20
Jul
By support
Home Mortgage Tips

On a Variable Mortgage? 3 Signs Your Mortgage Payment Is About To Increase

On a Variable Mortgage? 3 Signs Your Mortgage Payment Is About To IncreaseFor many homebuyers who are new to the market, it can be very comforting to be on a fixed rate mortgage where fluctuating interest rates cannot have an impact on your monthly payments. While a variable rate mortgage can sometimes lead to significant savings at the end of the day, there are a few ways you can tell if your monthly payment is on the upswing.

An Increase In Your Home’s Value

A marked increase in a home’s value is ideal for most homeowners who consider their home an important investment. However, the downside of an increase in the price of real estate is that your property taxes will probably be bumped up along with it. According to Josh Moffitt at Silverton Mortgage, “If your home value increases because of market conditions, taxes will follow, and it will cost more to insure the home.” In order to determine if a higher payment is on the horizon, you may want to take a look at the listings in your neighborhood.

A Miscalculation

Most people hope that a re-assessment of the value of their home will lead to a bump in its price, but if your monthly mortgage payments were calculated at a specific time during the transaction, this bump may mean a higher monthly payment for you. If there was some overlap between the assessment and the property transfer, or other fees were included in your payment, your tax professional should be able to advise you on the best course of action you can take come tax time.

Insurance Renewal Is Up

In the event that the homeowner’s insurance on your home is about to expire, there’s a possibility that you’ll be paying a bit more following renewal. Instead of leaving this to chance, ensure that your insurance company is communicating with you and keeping you abreast of changes. After all, while insurance is important to protect your investment, you have the option of looking into other insurance providers who may be able to give you a better rate.

It can be hard to plan for the increase in rates that can go along with a variable rate mortgage, but if your insurance is up for renewal and the value of the homes in your area has increased, a higher monthly payment will likely follow. Contact your trusted mortgage professional for more information.

14
Jul
By support
Home Mortgage Tips

3 Tips to Consider when Shopping for a Second Mortgage

3 Tips to Consider when Shopping for a Second MortgageWhether you’re considering a second mortgage to consolidate your debt or complete some home renovations, there can be a lot that goes into making this financial decision. Because a second mortgage is a loan that goes against the equity you currently have on your property, this can be a risk to the ownership of your home. If this is an option you’re seriously considering, here are some basics to know before deciding to on this route.

Be Prepared For Higher Rates

You may be use to the steadiness and consistency of the fixed rate on your first mortgage, but the rates associated with a second mortgage will likely be higher. Because, in the event of default, the first loan on a mortgage will be paid first, lenders for a second mortgage will charge higher rates and fees to validate the elevated risk they’re taking on. While there are lenders that can offer competitive rates, you’ll need to do your research to find one that works for you.

Private Lenders May Offer More Solutions

If you cannot go through your initial mortgage lender in order to secure a second mortgage, you may want to consider a private lending professional who may be able to provide a better solution for you. Because private lenders are not working within the constraints of a larger institution, their guidelines for documentation and qualification may be a little less stringent. While they may have their own set of guidelines for providing a second mortgage, it can be a better way to go.

Is A Second Mortgage Necessary?

In order to obtain a second mortgage, it’s important to be aware that you should have enough equity in your home to make the loan worthwhile. Because you will only be able to refinance 80% of your home’s value, it may not be worth the higher rates you’ll be paying if you’ve only been paying into your home for a short time. Before deciding if a second mortgage is right for you, make sure you consult with a professional to determine the best choice for you.

There are a number of reasons that home buyers consider a second mortgage, from making large-scale home renovations to getting rid of overriding debt, but it’s important to consider if this option will work for you before moving forward. If you’re thinking about a second mortgage, contact your local mortgage professional for more information.

13
Jul
By support
Home Mortgage Tips

3 Mortgage Mistakes That Could Be Costing You Money

3 Mortgage Mistakes That Could Be Costing You MoneyPurchasing a home can be one of the most exciting and stabilizing investments of your life, but because of the expense, there are many ways you may be spending more money than you should. If you’re wondering about the financial soundness of your home investment, here are some things to consider before putting anything down.

Investing In Too Much Home

Many homebuyers are so gung-ho about having their own home that they forget a mortgage takes many years to pay off and there’s a lot of living to do in the interim. While you may be looking at the monthly cost of your mortgage as something to get through, it’s more important to find a home that will provide you with a more flexible lifestyle. Instead of spending half your income on your home, it’s better to choose a more affordable option that won’t lead to buyer’s remorse.

Putting Less Than 20% Down

One of the greatest struggles for those who want to make the leap into home ownership is the down payment, and many buyers will put down a lot less than 20%. While this might seem like a better deal in the short term, putting 5 or 10% down means you’ll have to pay for mortgage insurance in case you default on your payments. It can be hard to come up with 20% for many buyers, but putting this amount down means you don’t have to pay for added insurance.

Not Asking The Right Questions

A house is likely your most valuable asset, so it’s a good idea to know as much as possible about your mortgage before you rush toward closing day. Starting with asking which mortgage option is best for you. Your mortgage lender will be able to answer this question once you’ve completed an application and the lender takes stock of your employment, income, assets, credit, debt, expenses, down payment and other information about your finances. Research the major questions you should ask your mortgage lender before signing up for a loan.

It can be overwhelming to buy a home with all of the information and energy that goes into finding the right place and the right price. However, by being realistic about what you can afford and searching for the best loan for you, you’re well on your way to a sound purchase. If you’re currently on the market for a mortgage, contact your trusted mortgage specialists for more information.