Provided By Yahoo! Personal Finance
Many lenders will offer a 'no-cost' loan in lieu of a traditional mortgage. 'No-cost' loans are generally priced at a higher interest rate than a traditional mortgage. The higher rate allows the lender to make enough money on the interest rate spread from the underwriter to pay for all your closing costs and provide them with their profit. Go to the calculator to help determine if a no-cost loan with your lender is better than a traditional mortage.
If you have questions about home loans give us a call at 972-772-7000 or email us at rockwall@kw.com.
Showing posts with label home loans. Show all posts
Showing posts with label home loans. Show all posts
Friday, February 25, 2011
Wednesday, January 26, 2011
Types of Lenders
Provided By Yahoo! Real Estate
Today's choices include banks, mortgage brokers, home builders, and Internet lenders. Each has its advantages and disadvantages, and rates vary from lender to lender.
Typically, most lenders do not keep money on hand but instantly sell conforming loans to third parties like the Federal National Mortgage Association (Fannie Mae) or the Federal Home Loan Mortgage Corporation (Freddie Mac). The most common source of home lending is a retail financial institution or credit union. They offer specific loan products and handle their own direct financing by taking consumer deposits and lending them to home buyers.
Mortgage brokers, on the other hand, act as the middleman and don't fund the loans themselves, but handle the mortgage financing for the borrower. Most earn their fees directly as a percentage from the lender and some from the borrower, or a combination of both. Since mortgage brokers have access to a wide variety of lenders they are usually on top of the latest rates, fees and lending practices.
Home builder financing is common in new developments where there is a single builder. The builder carries the construction costs until the homes are built. The builder works with a lender to set-up financing for the buyer and finances the construction costs. The buyer doesn't make mortgage payments until the property is finished.
The popularity of finding a mortgage on the Internet mortgage has grown in recent years. Many lenders offer competitive rates and the convenience of tracking your application through the approval process. Some can save you a significant amount in closing costs, since everything is automated and the time to get approved can be shortened.
Do you have questions about a new home loan? Give us a call at 972-772-7000 or email us at rockwall@kw.com.
Today's choices include banks, mortgage brokers, home builders, and Internet lenders. Each has its advantages and disadvantages, and rates vary from lender to lender.
Typically, most lenders do not keep money on hand but instantly sell conforming loans to third parties like the Federal National Mortgage Association (Fannie Mae) or the Federal Home Loan Mortgage Corporation (Freddie Mac). The most common source of home lending is a retail financial institution or credit union. They offer specific loan products and handle their own direct financing by taking consumer deposits and lending them to home buyers.
Mortgage brokers, on the other hand, act as the middleman and don't fund the loans themselves, but handle the mortgage financing for the borrower. Most earn their fees directly as a percentage from the lender and some from the borrower, or a combination of both. Since mortgage brokers have access to a wide variety of lenders they are usually on top of the latest rates, fees and lending practices.
Home builder financing is common in new developments where there is a single builder. The builder carries the construction costs until the homes are built. The builder works with a lender to set-up financing for the buyer and finances the construction costs. The buyer doesn't make mortgage payments until the property is finished.
The popularity of finding a mortgage on the Internet mortgage has grown in recent years. Many lenders offer competitive rates and the convenience of tracking your application through the approval process. Some can save you a significant amount in closing costs, since everything is automated and the time to get approved can be shortened.
Do you have questions about a new home loan? Give us a call at 972-772-7000 or email us at rockwall@kw.com.
Wednesday, November 17, 2010
Down Payment Options
Provided By iforma Research Services
Source Yahoo! Real Estate
One of the components a lender uses to help determine what loan amount to approve is your down payment. A down payment not only serves as a commitment on a borrower.s behalf to make good on a loan, but acts as a lender.s guarantee to minimize risk in case a borrower defaults on a loan. The more of your own cash that you can put down for a loan, the easier it is to qualify for a higher loan amount or a lower mortgage payment.
Alternative sources of funding
Since most borrowers do not have large cash reserves on-hand for a down payment, there are other alternative sources for funding. Besides tapping into your own savings accounts, other resources may include friends, relatives, 401(k) plans, proceeds from stock sales, appraised assets, even a co-signer.
Many cities, looking to expand their communities, even offer their own down payment subsidy programs for cash-strapped buyers. It.s not uncommon to be gifted $5,000 to $10,000 without expectation of re-payment.
Loan-to-value ratio
A down payment is always expressed as a percent of the sales price and often referred to by lenders at the .loan-to-value ratio. or LTV. For instance, a $250,000 mortgage with an LTV of 80 percent would require 20 percent down or $50,000. Using a down payment calculator can help you see what influence a different down payment can have on your monthly mortgage.
Other down payment options
Some banks even offer zero-down percentage loans which require no down payment. These types of loans are typically directed at first-time buyers with good credit who are qualified to make the monthly payment but cannot come up with a down payment. However, without a down payment the buyer has no equity in the house and the lender is at greater risk, so the interest rate could be higher.
Another alternative to buying a home without committing to a down payment is to consider a lease option to buy. As a renter, you have an option anytime during the term of the lease, to buy the property at an agreed upon price from the owner. In some instances, the money you.ve put toward rent can be fully or partially applied toward the down payment.
Sellers can also assist buyers with their down payment. By offering a carry-back mortgage, sellers can sell their house faster in a competitive market and buyers can purchase a home they otherwise might not be able to afford.
Do you have questions about all your down payment options? Give us a call at 972-772-7000 or email us at rockwall@kw.com.
Source Yahoo! Real Estate
One of the components a lender uses to help determine what loan amount to approve is your down payment. A down payment not only serves as a commitment on a borrower.s behalf to make good on a loan, but acts as a lender.s guarantee to minimize risk in case a borrower defaults on a loan. The more of your own cash that you can put down for a loan, the easier it is to qualify for a higher loan amount or a lower mortgage payment.
Alternative sources of funding
Since most borrowers do not have large cash reserves on-hand for a down payment, there are other alternative sources for funding. Besides tapping into your own savings accounts, other resources may include friends, relatives, 401(k) plans, proceeds from stock sales, appraised assets, even a co-signer.
Many cities, looking to expand their communities, even offer their own down payment subsidy programs for cash-strapped buyers. It.s not uncommon to be gifted $5,000 to $10,000 without expectation of re-payment.
Loan-to-value ratio
A down payment is always expressed as a percent of the sales price and often referred to by lenders at the .loan-to-value ratio. or LTV. For instance, a $250,000 mortgage with an LTV of 80 percent would require 20 percent down or $50,000. Using a down payment calculator can help you see what influence a different down payment can have on your monthly mortgage.
Other down payment options
Some banks even offer zero-down percentage loans which require no down payment. These types of loans are typically directed at first-time buyers with good credit who are qualified to make the monthly payment but cannot come up with a down payment. However, without a down payment the buyer has no equity in the house and the lender is at greater risk, so the interest rate could be higher.
Another alternative to buying a home without committing to a down payment is to consider a lease option to buy. As a renter, you have an option anytime during the term of the lease, to buy the property at an agreed upon price from the owner. In some instances, the money you.ve put toward rent can be fully or partially applied toward the down payment.
Sellers can also assist buyers with their down payment. By offering a carry-back mortgage, sellers can sell their house faster in a competitive market and buyers can purchase a home they otherwise might not be able to afford.
Do you have questions about all your down payment options? Give us a call at 972-772-7000 or email us at rockwall@kw.com.
Monday, July 12, 2010
How much home can you afford?
Published By Morris Communications
Provided By Dallas Morning News
Whether you can afford the home you've always wanted will boil down to a simple factor: How much you make versus how much you owe.
Lenders are not eager to extend loans to borrowers who will become overloaded by taking on more debt, so there are some general guidelines to keep in mind when pursuing a home loan.
Determine your monthly gross income, which includes regular monies that can be documented. Remember that income that can't be documented can't be used to qualify for a loan. However, unearned sources, such as alimony and lottery payments, can be used as well as income-producing assets, such as stocks or real estate. If you have questions, ask a loan officer to help you with the rules.
After you've figured how much you make, calculate how much you owe. This is all monthly debt obligations such as credit cards, installment loans, personal debts or other monthly obligations such as alimony or child support. Debts that will be paid off in fewer than six months don't have to be considered.
Although each lender has his or her own formula, generally speaking, monthly housing expenses, including monthly payments for taxes and insurance, shouldn't be in excess of 28 percent of the gross monthly income. Additionally, the proposed monthly housing expense and total debt obligation can't exceed 36 percent of the gross monthly income. If it does, the loan may not be approved.
However, there are numerous types of loan programs available, and each one has different guidelines, so don't get discouraged by the process if your first choice doesn't work out. Keep shopping around.
Your down payment can have tremendous impact on your ability to qualify for a loan. The greater percentage of down payment that you can make, the smaller the monthly payment you will pay. Likewise, closing costs, which can vary from 2 to 5 percent of the asking price of the home, also are part of the financial obligation that comes with purchasing a home.
To determine how much you can afford:
-Determine your gross monthly income.
-Calculate your monthly debt obligations.
-Generally, monthly housing cost should not exceed 28 percent of gross monthly income.
-Proposed monthly housing cost and monthly debt obligations combined should not exceed 36 percent of gross monthly income.
-Questions? Ask a qualified loan officer for help.
-How much of a down payment can you afford? The more money down up front, the smaller the monthly mortgage payment.
-Ask about closing costs.
Do you have questions about buying a home, would you like quick and honest answers? Give us a call at 972-772-7000 or email us at rockwall@kw.com.
Provided By Dallas Morning News
Whether you can afford the home you've always wanted will boil down to a simple factor: How much you make versus how much you owe.
Lenders are not eager to extend loans to borrowers who will become overloaded by taking on more debt, so there are some general guidelines to keep in mind when pursuing a home loan.
Determine your monthly gross income, which includes regular monies that can be documented. Remember that income that can't be documented can't be used to qualify for a loan. However, unearned sources, such as alimony and lottery payments, can be used as well as income-producing assets, such as stocks or real estate. If you have questions, ask a loan officer to help you with the rules.
After you've figured how much you make, calculate how much you owe. This is all monthly debt obligations such as credit cards, installment loans, personal debts or other monthly obligations such as alimony or child support. Debts that will be paid off in fewer than six months don't have to be considered.
Although each lender has his or her own formula, generally speaking, monthly housing expenses, including monthly payments for taxes and insurance, shouldn't be in excess of 28 percent of the gross monthly income. Additionally, the proposed monthly housing expense and total debt obligation can't exceed 36 percent of the gross monthly income. If it does, the loan may not be approved.
However, there are numerous types of loan programs available, and each one has different guidelines, so don't get discouraged by the process if your first choice doesn't work out. Keep shopping around.
Your down payment can have tremendous impact on your ability to qualify for a loan. The greater percentage of down payment that you can make, the smaller the monthly payment you will pay. Likewise, closing costs, which can vary from 2 to 5 percent of the asking price of the home, also are part of the financial obligation that comes with purchasing a home.
To determine how much you can afford:
-Determine your gross monthly income.
-Calculate your monthly debt obligations.
-Generally, monthly housing cost should not exceed 28 percent of gross monthly income.
-Proposed monthly housing cost and monthly debt obligations combined should not exceed 36 percent of gross monthly income.
-Questions? Ask a qualified loan officer for help.
-How much of a down payment can you afford? The more money down up front, the smaller the monthly mortgage payment.
-Ask about closing costs.
Do you have questions about buying a home, would you like quick and honest answers? Give us a call at 972-772-7000 or email us at rockwall@kw.com.
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