Banks, Credit Ratings and Getting A House Mortgage

October 30, 2009 · Posted in Bad Credit Loans · Comments Off 

Below we have listed some of the many questions that banks and other mortgage lenders will ask you when determining whether or not to grant your house mortgage application. The better you are able to answer these questions, the more chance you have of getting a mortgage and owning your own property.

Obviously, mortgages, large house deposits and jobs are currently hard to get, but if you really want a house or apartment of your own in the future, no matter how long it takes to get it, now is the time to think ahead and to put yourself in the best position to obtain a home mortgage when the economy improves.

Are Your Income and Expenditure Claims Realistic?

Do your homework before meeting with the bank or mortgage lender regarding how much monthly income you expect to receive in the future. If you intend to rent out a room in your new house, make sure you know what the current monthly rent is in your area. How much will you need to spend in order to make the house or room rentable? First time buyers are allowed to receive a maximum of 10,000 euros per year tax-free as income from renting out a room.

Can You Manage Money?

Nowadays the banks will want to know that you are a trustworthy person to loan money to. Keeping good records of your rent as well as your other major repayments such as car loans will reassure the bank that you can manage money.

Do You Need Money For Other Payments?

In the past the banks were happy to lend money for the fitting out of a house, as well as the mortgage needed to buy it. Today, if you are lucky enough to obtain mortgage approval, the banks will try to reduce the amount loaned to you as much as possible. It will help your mortgage application if you have no other major repayments to make, so defer any ideas you have about a new car or other big spend until after you receive your mortgage.

Do You Smoke?

Non smokers can make significant savings on the life assurance cover that will be needed in association with your mortgage.

Have You A Bad or Inaccurate Credit Rating?

Bad credit ratings can happen to good people. It may be due to an unpaid or lost bill, whilst it can also be due to inaccuracies in the credit report itself. It is better to find out your credit rating yourself, rather than waiting for a lender to inform you of your credit rating. This will give you an opportunity to address any inaccuracies and perhaps settle any outstanding debts. The more ‘blemishes’ you have on your credit report, the more likely it is that your lender will charge you a higher interest rate to protect themselves against a potentially bad loan.

Do You Expect Higher Interest Rates?

Are you assuming that you can repay your mortgage on the basis of current interest rates or have you calculated what it would cost based on interest rates that are two, three or four percent higher than current rates? Ask yourself if you could afford to pay a higher monthly payment without infringing on other payment commitments you may have.

This article is only intended as a basic general summary and you should always seek professional advice where necessary.

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Planning Ahead For A Home Mortgage

October 29, 2009 · Posted in Bad Credit Loans · Comments Off 

Obviously, both mortgages and jobs are difficult to come by these days, but if you really want a house or apartment of your own in the future, now matter how long it takes to get it, now is the time to think ahead and to put yourself in the best possible position to get a mortgage when the economy improves.

The list below includes some of the questions that the banks will ask you when assessing your house mortgage application. The better you are able to answer these questions, the more chance you have of getting a mortgage and owning your own property.

Have You Accumulated Savings?

Mortgage lenders will want to make sure that you have a good record of savings. Regular contributions, for as long a period as possible into a savings or deposit account, will be looked on favourably by banks and mortgage lenders when they assess your application. So plan ahead, open an account now and get a regular savings plan going so that when mortgages become more widely available, you will have a good record to show the bank. Even if you can’t afford to save much every month, at least it will demonstrate to the bank a regular history of payments.

Are You A Loyal Customer?

There is some evidence that banks are more willing to lend to those people that have savings with them for a long period of time. So if you feel that mortgage rates will be equivalent from the major lenders in the future, open a savings or deposit account in the bank of your choice and become a regular saver, even if it is only a small amount every month.

Do You Have The Right Job?

The type of job you have is crucial. Mortgage lenders will only loan to those people in the most recession proof jobs, so a job in a semi state organization or the most secure private company will really help your house mortgage application. At the moment, any job is a good job, but if you want your own house in the years to come, you should consider the impact any future job will have on your chances of getting a mortgage.

Do You Have A Bad Credit Record?

Reduce your debt as much as possible and do all you can to avoid a bad credit history. It’s vital that you keep in touch with any company or lending institution that you owe money to. Don’t avoid their letters, negotiate a repayment schedule with them, even if it is for a small amount each month. Do all you can to avoid being listed on the wrong page of a credit agencies records.

Have You The Right Friends?

If you think that you will never be able to afford a mortgage on your own, or that your job is not secure enough, consider a joint application with a friend and don’t forget the conditions above will apply to them too, so let them know what the banks will expect from them.

This article is only intended as a basic general summary and you should always seek professional advice where necessary.

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Calculating your mortgage online

October 28, 2009 · Posted in Bad Credit Loans · Comments Off 

When you are looking for mortgage in order to be able to buy a new house, you can make use of a mortgage calculator. If you didn’t need a mortgage to buy a house, there would be nothing like it. But, when you need one you must have your calculations in place so that none of your money is wasted. These calculators help you determine the amount of mortgage you need based on your current finances as well as the value of the house. You may be great with figures but the numbers and equations in mortgage can be really confusing. A calculator can help you in a situation like this.

Which calculators can you avail?

You may choose mortgage calculators according to your needs. Here are a few options:

•    Debt consolidation calculator – This gives you an idea of the benefits you will get in consolidating your debts.
•    Borrowing calculator – This helps you in calculating the amount your lender would offer you depending on a few factors.
•    Repayment calculator – Helps you calculate your repayment options.
•    Cost calculator – Helps you work out the cost of buying your house.

How much mortgage can you afford?

This is a very important question to ask before finalizing a house. While a lot of you may know how much you can afford, many of you may not be aware of the same. For those of you who do not know, these mortgage calculators allow you to combine different figures and help you arrive at a conclusion. You can play with different interest rates and get a figure and hence can analyze your options.

You can easily change figures/numbers to get various results. You can then analyze how these changes may affect your monthly income. This way you can get the best rate that you will be able to afford. Often when buying a house you may be confused as to how much you should pay. If you are informed and have done your research well, you can get a better deal than most others who don’t go prepared to buy a house. Some of you may think that you cannot pay beyond a certain fixed amount while in reality you still can. These online instruments will help you in calculating your payment options and also how quickly you can pay off your mortgage.

The greatest advantage of these calculators is that since you have used them you now know what the figures should be. If your lender gives an unreasonable offer you will immediately know. You can even negotiate better with your lenders. With advantages, there are bound to be disadvantages too. These mortgage calculators have certain limitations and may not cover all aspects of calculating a mortgage. Hence, you may have to depend on assumption too for a little bit. Although these online instruments may not be accurate all the time, they can give you a very good idea about your mortgage.

Samantha Taylor is a contributing Financial Writer, Moderator and Community Mentor of MortgageFit. She has been an active participant in the forums wherein she offers mortgage advice and suggestions to people in loan problems. If you have a query on “how much house can I afford” related issues, you can simply discuss it with her in the Mortgage Forum.

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Foreclosure, Home Loan Modification, and What The Homeowner Needs To Know

October 25, 2009 · Posted in Bad Credit Loans · Comments Off 

The current real estate and foreclosure crisis began two or three years ago. Since then homeowners have been working towards getting home loan modifications from their banks. As a result, the banks are becoming more and more buried under requests; many of them unprepared for the number of requests received. All of this equals up to homeowners who qualify for home loan modifications being left in limbo while the banks struggle to keep up.

The government’s solution to the problem: President Obama’s Home Affordable Plan.  HAMP (Home Affordable Modification Program) is a $75 billion initiative designed to help people afford their mortgages and stay in their homes.  One program it funds is a home loan modification program.   Lenders are encouraged to assist borrowers who are having trouble keeping up with their monthly mortgage payments.  The banks are rewarded with $1000 for each home loan modification that they complete, so they are more than willing to help.  Also, they are more than likely to make ore from the renegotiated loan than they are from the foreclosure.

A Home loan modification is a renegotiation of your initial mortgage.  This modification can reduce your interest rate; change your rate from variable to fixed, or even both.  It can extend the duration of the loan (usually up to between 30 and 40 years).  It can even lower the principal for borrowers whose homes have lost their value.  Any one of these changes can mean the difference between the homeowner keeping their house or losing their house.

If the lender doesn’t renegotiate the borrower still has 90 days from the first notice of delinquent payment until the bank can step in and seize the house.  This will allow the borrower a little time to think of an alternative such as negotiating a short sale with the bank, or consulting a professional home loan modification specialist.

A short sale is when the homeowner sells the house for less than its value, and the bank accepts the money and erases the rest of the debt.  Banks will sometimes do this because it is preferable to them owning a house it may take months to sell under in the current housing market.

A home loan modification specialist is just what the name suggests.  It is a person who specializes in loan modifications, and the laws and regulations surrounding them who can help the homeowner navigate their way though a loan modification process.  These specialists work with banks on a daily basis so they know how to talk to them. Not just all the legal and technical language, but the proper channels of negotiation and communication to use when dealing with a bank.  They will also have a better understanding of whether the bank is offering is the best possible option and if it is fair. Also, because of their existing relationship with lenders, they’ve made the business contacts needed to get you the best possible deal.

The most important thing to remember is to take action the moment you miss your first payment, maybe even before you miss it if you know you are going to.  The sooner you start working either with a professional home loan modification specialist or the bank itself, the sooner you can get the problem taken care of.

To learn more about home loan modification visit Legal Loan Bailout.

Dustin Rohde is an article contributor to Legal Loan Bailout. Legal Loan Bailout connects you with lenders that can help you avoid foreclosure using home loan modification. Depending on your specific situation (the Property State, your mortgage lender, your mortgage history, your hardship, and any other unique situation you might be in), we will negotiate a loan modification that will help you keep your home. Visit

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House Finance, The Available Options

October 5, 2009 · Posted in Bad Credit Loans · Comments Off 

Many people dream of having a nice place they can call home. It is no easy fete to achieve and a lot of planning and organizing has to go into it. Usually, many individuals may not be in a position to have the funds required and have to look for financing. There are many options available for house finance but you have to look for the one that is tailor made to suit your needs. It is advisable that you conduct research online and also make personal visits to the various lending institutions that you feel have a great deal for you.

There are many options available from zero-interest mortgages to the conventional thirty year fixed rate loan. When you have compiled your research then you can got mortgage shopping. One advantage is that getting this type of funding is easy. This is because the lenders do not have to prove the value of the purchase since they are selling a product. Normally, the number of the loan request is equal to or less than the actual value of what you want to buy.

There are many people who go for mortgages since the monthly payments are fixed and the interest paid is tax deductible. It is important that you analyze your purchasing power and if you can honestly afford to make the payments promptly. This will help you budget for the purchase of a house and narrow down your options to those that fit your pocket.

It is also necessary to include initial and other ongoing costs when looking for house finance. These are costs like the down payment, homeowners insurance, mortgage insurance, maintenance etc. If you get the reliable assistance and flexible payments, you are on the road to owning a house.

Mercy Maranga writes content on Finance and Finance Management. Visit her site here for more information on Finance. Finance Information

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Appropriations Act 2010 changes Reverse Mortgages

October 2, 2009 · Posted in Bad Credit Loans · Comments Off 

Changes to reverse mortgage provisions are being considered by both the House and Senate in coordination with the HUD Secretary. The changes are necessary in order to protect both lender and borrower in light of the depressed real estate market. One of the things being considered is a subsidy, and it is estimated a total of $298 million will be needed to protect any loans made during the fiscal year of 2010. The President already included appropriates for this subsidy in his fiscal Year 2010 budget but it has not been approved by the House and Senate as of yet. These figures are based on the assumption that the current housing market will continue on a downward trend and though OMB supports this theory they are not willing to release their estimates to the public in order to avoid causing any alarm or making premature projections that are based only on theory.

The Congressional budget Committee has agreed there is a need for a subsidy in the amount of $798 million. HUD’s Secretary has commented they are willing to increase insurance premiums and tighten the eligibility requirements in order to finance the subsidy. The House version of the bill does not make any appropriations for the subsidy but rather advises the HUD Secretary to make any changes he feels necessary. The Senate on the other hand includes appropriations for a $288 million subsidy in addition to the potential for reducing current loan limitations by five percent. The Senate will most likely vote on the bill during their current session. This may take a little time since they only recently returned from their summer recess and will need to include this bill on their calendar.

Because of the vast differences between the Senate and House versions of the bill it will probably be necessary for it to go to conference. That doesn’t mean it will be tabled but there may be dramatic changes, possibly even a return to the original appropriation of $798 million the President requested for his fiscal year 2010 budget. It is essential to develop a bill that will be beneficial to not only the lenders but also the elderly borrowers. The subsidy is a necessary addition and requires the development of realistic and workable provisions that will benefit everyone involved.

NRMLA is providing information to key figures in Congress concerning the feasibility of lowering the reverse mortgage limitations. They have conferred with several of their major lenders and have discovered that with limitations being lowered 10%, 21% of borrowers would be unable to borrow enough funds from a reverse mortgage to meet their current indebtedness. This would leave many elderly homeowners faced with having to sell their homes and use the funds in to secure housing elsewhere or move in with relatives. There is a definite need to trim costs but at the same time to not take away from the elderly homeowner who wishes to remain in his home and needs the reverse mortgage to do so.

If you would like more information, please call (866) 683-3690 or complete our online Reverse Mortgage Information.

A thirteen-year veteran of the mortgage industry, Robert Griffin specializes in reverse mortgages and has helped over 3000 Americans find financial security with a reverse mortgage. The owner of Griffin Financial Mortgage LLC, based in Fort Worth, Texas, his memberships include the National Association of Mortgage Brokers (NAMB), the Mortgage Bankers Association (MBA), the National Reverse Mortgage Lenders Association (NMRLA) and the Better Business Bureau (BBB). Robert Griffin is also co-author of “62 Senior Moments.”

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