Monday, January 24, 2005

Mortgage Refinancing - A Fresh Start

Refinancing your mortgage can provide you with a fresh start and allow you to take advantage of improvements in your credit as well as reductions in market interest rates. These are certainly good reasons to refinance because lower rates can reduce your monthly payment or the term of the loan.

These of course are not the only reasons someone might decide to refinance. Another reason to refinance is for the purpose of consolidating other high interest debts into your home loan to save on interest expenses. Mortgage related interest for investment loans is tax-deductible whereas other interest is not. If you currently have a 15 year term on your home loan you may decide to refinance to a longer term in order to lower your monthly repayments. Or on the other hand, you may have a fixed interest loan and decide you want to switch to a variable mortgage.

Refinancing your existing mortgage also gives you the opportunity to lock in today's current rates on a fixed rate mortgage. Some people like to make a small increase in the loan amount when refinancing in order to take out cash. This is a very popular option. The interest-rate you pay is generally the same but there may be a fee associated with the cash out refinance loan. This will depend on the particular loan program you choose.

Mortgage Refinancing - A Fresh Start, continued here:

Mortgage Application Tips

When you are planning to buy a home it is important to get pre-approved for a mortgage before you even starting looking at houses. Sellers will be more likely to accept your offer if you are already approved for a mortgage. A seller does not want to take the chance on accepting an offer from a potential buyer who may not be able to qualify for finance when there are other buyers who are already approved. Here are some tips to increase your chances of getting pre-approved for a loan.

Mortgage Application Tips continued here...

MORTGAGE CALCULATOR

Mortgage Calculator - PC based software

The banks do not want you to use this software because of the refunds they have had to make to users. If you have an existing mortgage then it will pay you to buy this particular mortgage calculator instead of using the free bank calculators. Not only can you do 'what if' scenario's but you can check whether the bank has been ripping you off with your existing mortgage and get a refund.

More on the super Mortgage Calculator here..."

Choosing a Mortgage Broker

Once you have made the decision to buy a home you will need to obtain mortgage financing for your purchase. Until about fifteen years ago buyers had to go directly to banks to obtain loans and shopping around for the right fit was a long process.

Mortgage Brokers are experts in home loans who will consider your financial situation and financing requirements and then shop around for various lenders to find the best possible deal on financing for your purchase.

Because mortgage brokers understand the loan process and the criteria used by lending institutions in evaluating borrowers they are able to make sure your loan application is completed correctly the first time resulting in a much smoother process. This can ultimately lead to faster approval. In addition they have access to hundreds of loan products with many different lenders resulting in the flexibility to find the best possible loan and interest rates for your situation.

Choosing a Mortgage Broker continued here...

Getting on Top of your Mortgage

Getting on top of your mortgage so you can pay your loan off faster and potentially save thousands of dollars on your home loan is possible with a plan and consistent effort. There are mortgage reduction strategies that you can put into place that will ensure that your loan is paid off more quickly without putting a huge strain on your current budget. The following tips are designed to help you pay off your mortgage as quickly as possible.

1. One of the most important things you can do to accelerate paying off your mortgage is to make a more frequent repayments. If you can arrange to make weekly payments as opposed to monthly payments you'll actually end up making the equivalent of 13 monthly payments each year instead of 12 therefore saving you money by reducing the term your loan. In order for this to be effective it is important that you make sure that your home loan has interest that is calculated daily. You do not want a home loan that calculates interest on an average monthly balance.

Getting on Top of your Mortgage continued here...

Australian Mortgage Choices

There are basically four types of mortgage choices popular in Australia. These are fixed interest rate, standard variable rate, basic variable rate, and split rate home loans.

Fixed Interest Rate

A fixed interest rate mortgage has a fixed interest rate for a set term which is usually one to five years. When the term expires the borrower can generally roll over the loan into new fixed term loan at the current interest rate or convert to a variable rate loan.

These mortgagess are very popular especially when interest rates are rising because borrowers can lock into a rate. This provides peace of mind and stability. The problem is, this can also be a bad thing if interest rates fall. For example, if the fixed rate is 8% and interest rates fall to 6% the borrower is unable to take advantage of the lower interest rates and associated lower repayments.

Fixed interest rate loans are typically more expensive than variable rate. The trade-off is for the security and stability provided by the fixed rate.

Australian Mortgage Choices continued here...