Home Mortgages Refinance Is Not Always A Good Idea

The home mortgage refinance means, that a borrower will take a new loan and pay away all the old ones. The target is to get the waited benefits. Most people are after the lower monthly payments in the form of the lower interest rates. But, why the home mortgages refinance is not always a wise idea?

1. The Recession Has Decreased The Value Of Your Property.

The appraised value of the home is usually the guarantee for the home loan. Now when you want to do the home mortgage refinance it may happen, that the appraised value has fallen. Usually you can refinance 80 % of the appraised value but it can happen that the present loan is more than that and you cannot pay with the new loan the old loan.

The right solution is to wait, because during the long term the home prices have always risen. Already a couple of years waiting time can bring the home prices to levels, where it is reasonable to do the home mortgage refinance.

2. If You Have Almost Paid Off The Old Loans.

You cannot win anything, if you have almost paid off the old loans. Let us say, that you have a 30 year mortgages and you have paid that for 29 years, it is not wise to refinance the loan, because the time, when you can enjoy about the benefits is simply too short, but still you have to pay the costs.

3. If You Have Taken A Second Loan.

If you have tried to easy your financial burden by taking a second mortgage or a home equity loan and used the free equity, it is not wise to try the home mortgage refinance. It works best, when you have enough equity and you will live in the home for years and you have a lot of years to pay the new loan.

4. If You Have Only A Couple Of Years To Pay.

The starting point of the home mortgage refinance is, that it is a long term commitment. When the refinancing has costs, the future benefits will cover these costs little by little. This simply means, that you have to keep the loan long enough and if you have only a few years to pay, the refinancing is not reasonable.

5. If You Want Only A Small Monthly Savings.

If you have heard news or gossips about the great savings from the home mortgage refinance and are enthusiastic to get the same benefits, maybe you have to think it over once more. If your extra cash need is a small one, the mortgage refinancing is not the right way to solve that need.



By: Juhani Tontti
Juhani Tontti, B.Sc., Marketing. The home mortgages refinance has pros and cons. It is wise to ask several quotes and to meet an expert to be able to refinance home mortgage loans correctly.
Visit: refinance mortgage loans http://www.refinancemortgageloansnow.com/

Why People Refinance Mortgages - An Essential Guide to Help You Save More Money

Getting a refinance mortgage with lower interest rates may not be easy. This is because loan companies do not just give you a good refinancing loan without first knowing your requirements. However, if you look closely and observe your own situation, getting a new refinance mortgage loan at lower interest rate can help you save a lot.

If you have acquired a home loan many years ago and still repaying it, it is time for you to reconsider whether it is beneficial for you to refinance your home loan. Most people feel that refinancing your current home loan is a good way of getting a loan at lower interest rate.

Before deciding whether you should refinance your current home loan, here are some of the common reasons why people go for such refinancing schemes which you should know.

Getting Benefits From Their Improved Credit Rating

For some people, they may have got the home loan years ago despite their poor credit ratings in the past. However, at the time when they acquired the loan, the interest rates could be quite high because of their bad credit history. As a result, they have to bear the cost of paying the high interest over the years.

However, if these people with bad credit repay the home loans on time over these years, their credit score definitely have improved. Because of their improved credit ratings, it is more sensible and logical to refinance the home loans with lower interest rates. This way, it could help save a lot of money and it is never ideal and not logical to continue repaying the high interest rates home loans that they acquired when they have a bad credit history.

Changing Adjustable Rate To Fixed Rate Mortgage

If initially you have acquired an adjustable rate mortgage, you may think to switch to a fixed rate mortgage. An ARM (adjustable rate mortgage) may seem to look attractive in the beginning, but the rate can change over the time, depending on various factors. Such rate can change twice in a year decided by the Federal Reserve.

On the other hand, fixed rate mortgage rate never changed and generally the rate will be lower over the years. If you want to change from an adjustable rate mortgage to a fixed one, you may need to refinance your current home loan.

Cash Out To Repay Other Debts With The Refinancing Home Loan

Another reason why people want to refinance at a lower rate because they are able to cash out some money on closing. These cash out money could then be used to repay some other debts that they may have.

For whatever reason to go for a refinancing home loan, it can definitely help you save a lot of money.



By: Julian Lim
If you think of acquiring a Refinance Home Mortgage but have a bad credit history, it is still possible. Go here today to find out more: http://www.bad-credit-home-mortgage-loan-refinance.com/

What You Need to Know About Balloon Mortgages

To overcome the major challenges, homeowners are provided with different opportunities to get different home loans. You have the option to choose a loan that is suitable for your capacity to pay. And one of the most preferable choices available for you is a balloon mortgages. It is important that you understand the features of this loan to determine if it is perfect for your situation.

What Is A Balloon Mortgage?

A balloon mortgage combines the features of 30 year (or 15 year) conventional fixed rate home loan at a lower start rate with a preset early payoff date. This preset payoff date is the date when the loan comes due and payable in one lump sum often called a balloon payment...hence the same balloon mortgage.

Because of this preset early payoff date, a balloon loan has a serious disadvantage that fully amortized mortgage do not carry. Of course, in the US the average home loan is retired via sale or refinance within 7 years anyway, so many advocates of balloon home loan are saying US borrowers are not taking advantage of the lower rate and are paying for time they never use.

When you get a balloon home loan, you will be given a fixed period to pay the loan at specific interest rate. So you will pay a fixed interest rate for the mortgage for either 5 years or 7 years. But after the fixed period, the mortgage becomes due.

If you want to stay in the home, this means you have to refinance or get a different home loan with interest rates subject to the current market rates. The balloon mortgage therefore forcing decision making sometime in the future where housing and interest rate markets are unknown.

The Benefits of Balloon Mortgages

When you get a balloon mortgage, you will enjoy lower monthly payments with lower interest rates for a specified period. This is one of the biggest advantages of this type of home loan. The fixed rates and the low monthly payments will give you the needed peace of mind. That is because your mortgage is predictable which will enable you to better manage your finances.

The typical fixed rate period for this type of loan is 5 to 7 years. During this time, you will know the exact amount that you have to set aside for the mortgage monthly. A balloon mortgage therefore will give you the opportunity to save some cash.

The Disadvantages of a Balloon Mortgage

A balloon home loan however has some major risks that should not be taken for granted. One of the biggest risks is the possibility of failing to get a suitable refinancing home loan when the mortgage becomes due. There are so many reasons why you might fail to secure a refinancing.

First of all, property values are very unstable. The value of your home could decline drastically which will prevent you from getting a new home loan. Another risk is the possibility of losing your job or your current income may not be sufficient to qualify for a refinancing or new mortgages. These are the risk factors that must be considered before you apply for a balloon type home loan.

A balloon mortgage is a suitable loan option for many homeowners. This type of mortgage however has certain risks that you must consider. If you are unable to get a new home loan when the balloon payment becomes due, and the housing market in you location will not allow you to sell for enough to cover the existing mortgage, there is a good possibility that you could lose your home by the lender forced to foreclose.



By: Rob K. Blake
Rob K. Blake, refinance expert and author, educates mortgage shoppers on finding local providers by state like West Virginia Mortgage Brokers and Lenders and provides reviews of national companies like Asset Acceptance Capital Corp. http://themortgageinsider.net/mortgage-reviews/asset-acceptance-capital-corp-review.html

Muslim Mortgages - An Opportunity For Investors and Islam

The question facing money-lenders who recognize the huge purchasing power of one of the most rapidly growing religions in Canada - Muslims - is, how do you lend money to someone whose religious beliefs ban the creation of money by money?

Not unlike the Christian faith, Islamic law takes a dim view of usury. In the Islamic world, the charging or paying of interest is equated to usury. So, a conventional loan or mortgages would violate the teachings of the Koran.

On the other hand, the Koran does allow money to be used in trading or investing, to generate a profit. Specifically, Islamic beliefs allow for investment based on "partnerships," in which risk and profit are shared by the parties.

For the past six years, United Kingdom banks have been offering a form of Muslim mortgages, based on two Islamic principles of Ijara and Mudaraba.

Canada and the USA have entered the Islamic mortgages market slowly; a surprise given that the number of Muslims in Canada in 2006 was estimated at 783,700, and expected to grow by over 160% by 2017.

Indeed, Muslim mortgages have been offered by one small Ontario company since 2007. That company claims to have a 5,000-person waiting list. It is difficult to dispute or challenge that claim, given that 23% of Canadian Muslims call Ontario "home."

Also in 2007, the Bank of Nova Scotia and the Toronto Dominion Bank began active exploration of the viability of providing mortgages that meet the requirements of those of the Islamic faith. In 2010, the Assiniboine Credit Union in Winnipeg began offering its version of the Muslim mortgages. It is too soon to gauge how well these products will be received.

A major impediment to the success of the mortgage concept is the CMHC insurance that is required on most home loans with less than 25% equity. A study commissioned by the Canada Mortgage & Housing Corporation in 2007, and released this January, states emphatically, "CMHC Insurance business has no plans to insure Shari'a mortgages." It goes on to say that "(there is) little empirical evidence based on a sound methodology assumptions exists to accurately project what portion of the Canadian population would be interested in [using] Shari'a-compliant financing."



By: Robert Frederick Lee
Bob is a former business consultant who has spearheaded planning & construction of cooperative housing, seniors housing, non-profit facilities and retrofit programs for homeowners across Canada. Since his retirement, he and his wife have built an innovative yurt design in which they live whenever they are not travelling across North America. Currently, Bob does freelance writing for Remax 2000 Toronto. Visit is blogs at http://torontochoicehomes.blogspot.com/ or http://movingtoayurt.blogspot.com/.

Fixed VS Variable Rate Mortgages

Mortgage Options: Understanding Fixed vs Variable Rate Mortgages

Choosing mortgages that's right for you is a big decision, and it's one that you can make with the help of a mortgage professional. By better understanding the different mortgage options available you'll be better informed before you begin the decision process. There are variable and fixed rate mortgages, and each of them has their own advantages and disadvantages.

Advantages of a Fixed Rate Mortgage:

1. Consistent payments for the term of your mortgage - your monthly payment doesn't change until the end of your fixed period. You never have to worry about lack of affordability and can stick to a reliable budget.

2. No impact from rising interest rates - with a fixed mortgage, it doesn't matter whether rates increase during your fixed term. Current rate will only affect you when it comes time to renew.

Disadvantages of a Fixed Rate Mortgage:

1. You can pay more than the current posted interest rate - interest rates can fall lower than your fixed rate, but on a fixed rate mortgage, you can't take advantage of them.

2. You always pay more than the standard variable rate - you pay more to get the advantage of consistent, fixed payments.

Advantage of a Variable Rate Mortgage:

1. You always pay the base interest rate - following a base interest rate means that you have a lower monthly payment when rates fall.

Disadvantages of Variable Rate Mortgages:

1. Your monthly payments can increase - if interest rates rise, it's possible that your payments will increase substantially.

Before settling on the type of mortgage that's right for you, discuss the options with a mortgage professional.



By: Ginette Pelletier
Did you find this article informative by Ginette Pelletier. She is an Ontario mortgage agent for the Mortgage Centre in Mississauga, Ontario. She can help you with your mortgage needs in the Brampton, Collingwood, Barrie, Wasaga and all of Ontario. She can help you facilitate any of your mortgage needs. Visit her site today for the best mortgage rates for your needs. http://www.gpmortgages.ca/

Things You Should Know About Second Mortgage

A second mortgage is an additional mortgage on a property where a primary mortgage already exists. They are secured against the same equity as the first mortgages. Therefore is based on the property's current value and the amount that is still owed. They are often granted by the lender of the first, but can be obtained from a different lender.

When choosing a second mortgage, there are typically three different types available. A traditional, where there is usually a fixed rate, and a term of 15- 30 years; a home equity line of credit, where the rate is typically adjustable and the funds are drawn as needed; and a home equity loan in which the borrower uses the equity of their home as collateral.

In a home equity loan, the equity of the home is usually reduced. To help determine which loan type is best, it is wise to speak with a competent mortgage broker.

In most cases, these mortgages are loaned at higher rates than those of first mortgages. The reason for this is due to the fact that the lender of the second mortgage is entering into a higher grade of risk. This increased risk does not directly correspond to the credit of the home buyer, but rather to the availability of funds the mortgagee can claim.

In the event of a default the property is sold, and the proceeds are applied to the repayment of the loan amount. Primary mortgages always take precedent over secondary mortgages; therefore mortgagee's have to await settlement of the first mortgage before any left over proceeds can be claimed.

This is what defines the second mortgage as a higher risk mortgage. In these mortgages not only is there a higher interest rate, but the second mortgage is also written for a shorter term than that of the first mortgage. Therefore, it is important to take appropriate precautions to ensure that the mortgage can be repaid on time.

This risk should always be carefully weighed when any mortgage, whether first or second, is being sought. A second mortgage can help relieve stress from financial crisis. A second mortgage can allow access to a home's equity. It is often acquired to make repairs or enhancements on a home, thus increasing the value of the property.

However it can be used for other non-related financial situations, such as paying off college tuition or lowering your debt load.



By: Paul Mangion
Did you enjoy this article by Paul Mangion on second mortgages? He is an Ontario mortgage broker for the Mortgage Centre in Mississauga, Ontario.They offer seamless solutions to all your mortgage needs. Visit his site today for the best mortgage rates for your situation. http://www.gtamortgagematters.com/

Small Houses and Even Smaller Mortgages

We all would love to live in a home of our choice and design but unfortunately sometimes we just can't afford to live in our dream homes. Seldom do our incomes exactly match our ambitious intentions for satisfying our hopes and dreams. Some of us have very few options due to a low income and lack of suitable information.

Have you realized that most people will not even have enough money to retire on? With that being said, even people of low income can have a house to call their own.

Don't lose hope, lose the mortgages and build your own home with plans for small inexpensive house designs and your own resourceful nature. Not only would you be owner of your home, but also have powerful financial leverage at your disposal.

Building your own inexpensive small house is not as difficult as you may think. You can easily find plans for small inexpensive house designs,begin building your own cheaper home and pay no more mortgages.

Sounds great, right! Wondering how you'll manage it?

The task of building your own small inexpensive house may seem challenging, but think of how rewarding it would be to actually do it. Because you can, in fact, build a small house without mortgages. There are whole communities of people doing that very thing.

Explore simple small house plans, especially if this is going to be your first home. Remember, the simpler the design, the more creativity you engage, the broader your ideas for building materials and resources, the less costly your brand new small house will be to build.

The savings in monthly expenses alone is enough to make you want to start building your own house. Very small house plans significantly reduce your environmental footprint, as do the plans for small inexpensive houses. Imagine your electricity bill between $30 and $60 every month, or use solar panels (and follow the DIY [do-it-yourself] solar plans method) to eliminate and even turn a profit from the electric company. Yes, they will buy energy from you.

You won't even owe a monthly mortgage when you build it yourself. If you decide to build your own inexpensive small house without the help of contractors, you own more than half the house because of the savings in labor cost. You are now able to borrow against the equity.

Imagine tens of thousands of dollars available to you for whatever reason regardless of your employment or credit worthiness. You're now able to open a revolving equity line of credit with low interest and a long pay-off schedule. This is a good security blanket if times get tough.

With the worldwide economy the way it is, the average used home price in America alone is around $250, 000. That's astounding once you factor in payments and bills for mortgages, utilities, property taxes, fees and regulations over 30 years.

Your home should enhance your lifestyle, not make you want to run from it. It should be a financial relief, not a financial burden. How it should be is how it could be if you take the time to consider building your own home and take a look at simple small house plans.




Written by Kim Magrath of http://www.LivingInSmallHouses.com

It Is Not Impossible to Get No Credit Check Mortgages

The reasons why you may need no credit check mortgages are many. Whatever the reason, you must be 100% sure that you are capable of paying back the money that you are taking else it is more advisable not to take such a mortgage.

It is not easy to find a mortgage loan of this kind. But it is not impossible as well. The main reason why it becomes tough to find a loaner of this sort is because such a loaner has to lend the money without being able to make any background checks about the person taking the mortgage.

When lending money, it is extremely important to do a background check about the person as it determines the stability of the person applying for the mortgages. Such kinds of checks determine whether the person who is taking mortgages will be able to pay back the mortgage loan or not.

Any loaner thus needs to be full aware of the 'stability points' of the individual that is applying for the mortgage loan. But when it comes to a mortgage of this kind, the loaner is almost in the dark and has no way of really determining whether or not the person opting for a mortgage without a credit check can actually pay off the loan.

But in spite of all the hurdles associated with a mortgage of this kind, it is still possible to get one. Of course, it is no way quite as easy as running to your local bank or a mortgage firm to get the 'normal' kind of mortgage.

You will have to do a lot of research and a lot of running around, but this cannot be helped. It would require you going that extra mile to find a mortgage lender who is offering no credit check mortgages. But, the trouble will be will worth it, as you will discover.



By: Andre Hansen
You can visit Andre Hansen's website at http://bankhelpsite.com/no-credit-check-mortgages-things-you-should-know/, where you can read more on his works about no credit check mortgages