4 Dangerous Mortgages Lenders Promote

If you are in the market to purchase a home and you need a mortgage, there are certain mortgages that will make your purchase the best investment you have ever made, but there are other types of mortgages lenders promote that are to be avoided.



Interest Only Mortgages have been around for a long time; for a short term loan, such as a construction loan while your property is being renovated, there is nothing wrong with them.However to get into a longer term mortgage where only the interest is being paid disallows for any value increase in the property.



Even the small amount of principal that is reduced during the early years of the loan are more beneficial than owing the entire amount after making payment on the interest alone.



Adjustable Rate Mortgage (ARM) with an Option that allows you to skip a monthly payment if you are short can be problematic The monthly payment that you missed is then added onto the back of the loan and you end up paying interest on your interest, since that is where most of the monthly payment goes to in the first few years.



Balloon Mortgages are dangerous for the simple reason that no contingency or arrangement can be made for the future that takes into consideration all of the problems inherent in nature of loans - primarily the economy, but more closer to home is the fact that such a loan requires a full payment at the end of the balloon term, often 5 years, at which time the borrower may not have the ability to secure fixed financing.



Piggyback Loans are used occasionally when the borrower does not have enough down payment and cannot afford the PMI (private mortgage insurance) required on a conventional loan with less than 20% down payment.



To make up the difference, a second loan is taken out that reduces the amount of the first.By reducing the first to an 80% LTV (loan to value) PMI would not be required. This type of loan caused many foreclosures during the most recent housing crises.



The more astute borrowers know these and many other details concerning mortgages and thereby prevent dangerous financial undertakings that for those less informed lead to catastrophe.

Home Mortgage Loan Interest Rate Predictions For 2009

A lot of people are very interested to have an idea of where home mortgage interest rates will head in 2009. Even with the housing stimulus plan in full effect, the economy, and especially the housing market, are struggling. Right now, interest rates have jumped around .5% from just a few weeks ago, as I predicted they would in January.



Here is the exact quote of mine "Over all I predict that home mortgage rates for 2009 will take a temporary .5% increase followed by steady steep declines throughout 2009.



" It is pretty easy to understand why I made that prediction, and how I predict mortgage rates will go in the future. For example, back in January I knew that with the super low interest rates available, homeowners would flock for refinancing or loan modification. They did, and lenders will overwhelmed with paperwork and the like. This led to a temporary (which just happened) rate increase of about .5% across the board on all mortgage interest rates. This mainly is to help ease mortgage lenders and banks workload while other refinancing applications are being reviewed and closed on.



For the rest of 2009, I predict that the current home interest rates will remain the same throughout the next 3 or 4 months. After that, I think the rates will start to go down a .25% or so, followed by another .25% drop either at the end of this year or early next year.



Always remember that only homeowners with the very best credit score will be eligible for the lowest of all interest rates, but even homeowners with bad credit should be able to get a reasonable deal on their home loan modification or refinancing.



Homeowners should also know that even though rates have recently increased a little, the current rates are really low nonetheless and a refinancing or modification of a home loan can still be very beneficial for a homeowner in the right financial situation.

The Entire Affordable Mortgage Rates Are Calculated Precisely

There are various methods where one can achieve anything and everything. My friend’s son at a very tender age is very insistent and wants to own all that his father has. He has great plans and dreams and wants to fulfill them in a beneficial way. Well, there are hundreds of youngsters these days who want to lead a comfortable life and settle in a luxurious way. My friend’s son (Daniel) is only 20 years old. He believes in earn and learn procedures. He is learning as well as earning. He works at night and easily takes out a few hours during the day to study through a correspondence course.



Daniel has also made plans for his marriage. He wants to get married after 4-5 years and wants to go for a honeymoon with his wife to a world tour. His dreams do not end here. He wants to buy a flat and a car so that both of them can lead a comfortable life after marriage. He wants to achieve all this before his marriage. Thanks to the easy procedures of EMI which most of the banks and the mortgage companies offer their customers? Many youngsters like Daniel can fulfill their dreams and achieve their target.



Daniel also has multiple credit cards.



He is a very confident boy and will definitely make a sincere effort to gain what all he wants to. Many youngsters or even a common man can make an attempt and seek the assistance from the leading mortgage companies to fulfill their dream. They offer Today's Mortgage Rates, Lowest mortgage rates and even home loans.Some people think that buying a property or a house on loan is not good. Instead this is the biggest change for today’s man that debt is no longer measured as a bad thing.



Today, debt has become a means to achieve one’ dream for many of us.



Thinking that debt is not a good thing was the perception of our ancestors because in those years there were no facilities and mortgage or loan amenities. These revolutionary transformations could be traced only a few years back and we have to be wise and take the assistance of such mortgage companies to fulfill our dreams. Paying a huge amount at once is possible for many of us. We should not fear in taking debts and in fact we should take the assistance from the leading mortgage companies and also take the advice from their agents so that we can come out of the fear of the term mortgage.



They will convincingly give us a good advice and then we can make a decision easily. Daniel’s father had guided him to take the home mortgage from the Mortgage Rates Ontario because he had taken their assistance earlier. He told Daniel that their home loans were beneficial and also accompanied him to the Mortgage rates Ontario so that he could help him to select the Mortgage rates as well as the Lowest Mortgage Rates to fulfill his dreams.

Life Made Easy With A Reverse Mortgage Home Equity Loan

Retirement is full of difficult choices just like everything else in life. When it comes time for the big day of retirement a reverse mortgage should be part of the planning process so you can have some fun choices to make and make your life easy.



Choices on where to vacation, where to eat, where to play golf-choices, choices, choices-the list is virtually endless. There will be no bigger choice for you to make when the time comes than deciding where to live and what to do with your home.



You worked your whole life long-now what do you do?



If you meet all the eligibility requirements and decide to stay in your home, you may want to apply for a reverse mortgage. A reverse mortgage allows those over 62 to get the equity they have in their house without having to sell it.



The proceeds can be used any way you want-medical expenses, travel, home improvement, pay off bills, even frivolous things-any way you want. More people are realizing that a reverse mortgage is a source of monthly income they can live on.



The amount you get is determined by the equity you have in the house.



There is no income requirement or income verification because there are no payments.



It is mandatory that all borrowers for reverse mortgages get counseling explained to you by a trained and tested counselors to make absolutely sure they know what the conditions are. This may be a little overkill but this market segment is most susceptible to getting ripped off. It is a good idea to bring a family member with you to this session.



For many reverse mortgages allow greater freedom and flexibility in retirement and thus a better quality of life. For many a Godsend. Life made easy!!



Jack Krohn is a leading free lance writer on Home Equity and Mortgage issues with over 40 articles to his credit. He is also the #1 author of Home Security Articles in the country according to Ezine Articles.