Showing posts with label mortage loans real estate mortgage lenders mortages. Show all posts
Showing posts with label mortage loans real estate mortgage lenders mortages. Show all posts
Friday, March 12, 2010
Understanding Points, Rates and Points
10:41 AM | 
Posted by
RaleighCaryNCNewHomes
Posted by
RaleighCaryNCNewHomes
Understanding Points, Rates and Points You do you have to understand what type of mortgage you should choose, you have to understand the costs associated with your mortgage. All of these costs will be paid upon closing your mortgage.
Purchase Points
Purchase points, also known as a "buy-down" or "discount points," are an up-front fee paid to the lender at closing to buy-down or lower your interest rate over the life of the loan. Each point is equal to one percent of your total loan amount. If you have a $100,000 loan, one point would equal $1,000. The more points you buy, the lower your interest rate, but the more money you'll need at closing.
How do you decide whether you should buy points and if so, how many? Well, the decision should be based on how long you plan on living in your home and what you can afford to pay each month toward your mortgage. If you plan on living in your home for more than five years, it's probably a good idea to purchase points. The longer you live in your home, the more you can save on interest over the life of the loan.
Interest Rate
When you get a mortgage, you are charged an interest rate.this is the rate which the lender charges you for using their money to buy a home. It determines how much your monthly payments will be. Generally speaking, the higher the interest rate, the higher your monthly payment.
Mortgage interest rates change constantly.daily, even hourly. If you speak to a lender and are quoted a specific interest rate, that's not to say you'll necessarily get that rate when you close on your loan. Not unless you formally lock-in that rate with the lender.locking in an interest rate will guarantee you get your loan with a particular interest rate. Lenders will allow you to lock in for 15, 45 or 60 days. But the longer you lock in, the more expensive it will be, since it's more of a risk to lenders.
Fees
There are always fees associated with getting a mortgage, these fees cover the cost of processing and underwriting the loan. These fees can include charges for ensuring the title to the home is free and clear; paying for a land survey; or paying for a home appraisal which gives you the estimated value of the property (lenders require an appraisal to close on your mortgage).
Deciding which mortgage to get may depend on what each lender does because different lenders may charge different amounts. Some may charge lesser closing fees to lure you in, but may charge you a higher interest rate, which means you may pay more in the long run. But everyone has different needs.you may or may not be able to afford to pay more at closing and are willing to pay more over the long term.
Before it comes time to close, do your homework, make sure there are no hidden fees, and ask your lender lots of questions so that you understand all the costs involved with your mortgage.
*Please consult your tax advisor.
Purchase Points
Purchase points, also known as a "buy-down" or "discount points," are an up-front fee paid to the lender at closing to buy-down or lower your interest rate over the life of the loan. Each point is equal to one percent of your total loan amount. If you have a $100,000 loan, one point would equal $1,000. The more points you buy, the lower your interest rate, but the more money you'll need at closing.
How do you decide whether you should buy points and if so, how many? Well, the decision should be based on how long you plan on living in your home and what you can afford to pay each month toward your mortgage. If you plan on living in your home for more than five years, it's probably a good idea to purchase points. The longer you live in your home, the more you can save on interest over the life of the loan.
Interest Rate
When you get a mortgage, you are charged an interest rate.this is the rate which the lender charges you for using their money to buy a home. It determines how much your monthly payments will be. Generally speaking, the higher the interest rate, the higher your monthly payment.
Mortgage interest rates change constantly.daily, even hourly. If you speak to a lender and are quoted a specific interest rate, that's not to say you'll necessarily get that rate when you close on your loan. Not unless you formally lock-in that rate with the lender.locking in an interest rate will guarantee you get your loan with a particular interest rate. Lenders will allow you to lock in for 15, 45 or 60 days. But the longer you lock in, the more expensive it will be, since it's more of a risk to lenders.
Fees
There are always fees associated with getting a mortgage, these fees cover the cost of processing and underwriting the loan. These fees can include charges for ensuring the title to the home is free and clear; paying for a land survey; or paying for a home appraisal which gives you the estimated value of the property (lenders require an appraisal to close on your mortgage).
Deciding which mortgage to get may depend on what each lender does because different lenders may charge different amounts. Some may charge lesser closing fees to lure you in, but may charge you a higher interest rate, which means you may pay more in the long run. But everyone has different needs.you may or may not be able to afford to pay more at closing and are willing to pay more over the long term.
Before it comes time to close, do your homework, make sure there are no hidden fees, and ask your lender lots of questions so that you understand all the costs involved with your mortgage.
*Please consult your tax advisor.
Wednesday, February 25, 2009
Can you still Borrow Money?
10:59 AM |
Posted by
RaleighCaryNCNewHomes
Posted by
RaleighCaryNCNewHomes
Credit Scores
1. Credit scores below the ‘excellent’ (at least 720) range will likely result in higher interest rates, more discount points at closing or potentially, denial of the application.
2. Down payment requirements are at a minimum of 25 percent on just about everything, even duplexes. (If you know of a legitimate source for 10 percent down, let us know.)
3. Investment property rates have dropped a little since November and are now in the range of 6.75 - 7.25 percent without adjusting for credit scores and other ‘risk factors’ as determined by the lender.
4. Lenders are also beginning to require points to be paid on some loans rather than offering it as an option to buy down the rate. This is likely an effort to reduce speculative short term strategies.
5. If you have four (4) or more residential mortgages, you cannot get another residential loan (and yes, your primary residence counts). You will have to seek alternative sources of financing such as commercial loan products, seller financing, or private equity.
Commercial Loans
1. Rates seem to be hovering in the 6.25 - 6.5 percent range for your typical loan, amortized over 15 to 20 years with a 5- to 7-year call.
2. Down payment requirements are typically 20.
2. There are no limits on the number of commercial loans a bank can give you. Any limit they impose would generally be at the discretion of the bank.
3. Commercial banks, especially local, privately owned institutions value relationships and continue to show a willingness to be ‘flexible’ relative to residential mortgage lenders. These banks are not boxed in by third-party regulations and can still make loans if the borrower is strong and they value the relationship with the client.
Subscribe to:
Posts (Atom)
TruliaMap
TruliaSearchbox
Find my Dream Home
Subscribe To New Homes In North Carolina
Posts
All Comments
Photos of North Carolina
