Many things affect your mortgage rates:
1- FICO sores are at the top. They use the middle score. Prime rate is over 660-680, alt-A rate is between 620-to 680 and sub prime under 620. Each of those will give you a different rate. Actually 619 gives you a worse rate than 620 because it is consider a 610.
2- Mortgage history in the last 12-24 months: Were you on time every month for the last 12 months? Were you 1 time 30 days late (1X30), twice 30 days late (2X30), 60 days late (1X60), 90 days late (1X90) after that it is considered foreclosure. These affects your rate a lot!
3- How much will you borrow on the value of your house. If your house is valued at $200,000 (will need an appraisal)and you borrow $160,000, then you are at 80% Loan To Value (LTV). You will get a better rate than someone borrowing 90%, 95% or 100%. Anything under 80% is very good for the rate.
4- Debt to income ratio: How much comes in and how much goes out... No mortgage company will go over 55% but prime in way under that.
5- Did you have a bankruptcy? How long ago? Was it a Chapter 7 or 13?
As you can see, YOU cannot call a mortgage company and ask what kind of rate do you have because they have many kind of rates... They will need to pull your credit and see what is on it in order to tell you what rate YOU can get!
Enjoy!
Thursday, May 31, 2007
Wednesday, May 30, 2007
Why do I write about mortgages?
That is a good question. I worked for about 14 months in mortgages. I learned many things about mortgages. But most of all I learned what people should know about their mortgages before they go out and shop for one.
I must say 90% of the people I did a mortgage for didn’t know what they had and still don’t know what they have now. They only thing people ask is “what rate do you have?”… Mortgage companies don’t have a rate, YOU have a rate!
Many aspects of your life will influence your new mortgage rate. I will explain some of them in my next post!
Hopefully I will help a few people understand a little bit more!
Enjoy!
I must say 90% of the people I did a mortgage for didn’t know what they had and still don’t know what they have now. They only thing people ask is “what rate do you have?”… Mortgage companies don’t have a rate, YOU have a rate!
Many aspects of your life will influence your new mortgage rate. I will explain some of them in my next post!
Hopefully I will help a few people understand a little bit more!
Enjoy!
Sunday, May 27, 2007
What I'm preparing about Mortgages...
Here's a few things I'm working on about Mortgages, refinance and loans. I will write about:
1- Why I give those tricks about mortgages?
2- What affects your mortgage rates?
3- The importance of your credit scores?
4- How to know if it's right to really buy the rate down for me?
If you have any other ideas you want me to write on, please add them in the comments sections.
Have a good memorial weekend!
1- Why I give those tricks about mortgages?
2- What affects your mortgage rates?
3- The importance of your credit scores?
4- How to know if it's right to really buy the rate down for me?
If you have any other ideas you want me to write on, please add them in the comments sections.
Have a good memorial weekend!
Thursday, May 24, 2007
Where to go for a mortgage?
There are so many places you can go for a mortgage or a refinance. The choice is basically yours but use your brain and shop good!
But you will also shop where you can. Here's an example: If your middle credit score (FICO) is 700 then you have the world to shop. You will have a very good rate and you shouldn't pay points or close to none! My first choice would be your current bank since they know you and they will serve you right. Check with them how many points they take.
If your credit score is a 600 then you will be limited! Many banks cannot even refinance you at 100% with that score. They would go up to 90% or 95% and on top of that they will charge you 2 or 3 sometimes 4 points.
Between you and I, if they want to charge you more than 2 points, make sure you go and check with 2 other mortgage companies. Within 14 days you can have easily 3-4 companies to pull your credit for a mortgage and it WILL NOT affect your score!
Enjoy!
But you will also shop where you can. Here's an example: If your middle credit score (FICO) is 700 then you have the world to shop. You will have a very good rate and you shouldn't pay points or close to none! My first choice would be your current bank since they know you and they will serve you right. Check with them how many points they take.
If your credit score is a 600 then you will be limited! Many banks cannot even refinance you at 100% with that score. They would go up to 90% or 95% and on top of that they will charge you 2 or 3 sometimes 4 points.
Between you and I, if they want to charge you more than 2 points, make sure you go and check with 2 other mortgage companies. Within 14 days you can have easily 3-4 companies to pull your credit for a mortgage and it WILL NOT affect your score!
Enjoy!
Friday, May 18, 2007
Be careful with a refinance or a new mortgage...
I just want to make sure you understand your choices when you decide to refinance your current loan or when you want to get a new mortgage.
The foreclosure rate pretty much increases every year due to the fact that the customer doesn't always understand what they sign!
You get an offer for a 2/28, a 3/27, interest only bla bla bla because the rate is better but UNDERSTAND!!!
Be careful and ask the right questions.
These mentioned before are not fixed rate!!! They are fixed for 2 or 3 years and then they go adjustable. That means you rate WILL go up and then your payment will go up every 6 month so so...
Here's an example:
2/28
mortgage: $150,000
7.25%
Current monthly payment (principle and interest): $1023.26
That payment is fixed for 2 years, then it will be an adjustable mortgage. I know what you are thinking... "I will refinance at a lower rate in 2 years..."! OK but what if:
1- You credit score went down a little?
2- You income situation changed or any other story here...
You will be in trouble because you monthly payment could go from $1023.26 to $1234.01.
That is a big OUCH!
Plus if you refinance, you will use the equity you built in your house to pay once again for those fees. If you can, go for a 30 year fixed right away! Refinance 10 years down the road and cut 5 years on your mortgage if you can! Plus try to put a few extra dollars on your monthly payment.
Enjoy!
The foreclosure rate pretty much increases every year due to the fact that the customer doesn't always understand what they sign!
You get an offer for a 2/28, a 3/27, interest only bla bla bla because the rate is better but UNDERSTAND!!!
Be careful and ask the right questions.
These mentioned before are not fixed rate!!! They are fixed for 2 or 3 years and then they go adjustable. That means you rate WILL go up and then your payment will go up every 6 month so so...
Here's an example:
2/28
mortgage: $150,000
7.25%
Current monthly payment (principle and interest): $1023.26
That payment is fixed for 2 years, then it will be an adjustable mortgage. I know what you are thinking... "I will refinance at a lower rate in 2 years..."! OK but what if:
1- You credit score went down a little?
2- You income situation changed or any other story here...
You will be in trouble because you monthly payment could go from $1023.26 to $1234.01.
That is a big OUCH!
Plus if you refinance, you will use the equity you built in your house to pay once again for those fees. If you can, go for a 30 year fixed right away! Refinance 10 years down the road and cut 5 years on your mortgage if you can! Plus try to put a few extra dollars on your monthly payment.
Enjoy!
Monday, May 14, 2007
Let me add about those Mortgage Calculators...
About Bloomberg Mortgage Calculator: http://www.bloomberg.com/invest/calculators/mortgage.html
One interesting feature is that you can find how much interest you can save on your mortgage loan if you put a few more dollars a month towards your principal.
In this example I will use a $100,000 mortgage at 6% for 30 years. I will put $75 extra a month. I will now show you how much interest you will save on your mortgage loan:
Your monthly payment is: $599.55
Your total payment including the principal and teh interest is: $215,838.44
Your total interest paid is: $115.838.44
If you put an extra $75 a month starting the first month:
You will save$33,006.85 in interest and you how will be paid in 22 years and 8 months...
That is a lot of savings! Go and play with it! If you have question about that mortgage calculator, please email me or add a comment!
Enjoy!
One interesting feature is that you can find how much interest you can save on your mortgage loan if you put a few more dollars a month towards your principal.
In this example I will use a $100,000 mortgage at 6% for 30 years. I will put $75 extra a month. I will now show you how much interest you will save on your mortgage loan:
Your monthly payment is: $599.55
Your total payment including the principal and teh interest is: $215,838.44
Your total interest paid is: $115.838.44
If you put an extra $75 a month starting the first month:
You will save$33,006.85 in interest and you how will be paid in 22 years and 8 months...
That is a lot of savings! Go and play with it! If you have question about that mortgage calculator, please email me or add a comment!
Enjoy!
Mortgage Calculators...
Here are a few websites with great Mortgage Calculator for your next refinance or your next loans:
Bloomberg: I like this site!
http://www.bloomberg.com/invest/calculators/mortgage.html
Bank Rate: I trust this site also! Great information about loans, mortgages, Second mortgage, refinance, home equity, Car loans etc...
http://www.bankrate.com/brm/mortgage-calculator.asp
Enjoy!
Bloomberg: I like this site!
http://www.bloomberg.com/invest/calculators/mortgage.html
Bank Rate: I trust this site also! Great information about loans, mortgages, Second mortgage, refinance, home equity, Car loans etc...
http://www.bankrate.com/brm/mortgage-calculator.asp
Enjoy!
Friday, May 4, 2007
Refinance your Mortgage... How to make it an opportunity?
Hello all,
I just wanted to write a little bit about Refinance and Mortgage. One thing you need to know (if you have questions, you just need to send them to me...), you can save. Make sure when you see your GFE (Good Faith Estimate), you check the mortgage broker points and the discount points. Here's your opportunity, or here's what they don't want you to know: Many brokers use the term "I will charge you 3-4 discount points to lower your rate"! Then you are happy to save but YOU HAVE TO MAKE SURE it is on the line discount points not mortgage broker points. Mortgage broker points are points the broker charges to make money, YES, to make money! It doesn't affect your rate AT ALL! Discount points are use to lower your rate but you have to make sure it is worthed. Make sure you will stay long enough in the new mortgage to make it worthed! Ask your broker to calculate how many year it take to get that money back! You'll see if it's worthed!
The opportunity here is for you to SAVE MONEY when you refinance. Here's an example:
New mortgage: $200,000
4 broker points: 8,000 (money you pay, and most of the people don't know)
You could use those points to discount your rate but you will not be able to use them all! There is a floor rate to respect.
Let me know if you have questions!
Use a simple opportunity everyday and you will save a lot at the end!
Enjoy!
I just wanted to write a little bit about Refinance and Mortgage. One thing you need to know (if you have questions, you just need to send them to me...), you can save. Make sure when you see your GFE (Good Faith Estimate), you check the mortgage broker points and the discount points. Here's your opportunity, or here's what they don't want you to know: Many brokers use the term "I will charge you 3-4 discount points to lower your rate"! Then you are happy to save but YOU HAVE TO MAKE SURE it is on the line discount points not mortgage broker points. Mortgage broker points are points the broker charges to make money, YES, to make money! It doesn't affect your rate AT ALL! Discount points are use to lower your rate but you have to make sure it is worthed. Make sure you will stay long enough in the new mortgage to make it worthed! Ask your broker to calculate how many year it take to get that money back! You'll see if it's worthed!
The opportunity here is for you to SAVE MONEY when you refinance. Here's an example:
New mortgage: $200,000
4 broker points: 8,000 (money you pay, and most of the people don't know)
You could use those points to discount your rate but you will not be able to use them all! There is a floor rate to respect.
Let me know if you have questions!
Use a simple opportunity everyday and you will save a lot at the end!
Enjoy!
Subscribe to:
Posts (Atom)
