Home Mortgage Refinancing the Right Way

Due to the high numbers of homeowners facing foreclosure President Obama and his government have devised a home refinance stimulus package and also some loan modification programs to help. The government and President Obama have begun these plans to help those that are facing foreclosure and having difficulty repaying their loans. As many as 9 million mortgages would be covered by the loan modification plan and home refinance stimulus package and the government is estimating spending $75 billion in the process to help all of the struggling homeowners.

2 main components for Obama's Stimulus Package:

1. Refinance

2. Loan Modification

Let us discuss both components in detail:

1. Home Refinance Stimulus Package

·Using this package the government would have the two biggest and powerful lending agencies, Fannie Mae and Freddie Mac, to refinance homes. Homeowners are buried under their mortgage and are paying more than their homes are actually worth. The condition in order to use this package, it is that the loan be a guarantee be the lender Fannie Mae and Freddie Mac. This condition applies even if you become financially secure and are able to pay on your own.

·There is however a major condition before one can qualify for the refinance stimulus package; the stimulus package is only for homes that are lived in. Those properties that have no one living in them are not eligible for the Obama home refinance stimulus package.

2. Loan Modification Stimulus Package

·President Obama and his administration have provided incentives for lenders that are doing loan modifications for homes that have existing loans. Based on this program homeowners are going to be able to stop foreclosure for good by following the program. The loan modification and refinancing program will reduce high interest rates and decrease it to 2% only. The tenure of the loan will increase in order to reduce the borrowers’ monthly payment and the late fees some have incurred would also be waived.

·Using this loan modification or refinancing program the lender would take care of monthly payments and it would not increase by more than 31% of the borrowers’ monthly income.

-M Petrone
www.HomeRefinancingAdvice.com

Homeowners who are having a hard time paying their monthly mortgage payment, are facing “Financial Hardships”, are facing foreclosure, or want to save money every month should take advantage of President Obamas “Making Home Affordable” plan. This recently enacted plan allows homeowners to get 2% fixed rate home mortgages through refinancing or loan modification. Here is how you can take advantage:

To take advantage of President Obamas plan for yourself, you must meet these guidelines and eligibility requirements:

-Homeowners who are facing financial hardships, and can prove them with documents, can apply for, and most likely be approved for a home loan modification. This will be into a much more affordable monthly payment, depending on your financial hardships and how much those cost you.

-The home which is to be refinanced using this “Making Home Affordable” plan needs to be lived in as a primary residence by the actual homeowner. Homes used as investment, or second properties are not covered under this Government backed housing bailout program.

-With such a bad housing market and economy, homeowners can now refinance or get a home loan modification even if they owe as much as 105% of their homes actual market value. This will assist a lot of homeowners who have been making their payments, yet have seen their home values drop as a result of the tough economy.

-Home loans backed by either Freddie Mac or Fannie Mae are automatically eligible to be modified into a monthly payment which will not exceed 31% of the homeowners gross monthly income. This will help a lot of people who currently spend 50% or more of their income towards their mortgage payments.

This is a great way for millions of homeowners across the country to get back on track with their finances, save money every month, or most importantly save their home from foreclosure. Refinancing and loan modification are now easier and more beneficial for a homeowner than they have ever been before. If you need to save money to save your home, or pay off other mounting debts, use this plan now and start seeing the huge savings every month. You at least should look into the potential savings that you may be able to get by talking to a mortgage lender or bank. Do yourself a favor and act now before it is too late and you lose your home, or this program is gone.

-M Petrone
www.RefinancingCondo.com

With the economy being less than stable these days business everywhere are swamped with the promises of saving money. Everywhere they turn they are offered ways to save on daily costs or they are offered an opportunity to reduce their overhead costs.

Many things can be done to reduce the overall expenses for a business. A few things that a business can do to reduce their cost of operation is purchase they very minimum of what they need, layoffs and even outsourcing is a possibility. It’s difficult to be a business in this economy people are doing everything it takes to stay above water.

All of this is happening while those lenders out there make getting credit harder than ever. These days it is very difficult to get credit to build your own business, lenders are making it increasingly difficult to get a line of credit and many of these same lenders are reducing and in some cases closing people’s line of credit all together. A great option that is out there is Refinancing.

Most people will think of refinancing their current loans only when they see rough times ahead. Usually business owners or homeowners decide to refinance when they know that their monthly payments are increasing or if they are about to default on a payment. There are many business owners never really think about the loans they have and as long as the payments are made and paid on time they don’t seem to worry about those loans. Since being a business nowadays is difficult, owners don’t want to approach banks or other lenders to restart the loan process over again.

Since many do not think of refinancing until they feel they need to, savings are being lost by hundreds of business owners. Also waiting to refinance when you are in trouble is going to be much more difficult and that much harder to find a lender that would be willing to help a struggling business in this economy. By refinancing your loans before being forced to can help your business grow and position yourself to save money while doing so.

Also, if you think that your lender now is thinking of raising rates or something like that, a great way to go around them is to refinance.

In order to always keep your finances in order you should always keep your eyes open and look for new opportunities. There really is no better time than now to refinance your home or business loans. Lenders are looking for new customers and are offering lower rates than ever before. Refinancing not only means your mortgage loans but if you are a business this also includes any and all equipment used to run your daily work day.

Example:

Let’s say that when starting your business 18 months ago, you also took a loan out for the equipment that you need. That loan you needed was for $80,000 and it was 8% for the next five years. If you were to refinance the loan at just 7% in the same time frame you would be saving about $500 every month. Once you refinance and start saving that money every month you can use that extra cash for other aspects of your business.

There is no quick easy answer to saving your business, however the combination of refinancing, cutting cost and getting more out of your current customers can help save not only much need cash but also the business.

Even with bankruptcy, refinancing a home mortgage can put more money in your pocket every month with lower mortgage payments, or to finance a large purchase. However, sometimes a bankruptcy can hurt your chances of refinancing at a lower rate than you have now, making a mortgage refinance pointless. So make sure to research a variety of different mortgage lenders to know your options and the lowest quoted rates.

Good Reasons to Refinance a Home Mortgage.
There are many good reasons to look into refinancing. Mainly, people refinance to get a lower interest rate than they currently have. If you can refinance at just 1% (Hopefully more) lower than your rate is now, you may save hundreds of dollars. Ultimately, the goal of refinancing a home loan is to have extra money every month. Although some home owners do choose a cash out refinance where they end up increasing the cost of their home. A cash out refinance is just borrowing money from the equity of your home. This can appeal if you want to reduce debts, home repairs, home improvements, or other big purchases.

Repair Your Credit Rating Before Refinancing.
The chances of getting a good low mortgage rate immediately following a bankruptcy are pretty low. Therefore, it is advised to improve your credit score as much as possible before refinancing a home loan. You should get your own copy of your credit score before applying with different lenders. Use this report to fix any errors you encounter and to see where you can eliminate old debts and improve your credit score. Usually paying off store credit cards, credit card, auto loans is a good way to quickly improve your credit rating. Do not get yourself into more debt before a home mortgage refinance or modification, or get new lines of credit.

Research Potential Mortgage Lenders.
There are a lot of different mortgage lenders who specialize in bad credit, or post bankruptcy refinancing. Sub prime mortgage lenders are especially good at this and have a wide variety of options to help you. You can research potential mortgage lenders using the internet. There are a lot of websites out there from lenders trying to get your business. Make sure to shop around to find the best rates, terms and conditions you can. Once you get a rate quote you like you can shop that quote around to other potential lenders.

-M Petrone
http://www.RefinancingCondo.com

There are a lot of homeowners who think that a mortgage refinance can be used as some kind of personal financial bailout, in case of emergency. If you count on your home getting you out of a tough financial situation, join the club. Some misconceptions about how a mortgage refinance should be used are widespread and common beliefs a lot of homeowners have. Here are some of the things that a home mortgage refinance should not be used, or considered, or counted on for.

Mortgage Refinancing Is Not An End All Solution To Financial Problems
This is probably the number one idea people get stuck in their heads. Basically, it is commonly believed that a mortgage refinance can be used to end all of your other financial woes. Generally, this homeowner believes that a mortgage refinance has helped them earlier in life and can help them again, and again. While this may hold true for the first, maybe second time, it will get harder and harder to find a lender who will work with you. The lender will see that their is another problem somewhere in your financial planning, that has casued you to be in debt so often, for so much. The rates will increase, the fees will increase, and the more you refinance the more you will put your home in risk of being taken by the bank should you miss a payment.

I can refinance my mortgage should an emergency come up.
Technically, it can be used as an emergency plan, but should not. You should not be getting into emergency financial situations often enough to be even comfortable considering a refinance, let alone execute one. Its bad habit, think of your home as the only thing that will be there forever. It should not just be used at your will to free burden that has been building up. You should act on financial irresponsibility in other ways.

I can refinance for any reason I want.
Again, technically you can refinance your home for any reason you want. However, you should only refinance to save on interest rates, or to shorten the length of an existing mortgage. Both of these reason are good financially sound reasons to refinance. Dont use a refinance to purchase non nesscary items or services. Use it only to better your long term financial position. Do not take it for granted you are putting your home one the line with a home mortgage refinance.

Refinance only if you can get a loan rate 2% or more lower than your current rate. This will save you money every month and ensure you get a good refinancing deal. Do not forget to add closing costs to the total. Often these can be added to the loan, but they should be paid if you can by cash. Shop your quote around to different mortgage lenders and see which terms rates and conditions fit your needs.
http://www.RefinancingCondo.com

Typically when applying for a mortgage loan, you quickly find out how many types of information you will need to provide. To begin with, you will need proof of income, checking or savings account information that goes back as much as 3 months to verify someone did not borrow you the down payment just for the looks, you will also need to provide tax returns. Also, you will need to bring a copy of the deposit that you gave to your realtor when you decide you found the perfect condo or home to finance. Almost all the time, the bank will send an appraiser out to the property your looking to finance, they also send an inspector out to make sure there is no significant costly damage that will need to be repaired within the first few months/years of your mortgage. You will also need to provide proof of home owner or condo owners insurance once the loan is approved.

Meanwhile, in the time between applying for either financing or refinancing you should not use any credit sources. Do not get anything financed or refinanced while the loan is awaiting approval. Refinancing loans are pretty strict and may take a few weeks to months depending on your personal financial situation. To receive refinancing in some instances you must pay off an old debt or two in order to turn that corner so the bank will refinance.

When your refinancing approval goes through it is all down hill from there. Meeting the bank and the Realtor one more time is needed before closing on the house or condo. Make sure to bring your down payment with you and anything else your realtor or banker asked you to bring in. Remember after the closing goes through the property taxes are now in your name, including any back taxes that were due on that property. You now will be the official condo or home owner!

-M Petrone
http://www.refinancingcondo.com

The biggest fear homeowners have when refinancing their home mortgage is being ripped off. Many homeowners are convinced that the best way to avoid being ripped off in a mortgage refinance is to search for the best mortgage rate quotes they can find. One of the best ways to quickly find a good mortgage rate is to use the services of a mortgage broker. However, here is where I want to caution you about the biggest secret in the mortgage refinancing industry. The secret no broker or bankers want you to know.

So, What is this secret that desperately needs to be exposed that can save you thousands?
On a daily basis, homeowners are being ripped off from mortgage brokers, lenders, and banks without even realizing it. How? By being ripped off by the mortgage lender and paying extremely high closing costs compared to what your costs should be or are compared to other homeowners in the same situation.

So what makes these closing costs so high... and why?
Sometimes mortgage lenders or brokers get together with their lawyers and then charge higher fees based on a lawyers time as well. These lawyer fees end up being passed on to you even though the lawyer was not necessary for most or all of the time. This is more of a red flag if the potential lender or broker offered you their service for “free”. When the word free is used to describe closing costs it just means the lender is making money off you in other ways. A lot of unethical mortgage lenders will grab your attention with these free or low cost refinance options. Sometimes, they will even give you cash when you refinance with them because they know the money will be coming back to them eventually. They will always work it so that you are paying more for this “free” or reduced cost closing than you expected. They will stack the deck in their favor.

Who else will be able to use this kind of scam on me?
You need to be cautious of anyone you are dealing with not only your mortgage lender or bank. Your real estate can just as easily perform the same sort of under handed scheming to you. That is why it is very important to do proper research on any potential mortgage lenders or banks. Know your estimated costs up front. Demand every single fee or related cost is estimated and quoted before the closing is set to take place. This way you can review the fees and ask any questions before signing off on the new loan. Mortgage lenders with long histories are often more stable and financially secure than fly by night mortgage companies. Usually the big lenders do not pull these cheap and greedy scams but be aware none the less. Practice patience and find the perfect lender, terms, rates, and conditions for your home mortgage refinance.

-M Petrone
www.RefinancingCondo.com
Taken from: http://www.refinancingcondo.com/2009/02/greedy-secret-of-mortgage-refinance.html