What is APR?

APR is annual percentage rate and its purpose is to give borrowers a truer representation of the effective interest rate on their mortgage. APR factors in certain closing costs and fees and spreads these costs over the life of the mortgage, along with the note rate, to arrive at a more accurate annualized percentage rate than the note rate alone represents.

What can home equity credit line do for me?

If you need to borrow money, home equity lines just could be a great source of cash. It would provide you with a large amount of cash at relatively low interest rates and with some tax advantages not available with other kinds of loans.

Is it a good idea to pay points for a lower rate?

If you are refinancing mortgage, paying points is not always your best option. Points paid for refinancing can be deducted only in small amounts from your taxes, so it could take couple of years before you benefit from a lower rate.

How much will closing cost?

Generally you will need around 2% of the purchase price to cover the time between when you close and your first mortgage payment. But when refinancing , your old mortgage should have money in escrow to cover these costs.

What is an interest only home loan?

An interest only mortgage is loan with which you can just pay the interest or the interest and portion of the principal whenever you want during the predesignated amount of time. These loans can be 20-year fixed or adjustable rate mortgages.

Is Home Mortgage Refinancing the right option for me?

Look at your mortgage related goals: are you looking to improve your monthly cash flow, reduce your mortgage term, do you need to take out cash utilizing the equity from your home? Obtaining the right mortgage for your particular needs could make sense even when rates are not at their lowest levels. First identify your goal and contact a mortgage professional for suggestions on mortgage programs that would best help you meet your objectives. Then shop for rates after you have selected the appropriate mortgage program.

Is it possible to reduce my closing costs?

If you are refinancing, you could reduce some costs by asking your lender about them. Example: your lender could use your last home appraisal or your other credit reports or even recertify old documents for cheaper then getting new documents.

Will my interest rate for second mortgage change?

If your loan is fixed-rate, the interest rate is set for the duration of the loan. Many lenders will offer variable rate mortgages, and these can provide for periodic interest rate changes. If your contract lets your lender adjust the interest rate, make sure to understand when excatly can the lender change the interest rate and if there are any limitations on how much the rate can change.

How much money can I borrow with home equity line of credit?

Depending on your your income,credit history, and the amount of your debt, home equity lenders could lend you up to 80% of value of your home less the amount owed on your mortgages.

How much Homeowner's insurance coverage do I need to get new mortgage?

A safe bet is to buy a guaranteed-replacement-cost policy that will generally pay out 20-50% more than the face value of the policy to rebuild your home (this is also the preferred policy of mortgage lenders). A replacement-cost policy typically adjusts the amount of insurance each year to keep pace with rising construction costs in your area. It is important to note that local building codes require structures to be built to specific standards which could vary over time, if your home is severely damaged, you may be required to rebuild it to current codes. Even guaranteed-replacement-cost polices do not always cover this expense. However, many insurers offer an endorsement that will pay for the upgrading cost, it is a good idea to consider adding such an endorsement to your replacement-cost policy.

What is the difference between 0 point and no cost mortgage?

With no cost mortgage, a borrower has accepted a higher interest rates, with the trade off that the lender or broker will pay for all their non-recurring closing costs. With 0 point mortgage, a borrower has opted not to pay points to buy their interest rates down but will still be paying for their base closing costs.

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