Currently on the market, there are many varieties of mortgage loans available. Sometimes it can be difficult to tell which mortgage loan is suitable and applicable to you.
I will discuss the 3 main types of mortgage loans on the market. Most banks and lenders offer mortgage loans that belong to one of these categories.
1. Fixed Mortgage Loan
Fixed mortgage loans are the most popular and common among the three types of mortgage loan.
You take out a mortgage loan with a lender and you pay a certain repayment amount for a fixed period of time. Most people usually choose 30 year fixed mortgage loans as the monthly repayment amounts are low and the interest rates usually evens out in a 30 year period.
One disadvantage of 30 year fixed mortgage loan is you have to repay more for your mortgage loan in total compared to someone who takes up a 15 or 5 year loan.
There are also shorter time periods such as 5 year, 10 or 15 years fixed mortgage loans. It allows people who want to pay off their house in a shorter period of time. Of course, you have to make sure you have the financial capability to repay higher monthly repayments.
There is also another sub-category of mortgage loan called adjustable rate mortgage loan or ARM. Usually, you will start off with a lower interest rate compared to a 30 year fixed mortgage loan. So you ended up paying less each month for your mortgage repayment.
However take note that ARM is highly fluctuating depending on interest rates. In other words, you pay less for monthly repayment when interest is low and pay more when interest rates is high.
2. Convertible Loans
Convertible loans are becoming more popular as it allows people to keep their mortgage loan options open allowing for more flexibility.
If you find interest rates are too high, you can convert to a fixed rate mortgage loan. If interest rates are low, you can also convert to ARM based mortgage loans.
There are too many varieties of convertible loans under this category. However I list one type of convertible loans I dealt with.
Balloon Loan
A balloon loan is a fixed rate convertible loan. Usually, you start off by repaying small monthly repayments for a period of years, usually 5 or 7 years. At the end of that period, you will need to repay the loan in one lump sum.
So what’s the advantage of a balloon loan? It is mostly used by investors or property dealers who are looking to sell the house in a short period of time. They can take advantage of low interest rates without locking their money on a house. Since they will have a large sum of money when they sell the house, it will not be a problem to return the lump sum.
3. Special mortgage loans
These are mortgage loans that are only being offered to a group of people. For example the FHA mortgage loans are only available for first time home buyers or people with bad credit.
Another one is the veteran affairs mortgage loan. They are only offered to widows of the US armed forces.
The best way to know whether you qualify or is suitable for a mortgage loan is to speak to a professional mortgage consultant before you decide to take up any mortgage offer
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Help answer the question about mortgage loan
Can the bank apply a payment for mortgage to another loan?We have (2) loans, our mortgage and a line of credit on our home equity. My husband lost his job and we were trying to keep up the payments on our mortgage. When he paid a payment he used a payment coupon for the mortgage loan. Instead of applying the whole payment to our mortgage, the bank put some of the payment towards (1) month of the mortgage loan and the rest towards the home equity loan. So now we are still (1) month behind on our mortgage payment and the home equity loan is paid for about (4) months ahead of time. We are trying our best to keep this house.
Yes my husband used a payment coupon with the loan number on it and he received a receipt for the amount and the loan number was on the receipt also.
If you plan on staying there less than 3 years then go for it. Otherwise go for a Coventional-Fixed.
No and if the judgement is still showing up he will not be approved for a VA loan or any other type of mortgage. To get the VA loan he has to be in the reserves for 6 years and then after the 6 years he will be able to receive the VA loan
No matter what your plans are, I wouldn't sign on for an ARM with the speculation that you will be upgrading in 3-5 years.
And please don't go to those in here spamming for business.
There are plenty of first time home buyer programs that, unless I miss my guess, you will be well qualified for.
Ask friends and family members for recommendations on a lender. If you don't get any, go with local lenders whose name you recognize. Compare everything to make sure you are getting an apples to apples comparison, rate, closing costs, pre-payment penalties, transaction fees, etc..
It will pay huge dividends to obtain a reputable lender, rather than one who tries to fit you into a loan program they make the most money on.
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Ampedee, I’m a mortgage broker and banker. I used to work for one of the largest banks in the country and to be honest our fees and costs were so much higher than brokers. Large banks spend money on advertising and pay salaries.
What is the Key disfavors by Having Your Mortgage
realmortgagepaid.blogspot. com
Average does not matter. Some lenders look at the lowest, some the mid. Your spouse's scores are bad, only just good enough for an FHA loan. Yours are better but not great. Really, you need scores over 700. You should wait until your scores are better.
hoyl hell this guy is a good sales man, but being in the mortgage industry my sell i see right through alot of his bulshit. GETTING YOUR LOAN THROUGH A BROKER MEANS UR GOING TO PAY MORE IN FEES, BECAUSE THAT LOANS GOING TO JUST END UP AT ONE OF THE BIGGER BANKS IN THE LONG RUN ANWAYS…..
It might be possible but I'm betting that the seller of your mortgage discounted it to the buyer due to the points you paid. I doubt that they would be willing to sell it at a discount, I guess let you pay it off at a discount is the proper way of looking at it. Trashing your credit is the absolute wrong thing to do, it won't help you, it's a loan with a term and probably not callable so don't do that. Since you ate the points and are paying what you are I think you should live with it.
very professional response b of a.
Hey Bank of America! You didn’t do squat for me and my husband. You promised the world but delivered nothing. So why don’t you get off this website and go do somethingproductive??? Like….get an education!
mortgageartist. com
The best thing you can do is arm yourself with knowledge, even better if it’s free. a little time and a few clicks now could save you years and thousands of dollars later.
the choices you make today define your tommorow.
Well, I just have a couple comments.
1. Look up Project Hope on the internet. I have the number at work, and I'll try to remember to come back and add it, but I'm getting old and forgetful. They may be able to help you if you're at least 3 months in arrears.
2. Sad news here…except for reverse mortgages, and maybe a mortgage your mother makes for you, ALL mortgages are recourse loans. When I lend you $XXX,XXX I expect you to pay me that much money. If you sell your house for less than that, you still owe me the difference. I expect you to do whatever it takes to get that money for me. Every loan except reverse mortgage works that way.
3. The 20% loan. Your loan docs, the ones you signed, say if it's payable in 3 years. You should have read them before you signed them.
Young and inexperienced maybe, but you could have asked someone for help. Smartfit is a Wells Fargo product, so I don't know anything about it. I can't see how both loans could be considered home equity loans. One should have been a purchase money 1st and the other a purchase money 2nd. I guess WF could do something funky but it's not the standard process. The 2nd is usually regarded as a cash out loan, but not home equity. Semantics to you maybe, but it's important in loan processing circles.
I've never liked 80/20 loans because you're not putting any of your own money into the purchase. On an 80/10/10, you're coughing up 10% of the purchase price, and have a greater stake in the property.
Do you have 401(k)? You may be able to make yourselves loans from them, and then you pay them back through payroll deduction. Not a great idea, but if you're young you'll have time to replace what you use now
Is there a question here?
Keep your payments up-to-date and you should be good. Don't get more credit. A score of 750+ is average for a good IR. Just keep showing the credit companies that you can be trusted to repay loans. Now is a good time to pull all three of your credit reports and analyze them. Correct any errors and make sure everything is correct.