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Are You Ready for a 40-year Mortgage?
Real estate prices have been increasing steadily over the last
five years, particularly on the East and West coasts. In parts of
California, homes are selling for 33% more than they were a year
ago. This has made it more difficult than ever for first-time
homebuyers to purchase a home.
Over the years, a number of new mortgage options have become
available to prospective buyers that ease the burden of buying a
home. Buyers can now obtain a mortgage with a variable interest
rate that rises or falls with the market or even a mortgage that
requires only interest payments for the first few years of the
loan term. This allows buyers to make smaller payments early in
the repayment schedule while purchasing a more expensive home
than they otherwise might be able to afford. The payments would
increase in later years, but so, presumably, would the income of
the buyers, so that the home would still be within the buyers'
range of affordability.
A relatively new mortgage option that may soon adjustable rate
mortgage and the interest-only mortgage in popularity is the
mortgage with a 40 year term. While most mortgages offered today
are for either 15 or 30 years, the 40 year mortgage has been
available for nearly 20 years, but few lenders offer it as an
option, as they are often reluctant to tie up their money for
such a long period of time. That may change, however, as Fannie
Mae has announced their intention to purchase more 40-year
mortgages. With Fannie Mae purchasing more 40-year mortgages on
the secondary market, lenders will probably be more willing to
offer them to customers.
Interest rates will likely be somewhat higher for a 40-year
mortgage than a 30-year mortgage, but the extra length of the
loan term will keep the payments lower than with a traditional
mortgage. Prospective buyers should be aware that they will pay
more in interest on a 40-year mortgage than they will on a
traditional 30-year note. Studies show that most homebuyers do
not stay in their homes for anywhere near 30 years, let alone 40.
This being the case, the market for 40-year mortgages may remain
fairly small. But for some buyers, it may mean the difference
between continuing to rent and buying the home of their
dreams.
©Copyright 2005 by Retro Marketing. Charles Essmeier is
the owner of Retro Marketing, a firm devoted to informational
Websites, including End-Your-Debt.com, a Website devoted to
debt
consolidation information and HomeEquityHelp.net, a site
devoted to information on home equity loans.
MORE RESOURCES updated Tue. June / 06 / 2023
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RELATED MORTGAGE AND REFINANCING ARTICLES:
Mortgage Info You Can
Actually Understand!
This is a great time to Refinance Your Home or Buy a New
Home -- the Mortgage Rates are so low, these days! It's
always worth a shot to find out what the costs of switching
over to a new mortgage would be, to see if that's the right
move for you. Whether you are building your own house,
buying a new property, gathering funds to do a renovation
project, or Refinancing your current Mortgage at a much
Lower Rate, you'll be looking for Funding -- Money, Money
& More Money! Here are some commonly asked questions
regarding funding for a Mortgage or a Home Improvement
Loan.
Home Equity Increases $1
Trillion in Five Years - Is the Market Peaking?
A new survey reveals that in the last five years, the
equity in the California real estate market has increased
by more than one trillion dollars. A trillion dollars is a
large number to ponder, but put in concrete terms, it can
be represented by a stack of one hundred dollar bills that
is six hundred thirty one miles high! This astronomical
increase in California home values isn't all that unique,
however.
Bad Credit? First Time
Buyer? You Can Still Get Approved For A Home Mortgage
Loan
Do you have bad credit that you worry will stop you from
being able to apply for a home mortgage loan? Have you
given up on the dream of being a home owner? Well don't.
Take comfort in the fact that there are special home
mortgage loans that you can apply for, that will make sure
your dreams of becoming a home owner are fulfilled! Home
Loans Are Flexible - The first thing you need to
keep-in-mind is that home loan mortgages are very flexible
- they can be adjusted to meet the needs of any borrower.
What is a Capped
Mortgage?
A capped mortgage is a variable rate mortgage with a capped
limit beyond which the rate paid will not exceed. Mortgages
are available in a number of different interest rate
options, one of which is the capped rate.
Fixed-To-Adjustable-Rate-Mortgage
What is a Fixed-To-Adjustable Rate Mortgage? This type of
mortgage offers fixed payments for an initial loan period
of up to10 years then followed by an adjustable interest
rate for the remaining term of your mortgage. Payments are
usually lower than most fixed rate mortgages.
A New Choice for Home
Financing: Correspondent Lenders
When you begin your search for a new home loan, one of the
first things to consider is where you'll get the money.
Your basic choices will be mortgage brokers and banks.
Home Loans and Mortgages
- The Selection Can Be Bewildering
For years, when someone wanted to purchase or refinance a
home, the choices were simple. The buyer chose either a
15-year fixed-rate mortgage or a 30 year fixed-rate
mortgage.
Bad Credit Home Equity
Loans
A home equity loan allows you to borrow against the equity
you have built in your house. Even if you have no equity,
you may be able to borrow up to 125% of the value of your
home.
Get the Best Rate on
Your Home Mortgage Loan
Home mortgage interest rates hit record lows in 2004 and
have remained at record lows as we go through 2005. It is
possible today to get a thirty-year fixed rate home
mortgage loan for under five percent, and an adjustable
rate mortgage can be found for under four percent if you
look hard enough! However, record low mortgage rates do not
mean that you should take the first mortgage offer made to
you, even if it sounds low.
Refinancing After
Bankruptcy
Refinancing after a bankruptcy can seem like an especially
difficult challenge, but it doesn't have to be. Six months
after your bankruptcy has been finalized, you can find
lenders willing to refinance your mortgage.
How easy is it to get a
Commercial Mortgage in the UK?
As is the case when applying for any mortgage, be it a
residential or a commercial mortgage, the better your
credit and the better the collateral, the easier the
process becomes. But that doesn't mean that if your credit
is less than perfect, or you want to purchase commercial
property in a less then desirable part of the city, that
you are automatically locked out of getting the money you
need.
Guide to Home Equity
Loans
Here is a useful guide to home equity loans. A home equity
loan is quite simply a loan against your house.
Guide to Mortgage
Terms
Listed below is a guide to mortgage terms. It is a useful
list of definitions of mortgage terms that may or may not
be familiar to you.
Home Equity Loans
Popular Scams
Most borrowers fail to realize that when trading their much
beloved home for cash, lenders can foreclose on their
property in the case of default. Moreover, because of
fly-by-night operators who are ready to strip unsuspecting
borrowers of their most prized asset, it is doubly
necessary that borrowers be familiar with some frauds that
could be perpetrated on them.
Home Equity Loan
Information - How to Use One Wisely
Using a home equity loan to get out of debt or make
improvements to your home is usually a smart move. You have
earned the equity, so it only makes sense that you put it
to good use.
Alternative Options For
Rising Interest Rates
As interest rates have risen in the last six weeks from
record lows, homeowners are once again face with finding
viable options to reduce the amount of interest paid on
their home loans. The rush to refinance provided borrowers
with good to excellent credit the opportunity to take
advantage of low interest rates, that helped to reduce
their monthly mortgage payments, which was the only benefit
provided by the lowered rates.
Buying a Home With Poor
Credit Is Easier Than Ever
Buying a home with poor credit is easier than ever with
online mortgage brokers. You can easily find sub prime
lenders, compare rates and terms, and complete the process
on your schedule, not the banks.
Composite Credit Report
Score Simplifies Mortgage Issues
Do you want a mortgage loan for your new home? Trying to
qualify for a new mortgage can be very tough, especially if
you aren't aware of the effect your credit report score has
on your ability to get approved for loans. One of the first
things a lender looks at to determine your suitability for
a mortgage loan is your credit report, or FICO score.
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.
The Mortgage Loan
Application Online - Save Time & Money By Applying On
The Internet
"You can save time and money by applying for a mortgage
loan online." This often touted tagline seems like a
gimmick, but it's true.
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