Repairing Your Credit Score: Other Options

If you’re interested in learning more about repairing and maintaining a good credit score, particularly if you need to improve your own credit score, then read on. Perhaps, as a potential first-time homeowner, you’re in the market for a mortgage—or maybe you need your mortgage refinanced; either way, good credit is important!

Fixing and repairing your credit score is more than simply paying off debt regularly and in a timely manner, however. Yet it seems to be commonplace for consumers to be ignorant of what affects their credit score and what they can do to repair it and maintain a higher score.

But as already mentioned, there’s a lot more involved with what goes into a credit score. Here are five other, perhaps lesser-known ways you can fix and then improve your credit score.Continue reading

What Does it Mean When a Mortgage Company Advertises “No Appraisal Required”

In trying to makes sense of advertising of mortgage company ads, one will hear many things. Today we will discuss what it actually means when someone says they can refinance your home without an appraisal.

Is a No Appraisal Refinance Possible?

Yes, it absolutely is. Currently, approximately 10% of our mortgage refinance transactions are done without an appraisal. In addition to saving the $350-$500 cost of the appraisal, the transaction can move faster due to many appraisers being backlogged, Currently, the refinance transactions that are done without an appraisal comes down to either conventional HARP loan or an FHA streamlines. Continue reading

Record-Breaking Interest Rates Fire Up Homeowners

Mortgage rates tumbled again last week and homeowners nationwide are fired up about refinancing. From homeowners drowning in underwater mortgages to those who refinanced 30-year mortgages at rates that hovered just below 4% last October, all kinds of homeowners are trying to take advantage of these new historically low rates. While every household’s financial situation is different, record-breaking low interest rates, a competitive lending market and changes in some federal refinancing programs for struggling homeowners make now the best time to refinance your home mortgage.
Continue reading

Increasing Your Home’s Value and Equity

With home values and home equity taking a beating the last five years, many homeowners are left wondering if there is anything they can do to increase the value of their home and their home equity. While there are some ways to increase your home’s value, many cost more than what you’ll gain, especially if you contract out the work. However, if you’re willing and able to do the work yourself, your “sweat equity” can boost the value of your home and increase your home’s equity. Despite the current economy, now is a good time to do home improvements since interest rates are at historic lows and contractors are scrambling for work. Provided you plan to stay in your home for a number of years and you do the right home improvements, you could enhance your home’s value when home prices recover.
Continue reading

The Cost of Not Refinancing Your Mortgage and Missing Out

Over the past 5 years, mortgage interest rates have gone in one direction, down, down, and down. Each time we appear to have hit a floor, the bottom drops out of it to another floor.

Over this time frame, some borrowers have taken an “I’ll get around to it” attitude. However, I thought it wise to break down what the actual savings on refinancing in today’s market will actually mean.

Example 1 – Paying off your Mortgage Faster

Borrower John in Chesterfield, MO has a $175,000 mortgage at 5.5%with 25 years left at a payment of $993.63 and has been putting off refinancing due to the trouble of rounding up all of the income documentation.
What is available is $175,000 mortgage at 15 years at 2.75% which carries a payment of $1,187.59.
Total payback on John’s loan (993.63x25x12) is $298,089 but by applying for a lower rate on a 15 year leaves him with a total payback of $213,766, saving John a whopping $84,322.

Ex. 2 Improving Cash Flow for Investments

Borrower Lisa from Overland Park, Kansas has a $200,000 Mortgage at 5.5% with 25 years left which carries payment of $1,135.58

What Lisa wants to do with her situation is refinance to a 30 at 3.500% and invest the excess cash flow. The payment on her $200,000 mortgage is $898.08, saving her $237.49. If Lisa invests the $237 savings every month over 30 years, assuming a 5% return in a tax deferred account, she will have $197,000 left over when she pays off her mortgage in 30 years.

So to conclude, if it’s to pay off your mortgage quicker, or to take advantage of investment opportunities, there are great financial opportunities in today’s refinance market.

Rebuilding Your Home’s Equity with Refinancing

The main reason homeowners today refinance is to get a lower interest rate. But what many homeowners don’t realize is that refinancing helps them to rebuild the equity in their homes more quickly. For those of us who bought homes prior to 2006, most of us have less home equity than we used to because our homes are worth considerably less than they were a few years ago. Therefore, we have less home equity. Fortunately, refinancing can help homeowners to rebuild the equity in their home.
Continue reading

Refinancing Without HARP

If you’re one of the millions of homeowners with an underwater mortgage who would still like to refinance but can’t qualify for HARP (the federal Home Affordable Refinance Program), there are still some options. Though limited to borrowers in specific situations, you can still refinance a negative-equity mortgage even if you don’t qualify for HARP as long as your mortgage loan is backed by the FHA or VA.

Provided you’ve kept up with your mortgage payments, both FHA and VA mortgage loans offer what is known as “streamlined” refinancing that enables you to be approved for a refinance almost automatically. In fact, credit scores, appraisals, proof of employment aren’t necessary no matter how much the value of your home has fallen below what you owe on the loan. But it’s important to remember there are criteria that must be met.
Continue reading