Home Loans -- Federal Regulators Warn Lenders to Be More
Federal banking regulators have recently expressed some
concern over the housing market as home prices in the United
States have risen to record levels. While homes are more
unaffordable than ever for many people, the lending market
remains strong, mostly because of the introduction of new,
ever-more-flexible types of loans. While these newer loan types,
such as the interest-only loan, make buying a home easier for
some borrowers, they also propose a greater risk to the
The lending market has been quite aggressive during the last
five years, as investors and homebuyers have purchased real
estate in record numbers. Buyers who are skittish about investing
in stocks have put their money into real estate instead, and
prices have climbed to record levels. Lenders have been all too
happy to accommodate the long line of customers in their offices
with an ever-increasing array of products. With hundreds of loan
types available, nearly everyone can qualify for some type of
mortgage today. The problem, as regulators point out, is that
some of the more popular types of loans are inherently risky. Two
such examples are the interest-only loan, and home equity loans that
exceed 100% of a home's value.
The problem with such loans is that they are both issued under
the assumption that home prices will continue to rise. Prices may
continue to rise, but if they don't or worse, if they fall,
lenders could find themselves in the ugly position of holding
liens on property that is worth considerably less than the amount
of the loan. As of yet, there's no sign of a crash in real estate
prices, but foreclosures are up in both Texas and Florida, and
this could be an indictor of more difficult times ahead for the
lending industry. The banking regulators didn't issue any orders
regarding how high-risk loans should be handled, but they did
caution lenders to check the credit scores of borrowers carefully
and to eschew or cut back on so-called "no-doc" loans, which do
not require full documentation of a borrowers assets or
This should be of relatively little concern for the average
borrower, who would probably think that such guidelines represent
ordinary common sense. Unfortunately, common sense sometimes gets
ignored during boom times in business, only to be remembered when
buyers start to default on their loans. By that time, it's too
late to do anything, and the stockholders are left with the
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Charles Essmeier is the owner of Retro Marketing, a firm
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Smart About Money: Well-Earned Lucky BreakCanton Citizen NewspaperI also asked why she wanted the money she'd get from a mortgage refinance. It turns out she needed funds occasionally for the upkeep of her home. A mortgage refinance would give her more than she needed but the rates were the lowest. As it turned out, ...
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Option ARM Mortgage Loan
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How to Find the Lowest
The quest is on! You're in the market for a new home loan,
a refinance, or a consolidation and you absolutely insist
on finding the lowest rate possible! So what better place
to do your research, then here on the internet, late at
night, with your coffee in hand, and your family fast to
sleep! We'd like to help you on your quest, so here are 3
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Mortgages - Which Loan
is Right For You
When buying a home, you need to take a home mortgage loan,
either because as a debtor, you end up paying less tax, or
because in a market where property prices rise faster than
salary levels, the money you have saved falls short of the
amount required. When searching for a home mortgage loan,
you can select from a wide variety.
Is It Time To Buy A
At some point as you're writing out your rent check, you
get to the point where you look at the amount and think to
yourself - at this rate, I could BUY a house. If you're fed
up with paying rent every month that's high enough to
finance a mortgage, it may be time to take a serious look
at what it would take for you to get a mortgage loan and
buy a home of your own.
Do You REALLY Need a
Home Equity Loan?
Your equity is the amount your home is worth, on the
market, minus the amount you owe to your mortgage broker.
For example, if your property is worth $200,000 and the
balance you owe your mortgage broker is $100,000, then your
home equity - the part of your property that you own free
and clear - is $100,000.
Mortgage Calculator -
How to Calculate Your Monthly Mortgage Payment
Just starting to shop for a new home? Do you want to know
how to figure what your monthly payment would be based on a
certain priced home? No problem, there are plenty of
mortgage calculators on the web you can use free of charge
(click here for an example of one). All you need to know is
the mortgage amount, sale price less the down payment,
interest rate (also easy to access on the web), and the
number of years you wish to finance your new home, usually
30 years (360 months) is the maximum term.
Using a Calculator to
Assess Your Loan
Buying a house is a very important step in your life. Every
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home, you know your mortgage is important.
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Your Home Equity Line of Credit
Tapping your home's equity to pay college expenses,
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So, your bank had just turned you down for a mortgage
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It is likely to be one of the largest purchases of your
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Selling Your Business
Before I go further, let me ask a question- if you won the
lottery tomorrow, would you take the payout in a lump sum
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your business sale over several years rather than take a
lump sum payout? The answer is probably because you didn't
know that you could get cash for your business note.
What is a Flexible
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money and even reduce or skip payments should the need
arise. A flexible mortgage allows you to make extra payments
to reduce the amount outstanding on your mortgage thereby
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Selecting the Right
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