January 31st, 2010 admin Posted in finance |
By Thomas Kadlec
Every consumer who has thought about a refinancing should take advantage of these times and refinance now.
What is refinancing? Most homeowners have heard of the process and know a little bit about it but aren’t sure what option is right for them and their specific situation. Refinancing a home loan is the process of securing a new loan for your home, usually with better terms, and paying off the old loan. Most do it because it allows them to lower their interest rates and/or monthly payments and can allow them to tap into the equity in their homes. Below is a list of your options as far as types of refinance loans.
1) Adjustable Rate Mortgage. With this loan, your rate of interest stays the same for a couple of years, then adjusts based on several economic factors. The rate could go up or it could go down. Most times, it goes up. Only choose this option if you are fairly certain it will go down.
2) Fixed Rate Mortgage. Your interest rate and monthly payment never change. There are no surprises with this loan, but the rate of interest is significantly higher than it is with an adjustable rate mortgage. Choose this loan if the rate being offered to you is less than the one you currently have.
3) Balloon Loan. This type of refinance loan is the perfect option for some homeowners because it offers them low monthly payments for an extended amount of time. The rate is fixed for between five and ten years. After that predetermined time is up, the full loan amount is due in one “balloon” payment. The best thing about this loan is that the fixed interest rate is very low. This loan takes a lot of strategy and planning to make work.
4) Home Equity Loan. This loan offers you a fixed interest rate so your monthly payments never change and allows you to pull out money from the equity in your home. This is the best way to get cash for renovations or investments, while keeping your monthly payment manageable and consistent.
5) Line of Credit. This is basically a loan from the lender to you, using your home’s equity as collateral. The payments you make are almost always interest only. This isn’t technically a refinance loan.
Call Today for one on one help with your mortgage. (719) 494-8280 or Visit: www.MagnumClosesLoans.com to get the best deal on your mortgage in Castle Rock
www.MagnumClosesLoans.com
Thomas P Kadlec
“your Home loan specialist”
Since 1993
(719) 494 - 8280
Getting Cash In On Cash-Out Refinance Mortgage Program
By Anthony Russell
What is meant by cash-out refinance mortgage?
It is a mortgage refinance transaction wherein the new loan amount is more than the existing mortgage amount, including the closing costs. Usually, the main purpose of a cash-out refinance is to extract equity from the house. It acts as an alternative to a home equity loan. It has become a popular method for borrowers to pay back credit card debts, or meet added expenses.
There are two ways to carry out cash-out mortgage refinancing. One is as HELOC - Home Equity Line Of Credit. That is, a line of credit is extended to a homeowner that uses the house as collateral. Once a maximum loan balance is reached, the homeowner may withdraw on the line of credit at his/ her discretion. Based on the current prime rates, a variable rate is calculated, and that is applied as the interest rate. Another method is to refinance the existing mortgage into two smaller loans.Bad credit mortgage refinance is also available.
Let us understand cash-out refinance mortgage with some examples.
Suppose, Mr. John Smith has a house worth $400,000. And the current loan balance on the house is $100,000. This implies that Mr. Smith owns seventy-five percent of his house. That is, as a homeowner, he has $300,000 worth of equity. If he can redeem that equity by a cash-out refinance.
An example to understand HELOC:
Suppose, Ms. Julie Anderson owns a home of value $600,000. She has a lien of $300,000. So, her equity comes out to be $300,000. Now, she avails a second mortgage of $100,000. This increases her existing liens to $400,000, and decreases her equity to $200,000. She can further use this in line of credit to get a loan. Here, the first and second mortgages are considered as separate loans, which are to be paid off under different terms and conditions.
An example to understand refinancing an existing loan, and adding cash-out into a single loan:
Suppose, Ms. Anderson refinances the original $400,000 loan, and additional $100,000 cash-out to meet some bill expenses. So, the new loan amount becomes $500,000. However, this is considered as a different loan altogether. This new $500,000 loan will have a new rate, and new set of conditions.
How to decide which home refinance method to opt for?
It depends on the interest rates. If the existing rate on the loan is higher than current rates, then the refinancing home as in third example will be beneficial. However, if the current rates are higher, then it is better to refinance as in the second example. It will leave the first mortgage unaffected, and only the second mortgage will have the higher rates. Homeowners execute cash-out for a variety of reasons. Paying off high rate credit card debts is the most common reason. Paying college fees, purchasing another property, or vacation are a few other reasons. A home improvement is another popular reason. Homeowners pull out cash from their home equity, and invest it back into the house itself. A renovation will increase the value of their home, and subsequently, increase the equity.
VA Loans Houston also offers VA Refinance Loans Programs. VA Refinance loan is most benefit in marketplace with low interest rate. They help you in monthly mortgage payments to meet your financial level in VA Refinance Loan. It is our pledge to provide customers with a team of highly-trained VA Mortgage Professionals, coupled with an exceptional level of service. Our dedicated loan officers and VA Specialists work hard to ensure the process goes as smoothly as possible. VA Loan Houston satisfied many Veterans for Home and Mortgage Loans.
A VA Streamline Refinance, also know as an IRRL (Interest Rate Reduction Loan), is an easy way to reduce your mortgage payment and save you a lot of money. A streamline refinance can be done WITHOUT an appraisal, NO income verification, and NO out-of-pocket expense. We also refinance your conventional loan to a VA loan and save your money by REMOVING your monthly MORTGAGE INSURANCE and LOWERING your interest rate. Removing your mortgage insurance is typically the equivalent of lowering your interest rate by 1%. Refinancing into a VA loan CAN and WILL save you money each and every month. On October 10th, 2008 the President signed into law the Veterans’ Benefits Improvement Act of 2008. This law now allows eligible veterans to take out up to 100% of the value of their home to pay off their debt, make home improvements, or get cash back while reducing their rate.
1. Equal opportunity.
2. No down payment (unless required by the lender or the purchase price is more than the reasonable value of the property).
3. Buyer informed of reasonable value.
4. Negotiable interest rate.
5. Ability to finance the VA funding fee (plus reduced funding fees with a down payment of at least 5% and exemption for veterans receiving VA compensation).
6. Closing costs are comparable with other financing types (and may be lower).
7. No mortgage insurance premiums.
8. An assumable mortgage.
9. Right to prepay without penalty.
10. For homes inspected by VA during construction, a warranty from builder and assistance from VA to obtain cooperation of builder.
11. VA assistance to veteran borrowers in default due to temporary financial difficulty.
1. Interest Rate Reduction Refinancing Loans = .50%
2. Manufactured Home Loans = 1.00%
3. Loan Assumptions = .50%
Call VA Loan Houston at anytime and we have VA Loan Professionals waiting to help you get started with the VA Loan process. We are available from 8am to 7pm (central time) Monday thru Friday. If it is outside these hours, please use this form to get in touch with us. We look forward to working with you!
VA Loan Houston - We are Houston VA Home Mortgage Loans experts to get a Houston Veterans Mortgage Home Loan.
Our Website is http://www.valoanshouston.com/
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