Lenders Offer Help For Borrowers
Whether it's from a job loss, medical emergency, mortgage-payment hike or simply personal-finance mismanagement, a small but growing number of homeowners are falling into foreclosure every year.
For most people who fall behind on their mortgage, their first instinct is to avoid all contact with the lender. But that's a mistake, consumer counselors and others say, because it's likely those financial problems will only get worse, making it harder to work out the best repayment terms.
Many borrowers don't realize that lenders are as eager as homeowners to avoid foreclosures, which cost lenders $40,000 to $60,000 per house, according to industry estimates.
Find out more about lenders workout programs…
Fixed Rate or Adjustable Rate Mortgage
Along with other decisions you will find yourself making while shopping for a mortgage, you will be deciding whether to take a fixed-rate mortgage (FRM) or an adjustable rate mortgage (ARM).
As the name implies, the interest-rate of an FRM will remain the same throughout the life of the loan. If interest rates are low when you are buying or refinancing a home, an FRM is a good choice, because you can lock in that low interest rate.
ARMs, however, will fluctuate as interest rates rise and fall. Your 6 percent rate today could drop to 5 percent next year or end up at 8 percent if the market rate goes up.
Find out more about mortgage loans…
Homeowners Continue To Tap Equity
Many US homeowners continue to take cash out of their homes even as mortgage rates climb and home sales slip, helping to brace the economy, economists said.
This year, Americans who refinance their mortgages are expected to draw $257 billion of wealth out of their homes, according to mortgage finance giant Freddie Mac. That's $13 billion more than the refinancing cash-out seen in 2005 — the hottest year of the recent housing boom.
Get the full story here…
Home Inspectors
Home inspectors can be a real asset in the biggest financial transaction of your life. How can consumers make sure to avoid any "bad apples?"
Bad apples exist in every industry — and home inspection is not immune. Unfortunately, home inspection is not regulated consistently across all states within the nation. There are also schools and Internet sites that offer credentials that make it appear that a home inspector is qualified. For example, recently a web site popped up offering to "certify" anyone as a Master Inspector for $175.
The home inspection profession is a demanding profession that requires a broad base of knowledge in all areas of home construction, maintenance and safety issues.
Find out more about home inspections…
Choosing a Mortgage Loan
Choosing a mortgage loan is not as easy as simply finding the lowest interest rate. There are many other factors that will determine which mortgage is right for you. Your financial picture, including your income, savings, cash reserves, and debt-to-cash ratio will determine how much you can afford to pay in monthly mortgage payments.
Finding the "best" mortgage means balancing your mortgage options with your financial situation and your housing needs, now and in the future. Since even the shortest mortgages typically last at least 15 years, you will need to project how your financial situation and your housing needs may change over the life of the mortgage.
Find out more about mortgage loans…
