Mortgage Fraud Bill Signed, Sealed & Delivered

Two bills designed to address some of the problems resulting from the economic crisis have been signed by President Obama. The first deals with mortgage fraud and the other with helping families who are involved in a foreclosure situation save their homes.

Look out rip-off artists, enforcers of the new mortgage fraud bill means serious business. Almost half a billion federal dollars has been authorized to spend on targeting charges of mortgage fraud. Agencies the likes of the Secret Service, U.S. Postal Service and HUD are all getting additional funding to increase their security measures.

The Fraud Enforcement and Recovery Act now sanctions the government to go after companies or individuals currently out of reach. Currently, an incidence of mortgage fraud can result in investigation, prosecution, civil penalties and prison time at a federal level, opposed to the prior gentler state penalties previously enforced. This new Act applies to all types of mortgage fraud, no matter how minor the offence.

In the past, these schemes defrauded home owners, realtors, lenders and builders out of billions of dollars each year. The FBI intends to send a message that mortgage fraud will not be tolerated and it is expected that offenders will receive stiff penalties in order to set an example to others.

The second bill, simply entitled, "Helping Families Save Their Homes Act," is intended to simplify the process for homeowners to receive foreclosure financing and modifications to existing loans. It also makes it easier for the lender to offer these types of options and hopefully prevent an impending foreclosure.

The new law also offers protection for renters who find themselves living in a home whose owners are facing foreclosure. Under the old rules, tenants would have to move immediately following foreclosure, now they have the option to continue renting for a term negotiated with the lender. This makes sense on so many levels. Now hundreds of families who otherwise would have found themselves on the street, still have homes. Lenders no longer have to deal with the problems associated with the upkeep of an empty home. Hopefully this will reduce occurrences of complete neighborhoods of foreclosed houses sitting vacant and facing ill repair and vandalism. In many cases, reliable tenants are happy to stay on and maintain the property.

The law provides additional homeless relief, makes better use of local organizations in this role, and allows them more latitude when allocating federal funds for assistance.

Part of the reason that mortgage fraud became so widespread was attributed to the lack of a single watchdog affiliation to oversee the the sketchy subprime loan offerings, underwriting and lending schemes. Instead there were a number of small agencies, each only seeing part of the problem, but no single unit had the power to actually deal with the issue as a whole. Currently, the Obama administration has a plan in the works to establish a single federal agency designed to watch over everyone involved; from the small brokers to the major lenders.

About the Author:

Search Sandy Springs GA condos at TinaFountain.com, the home of Sandy Springs real estate experts.

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3 Things to Know Before Applying For Mortgage Refinancing

Interest rates affect everyone, but no one feels the affects of interest rates more than a homeowner.

When was the last time you examined your current home mortgage interest rate? If it has been more than 2 years, you will definitely want to consider refinancing. Before you pick up the phone to speak with a lender however, it is a good idea to go through a few simple steps to determine if the call to your local lender will be justified.

Mortgage Rates and Current Length of Loan

The first step in determining the feasibility of refinancing your home mortgage is to locate your current loan documents to determine two things: 1) what is your current interest rate, and 2) how much longer is your current mortgage going to exist.

If your mortgage is an old one and only has few years left, most of your payment is now going towards principal. Refinancing this type of mortgage is not advised because the costs of acquiring the mortgage itself will negate the money saved. Work hard to pay off an old mortgage as quickly as possible. If, on the other hand, your mortgage is less than 10 years old and the interest rate is at least 1% more than the current lending rate, then your home is a prime candidate for refinancing.

Equity, FICO Score and Debt to Income Ratios

The next step is to compile an assessment of your ability to get a new loan on your property. This assessment will include: 1) determining your FICO score, 2) calculating the current equity in the property, and 3) calculating your current debt to income ratio.

Your FICO Score

Today, lenders can quickly determine the credit worthiness of a potential borrower by checking just one number: your FICO score. A FICO score is a number, generally in the range of 500-850 with 850 being the absolute best number. Banks would prefer individuals with pristine credit, but there are many lenders that deal with borrowers in the mid and even low ranges. Remember: interest rates make or break a home mortgage, so the lower your credit score, the more you will pay in interest for your home. Take every step you can to raise your credit score before speaking with a lender.

Calculating Current Home Equity

The next step is to determine if a lender will be willing to take a risk lending money against your home. This involves simple math. Calculate what your home is currently worth in your market and then subtract what you owe. The difference will be your "equity". Banks like to see borrowers with equity simply because if they get stuck with the home due to foreclosure, they will be able to recoup the money they lent on the property. If your equity is less than 10%, you may want to consider waiting for the market to recover thereby raising the value of the home and your equity.

Debt to Income Ratio

The next crucial step you'll need to complete before speaking with a lender is to determine your current debt to income ratio. This percentage is easy to calculate. Simply add up all of your monthly payments for housing, credit cards, student loans and car loans and divide by your total income.

For example, if your take home income is ten thousand dollars per month, and you pay a total of twenty five hundred dollars in monthly debt obligations, your debt to income ratio is 25%. Lenders like to deal with borrowers whose debt to income ratio is low or at least within reason. Anything over 40% is pushing the limits of what most banks (especially these days) will consider as a reasonable risk. If your debt to income ratio is high, begin today to pay off those pesky credit cards and car loans. When you do, you will see your debt to income ratio begin to fall.

Obtaining a new mortgage or refinancing a home does not have to be difficult. Preparation is the key. Follow these three simple steps before speaking with a mortgage broker and you will be much more informed on your chances of obtaining a refinancing mortgage on your home.

About the Author:

For more information on refinancing, visit the site that is dedicated to it, http://www.refinance-directory.com

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Refinance House Top Strategies You Should Follow

To be able to realize your dreams, despite suffering from a bad credit, you need to try and involve the following tips into your daily lives. This will help you get back on track!

Look For A Suitable Deal

Real estate is not a simple topic and involves a lot of research but it can also prove to be really beneficial once you zero in on a suitable real estate deal. The moment you purchase a house and consider the option of equity, your bad credit would often be treated as a partially secured loan. A refinance house option is often considered beneficial regardless of your bad credit. Hence, the sooner you get in touch with your mortgage broker, the better it would be for you.

Opt For Innovative Finance Options

Refinance house options can often lead you to choose creative financing schemes. If you wish to get your loan accepted, you need to opt for an adjustable rate mortgage, for not only is it suitable for all persons, it is also beneficial in case you are suffering from bad credit. Likewise, you may also like to involve the services of a professional seller as he would be able to contribute in terms of a partial upfront payment on the purchase. You may like to opt for a second mortgage, as not only would you be able to pay back your loan amount at an attractive interest rate, you would also quit worrying about the related pressures. If you use these creative methods effectively, you can hope to get a clearance through the means of an acceptable mortgage deal.

Go For A Down Payment

Refinance house option can prove to be effective if you manage to make a down payment. If you wish to avail decreased interest rates on home loans, you need to try and make a down payment which is in between 2% to 5% of the total loan amount. As most home loans are based on a thirty year period, even a single percent reduction on the total loan amount can prove to be beneficial. To save an added expense, you may like to wait for a few months and save enough money for the required down payment.

Look For Yourself

The benefit of refinance house is that you have a choice to shop around on your own and while most mortgage brokers would like you to believe that they are the best in the business and you cannot do without them, truth is somewhat different. Rather than depending blindly on a broker, it is best to shop on the internet and try to locate a suitable broker who is willing to work with you. Internet lenders are definitely more experienced when it comes to handling refinance options and hence it often pays to choose an online mortgage option.

Improve Your Credit Score

Another tip to refinance house is to ensure that you have good credit ratings. Well, credit scores can be boosted in a short time if you are willing to pay your pending bills. You can also get in touch with various credit agencies for the same.

About the Author:

To avail the benefits of Refinance House, you may like to visit http://www.homemortgageloan-refinance.com/Bad-Credit-Home-Loan-Refinance.php. Here, you would be able to get the best solution for your ongoing problems.

Article Source: ArticlesBase.com - Refinance House Top Strategies You Should Follow

Time to Refinance Your Mortgage

There are signs the recession is ebbing and recovery is on the way. The $787 billion stimulus package aimed at injecting cash to the economy plus the conglomeration of smart and immediate government actions such as maintaining the Fed Funds rate between 0 and 0.25 percent.. The stock market is on the rise and is now over the 8,000 mark, the housing industry is also on the upward trend with the construction of homes and apartments jumped by 22.2 percent in February and the general consumer index is going positive.

With all these economic indicators pointing upward there is one question that any homeowner must answer. Is it time to refinance my mortgage? The housing industry after all is pinpointed by financial experts as the root cause of the current economic woes. Mortgage rates have all suddenly become unaffordable to a majority of homeowners and a large number of them are currently threatened by foreclosures. Refinancing can cancel the foreclosure notice and can give you thousands in savings with the lower mortgage rates currently being offered by lenders.

However with the election of President Barack Obama the government has made a lot of economically sensible decisions which lead to one of the lowest mortgage rates in US history. According to Freddie Mac, their weekly survey showed that the average rate on a 30 year mortgage increase to 4.87 percent from an all time low of 4.78 percent. Mean while Mortgage Bankers Association also revealed a similar trend by reporting
that a 30 year fixed mortgage had increased to 4.73 percent from 4.61 percent.

Although the mortgage rate has increased it is still below 5 percent and most financial experts predict it will stay at this level. This low mortgage rate is attributed to a series of government actions such as buying back trillions of mortgage back securities and treasuries, providing $5 billion as incentives to mortgage industry who can modify their loans to lower rates and providing an $8,000 credit for first time home buyers as part of the stimulus package.

The low mortgage rates have enticed a lot of homeowners to apply for refinancing. In fact the Mortgage Bankers Association’s index for refinance increased by 3.2 percent and Fannie Mae declared that it refinanced $77 billion worth of loans last month March. So the answer to the question of whether it is time to refinance or not is “now” is the time. With the mortgage rate hitting low and appears to be on the upward trend, the current rate seems to be a very good reason to refinance. Even President Barack Obama himself indicated that this is a good time to do so by declaring "we are at a time where people can really take advantage of this". This is in reference to an estimated 9 million homeowners out of which 12 percent are due to foreclosure and haven’t availed of refinancing yet.

So there you go, even the US president himself is prodding you, now is the time. The waiting is over and now is the time to start doing your share of uplifting the economy by refinancing your mortgage now if it’s makes financial sense for you to do so.
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By Frank Elliot

Selecting a Home Mortgage in Today's Market

Even in a normal economic environment, getting a mortgage loan can prove to be very taxing on one’s nerves and time. First of all you have to find a house, then you need to fill out a huge loan application, you gather up all the required paperwork, you talk to your loan consultant several times during the process to assure that everything is going ok and the loan may still not be approved.

And that happens when everything is going fine with the economy, not like what’s happening nowadays. Due to the economic crisis mortgage lenders are becoming increasingly restrictive when it comes to doing what they do, the biggest reason being that Fannie Mae and Freddie Mac require governmental financial assistance to stay afloat.

When the largest companies in the field require bailouts this start a trickle-down effect, meaning that Fannie Mae and Freddie Mac will be more restrictive with the mortgages that they purchase and as a result the companies that sell their loans to Fannie and Freddie become more restrictive with their clients.

The government is highly invested in keeping Fannie and Freddie working because if these two companies go down, then the entire mortgage industry breaks down, hence the bailout which ensures that there will still be money available to those who want to purchase a home or refinance their existing loan.

If you find yourself in the market for a loan in Denver or any other city in the U.S., the first thing that you need to do is, even in this current economic troubles, shop around however not the sort of shopping around that you used to do. It used to be that shopping around for a loan meant that you were looking for a low
rate, but now you’re in fact looking for a mortgage company that will approve your loan application. By doing this you’ll become more knowledgeable about the local market and be able to determine what the average rate and closing costs should be for the loan that you’re looking for, and also this will mean that you’ll have a good stock of lenders to apply to if your chosen company doesn’t approve your application.

You should also consider local credit unions and banks, while it is true that they used to have higher rates than most specialized credit companies, the economic downturn has made them lower their rates and offer competitive prices. Even so you’ll still need to qualify for the loan and it may be under stricter guidelines, but going this route may also offer lower fees on your contract, as well as offer you lower fees on savings and checking accounts that you keep with them.

The government wants to ensure, through the bailouts, that Freddie and Fannie are capable of purchasing mortgage loans from mortgage lenders, and even though the mortgage economy is a small fraction of the overall wealth of the United States it is a very important one, this means that there will be more regulation and increased scrutiny all across the board. You’ll still be able to get loans but the important thing that you need to do is to shop around and look at all the alternative ways of financing your home so that you can be sure that your loan will close.

Regardless of what your goal is, whether you’re thinking of buying a home or you want to refinance your current loan, by doing a little bit of research and looking into your local market you’ll get important and maybe even crucial insight into what your choices are, and what you can do with them, so take your time and make the right choice. By Bill Marinelli

Bill marinelli is the owner and operator of Denver's Paramount Home Loans.

Home Mortgages 101: A Must-Read for First-Time Home Buyers!

Home Mortgages 101: A Must-Read for First-Time Home Buyers!
One of the most important parts of manifest destiny and the American dream is home ownership. Owning your own home can be a very smart investment decision since prices tend to increase faster than the inflation rate, and now, with the recession dropping home prices and interest rates to their lowest in the last decade, there isn't a better time to buy! Because of the current market timing and the fact that it's a widely known as a smart investment, now is the time to start considering the idea. Before you rush out, call a realtor and start looking for a house, you should start by seeking out the perfect mortgage for your budget.

All potential homeowners should take some time to research home loans before calling their local Realtor. There are a dazzling array of choices available when it comes to home loans, and finding the right mortgage for your needs can be difficult. Approach your upcoming home purchase with the same seriousness you apply to other major purchases. Your home will most likely be the biggest single investment you ever make. Take the time at the beginning to educate yourself about home loans. It will be time well spent.

To begin your home mortgage search, talk to credit unions, banks, and brokers in your area. You're looking for someone to hold your hand through the process, but you also want a decent rate with low fees, so make sure to shop around.

When you're looking at rates, you will be shown two different types - variable/adjustable rate (ARM) and fixed rate. The ARM rate is usually shown as a promotion at a cheap rate, sometimes called a "teaser." After the fixed period of the ARM is up, you can expect rates to rise significantly if you get into one of these adjustable rate mortgages.

ARMs have two specific things you look for to use in your analysis - when the rate adjusts (anywhere between one month to 10 years) and what the cap on the interest rate is. Usually, the rate will adjust to whatever the prime rate (the federal government chooses this number) is at the time of the adjustment, plus a certain percentage of 'mark-up' that pays the bank. When you discover the rate cap, use a mortgage payment calculator to find out how much your maximum monthly payment is, worst case. That's not to say your mortgage will actually adjust to that rate, but it's a prudent idea to plan for different scenarios - including worst case.

Variable rate home loans can be a good choice if you believe interest rates are likely to fall. In an environment where interest rates are steady or rising, they may not be so good a choice. You may also want to consider a variable rate mortgage if you do not plan to stay in your home more than five years. For instance, if your job transfers you every couple of years, you could probably get away with a variable rate mortgage and take advantage of the lower interest rate. When you move and sell your home, you will probably realize a gain due to rising home prices.

On the other hand, fixed rate home loans have a set interest rate for a set period of time, generally either 15 or 30 years. The interest rate does not change, therefore you will always know what your monthly mortgage payment will be. You are protected from rising interest rates with a fixed rate mortgage. If rates fall significantly, you can always refinance your mortgage loan to take advantage of the lower rates.

Your mortgage term, or length, is another deciding factor of how much interest you'll end up paying. With a longer term, you'll pay more interest since your loan is amortized over more years - creating more compound interest. If you need the flexibility to make smaller payments by taking on a longer mortgage term, you can always pay more toward your principal at any time to help reduce the length of the loan. Just by paying a few extra principal payments/year can save you tens of thousands of dollars in interest!

Whatever type of home loan you decide on, the most important thing is to take that step which transforms you from a mere renter to a home owner and builder of equity. There are a great many home loans out there, but once you find the right one, you will find the rewards of home ownership well worth the time and effort put forth.


About the Author
Robert Laughlin has been working with the Sacramento home mortgage and real estate fields for over 20 years. For Robert's other resources about home mortgages, check out his home mortgage website,where you can download the free guide: the 8 Essential Home Mortgage Tips.

Finding a Mortgage Refinance Advisor

By: Jennifer Hershey
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.

Author Bio
Jennifer Hershey has more than twenty years of experience in the Mortgage Industry as a loan officer. She is the owner of a mortgage resource site devoted to making mortgage terms and products easy to understand.

Mortgage Refinancing

If you are interested in Mortgage Refinancing, it is normally for one of two reasons. Either to get a lower interest rate to save money in interest payments over the life of the loan. Or, you are interested in refinancing with cash out.

Mortgage refinancing can be done in a number of ways. The two most common are going to your local bank or using the internet.

The internet is becoming a more and more popular method of mortgage refinancing by the day.

Some of the reasons are obvious, mortgage refinancing over the internet is very simple, and the information you can find on the mortgage industry is limitless.

The mortgage industry is a very competitive one, so using the internet to shop around for mortgage refinancing is very smart. As opposed to using your local bank that normally has one product for you to choose from.

Finding someone to do your mortgage refinancing by way of the internet may be easier than you think. These loan officers are hungry for your business, and by putting only limited information on a secure mortgage web site, you will have at least four mortgage loan officers calling to compete for your business within twenty-four hours.

There is also no need to hide the fact that you are shopping around, this only forces loan officers to come back at you with the best rate they can possibly find in order to keep you from doing business with someone else.

The best part is, you are not committed to anything by shopping around, and this is a great way to educate yourself about the programs that are available, and to get a feel for how mortgage refinancing works.

In the end, the choice is yours. But remember, take your time and gather as much information on the mortgage industry as possible. It will help you make much wiser choices, which will pay off in the end.

Lending institutions in the mortgage market

The mortgage business is an ever changing and it is an industry that has its own complexities. It is very much important that you understand how the mortgage industry works and how is the profit generated by the lenders. An analysis of this information will help you to have an insight knowledge about the techniques with which the loans can be appreciated and what is the reason behind the question as to why some lender offer certain loans and not the other. This article will help you to have insight knowledge about the different lending institutions that operate in the mortgage market.

Private lenders Vs institutional lenders: The foremost broad distinction arises between the private lenders and the institutional lenders. The lenders in the institutional lender category include commercial banks, savings and loans, credit unions, mortgage banking companies, pension funds, and insurance companies. These lenders generally determine the loan giving capacity of a person based on the income and credit of the borrower; these institutions have to adhere to the standard lending norms. On the other hand the private lenders do not have the guaranteed depositors and they are not regulated by the norms of the federal government.

Primary Vs the secondary market: First of all these markets should not be confused with the first and second mortgages. The primary mortgage lenders deal directly with the general public and they themselves originate the loans from their resources and then lend the money to the borrower directly. The primary market is often referred as the retail side of the business. The profit is generated by the lenders from the loan processing fee and not with the interest amount of the loan. The primary mortgage market generally lends the money to the consumers and then they sell the mortgage notes to the investors in the secondary market so as to replenish their cash reserves.

Some of the largest buyers in the secondary market are the Federal National Mortgage Association or FNMA or Fannie Mae, the Government National Mortgage Association or GNMA or Ginnie Mae and the Federal Home Loan Mortgage Corporation or FHLMC or Freddie Mac. Private financial institutions such as banks, life insurance companies, private investors, and the other thrift associations also buy notes.

Mortgage brokers Vs Mortgage bankers: It is a common assumption that the mortgage companies are the banks that lend their own money, it is important to note the fact that any company that you deal is either a mortgage banker or a mortgage broker. The mortgage banker is the direct lender who owns money and he often sells it to the secondary market. They are referred as direct lenders and they are the ones who sometimes even retain the servicing rights. On the other hand a mortgage broker is an intermediary who is responsible for loan shopping, he is the one who is responsible for the loan analysis, and he acts as a connecting link for the lender and the borrower. Mortgage brokers do not deal directly with the public and they are also referred as the wholesale lenders.

About the Author:

Shijina is a SEO copywriter for Cemap Courses .She has written various articles like Home study cemap, CeMAP, Cemap Training , and more. For more information visit our site http://www.cemap-training.com/.Contact her through mail at cemap.course@gmail.com

Article Source: http://www.articlesbase.com/mortgage-articles/lending-institutions-in-the-mortgage-market-846418.html

Using an 80 20 Mortgage to Avoid Mortgage Insurance

An 80 20 mortgage is also called a zero down loan or no money down loan. It is actually two loans, a regular home mortgage which constitutes 80% of the price of the home and a second mortgage or home equity loan that consists of 20% of the cost of the house. The idea behind this type of loan is avoiding mortgage insurance (PMI) by using the home equity loan as the down payment.

Just about all mortgages require some form of mortgage insurance if you are unable to make a down payment of at least 20 percent. By obtaining a second mortgage or home equity loan for 20 percent of the homes cost you can circumnavigate this requirement by using that second loan as the down payment.

There are variations of this type of mortgage such as an 80-15-5 loan. This means that the borrower got a main mortgage of 80 percent of a home's purchase price, a piggyback loan for 15 percent, and made a 5-percent down payment. This can be a good option if you have some money for a down payment but not enough to cover the entire 20%.

The second mortgage can either be a fixed second mortgage or it can be a line of credit. If it is a fixed second mortgage then the interest rate is normally fixed for the entire length of the mortgage. Most fixed second mortgages are a 30 due in 15 which means that the second mortgage is amortized over 30 years, but is due in 15 years. The benefit of going with the line of credit as the second mortgage is that the interest rate is normally much lower than the fixed second mortgages rate. They can also be an interest only loan which could save you hundreds of dollars in mortgage payments every month.

The 80 percent first mortgage can be a fixed-rate (15-year or 30-year), adjustable-rate (usually 5/1, 7/1 or 10/1fixed period ARM) or interest-only loan. Typically, the interest rate on the second mortgage loan is higher than the interest rate of the first loan. But because the borrower doesn't have to pay mortgage insurance, the overall cost is less than a traditional mortgage even with the higher mortgage interest rate on the second loan.

Plenty of mortgage programs allow borrowers to buy houses with little or no money down, but they usually require private mortgage insurance, or PMI. Getting an 80 20 mortgage can be a good way to avoid the extra cost that PMI will add to your monthly payments.

About the Author:

To learn more about home equity loans and lines of credit please visit the website Home Equity Loans by Clicking Here.

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5 Proven Mortgage Refinance Tips For Lower Fees And Costs

By handling these costs wisely, you can make your mortgage refinance tips even more effective and save remarkable sums in your monthly payments.The structure of your mortgage refinance loan, PMI avoiding and an ability to buy lower interest rates are the ways.

1. Mortgage Refinance Tips – Close Credit Card Accounts.

What credit cards have to do with your mortgage refinance tips? A lot! When you close inactive credit card accounts, you can improve your credit score, which means lower interest loans possibilities to you.

This is wise to do by a letter to the credit card company. In this way you will have a document, if there is a need to handle the issue later on.

As a second step you have to check your credit report after 30 days to make sure, that it includes the comment that your credit card accounts have been closed by ”Customer`s Request”.

This is important, because this report can be seen by other lenders later on, so they see that you have done the closing and not the company. Remember to correct all the mistakes, which can affect your future possibilities to get a loan.

2. Mortgage Refinance Tips – Avoid Hidden Cost Of PMI:

PMI, private mortgage insurance, can hit you, if you do not do the refinancing right. Why? Around 30 % of the people, who will refinance their home loan take certain part of their home equity as a cash to pay home improvement or paying some other big costs.

By paying off credit cards or improving your home, this can be extremely smart, but if you borrow more than 80 % of the home equity, you must pay PMI, private mortgage insurance, which can be hundreds per every year.

3. Mortgage Refinance Tips – Short Term Loan.

Usually short term mortgage loans offer lower interest rates than the long term ones.This means lighter monthly payments but also shorter payment time.

The result is a larger monthly payment, but you can still save thousands later on.

4. Mortgage Refinance Tips – Ask About Fees.

Every mortgage refinance case includes fees, which are costs you do not necessarily remember to ask. They have several fancy names: document prep fees, courier fees, administrative fees etc. And lenders must disclose these costs, fees, within three business days of a mortgage loan application.

Now you can do the following. Request an official list of these fees from every company, you have asked an offer. When you have them all, add the fees to the interest rate of the mortgage loan. You will be surprised, when you notice that the cheapest offer has not the lowest interest rate.

5. Mortgage Refinance Tips – Pay Points.

When you plan to live in your home for many years, you can save money by paying points for lower interest rates. This happens by paying upfront fees by which you guarantee that the interest rates are lower during the rest time of your loan.

About the Author: Juhani Tontti, B.Sc., Economics.
Mortgage Refinance Tips Are More Than Just Lower Interest Rates Refinance Mortgage Right And You Save A Lot. Visit: LowerMortgageRefinanceRates.com

Second Mortgage a Good First Step

A second mortgage can be the first step to climbing out of debt, especially for homeowners who have bad credit. A second mortgage is a loan taken out in "second position" on a property that already has a mortgage. There are fixed-rate loans, adjustable-rate loans and home equity lines of credit (also known as HELOCs). Fixed-dollar-amount mortgages are the way to go when you need all the money at once. A HELOC is a credit line that can be drawn upon as needed up to the limit of the loan.

"Bad Credit" Second Mortgages
Your right to credit is guaranteed by the Equal Credit Opportunity Act. You can't be denied credit based on race, gender, marital status or ethnicity. But how much money you can borrow and how much interest you will be charged will depend on your credit score.

Credit is easy to get and hard to control. Not using it properly will get you a low FICO score from the three major credit bureaus. Generally, a score of 680 or better signifies good credit. Scores in the 680-620 range are still considered good, but will cause creditors to take a second look before lending you money. 620 and lower, and you are in the bad credit range.

Here are some indications that you are in bad credit territory:
You have to apply for new credit cards to pay off old ones, thus rotating but not retiring your debt.
You can only make the minimum payments on your loans and cards each month.
You are at the limit on all your cards and accounts.
You have to get subprime financing when you need to borrow money.
Improving Your Financial Situation
It's a catch 22 that getting a bad credit second mortgage can lower your FICO score initially, but it can also help raise it in the long run-if you use the money to pay off high interest debts. This new loan doesn't reduce your debt; it just restructures it to help you get back on your feet financially. An added bonus is that the interest you pay is tax deductible. The IRS says joint filers can deduct all the interest to a maximum of $100,000 on home mortgages.

It's easy to shop and compare bad credit second mortgages online at reputable sites like www.badcreditsecondmortgages.com. The no-obligation application process is quick and confidential. Interest rates are still relatively low, but might rise in 2006, so now is a great time to see if a second mortgage is a good financial move for you.

Mortgages for People in Foreclosure - Keep Your Home

Are you need of saving your home from foreclosure? If so, you can simply get a loan modification that will give you a mortgage for people that are in foreclosure.

Learn About Getting A Loan Modification Here

In basic terms a loan modification can save your home from foreclosure because it does a number of things which will enable you to keep the home. There are different options depending on what your biggest needs are but here are a list of the following that can help you save your house.

* Your interest rate may be decreased on your current mortgage
* Your interest rate can be changed from an adjustable rate to fixed rate
* Your time to pay back the loan can be increased by a number of months or years depending on how much time you need.
* Your total loan principal amount can be decreased in overall total to ease payments
* Your late fees or penalties may be waived if you have any at all
* If you have a second mortgage, it could be eliminated altogether.

Start the Loan Modification Process Here by simply answering a few questions to make sure you can qualify for a mortgage for people in foreclosure. There are millions of people that are in foreclosure right now and even families that are not only losing their home but actually filing for bankruptcy.

It's a tough economy right now, but for people that need help with their current mortgage that are in foreclosure, the loan modifications can work to your advantage by saving your home altogether.

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Get Your Loan Modification Here to Avoid Foreclosure

Article Source: http://www.articlesbase.com/mortgage-articles/mortgages-for-people-in-foreclosure-keep-your-home-845750.html

The Right Time for Mortgage Refinancing

If interest rates have dropped by a percentage point or more since you got your first mortgage, refinancing could save you big bucks. And if you have enough equity so that your new mortgage is for less than 80% of your home's value, you'll be able to stop paying Private Mortgage Insurance (PMI), which will save you even more.

Mortgage refinancing could also result in lower monthly payments, depending on factors such as: if any 'points' are paid to lower the interest rate on the new mortgage; how much cash is taken out at the time of refinancing; the duration of the new mortgage and whether the new mortgage is a fixed-rate, adjustable-rate or variable-rate loan.

"A vast majority of people close their loans, make their payments and don't worry about it again," says Bob Cannon of BancMortgage Financial Corp. "They don't refinance when they should be looking at it."

Even if you have bad credit and have to pay somewhat higher interest rates, mortgage refinancing will still cost less than other forms of borrowing because the loan is secured by your home. And if you use the money wisely, you can get out of credit trouble and raise your FICO score. This will qualify you for better rates in the future.

Your FICO score is computed and tracked by the three major credit bureaus: Trans Union, Equifax and Experian. Your score is updated quarterly and is negatively affected by such things as: late or missed loan payments, filing for bankruptcy, having too much debt compared to your income, and credit card balances being too close to their limits.

Fixing Bad Credit
If you are a homeowner, mortgage refinancing can go a long way toward improving your financial situation. Here are a few other positive steps you can take to speed up the process:

Credit card discipline - Reduce the number of cards in your wallet or purse to one. Take it out only when necessary and pay it off each month.

Credit union membership - If you aren't already a member, join a credit union. They're a good source of loans for purchases like a car or a home.

Automatic savings - Have your bank automatically deposit a set amount from your paycheck into your savings account or retirement plan.

Avoid credit repair scams - There's nothing a credit repair company can do that you can't do yourself with a little research and effort.

Many of the homes on your block have probably been refinanced in the last few years. Now it's your turn.
By: Mike Hamel

Internet-based Closing Means Good Faith Estimates Could Get Better

The Mortgage Banker’s Association’s Tech 09 Conference, held on March 14-18, 2009, saw the announcement of new procedures that could revolutionize the real estate closing as we know it. Tony Farwell, ClosingCorp’s CEO (closing.com), announced that there was a move to standardize closing procedures for real estate and make it more accessible online. Consequently, closing procedures - including good faith estimates - will get clearer, more accurate and less vulnerable to abuse by unscrupulous lenders.

What does this mean for the ordinary mortal? Well, for one, it could make the “Good Faith Estimate” (GFE) – the itemized statement of fees and costs associated with a mortgage – better. Right now, the so-called Good Faith Estimate is not really good, nor should you put your faith into it. Many people have found that their final closing costs are a lot more than what they were led to believe from the initial estimate.

The rates oft-quoted in a GFE are what they are at the moment - not what they are upon the signing of the loan papers. The GFE can be manipulated with little difficulty. "Oops, there was an extra fee there! Oh, did we forget to tell you about costs that we don't have to disclose on the GFE?" Ethical lenders will do everything they can to clearly explain the fee structure and interest rates, but as today's struggling market attests, not all lenders are ethical.

What Farwell announced could have a positive effect on these statements – for home buyers, at least. With these standardizations come calls for making the government require more accurate estimates and less leeway for lenders to hide high fees within the financial confusion of a home purchase. It also paves the way for more Internet-savvy buyers to play a greater part in the closing of a real estate deal, something that gives them more access to information and the power to make choices about what they spend their money on and why.

A reform of the Real Estate Procedures Settlement Act by the U.S. Department of Housing and Development requires that lenders provide borrowers with a GFE. Now, the lender must provide the borrower with an estimate that gives them information about the term of the loan, type of interest, penalties, payment structure and total closing costs. While this is an improvement over the previous Act, it still does not require that the GFE in any way represent the terms that the loan will finally settle at. “Uniform Closing Instructions” will help improve this in favor of the buyer, by requiring GFEs to more accurately represent the final costs of closing.

Right now, most real estate services are not set up to fully function on the Internet, but that time is coming, if the vision of the people at Tech 09 is correct. The eventual aim of the movement towards more Internet-friendly real estate transactions may mean that one day we might conduct our entire real estate search, evaluation, loan shopping and transaction from the comfort of our own homes. For now, though, it may just mean that legislation is journeying towards fairer treatment of real estate buyers.

Bloopers And Blunders While Agreeing On A Mortgage

Getting a mortgage need not be love at first sight. So do not rush to the first company your come across. At times this might work out well. Like in the case of any important product or service that you intend to buy, make sure to complete your due diligence. Where money is involved, time is of the essence and other factors such as reliability and credibility need to be assessed. Understanding the whole loan process and the paper work involved can become a little too much. But this must be done to protect oneself from getting into incomplete agreements.

If there wasn't enough thought and effort that went into evaluating a mortgage, you might be in for some surprises down the line. All this is because of lack of preparation and awareness. Some of the other common mistakes made by mortgage buyers are:

1. Consider a mortgage to be a long term commitment - Sometimes buyers do not do this. They look at loans as an option for ending their current dilemma. If one wishes to invest in real estate, they need to think about what the house will fetch if sold and if they will be able to sell it. All this must be discussed with a banker or a real estate agent before signing on the mortgage agreement.

2. Paper work, paper work, paper work - Some buyers relay solely on oral communication. If they are not in possession of the contract, the companies may cheat them or they will lose out on certain benefits that were discussed during the meetings.

3. Is there limit to how much you can borrow? Do you know what that limit is? - Buyers assume they will be eligible for any amount of loan from the mortgage company which is not true. And even if they offer you the same, you will end up paying high rate of interest. This will only add to your financial woes. You will have to work towards repaying your debts as well as struggle to meet your interest payments, so one need to think it through before agreeing to the same.

4. Additional costs -- When closing the mortgage deal, buyers have to make some additional payments such as legal fees and taxes. Redemption penalty might also be charged if the loan is cleared before the stipulated time. Better prepared than sorry! So, it is best to talk to your mortgage company about this before jumping right in.
Source: Free Articles

Variable Rate Mortgages - Should I Have One Now?

Choosing which is the best mortgage for you and your circumstances can sometimes be difficult with so many different options on the market. One of these options is a variable rate mortgage which with the current credit crunch and low bank base rate could be very attractive.

A variable rate mortgage is a type of mortgage that is linked to the bank of England base rate. This variable rate is normally around 1.5% - 3.5% more than the Bank of England's base rate however a variable rate mortgage does not necessarily go up and down in sync with the Bank of England's base rate.

Will a variable rate mortgage work for me?
If you are thinking about looking into a variable rate mortgage here are a few things that you should know -
If the Bank of England's base rate falls so could your mortgage repayments, this is good news at it means that you will be paying less each month for your mortgage. However you must be warned that should the Bank of England's base rate go up, so will your repayments. Borrowers should also take note that lenders do not always alter their base rate as significantly as the Bank of England does, so any reduction in repayments may not be as dramatic as you may expect.

You are able to change mortgage lender at any time and avoid paying a penalty for doing so. For many people this is a real plus point as many mortgage lenders will make you pay a fee to switch mortgages.

If you are looking to plan a budget for your household expenses it could prove to be difficult with a variable rate mortgage as you can never predict how much your monthly repayments will be.

What's the future for the variable rate?
With the Bank base rate at an all time low a variable rate mortgages is clearly an attractive proposition.

With the global recession it is clear that interest rates will have to remain low for some time to come. This makes a variable rate very beneficial in the short term, and here is the problem for all the people looking for a new mortgage. Whilst it is very attractive to have a variable rate at some point in the next 12 months there will be a recovery in the economy.

When the recovery starts one thing is clear, interest rates will rise and even before they do the rumours of a rate rise will push fixed rate prices up. Over night the 3.99% five year fixed your bank could offer you today could be 2% higher.

So the simple answer is, if you can afford to take the gamble of a variable rate mortgage take it, for all of us you need to budget each month a long term fixed rate now may be more expensive then a variable rate, what price do you put on peace of mind and stability?

Jason Haines is a Mortgage and Protection Adviosr with Go Direct. For details on the latest mortgage rate options or the , why not visit Go Direct today.