Mortgage Equity Withdrawal is the formal name for equity refinance, reverse mortgages or simply home loans based on equity (as the security for the loan).
Mortgage Equity Withdrawal rose to 8.7 billion pounds in the second quarter of this year to its highest since the third quarter last year, official data showed (on Tuesday 4th Oct 2005).
Mortgage Equity Withdrawal is a measure of the equity Britons have extracted from their homes but which they have not re-invested in property.
Sharply rising house prices in the last few years have encouraged a trend where Britons refinance their mortgages to extract cash which many economists say has helped support spending.
The Bank of England said that Mortgage Equity Withdrawal was up sharply from 6.437 billion in the first quarter of this year although it is still well below the 14.5 billion seen one year ago, when house prices were rising more than 20 percent annually.
The Bank of England has since cut interest rates by a quarter of 1% to 4.5 percent which could support Mortgage Equity Withdrawal in coming months, particularly as there are signs that the property market may be stabilizing after a year of stagnation.
As a percentage of post-tax income, Mortgage Equity Withdrawal rose to 4.2 percent from 3.2 percent in the first quarter of the year but is well down on 7.3 percent seen a year ago.
" Mortgage Equity Withdrawal appears to have found its way into increased holdings of financial assets (equities, bonds) as much as extra spending," said Geoffrey Dicks, UK economist at RBS Financial Markets.
"Generally the pick-up in Mortgage Equity Withdrawal is probably indicative of more `normalization' of the housing market but while it is saved rather than spent, the policy implications are not huge."
Official data last month (September) showed the saving ratio rose to 5 percent in the second quarter of this year from 4.5 percent in Q1 (also of this year).
Separate figures showed UK residential construction barely grew in September, putting in its weakest monthly performance since May.
But what does this mean in real terms?
There are several key points in this statement, these are:
1.People are refinancing their homes because of increased value
2.People are not necessarily spending the money on the property
3.People are not necessarily spending the money in the high street
These three points are important to all of us, not just the policy makers. Here’s why.
Let’s consider the first point, people are refinancing there homes because the equity has grown rapidly.
This statement tells us that the housing market although not sky rocketing as it was a couple of years ago, is none the less still rising.
The second point tells us that when people effectively withdraw this money it is not to improve the home itself, hence the equity of the property will not grow at a better rate than market rate.
The third point is perhaps most telling, people are not taking the money and spending it in a hap hazard manner but are potentially saving it (bonds, shares, bank accounts).
So what do this mean for us?
Well, it’s a bit of mixed signals heads up if you like.
The general population (property owners) are slipping into ever increasing levels of debt (if you’re refinancing your mortgage or ‘freeing up equity’ as the agents put it, you are effectively borrowing money) – unless it’s a reverse mortgage.
People who are refinancing are not improving the quality of the property with the money and so if the market takes a fall their property will devalue as much as the next property (whereas if they’d returned some of the capital into improvements they would at least be sitting on a lesser slump in value).
Finally, and perhaps the most damming sign is that people are saving more, this is not a good sign. In a healthy economy the rate of saving is low, this is primarily because confidence is high (people aren’t worried about the bills or their jobs) but the fact that more people are now starting to save money rather then spending it means that the retail sector will be taking a hit, this means that the bottom end jobs will be in danger, this in turn has a knock on effect in the service sector and becomes a vicious circle – the end result being market stagnentation .
But what this trend does illustrate quite simply is that you can potentially get more money back in savings interest than you pay out in refinancing interest – so at the moment the smart moneys in equity refinance.
Sunday, June 10, 2007
Saturday, June 9, 2007
Refinancing Mortgage Loan - Get The Lowest Interest Rate You Can When Refinancing
Refinancing can be a very simple process. You fill out a few applications, take the best offer and you’re done. You already own your home, so, depending on your broker, the whole process can be fairly simple. Just be careful and make sure you do your homework before you accept a refinance loan offer. You will want to make sure that you get as many refinance mortgage loan offers as possible and talk to as many mortgage loan brokers as you can.
Mortgage loan brokers will usually insist that if they can’t help you, no one can. That is simply not true. All mortgage loan brokers or loan officers have access to many different types of programs. A refinance loan program that is impossible for one broker to do, may be completely possible for another broker.
When refinancing, one of the most important factors to pay close attention to is the interest rate. There are many ways to make sure that you get the lowest interest rate possible.
1. Do your own research online. Find out what current interest rates are.
2. Apply for your refinance loan with companies that will submit your application to multiple lenders, in order to get them to compete and give you the best rate. (For a list of our recommended mortgage companies that will get you multiple offers, click on the link below) Most of these companies will offer you up to 4 refinance mortgage loan offers. Most of the companies do not even initially pull your credit, so there is no harm in applying to a few of them, to make sure you can get as many offers to work from as possible.
3. Once you have received a few mortgage loan offers, talk to each loan officer and find out if you can negotiate with them for a slightly lower interest rate than they are offering you. Once you have received a few offers, you should have a pretty good idea of what kind of interest rate you can expect to get, realistically.
When refinancing, there are a few factors that are important to be very careful about. If you overlook an important detail like interest rate or closing costs, it could make the refinance hardly worth doing. You can save yourself potentially hundreds a month in unnecessary interest payments if you make sure you are getting the absolutely lowest rate possible.
Mortgage loan brokers will usually insist that if they can’t help you, no one can. That is simply not true. All mortgage loan brokers or loan officers have access to many different types of programs. A refinance loan program that is impossible for one broker to do, may be completely possible for another broker.
When refinancing, one of the most important factors to pay close attention to is the interest rate. There are many ways to make sure that you get the lowest interest rate possible.
1. Do your own research online. Find out what current interest rates are.
2. Apply for your refinance loan with companies that will submit your application to multiple lenders, in order to get them to compete and give you the best rate. (For a list of our recommended mortgage companies that will get you multiple offers, click on the link below) Most of these companies will offer you up to 4 refinance mortgage loan offers. Most of the companies do not even initially pull your credit, so there is no harm in applying to a few of them, to make sure you can get as many offers to work from as possible.
3. Once you have received a few mortgage loan offers, talk to each loan officer and find out if you can negotiate with them for a slightly lower interest rate than they are offering you. Once you have received a few offers, you should have a pretty good idea of what kind of interest rate you can expect to get, realistically.
When refinancing, there are a few factors that are important to be very careful about. If you overlook an important detail like interest rate or closing costs, it could make the refinance hardly worth doing. You can save yourself potentially hundreds a month in unnecessary interest payments if you make sure you are getting the absolutely lowest rate possible.
Thursday, June 7, 2007
Pro's And Con's Of Low Cost And No Cost Refinancing
At some point in time, many homeowners will check into refinancing their current mortgage. There are several things that need to be taken into consideration whenever you do this. One of the most obvious concerns is of course the interest rate. However, be sure to consider closing costs when looking to refinancing. It is wise to weigh all of your options before making a decision.
Since closing costs can sometimes be steep, many homeowners are searching for a low cost or no cost mortgage. Often times, they are also looking for a no fee refinancing. With the growing demand for more economical loans, came the need for no fee financing. A no cost finance loan is simply a loan in which the borrower does not have any closing costs to pay. The lender pays fees that often associated with a loan, such as an appraisal, title search fee, closing fee and/or application fee. This is an excellent opportunity for those who do not have the money to pay such fees up front.
Low cost or no cost refinancing deals often carry a much higher interest rate than a more traditional loan. The higher rate is used to compensate the lender for the fees they have paid on your behalf. Often times, the rates are somewhere between a quarter and a half of a percent higher, than if you would have paid for the normal closing costs. However, it is important that you keep in mind that most lenders will add the closing costs into the actual loan, if you do not have the money up front. This is generally acceptable if you have the equity in your home. However, if you are at the max for your loan value, it may not be worth it.
Prepayment penalty is another thing to look for. If you are planning to live in the home for a while, then this may not be an issue for you. However, if you are considering moving within a couple of years, be sure to have a full understanding of what the fee will be for paying off the loan early.
No cost refinance loans have other advantages. Often times, a different division of your bank will offer these. Generally, you can get a larger amount of money, without paying for Private Mortgage Insurance or PMI. Often time, this type of loan does not access points. This sometimes makes it worth paying a higher rate, since PMI can be very expensive. Be sure to ask about any special deals on credit cards or checking accounts too. Some banks will give you a higher checking amount with better benefits if you have a current mortgage with them. This can help to save you money on check ordering fees and monthly service fees.
Low cost or no cost mortgages are very common these days. When searching for an affordable mortgage solution, compare your options and calculate how, in the long run, you will be saving. Make sure you read all of the fine print, in order to find the best deal. If you do all of your homework, the right option for you might just be a no cost mortgage.
Since closing costs can sometimes be steep, many homeowners are searching for a low cost or no cost mortgage. Often times, they are also looking for a no fee refinancing. With the growing demand for more economical loans, came the need for no fee financing. A no cost finance loan is simply a loan in which the borrower does not have any closing costs to pay. The lender pays fees that often associated with a loan, such as an appraisal, title search fee, closing fee and/or application fee. This is an excellent opportunity for those who do not have the money to pay such fees up front.
Low cost or no cost refinancing deals often carry a much higher interest rate than a more traditional loan. The higher rate is used to compensate the lender for the fees they have paid on your behalf. Often times, the rates are somewhere between a quarter and a half of a percent higher, than if you would have paid for the normal closing costs. However, it is important that you keep in mind that most lenders will add the closing costs into the actual loan, if you do not have the money up front. This is generally acceptable if you have the equity in your home. However, if you are at the max for your loan value, it may not be worth it.
Prepayment penalty is another thing to look for. If you are planning to live in the home for a while, then this may not be an issue for you. However, if you are considering moving within a couple of years, be sure to have a full understanding of what the fee will be for paying off the loan early.
No cost refinance loans have other advantages. Often times, a different division of your bank will offer these. Generally, you can get a larger amount of money, without paying for Private Mortgage Insurance or PMI. Often time, this type of loan does not access points. This sometimes makes it worth paying a higher rate, since PMI can be very expensive. Be sure to ask about any special deals on credit cards or checking accounts too. Some banks will give you a higher checking amount with better benefits if you have a current mortgage with them. This can help to save you money on check ordering fees and monthly service fees.
Low cost or no cost mortgages are very common these days. When searching for an affordable mortgage solution, compare your options and calculate how, in the long run, you will be saving. Make sure you read all of the fine print, in order to find the best deal. If you do all of your homework, the right option for you might just be a no cost mortgage.
Wednesday, June 6, 2007
More Ways To Beat Closing Costs On Your Home Mortgage
Closing costs on your home mortgage are normally the thing that buyers don't worry about until the last minute. Problem is, if you don't think about closing costs until the last minute, you will likely be shocked when you find out that these costs run into the thousands of dollars. Relax though and don't be intimidated. I have made the mistake of not planning, and I can show you how a little planning, can save you hundreds and potentially thousands at closing.
If you can read a HUD1, then you should know exactly what you will be charged at closing. However, simply being able to read and understand a HUD1 doesn't mean that you'll save money. What you need to do prior to closing and during the entire time leading up to closing is be in the habit of every time you hire someone to complete work for you that's required for the close, ask how much they charge. Don't just accept the realtors recommendation for a home inspector. Ask around if possible. If you don't know the realtor that well, how do you know that their recommendations are best for you. Although they usually will be "steering you in the right direction. It behoves you to check around. Don't just shop for price, shop for service as well. If you are working with a home mortgage broker, you should understand that how much they charge usually varies by the amount of the loan. When your broker offers you several home mortgage loans to choose from, ask about their fees with each option. It's critical that you include the cost of fees when you are comparing home mortgage loans. This is the only way you can get an apples to apples comparison. Don't forget, there's more to a home mortgage than simply the interest rate. It's very possible that the lower home mortgage interest rate, might also include a "hefty" fee. Home mortgages are a one-time deal, but higher up front fees could also be your new carpet or furniture payments.
Beware of courier fees. I've been hit with these before. You've negotiated what you think is the best rate online through someone you got hooked up with through Lending Tree or some other Online Loan finding service. However, you're likely dealing with someone that's 1,000 or more miles from you. If this is the case, then there's likely no way around a courier fee. Since everyone wants to get the closing completed and start that wonderful experience called moving, the closing documents typically arrive at the Title Company one day after completion. Unless you know that someone had to drive over an hour just for your file, you should refuse to pay courier fees. It's reasonable to pay a next day air fee, which is usually about 10 to 15 dollars, but not a courier fee. It is very important that you make your home mortgage broker and lender justify their fees. Sometimes when they start to explain a fee, you might come to the agreement that it is unnecessary and can be removed from the HUD.
Another, most common way to save on Closing Costs is to comparison shop home mortgage brokers, too. Be careful when you do this. You want a home mortgage broker that will work to put you into your house. I recommend that you work a few local brokers against each other to get the best deal. Be up front with them and tell them that you want the best deal not only for the close, but for the life of the loan. Ensure that the mortgage broker or bank understands that you know what you're doing and that you understand the various fees and interest rates available. If your credit is good, you will save yourself the most money by going directly to a home mortgage lender (the bank or institution that will actually provide the funds at closing). A lot of times you may find that a home mortgage broker is your best option only if you are having trouble getting a home mortgage. Brokers, specialize in the hard cases. I used a broker for my first home loan. We had a bunch of credit card debt from graduate school and he had to creatively get us approved. It likely resulted in a higher interest rate, but I got into my first home and have never looked back. If you have good credit and have been in your job a while, I wouldn't bother with a home mortgage broker. But let this be our secret, please! The broker is actually working through the bank, so for them to make money, they have to charge more money than the bank. It's like buying directly from the distributor vs. a manufacturer.
More Fees, shop around for deals while you're in escrow or waiting to close Another place fees can vary greatly is your survey. You will probably have to have one, so call around and find a cheap surveyor. Since they are state licensed, any licensed surveyor will do an adequate job. You already know to shop around for homeowner's insurance. The closing process can take weeks or even months, so it really makes sense to use the time to your advantage to get great deals. You won't be able to do anything about reserves or prepaids, so do not worry about them. Usually the lender will determine the prepaids necessary based on your interest rate and timing for real estate taxes. Title companies are like surveyors. Most will do a competent job, so call around for the cheapest. If an attorney is required for closing, I have found that rural or smaller law firms are almost always cheaper than urban or even suburban ones. Better yet, if you have a friend that's an attorney, ask if he or she will help you. If they can't perhaps they can make a recommendation. You can call surrounding counties for attorney fees for a home mortgage closing. By driving a bit you could save major money.
Points and other gimmicks to lower your interest rate or buy-down your interest rate are actually home mortgage lender fees. Do not pay them unless you have to. If they will give you a lower rate with points, get it in writing, then go to someone else and get that rate without points. If you have a hard time getting a home mortgage loan, you may have to pay them. Points are a percentage of the loan, so they are very expensive. If it looks like you might have to pay them, offer to pay the same amount as a down payment, reducing the loan amount. The lower amount may get you a loan without points, and instead of fees, you have equity. Question everything, accept what you have to, and in the end be content. No home mortgage is perfect.
Closing costs on your HUD just compile many fees related to your home mortgage. Thanks to the Feds, they are all in one place on this form. Knowing what they are and what caused them can give you the confidence to have a smooth closing. You can now walk into closing knowing exactly what you bought and how much you paid for it, and then head out to with your new home and reason to celebrate.
If you can read a HUD1, then you should know exactly what you will be charged at closing. However, simply being able to read and understand a HUD1 doesn't mean that you'll save money. What you need to do prior to closing and during the entire time leading up to closing is be in the habit of every time you hire someone to complete work for you that's required for the close, ask how much they charge. Don't just accept the realtors recommendation for a home inspector. Ask around if possible. If you don't know the realtor that well, how do you know that their recommendations are best for you. Although they usually will be "steering you in the right direction. It behoves you to check around. Don't just shop for price, shop for service as well. If you are working with a home mortgage broker, you should understand that how much they charge usually varies by the amount of the loan. When your broker offers you several home mortgage loans to choose from, ask about their fees with each option. It's critical that you include the cost of fees when you are comparing home mortgage loans. This is the only way you can get an apples to apples comparison. Don't forget, there's more to a home mortgage than simply the interest rate. It's very possible that the lower home mortgage interest rate, might also include a "hefty" fee. Home mortgages are a one-time deal, but higher up front fees could also be your new carpet or furniture payments.
Beware of courier fees. I've been hit with these before. You've negotiated what you think is the best rate online through someone you got hooked up with through Lending Tree or some other Online Loan finding service. However, you're likely dealing with someone that's 1,000 or more miles from you. If this is the case, then there's likely no way around a courier fee. Since everyone wants to get the closing completed and start that wonderful experience called moving, the closing documents typically arrive at the Title Company one day after completion. Unless you know that someone had to drive over an hour just for your file, you should refuse to pay courier fees. It's reasonable to pay a next day air fee, which is usually about 10 to 15 dollars, but not a courier fee. It is very important that you make your home mortgage broker and lender justify their fees. Sometimes when they start to explain a fee, you might come to the agreement that it is unnecessary and can be removed from the HUD.
Another, most common way to save on Closing Costs is to comparison shop home mortgage brokers, too. Be careful when you do this. You want a home mortgage broker that will work to put you into your house. I recommend that you work a few local brokers against each other to get the best deal. Be up front with them and tell them that you want the best deal not only for the close, but for the life of the loan. Ensure that the mortgage broker or bank understands that you know what you're doing and that you understand the various fees and interest rates available. If your credit is good, you will save yourself the most money by going directly to a home mortgage lender (the bank or institution that will actually provide the funds at closing). A lot of times you may find that a home mortgage broker is your best option only if you are having trouble getting a home mortgage. Brokers, specialize in the hard cases. I used a broker for my first home loan. We had a bunch of credit card debt from graduate school and he had to creatively get us approved. It likely resulted in a higher interest rate, but I got into my first home and have never looked back. If you have good credit and have been in your job a while, I wouldn't bother with a home mortgage broker. But let this be our secret, please! The broker is actually working through the bank, so for them to make money, they have to charge more money than the bank. It's like buying directly from the distributor vs. a manufacturer.
More Fees, shop around for deals while you're in escrow or waiting to close Another place fees can vary greatly is your survey. You will probably have to have one, so call around and find a cheap surveyor. Since they are state licensed, any licensed surveyor will do an adequate job. You already know to shop around for homeowner's insurance. The closing process can take weeks or even months, so it really makes sense to use the time to your advantage to get great deals. You won't be able to do anything about reserves or prepaids, so do not worry about them. Usually the lender will determine the prepaids necessary based on your interest rate and timing for real estate taxes. Title companies are like surveyors. Most will do a competent job, so call around for the cheapest. If an attorney is required for closing, I have found that rural or smaller law firms are almost always cheaper than urban or even suburban ones. Better yet, if you have a friend that's an attorney, ask if he or she will help you. If they can't perhaps they can make a recommendation. You can call surrounding counties for attorney fees for a home mortgage closing. By driving a bit you could save major money.
Points and other gimmicks to lower your interest rate or buy-down your interest rate are actually home mortgage lender fees. Do not pay them unless you have to. If they will give you a lower rate with points, get it in writing, then go to someone else and get that rate without points. If you have a hard time getting a home mortgage loan, you may have to pay them. Points are a percentage of the loan, so they are very expensive. If it looks like you might have to pay them, offer to pay the same amount as a down payment, reducing the loan amount. The lower amount may get you a loan without points, and instead of fees, you have equity. Question everything, accept what you have to, and in the end be content. No home mortgage is perfect.
Closing costs on your HUD just compile many fees related to your home mortgage. Thanks to the Feds, they are all in one place on this form. Knowing what they are and what caused them can give you the confidence to have a smooth closing. You can now walk into closing knowing exactly what you bought and how much you paid for it, and then head out to with your new home and reason to celebrate.
Tuesday, June 5, 2007
Lowest Mortgage Rates UK – Lowering The Cost Of Mortgage
Mortgage is the most widespread industry that offered to loan borrowers with real estate as collateral. Mortgage has so many innovations and opportunities that a loan borrower can exploit them for their own benefit. You must have heard and read it elsewhere that mortgage rates are at an all time low. That is true. With growing competition in the mortgage industry getting lowest rates for mortgage in UK is not that difficult.
Yes that is true, but how does one find lowest mortgage rates in UK. Many borrowers are practically clueless the criteria to decide on whether the mortgage rates are lowest or not. When you are looking for lowest mortgage rates in UK, you will see that there is not any one single rate. There is a list of rates. And when you go to different loan lenders for rates, they will give to you several mortgage rates list, sometimes identical sometimes different. “What is going on”? – You think in your mind. Is there any thing as lowest mortgage rates in UK? Yes, there is.
You will come across this message everywhere – ‘go look around lowest mortgage rates’. Look around how? – nobody tells you that. It is like standing on the start line not knowing this way you have to run. Calling loan lenders and asking for lowest interest will be practically useless. Also calling for lowest mortgage rates at different days will give you different rates for mortgage rates are changing everyday.
Who is responsible for getting you lowest rate for your mortgage in UK? Economy? President? Government? Inflation? Discard all the high words! It is you and you are one of the most fundamental factor responsible for finding lowest interest rate on your mortgage. With mortgage borrowers absolutely flooding the market place, mortgage lenders are lowering the mortgage rates to attract more and more customers. How can one attract customers for mortgage? By offering lowest interest rates.
However, it is not that easy. Every homeowner wants lowest interest rates for its mortgage in UK. Lowest rates on mortgage in UK are subject to a borrower’s personal financial condition. Therefore, different mortgage borrowers will have different lowest rate for mortgage. One way to figure it out is to apply for mortgage quotes at different loan lenders. But are these quotes really consistent keeping in mind the fact that mortgage rates are continually changing. Most loan lenders will give you a correct quote for mortgage. A mortgage borrower looking for lowest rate should use APR to compare rates. APR will enable you to know true interest rates on mortgage including the interest, discounts, mortgage insurance and other related fees. This will enable you to get a true quote without any hidden fee which the lender might be concealing behind the lowest mortgage rate claim.
Prequalification is a way of discovering whether for mortgage will also enable you to know whether you are getting lowest interest rates or not. A lender will see your present current income, debt and basic credit history situation in order to qualify you for a maximum mortgage amount. When you find lowest interest rate for mortgage in UK, you can lock in your interest rate. A lock means the lender will lock in the lowest interest rate and points for a specific period of time that is usually the time during which the loan application is processed.
Lowest interest rates in UK are possible if you have good credit history. A good credit history has innumerable benefits in the loan market. Also lowest interest rates are possible adjustable rate mortgage. Adjustable interest rate mortgage in UK have interest rates lower than traditional mortgage. Also loan term of a mortgage should be lesser. A 15 year mortgage will mean lower rate of interest than a 30 year mortgage. A shorter loan term will always save money.
No other single factor has so much effect on your mortgage as mortgage rates. Getting a mortgage in UK at lowest rates will mean that you have agreed to all those who asked you to get the “best mortgage deal”. A little decrease in interest rates would mean big in terms of savings. There is loads of information available on internet to know how the market is currently fairing. Don’t settle for the first mortgage rate you stumble upon because they seem lowest. Go to different mortgage lenders. And then decide. Lowest rate for mortgage is not the only factor to look out while mortgaging for but it certainly is one of the deciding factors.
So while you are jumping frantically from one site to another in order to get lowest interest rate, you forget that it will need some patience and hard work. Like all good things it won’t come easily. Lowest rates for mortgage in UK won’t be served on a platter. No way. If you had enjoyed doing homework in school, looking for lowest interest rate won’t be a problem. Look around, study research, read and you will find mortgage rates not only lowest but surpassing your own mortgage rate arithmetic.
Yes that is true, but how does one find lowest mortgage rates in UK. Many borrowers are practically clueless the criteria to decide on whether the mortgage rates are lowest or not. When you are looking for lowest mortgage rates in UK, you will see that there is not any one single rate. There is a list of rates. And when you go to different loan lenders for rates, they will give to you several mortgage rates list, sometimes identical sometimes different. “What is going on”? – You think in your mind. Is there any thing as lowest mortgage rates in UK? Yes, there is.
You will come across this message everywhere – ‘go look around lowest mortgage rates’. Look around how? – nobody tells you that. It is like standing on the start line not knowing this way you have to run. Calling loan lenders and asking for lowest interest will be practically useless. Also calling for lowest mortgage rates at different days will give you different rates for mortgage rates are changing everyday.
Who is responsible for getting you lowest rate for your mortgage in UK? Economy? President? Government? Inflation? Discard all the high words! It is you and you are one of the most fundamental factor responsible for finding lowest interest rate on your mortgage. With mortgage borrowers absolutely flooding the market place, mortgage lenders are lowering the mortgage rates to attract more and more customers. How can one attract customers for mortgage? By offering lowest interest rates.
However, it is not that easy. Every homeowner wants lowest interest rates for its mortgage in UK. Lowest rates on mortgage in UK are subject to a borrower’s personal financial condition. Therefore, different mortgage borrowers will have different lowest rate for mortgage. One way to figure it out is to apply for mortgage quotes at different loan lenders. But are these quotes really consistent keeping in mind the fact that mortgage rates are continually changing. Most loan lenders will give you a correct quote for mortgage. A mortgage borrower looking for lowest rate should use APR to compare rates. APR will enable you to know true interest rates on mortgage including the interest, discounts, mortgage insurance and other related fees. This will enable you to get a true quote without any hidden fee which the lender might be concealing behind the lowest mortgage rate claim.
Prequalification is a way of discovering whether for mortgage will also enable you to know whether you are getting lowest interest rates or not. A lender will see your present current income, debt and basic credit history situation in order to qualify you for a maximum mortgage amount. When you find lowest interest rate for mortgage in UK, you can lock in your interest rate. A lock means the lender will lock in the lowest interest rate and points for a specific period of time that is usually the time during which the loan application is processed.
Lowest interest rates in UK are possible if you have good credit history. A good credit history has innumerable benefits in the loan market. Also lowest interest rates are possible adjustable rate mortgage. Adjustable interest rate mortgage in UK have interest rates lower than traditional mortgage. Also loan term of a mortgage should be lesser. A 15 year mortgage will mean lower rate of interest than a 30 year mortgage. A shorter loan term will always save money.
No other single factor has so much effect on your mortgage as mortgage rates. Getting a mortgage in UK at lowest rates will mean that you have agreed to all those who asked you to get the “best mortgage deal”. A little decrease in interest rates would mean big in terms of savings. There is loads of information available on internet to know how the market is currently fairing. Don’t settle for the first mortgage rate you stumble upon because they seem lowest. Go to different mortgage lenders. And then decide. Lowest rate for mortgage is not the only factor to look out while mortgaging for but it certainly is one of the deciding factors.
So while you are jumping frantically from one site to another in order to get lowest interest rate, you forget that it will need some patience and hard work. Like all good things it won’t come easily. Lowest rates for mortgage in UK won’t be served on a platter. No way. If you had enjoyed doing homework in school, looking for lowest interest rate won’t be a problem. Look around, study research, read and you will find mortgage rates not only lowest but surpassing your own mortgage rate arithmetic.
Monday, June 4, 2007
Home Mortgage Loan Refinance – Benefits To Refinancing Your House Online
Here are some of the benefits to doing your home loan refinance online:
Everything seems to happen faster - Online, when looking for a mortgage loan you can search around, fill out an application and a few minutes later, you can be receiving a pre-approval letter via email. There was no calling, no driving & no waiting on hold for an answer. The mortgage company will usually contact you quickly and give you all the information you need to move forward.
You will be more informed and make better decisions - People nowadays that use the internet as consumers, use it primarily to make better purchasing decisions. If you are sitting at home on the couch with your phone book calling every mortgage company listed, you are not going to know what the current interest rate is. You aren’t going to know what your contacted companies competitors are like. All you will know is what that loan officer tells you.
Online, you can view a lot of information very quickly. - After looking at a few mortgage loan websites, you will know quickly that when you refinance you have many options. Do you want to get cash out of your home? Do you want to borrow more than your homes current value? Do you want an interest only loan? And, you will know right away which mortgage companies offer these options. There are many different kinds of refinance loans, and all of these options can be learned after a few minutes of searching online.
Deal with large, reputable companies – When applying online, you should quickly be able to spot the larger, more reputable mortgage companies. I always prefer to use the companies that will submit your application to multiple lenders. That way, your credit is only pulled once, and you can receive multiple offers from up to 4 lenders. For a list of these recommended mortgage companies, see the link below.
Save money – Many online mortgage service companies can save you money by cutting out fees like origination fees and underwriting fees. You will also save money using mortgage services where more than one lender competes for your business. When you can receive multiple offers, you will know that you are choosing the loan with the lowest rate possible and the best terms you can qualify for. I usually recommend applying with about 3 different mortgage companies that will submit your application to multiple lenders and give you multiple offers. That way you can really maximize your options.
Less Commitment – You can search around online and apply to 2-3 different lenders without feeling guilty for working with more than one company. That way you make can make sure you are getting the best deal. Often when you start working with a mortgage broker in person, even if the person isn’t doing the best job for you, you start to feel obligated to continue to work with the person. This is not so online. If you aren’t getting what you want, you are free to move on with no guilt.
Saturday, June 2, 2007
No Closing Cost Mortgage Refinancing - Things to Know
If you're considering refinancing your home, lenders that offer refinancing with no closing costs can be very appealing. Closing costs are required upfront, meaning you must pay them before the loan funds can be received. Lenders that offer no closing cost refinancing agree to pay the upfront fees. This can be especially attractive to the lender who simply cannot afford the upfront costs. However, there are some things to consider before applying for this type of loan.
Higher Interest Rates
Unfortunately, lenders rarely do things out of the kindness of their hearts. If they are going to pay your closing costs, they are going to want something in return. In this case, it usually means a higher interest rate. The lender will pay your closing costs, and, in return, they will charge you an interest rate up to 1% higher than the rate you would receive if you paid the closing costs in the traditional manner. This can save you money if you only plan to keep the loan for a short period of time—a few years at most—but more often it will end up costing you more in the long run. Borrowers who are considering paying a higher interest rate in order to avoid paying closing costs should first estimate the amount of interest that will be paid in both circumstances over the lifetime of the loan.
Negotiations with Current Lenders
Before shopping around for a new lender, discuss your plans with your current mortgage holder. They may be able to offer a refinancing loan that suits your needs. If you have been a reliable customer and have established good credit with the company, they will often waive some of the upfront fees in order to keep your business.
Fees Included in Loan Amount
If you simply do not have the cash to pay the closing costs upfront, your lender may allow you to include them in the balance of your loan. Though you will have to pay interest on them, the interest on these fees is likely to be less expensive than a higher interest rate for the life of your loan.
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