begin to actually save money on your mortgage with the new refinanced mortgage loan. If you do not think you are going to be in your home for the length of time it will take to break even, it may not be worth it to refinance your mortgage.

Finally, don’t forget to check the terms of your first mortgage and make sure you won’t be penalized for paying off your loan early. In some cases, this can amount to as much as $1,500; which can seriously impact your break even point.



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real estate investment loan : refinance - "Better to Refinance at Right Time"

John had taken a loan for $150000 in 1995 at an interest rate of about 16% annually for a period of 15 years. He recently heard of refinancing option and refinanced his loan. He managed to get a loan at just 12.5% annually. His earlier EMI payment of $2240 fell to $2000. Over the remaining 9 years of the loan he will stand to gain $20000. In fact, a few months later, John had been having some financial difficulties and approached us to help him further reduce his monthly payments further. Consulting a refinance expert he further extended his loan term to 30 years at 12.75% annual interest, thus reducing the yearly payment.

Refinancing is a delicate issue. On one hand you may have to pay a prepayment penalty to the company you had taken the loan from and on the other hand you will have to pay administrative and processing fees to originate a new loan. These are one time costs and may take away about 2.5% to 3% of the interest savings in the first year. However, you will continue to enjoy the benefits of a lower EMI payment for the remaining period of the loan. You can even take a loan for a longer period popularly known as loan-extension and start paying an even lower EMI.

If you are thinking of refinancing your home then you should refinance before it is too late. Refinancing might be a difficult decision to make, but it can also prove to be the best thing you ever do for yourself depending on your state of affairs. One of the reasons to go for refinancing is the number of remarkable packages you can get on interest rates today. So if the present interest rates are low it's an intelligent move to refinance before the rates are high again and you are helpless.

You have mortgaged your home and have already taken a home mortgage loan. You are now in an upsetting debt. You are not in a position to pay the high monthly installments per month and want a way out.

In a case like this, the quicker you can get the refinancing done the better it will be. Take advantage of various refinancing options and it can prove to be a turning point in your life. If you have overwhelming small debts such as small bills, car loans etc that have quite high interest rate and find the payments are getting too much for you to handle then you can should stop struggling with it and refinance your home.

By refinancing you can get ample amount of money to eliminate all your smaller payments and have them condensed down into one low monthly payment on your mortgage. You can extend your loan term, if necessary, and reduce your monthly payment, hence putting your off track life back on track.

Another reason for refinancing is you have your eye on a certain piece of property that you want to buy to start a business or if you are planning that vacation of a lifetime, but you are afraid it will be too late by the time you round up enough cash to do this. Here you need to have immediate cash and you find out ways to do it. Refinancing your mortgage will give you the cash you are looking for and leave your mind at peace to continue on with your plans.



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real estate investment loan : refinance - "Refinance Your High Interest Current Mortgage"

Mortgage rates have seen the bottom figures in the last few years. A lot of people have turned towards refinancing in order to save their hard earned money in the existing loans. This has caused a refinancing wave and hit all time lows. Thousands of people have seized on this opportunity to save money on their existing home loan. This era has been marked as the mortgage refinance era. The online availability of rates and refinance advisors makes it easy to apply for a refinance quote on all loans types. Money saved is money earned. Refinancing offers a wide variety of benefits, among those are:-

1)Refinancing allows a homeowner to lower the existing monthly mortgage payments.

2)The homeowners so as to save valuable money in the long term can consolidate debts.

3)A lot of cash can be freed up that can be used on much needed expenditures.

In order to get money safely, a right decision to refinance should come as rates touch a low. You must be educated for the best prevailing rates and packages available .If you are paying high interest on your mortgage and want a better option, it is the perfect time to look into refinancing. In this era of stiff competition some companies offer no cost mortgages and some that offer very low rates of interest. Open your eyes if you are struck up with a mortgage that started out at a high interest rate.

Save your money by refinancing at a lower rate of interest. Every morning new strategies with new prices are offered. Concept of Mortgage Cycling is offered. This is an answer to high mortgage rates. In mortgage cycling, one lump sum of a certain amount of money is to be paid every 6 to 10 months generally depending on the interest rates of these months. This is a good scheme for those that have the extra cash at the end of the month. The Mortgage Cycling program is an efficient scheme designed for people that can make big payments on the principle of their mortgage, thus reducing the time they have to pay and also decreasing the principle at the same time.

The people who feel themselves bound in an interest rate have a way out. But then it all depends on the length of time you have left to pay on your mortgage as this decides whether the mortgage cycling is good or not in that particular case. For example if the initial years of your mortgage are over, you might not be at an advantage as most of the interest is paid within the first years of the term. Again another important factor driving refinancing is the time you are planning on staying in this home. If you were there for a long term, then it would definitely pay to do this. However, if you are planning on moving in a few years it may be better to just go on paying at rates you have and sell to get back your money.


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real estate investment loan : refinance - "The Advantgaes of Refinancing A Home Mortgage"

A refinance mortgage loan is term that implies act of replacing your current mortgage with a new home loan mortgage. Mortgage refinancing is done to save money through lower borrowing rate and more favorable borrowing terms.

There are many advantages to refinancing home mortgages to extend your term. But then, it depends on why you want to do this and there are many possible reasons. You can be a gainer if you find yourself with other debts that have become a headache. You should keep in mind many things before doing this.

Firstly, take stock of your short-term debts and remember the equity in your home is based on the difference between what you still owe on your mortgage and the value of your home on the current real estate market. This is about having more money in your hands rather than that of mortgage lender. A refinance home loan replaces your current mortgage with a new refinance loan that carries a lower borrowing rate.

But before deciding on going ahead with a new home loan, you need to know the closing costs and other hidden costs associated with a mortgage refinance. They include loan processing fees, appraisal fees, legal fees and administrative fees. These refinancing costs can make up to 2% of the home mortgage loan.

What you should do is to make a list of your present interest rates on your mortgage as well as on current debts you owe. This will tell you how much you will save on refinancing. Then you have to decide which type of refinancing would be the best for you.

When you refinance your mortgage you will find that it can be extended over a period of up to 30 years, which would give you very low monthly payments. Keep in mind that the longer you are paying off the loan, the more interest you will pay in the end, so it really takes some planning to know if this will benefit you in the long run.

Mortgage terms can also be reduced when you refinance. This means higher monthly payments, but will get the mortgage paid off earlier, hence a benefit. When you have decided to get the loan try to shop around, as there are many lenders that would be willing to give you good deals in a mortgage.

Under a heavy debt, refinancing your home may give you a sigh of relief. Suppose you are under a lot of small debts then you can add up these debts and extend the term of your mortgage and end up in paying one low monthly payment.

Finally, one should go for a refinance mortgage only if your savings from lower interest payments is greater than the costs involved in getting a new mortgage refinance loan as in a new mortgage thousands of dollars are needed. You must do a great deal of research to avoid any unpredicted situation. In addition to learning about the workings of a mortgage refinancing, you need to get sufficient quotes to make a decision. If a mortgage lender is honest, their quotes match their actual offer. They do not suddenly hit you with additional closing fees and hidden fees.

After all, being a happy homeowner means having a refinance mortgage loan that you can comfortably live with.



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real estate investment loan : refinance - "The Facts about Home Mortgage Refinance"

There has been a lot of speculation lately that the bottom of the real estate industry is going to fall out in 2007. It is more likely that a couple of holes will form in the bottom, but it will not fall out. Recent numbers say that most places will not see more than a ten percent decrease in house values. This is not bad for an industry that has seen many places across the country show a one hundred percent increase in their home values over the past five years. This means that it is still a good time for homeowners to get a home equity loan.

There are many advantages to refinancing your mortgage loan. If you have been making regular payments for years and you have built up some equity and good credit since the original mortgage was taken out then you can generally make a better deal with lower rates. The market rates are most certainly lower now than when you originally signed. Also, you may have built up some high interest credit card debts along the way. You can pay off the credit card debt and reduce the amount of money you pay in interest each month as well as consolidate your payments into one payment instead of many.

Your home mortgage is basically like a big savings account that uses your house as the bank. The savings part is the equity you accrue as you pay off your home combined with the increase in overall value. The rest of the money is the interest that you pay to the financial institution you signed with because they were the one who loaned you the money.
There are a few things you should know about signing for a home equity loan. It basically means that you will be taking out a new loan to pay off your old mortgage loan as well as any other debts you decide to consolidate. The idea is to save money by getting a lower interest rate. You may also want to cash out and make some investments with this money. The idea here is to make money using your mortgage as your investment capital and your house as your collateral.

If you are planning to sign for a home equity loan it is vital that you are planning to live in your home for a long time. There are penalty fees for early withdrawal from a home mortgage refinance contract. Secondly, it is very important to know the state of the real estate market. If your area is showing a dramatic decrease in prices and the area is in decline it is not a good idea to refinance your mortgage. If your area is showing a trend of an increase in median housing prices then this is a good time to refinance.

Refinance home loan information is available on the internet to anyone who is willing to do a little research. You can get all the information you need on this subject. Before you contact any companies regarding any loan information it is a good idea to do some background research using the Better Business Bureau's web site. Just enter the name of the company in their search box and you will get a history of complaints on the company, if there are any. You should also do a search at Google.com and you will get any information on that company that has ever been posted on the internet.

The real estate market in the United States is still going strong with no apparent signs of a bubble burst anytime soon. It may slow down a little, but there will not be any dramatic decrease in home values. This means that now is a great time to cash out some of your equity and fix up your house. The improvements you make will improve the market value of your home which is money in the bank in terms of your equity.

Home mortgage refinance can also give you some relief from any high interest credit card debts or personal loans you may have built up over the years. It is a much better idea to make one low interest monthly payment than it is to make several high interest ones each month that take a lot of time to do and cause a lot of grief in the process. A refinance home loan can save you time, make you money and take away some of the stress you experience each month when you sit down and take care of your finances.



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real estate investment loan : refinance - "Refinance Loan Options And Know-how"

Today a lot of refinancing loan options are available in market. It totally depends on the financial condition of the borrower as to which refinance option to adopt that will solve all his requirements. Here we will look upon various options and requirements of the people concerned.

Fixed Rate Mortgages Refinance

1) If you have taken an adjustable rate mortgage and rates are about to rise, go for refinancing to fixed rate mortgages as they have all time low interest rates.

2) It is a fruitful refinance only if you plan to stay in your home for a long term.

Adjustable Rate Mortgages Refinance

1) Anyone who has a fixed rate mortgage and is planning to move within 7 years should go for adjustable mortgage refinance, as it does not make sense to pay a higher interest for 30 years of a fixed mortgage.

2) This in turn decrease monthly installment.

3) People who want the low rate of an ARM with the security of a fixed rate can start with ARM and switch to fixed rate afterwards.

Interest Only Refinance

1) An interest only loan gives you the option of paying just the interest, or paying interest and as much principal as you want in any given month. People who want significantly lower monthly payments use this option.

2) People go for this kind of refinance when they want to pay off debts.

3) People who want the flexibility of an Interest Only option.

4) People who want month by month flexibility

5)People who want to add principal whenever they want

Home Equity Refinance

1) A home equity loan is loan on the value of equity you have in your property . If you have various credit card debts or other high interest debts they can consolidate into a single debt and paid off via refinancing home equity loan.

2) Those who want lower monthly payments at low interest.

3)Those who want a long term stay in their home, as this refinancing is not beneficial in short term.

High Interest Refinance

1)Anyone who has a problem in showing their income and/or qualifying with other lenders because of variety of reasons such as a high interest loan taken recently or no income proof etc.

2)People with unique situations: selfemployed, entrepreneurs, divorcees, hospitality employees, sales people, retirees, etc.

Bad Credit Refinance

1) People with low credit score, less than perfect credit and want to get approved for refinance

2)People who want to pay off debt and repair their credit profile.

3)People who want to consolidate their multiple high interest bills into one low interest payment but are unable to do so because of bad credit history.

Cash out Refinance

1)In 100% Cash out refinance transaction, the amount of money received from the new loan exceeds the total of the money needed to repay the existing first mortgage and the associated costs, thus giving extra money. People who are in urgent need of cash go for this king of refinancing.



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real estate investment loan : refinance - "Best Refinance Options For Your Particular Case"

Is it really frustrating? Look at the falling interest rates!

You are paying much more than you would have if the rates had been as low when you closed your mortgage, refinancing is for you. When you are thinking of refinancing your loan, you want the best refinancing mortgage options that are available.

In todays market there are multiple options to choose from. There is a need to give a lot of consideration as to which option to choose. Look from a lender's view, this is the ultimate low risk loan. They can always guide to take the package that suits your needs as they find their side secure.

Why do you go for refinancing a mortgage? It allows you to:-
1) Shift to a better type of fixed rate loan
2) Lower your monthly payments via lower interest rates
3)Use your improved credit score
4)Shorten or increment your term for paying a loan
5)Take up lower interest rates on an adjustable rate loan

Use home equity to take cash out for a large purchase. When you have equity in your home, what you need is adequate cash at a low interest rate. So keep your eyes open for the various options available in the lender's market. The first way to choose is to shop around. Don't just go to a normal bank. Shop around at other banks and see which one offers the best rates. Business is the word for today so any bank that you visit wants your business and may be willing to give you a lower interest rate than the one you've been dealing with all along. Surfing around really pays in long term.

When you go refinancing, the first thing that clicks your mind is low interest rate while the word flashing in creditor's mind is credit score. So if you're looking for lower interest rates on a mortgage, make sure that your credit profile is properly brushed up. Keep your credit cards down. If your credit history reports low scores, you can still improve the score by, paying all bills in time, use debt consolidation to have minimum number of accounts and keep existing credits under control, paying off unnecessary debts. Banks also take into account the new credits taken recently and it is the main factor deciding your refinance interest rate. So weed out all possibilities of being tagged as bad creditor before you apply for a refinanced mortgage.

Check out with closing costs? There are few loans that truly have no closing costs. Sometimes lenders may not charge application fees. They may even agree to pay the appraisal and title fees. However hey will never take out anything from their pocket. They may increase the interest rate in return or find some way to add up these costs into your amount of your loan. A slight increase in mortgage is fine for you as it gives you a satisfaction of "closing cost free" loan. There are more places to apply for a refinanced mortgage than the bank you deal with such as online lenders, credit union etc. You might strike on the best deal. Some of these companies offer unbelievable interest rates. Some companies do a preliminary research and provide you with the most favorable package.



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real estate investment loan : refinance - "What Does Refinance Mean?"

The process of paying off one loan with the proceeds from a new loan secured by the same property. When we use the term Refinance, it means a person is replacing his/her current loan with a new loan in order to save money. The loan can be of any type. It can be any consumer debt or a credit card debt or a mortgage. Suppose you think of refinancing your loan the basic rule of refinancing is that the new loan must have a lower borrowing rate then what you are currently paying and even get better borrowing terms. One needs to go through refinancing terms of loans, especially on mortgages.

It is always advised to do your research about borrowing terms and the rate of interest of the new loan. Now, there are some general ways to get better borrowing terms on the new loan. Firstly, you must have a good credit balance. A higher credit balance increases your chances of paying debts. You get a better rating if you have a good balance. A good Rating involves making sure that all your bills are paid on time, no new credit applications are made and keeping your loan balances low.

Sometimes it makes sense to refinance. Sometimes it does not. It basically depends on your personal situation and financial goals. For instance, you may want to lower your interest rate and/or monthly payment, but when you're shopping for a loan to refinance your current debts you need to ask yourself some questions:-
1) Will the interest savings more than offset the costs associated with getting a new loan?
2) Did your credit score improve considerably?
3) Are you willing to pay points to get a lower rate?
4) Will having lower payments more than make up for the closing costs , fees and points if any?

All you need to consider is that the reason for getting a new loan is to save money. On a mortgage, a new refinance mortgage loan could mean thousands of dollars in savings. One must adequately compare different loans that is see the quotes of multiple lenders before making any decision. Also make sure that the lender discloses the fees involved in closing a loan.

Before moving further I must explain the meaning of ARM that is Adjustable Rate Mortgage: Loans with a 30 year term, but have a lower initial interest rate for a fixed period of time. The interest rate may increase or decrease with time. While a Fixed Rate loans have interest rates that do not changeover the life of loan.

As a result, monthly payments for principle and interest are also fixed for the life of the loan, typically 15 or 30 years. One more important thing is that the lowest rate quoted is not always the best rate.

Generally, it is a good idea to get the lowest fixed rate possible, but you also have to consider your situation. If you are in the first year of an adjustable rate mortgage (ARM) and you plan on moving in three years, it probably does not make sense for you to refinance. However, if the rate on your ARM is about to adjust and you think the rate will go up, then it may make sense to get a long term fixed rate mortgage, especially if you do not plan on moving in the next seven years or so.


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real estate investment loan : refinance - "Refinancing or Home Equity Loan: Which Way to Go?"

Suppose you have taken a home mortgage. Now again you are burred under debts or there are certain expenses that you can not postpone. You go around looking for various options where you can get cash easily. Various lenders direct you towards either home equity loan or cash out refinance option. Now depending on your circumstances you have to decide one of them. Here are certain aspects of both the options:

BASIC DEFINITION: The value of your home is $200,000 and you owe $150,000 on the mortgage. That means you have $50,000 of equity in your home meaning a saving account with balance $50,000.

In cash-out refinancing you are allowed to access that equity. If you need $20,000, you can refinance your mortgage so that you owe $170,000 and the lender then gives you $20,000 in cash at closing. While, with a home equity loan, you keep your original mortgage and take out a second mortgage against the amount of equity you possess. But then it is the individual conditions that ultimately decide the loan type. There are many other factors that compare these two types of loans.

TIME TO GET MONEY: Suppose you are in such a situation that you feel helpless and need money as early as possible then Home equity loans are for you. They close significantly faster than a cash-out refinance - in as little as four days. However, refinancing requires a considerable amount of time to close that might be important to you.

COST EFFICIENT: Then comes the cost of loans. Generally the costs associated with home equity loans are minimal fees. With refinancing, there is an upfront fee paid to the lender at the time that you get your loan and this fee is called point. Each point equals one percent of your total loan amount. The more points you pay, the lower the interest rate you get. Along with points, a higher loan fees is also associated with refinancing.

RATE OF INTEREST: A home equity loan is a second mortgage. A second mortgage is an additional mortgage placed on property that has rights that are subordinate to first mortgage. Here you are given an amount according the equity you have in your home. In case of default, the lender who holds the second mortgage is paid only after the lender holding the first is paid. So a higher risk is involved with the lender, thus a higher rate than a cash-out refinance.

DEAL ON SITUATION: So the deal depends on your situation. If rate on your mortgage is relatively low and you go for refinancing then you lose the low rate you already have on your first mortgage. Here to enjoy the low rates of first mortgage, it may be worthwhile to get a home equity loan even at a higher rate. Often refinancing is beneficial when the term is 15 or 30 years. A home equity loan is more flexible and you can take advantage of a shorter term, greatly reducing your overall interest costs.



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