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Some Information on Home Loans Options

Wednesday, May 21st, 2014

When you make the decision to take the plunge and get a new home, or you want to refinance the house you are currently living in, you will probably be both excited and nervous. There is no doubt it can get confusing with all the different offers for home loans and refinancing on the Internet today.

You may want to begin by finding a company that makes it easy for you with a 24 hour support staff. You can talk to a home loan specialist on the phone or through a live online chat. Of course, there is always the option of email as well. In any situation where you are trying to qualify to buy or refinance a home, there will be times where you have questions, so having multiple ways to get those inquiries answered fast really does mean a lot to the home buyer.

The first step to any home purchase loans is the pre qualification. This is a process you can begin online or over the phone. If you are pre qualified, you will be able to sail through the loan process much more easily. You can qualify for a number of different loan products depending upon your specific needs.

Some of the loan options may include, but are not limited to: The jumbo loan (fixed or adjustable rates, bigger amounts than most loans,) the fixed rate loan (a fixed principal and loan payments that will be consistent until the loan is repaid,) the adjustable rate mortgage (lower payments for the first several years of the loan with adjusted larger payments each year in later years of the loan,) the FHA loan (a fixed rate loan provided by the US government, with income and credit guidelines for lower income people,) and the VA loan (available only to veterans of the US armed forces, no down payment and a fixed rate).

You may also be looking for home refinance loans options like the Home Affordable Refinance Program (HARP refinance.) A HARP loan is designed especially for people who are currently homeowners struggling to pay for a house that has lowered in value since the original purchase. Because the home has lowered in value, it is often difficult for the homeowner to get refinancing through many lenders, but HARP was created for exactly that situation. HARP gives homeowners a new mortgage that is more reliable and stable than the old one.


Save Money By Getting The Best Home Loans For Your Situation

Tuesday, May 20th, 2014

One of the most important keys to financial stability is to keep your housing costs in check. While there are other bills you can cut back on when you find money is a little tight, such as a cable or mobile phone bill, your housing costs are usually set for a long period of time. This is particularly true if you have taken out a mortgage. Putting time into making sure you are getting the lowest payments possible for the place where you want to live will pay off in the long run by giving you more financial confidence and flexibility.

Of course, it’s important to spend time doing research on home purchase loans before signing a mortgage, to make sure you are happy with the deal you are getting. Even down the line, though, it is possible to make changes. This is done through something called home refinance loans. This basically means you take out a new loan that pays off the original one, and then you make payments to the new mortgage lender. There’s usually a fee for doing this, but it pays off over time if you can manage to set it up at a time when the interest rates are lower than when you got your original loan.

For some people who have gotten home loans, refinancing is largely out of reach through the normal channels. A lot of people bought housing in the lead up to the pricing correction, and this left a large proportion of people in many markets underwater, which basically means they owe more money on the loan than the value of the property that secures it. In such a situation, a refinancing arrangement would normally either be unavailable or would require paying for Private Mortgage Insurance, or PMI, to provide the lender with an additional guarantee that they will get their money back no matter what happens.

In that situation, homeowners should pursue a HARP refinance. These are available through the Home Affordable Refinance Program, which was set up by the federal government for homeowners whose mortgages are guaranteed through Fannie Mae or Freddie Mac. With this program, you can refinance without having to pay the PMI if your home is underwater due to the housing downturn. Since PMI costs can otherwise eat up the savings of refinancing to a better interest rate, it’s worth your time to contact your lender and to find out if you’re eligible for this program.

HARP Can Make Home Loans More Affordable and Within Reach

Monday, May 19th, 2014

In 2008, the housing market crashed. Millions of homeowners found themselves underwater in their mortgages, unable to pay grossly inflated mortgages and unable to refinance their home loans. The number of houses going into foreclosures grew in record numbers. People saw their properties lose more than 50% in value, and investors saw their portfolios deteriorate rapidly. People with ARM’s saw their interest rates begin to climb and were unable to refinance into a more stable, fixed rate. A little more than 5 years later, the market is beginning to slowly recover. Homeowners and investors alike are starting to once again look into home refinance loans.

Many people struggled to hang onto their homes and to keep making their payments on time. Newly created programs can bring relief to the homeowner, making it easier for those who remained steady during the mortgage crisis to qualify for new home refinance loans. The Home Affordable Refinance Program or HARP refinance has been designed for the people who have remained current, not more than 30 days late on a payment in the past six months, owe more than eighty percent of the current value of their home and have a credit score higher than 620. Mortgages owned by Fannie Mae or Freddie Mac may also qualify for the Home Affordable Refinance Program.

Designed to help homeowners who have worked hard to remain consistent in their payments, and wanting to stay in their home, HARP may bring much needed relief. The plan enables borrowers to refinance their current mortgage, often lowering their principal and interest payments, and making them more affordable. These new home purchase loans, are designed to stabilize the housing market, and bring much needed relief to the mortgage fatigue many are feeling.

The program assists borrowers to completely refinance their homes with a brand new mortgage, interest rate and terms. For those with adjustable mortgage rates, the opportunity to qualify for a fixed interest rate translates into a consistent payment each month. Many people have balloon mortgages looming ahead of them. At the time of purchase, it seemed like a good idea; the homeowner would purchase a home making minimum payments over a 5 or 10 year period, paying down only a small portion of the principal balance. In a few years, the balance of the amount financed would become due. During the time the home loans were taken out, it would have been easy to refinance the mortgage. Then came the crash and an inability to refinance. HARP can offer relief.

Investing in real estate has always been a good place for people to put their money. For generations, people have been taking out mortgages to buy their piece of the American real estate pie. It was a good way for people to build their retirement nest eggs, making their golden years a bit sweeter. Home ownership is still a good investment in the future, and now there are new programs designed to make it easier.

Home Loans Can Still Be Affordable

Monday, May 19th, 2014

Deciding where you’re going to live is among the most fundamental questions in life. It’s also one that can produce a great deal of anxiety. Buying a home is a major investment at the best of times, and families often have to strain to put together every available penny to be able to afford a down payment and a mortgage. Once that happens, though, things don’t necessarily go perfectly smoothly. The economic downturn and housing crash of the past few years left a lot of families who’d worked hard for their homes in the terrible position of owing more on their home purchase loans than the property was worth. There are lenders who are willing to help the people in this situation.

It’s normal to be able to seek home refinance loans, but these are still secured by the value of the property. Because of that, the options offered through normal channels will normally not be available to someone who owes more than it is worth. Many people assume they simply have no option to refinance because they don’t have the ability or the willingness to hand over a lump sum to bring them up to par before taking out a new loan.

Thanks to the government, however, there is a specific program in place to make sure home loans for refinancing are available to the people who need them most. It wasn’t individual home buyers who caused the housing bubble and crash. Rather, it was the irresponsible lending policies that dominated at the time. A HARP refinance is available not for the people who are struggling and behind in their payments. There are other programs for that. This program assists those who are current in paying their mortgage but can not take advantage of a refinance due to their home being driven under financial water in the course of the housing price correction.

The major benefit of this program is that it allows people to take out new home loans, at better interest rates, without having to pay for Private Mortgage Insurance due to the amount they owe over the value. PMI can add up to a substantial amount of money and can often wipe out the benefits of refinancing entirely for a family who must pay it. This means people who qualify for this program and go through the process can reduce their mortgages and sleep better at night.

Tips for Getting Home Loans with Bad Credit

Thursday, May 15th, 2014

In today’s struggling economy, many people are losing their credit rating and finding they can’t buy anything, including a new home. While having poor credit shouldn’t be used against you when you are trying to procure home loans, everyone knows it is. There are even some government programs that exist to help people with poor credit get the home purchase loans they deserve. Below, you will find some tips on how to get the loan to buy your home.

Credit Report

Everyone has the right as a consumer to get a free copy of their credit report once a year. The first thing you will want to do when you decide to apply for home loans is obtain a copy of your credit report and dispute any charges you did not make. You can dispute any false information, and have it removed from your credit report. It will probably still affect your rating a little, but is a great way to start rebuilding your credit.

Submit all Important Information

Your poor credit may be the result of divorce, the death of a spouse, or any other disaster you can’t control; however, that will still stop you from getting home loans, or even home refinance loans if you already own your home. If you have since gotten your finances straightened out, you can get together all paperwork proving your new found finances and submit them to the lender. Sometimes, submitting this paperwork will help you to get the loan you need and may ensure you a low rate.

Get a Cosigner

One of the easiest ways to get a home loan is by getting a cosigner. It has to be someone who is a relative or a close friend and is financially stable with good credit. You do need to remember, if you default on the loan, the cosigner will be held responsible. You could end up ruining their credit and making your own rating worse, if you don’t act responsibly.

If you already have a home and are looking to refinance, then you might check into the HARP refinance loans available. The HARP, also known as the Home Affordable Refinance Program helps homeowners who are current on their mortgage and have no late payments during the last six months but actually owe more on their homes than the homes are worth. If you are looking to refinance for this reason, the HARP is a viable option for you.


Tips for First Time Buyers Seeking Home Loans

Thursday, May 15th, 2014

Perhaps you have decided you are going to take the plunge and buy the home of your dreams. You have saved, scrimped, and climbed your way to the point where you are able to afford to live in a home you can call your own. The only thing you need to do now is apply for the home loans you will need to get the home of your dreams. In today’s world, applying for home purchase loans is easy; getting approved for these loans is a little harder. Below, you will find some tips on how to get the home loan you need.

Check Your Credit

Before you even consider talking to a lender, you will want to have a credit report pulled. You are entitled to one free credit report per year, and when you start applying for home loans, is the right time to get it. Remember, just because you pay everything on time doesn’t mean your credit is the best in the world. There are other considerations, including exactly how much credit you have. It’s best to know what you are working with before you start trying to get any type of home loans.

Determine how You Spend Your Money

You will want to take a couple of months to track how you spend your money. Evaluate your assets and liabilities before you make a decision on what you are willing to spend and what type of down payment and monthly payments you can afford. You will probably need about two years’ worth of steady earnings to show a lender before they will even consider giving you a home loan.

Organize all of Your Documents

The term have all of your ducks in a row has never been more apt than when you are applying for a home loan or even for home refinance loans. You can, of course get a HARP refinance loan, but you have to have your ducks in a row here as well. You will want to have all of your paperwork from tax information to recent paycheck stubs before you even step into a lenders office. Without the right documents, you are more likely to be turned around at the door.


In today’s struggling economy, many homeowners find themselves in foreclosure for no other reason than the housing market has toppled. This is where the HARP refinance loan can come in handy. Many homeowners are paying on a home that is not worth even remotely what it was when they bought it years ago. If you want to refinance your home because you are underwater on your mortgage, this is an option you will want to check into.

For first time buyers, procuring a home loan can be pretty confusing. Follow the tips above, and you should have no problem at all.


A Guide to Getting Home Loans

Monday, May 12th, 2014

Many people dream of owning their own home. However, a home purchase usually requires financial assistance with a home loan through a bank or other lender. Having knowledge of how home loans work helps a great deal in the process. Home purchase loans grant the borrower money, who promises to pay back the loan based on terms set by the lender. Loan are based on terms of fifteen to thirty years. They can be secured or unsecured. A secured loan requires collateral like the home itself. If a borrower defaults on the loan, the lender may repossess the property. The borrower must provide all of their financial information on the application. Payments will include interest, and the lender charges various fees like appraisals and closing costs.

Borrowers are not provided funds until the lender runs a credit check. You will be allowed to borrow what the lender feels you can pay back. You will be required to set up an escrow account before you get the loan. Escrow is an account held by the lender, which requires a deposit every month. This money may be used to pay insurance and property taxes. It should have adequate funds to cover several months of expenses.

There are several types of home loans available. If you have good credit, you can get a prime loan, which has a lower interest rate. Most lenders will only allow prime loans for their best customers with credit scores of at least 620. Borrowers with credit scores below 620 can apply for subprime loans. Subprime loans often come with higher interest since borrowers commonly have a history of defaulting. Subprime loans are ideal for borrowers with a history of bankruptcy or no credit.

Borrowers who are struggling to cover payments with high interest rates may get home refinance loans to reduce the interest rate on their previous loan. A refinance loan may also be taken out for debt consolidation. Low income buyers with acceptable credit can take advantage of Federal Housing Administration loans. These are government home purchase loans that provide you with more flexibility, and you only have to make a 3% down payment. You just need to submit an application with a Department of Housing and Urban Development, or HUD, lender.

Getting a home is exciting, but you should use caution when looking for lenders. An online loan calculator can help you decide how much of a loan you can afford. Owning a home can be accomplished with planning. If you have little equity left in your home and need a second loan, the HARP refinance program can help. HARP refinance provides consumers who are not behind on mortgages with refinance loans at affordable rates.

What Is The Home Affordable Refinance Program (HARP)?

Tuesday, April 22nd, 2014

Have you been having trouble getting traditional refinancing for your home because of a major decline in its value? Well, if your monthly mortgage payments are current, the Home Affordable Refinance Program (HARP) may be the key.

HARP refinance loans were designed to help homeowners obtain a more stable, reasonably priced mortgage loan. HARP loans help to make homeownership more affordable in the US.

HARP Refinance Eligibility Criteria

If you’re looking for a more affordable option for your home loan than traditional refinancing, HARP refinance could be the answer. In order to be eligible, your current mortgage loan must meet all of the criteria below:

  • Your mortgage loan must be guaranteed or owned by Fannie Mae or Freddie Mac.
  • It must have been sold to Freddie Mac or Fannie Mae no later than May 31, 2009.
  • You cannot have previously refinanced your mortgage loan under HARP unless it’s through Fannie Mae that was refinanced through HARP at any time between March 2009 to May 2009.
  • The home’s current loan-to-value (LTV) ratio has to be at least 80% or more.
  • Your mortgage payments must be current, and must have been good standing for the last 12 months.

* Check potential eligibility for Freddie Mac loans.

* Check potential eligibility for Fannie Mae loans.

Where to Begin

  • First, find out whether or not your home mortgage loan is guaranteed or owned by either Freddie Mac or Fannie Mae.
  • Get in touch with your current mortgage loan companies. Or, contact an approved Freddie Mac or Fannie Mae mortgage servicer to get more information about HARP refinance.
  • Compare mortgage costs and rates with various mortgage servicers to ensure that you get the best terms available.

How Do I Apply for a HARP Refinance Loan?

Gather up the following documents and take them to your local HARP specialist to have your data analyzed:

  1. Your income tax return most recently filed
  2. Information related to any junior lien mortgage loans on the home
  3. Monthly payments and account balances of all your current debts

Refinance Your Home with a HARP Loan

Contact the mortgage servicer to which you currently make your monthly mortgage payments to see if they’re HARP participants. If they don’t, contact a mortgage servicer who does participate in HARP.

* Note: The Home Affordable Refinance Program ends on December 31, 2015.

All The Facts About FHA Loans

Thursday, April 17th, 2014

A FHA loan is a great way for people to buy or refinance a home. Down payments can be as low as 3.5 percent of the home purchase price, and the loan can include most fees and closing costs. The Federal Housing Administration insures the loans, and borrowers pay mortgage insurance, meaning that lenders such as Loan City Home Loans are protected from a loss if a borrower cannot pay. It also means Loan City can provide these loans at lower interest rates and with more flexible standards.

Various Types
There are plenty of FHA loans for various needs. For example, there is a mortgage product that focuses on energy efficiency if you want to make energy improvements. There is also a reverse mortgage for people at least 62 years old who own their houses or who don’t have much left to pay. The FHA also provides loans for mobile housing and factory-built homes—and for fixer-upper homes.

The Federal Housing Administration does not function as a lender. It is really an insurance fund, so home buyers get their loan approved through lenders such as Loan City. Factors such as interest rate and cost vary among lenders.

Credit Scores
The minimum credit score needed to qualify for a FHA loan depends on the loan type, but in general, aim to score at least 580. The lower you score, the more you have to pay for the house up front. For example, if your credit score falls between 500 and 579, you will generally qualify to borrow 90 percent of the home’s value, meaning you will need to provide a 10 percent down payment.

The good news is that the FHA does not automatically deny applicants with credit scores of less than 500. Ask Loan City if you might qualify, especially if you have an unusual credit history.

Mortgage Insurance Premiums
You pay two mortgage insurance premiums on all FHA loans. One is 1.75 percent of the loan. It’s paid at the time of the loan but can be part of the loan amount. The second premium amount depends on the amount borrowed (the higher the down payment, the lesser the premium), loan length and the loan-to-value ratio. Premium amounts can range from about 0.70 percent to 1.3 percent.

Please contact Loan City Home Loans with any questions and to find out how you could benefit from a FHA loan.

How to Find a Good Mortgage in the Current Market

Tuesday, April 15th, 2014

Whether you are a homeowner who is looking to refinance an existing loan or a first time buyer who needs financing, it’s important to realize there are many different options for mortgages today.  To find the best one in today’s economic climate, it pays to check into each one of those options.  Specifically, you want to consider how long you will need to pay off the mortgage, and the current market mortgage rates for both fixed and variable rate financing.

Mortgage Duration

Since people do tend to change jobs and move to new cities more frequently these days, exploring the benefits of mortgages with shorter terms make sense.  Doing so makes it easier to build up equity in the home faster.  As a result, you will be able to keep more of the sale price of the home and still pay off the remainder of the mortgage without any problem.  That extra money can make it easier to negotiate better terms when you buy a home after the move.

Even if you don’t plan on moving, consider a shorter term.  Think of the amount you will save on interest if you can manage the payments on a 20-year mortgage just as easily as one that will run for 30 years.  Those savings can be used to make improvements to the home or otherwise provide you with more financial security.

The Current Mortgage Rates

Don’t automatically go for a fixed rate.  If the rates could actually drop in the years ahead and stay lower than the current market mortgage rates, consider the possibility of going with a variable rate mortgage.

Variable rate mortgages begin with a competitive fixed rate term that lasts for up to ten years.  Why not go ahead and lock it in?  You can always take a second look as the term is about to expire and see what you think about the current market mortgage rates.  Assuming they seem to be creeping upward and show no signs of reversing course, you can always refinance immediately and lock in a lower rate.

Call today and talk with an expert at Loan City Home Loans about their financing options.  By considering these two factors along with the amount of your down payment and the pros and cons of bundling the cost of home insurance into the loan, you are sure to find the option that is right for you.