Getting a Home Mortgage? Don't Even Think About Applying Unless you Have These 3 Things!

Purchasing a new home can be both exciting and terrifying as you put all your hard earned money towards a down payment, and prepare for one of the largest financial decisions you will make in your lifetime.

The best advice I can offer you when applying for a mortgage, is to be prepared! This means understanding all your finances including income, expenses, debt and credit history and score. When you come prepared to a mortgage lender or broker, you are more likely to explain your wants and needs, and the process will be expedited because they will not have to decipher your financial information.



The mortgage broker or lender will be able to simply verify your information and look at it from a lending stand point. They will be able to determine the amount of money you can handle as a monthly payment, how much money will be paid in interest, as well as the interest rate that is best suited for your level of risk. Generally, the better your financial position and credit history, the better your interest rate on the mortgage will be.

You are saving both yourself and the mortgage lender broker time in assessing your specific case.



By being educated, you also have a sort of protection device. You are more likely to sense wrong doings, or unfair dealings when you come prepared. They can not tell you something negative about your financial environment that is not so, because you know what your situation looks like and understand the type of deal you are capable of qualifying for.

So here are the top 3 things you need to have before you begin shopping mortgage lenders:

1. Credit Report

Don't rely on the mortgage lender to pull your credit report.



Take responsibility and pull it yourself! You can get your credit report for free. Check for mistakes or discrepancies, as they can happen often. You can see the exact items on your credit report and your credit score. Perhaps there are items you can quickly take care of, or items you simply forgot about that could be easily closed out. You can also have an explanation planned for less than attractive items on the credit report.

Perhaps you fell on hard times, but since have taken steps to correct the problem and are now in a better position.



When you understand your own credit history you have full control over the information and how it is used in the mortgage process.

It is much better to come prepared with an explanation for a negative item, rather than being surprised by the item by the broker and responding with a "What?" or "I don't know."

2. Income and Expense Sheet

In order to assess how much of a monthly payment you can afford, an analysis of your total income and expenses needs to be done. You can do this by writing down literally every source of income as well as the amount, on a monthly basis.



This may include pay checks, alimony, child support, investments, a side business etc. Anything that contributes to your income is a source.

You then would want to determine your monthly expenses, such as rent, car payment, food, cellular phone bill, utilities, clothing etc. Anything that is taken from your income is considered an expense.

Everything that is left over is considered disposable income, and this is used to help determine how much a payment can be afforded every month in congruence with your current rent or lease payment.



3. Asset Documentation

Assets are a definite plus when applying for a mortgage. It shows the mortgage lender that even if your cash reserves are depleted or in trouble, you will still be able to afford the monthly payment. Assets may include investment properties, investment accounts, types of cars and household items etc. Anything that can appreciate or return you money is considered an asset. Assets are used to gain wealth, not just have a large bank account.



Be prepared to show these assets with supporting documentation.

If you come prepared with this information and documentation to support it, you are half way to getting your mortgage application approved! The process will be much smoother and pleasant by having this information readily deliverable to who might need it. If you need help putting this together, ask for the help of a financial advisor. There are many resources available for your use.

John R Blakefield is a mortgage and real estate specialist.



For more information, articles, news, tools and valuable resources on home mortgages or investment loans, refinancing, debt solutions, visit this site: http://www.scourtheweb.com/mortgage/.

What Are Mortgage Brokers And Why To Use One

"Mortgage" is formed from two words: the French word "mort" meaning "dead" and the word "gage" from Old English meaning "pledge". Sir Edward Coke (who lived from 1552 to 1634) explained the term: the land as considered "dead" to the mortgagor, as if the person never had it.

Today, the term mortgage is used for a loan for purchasing propriety. The most common
mortgages are the home mortgages. It is not common to pay cash a home today.



The
"life' of a home mortgage is from 20 to 30 years. During all this years, the owner will pay
regularly and with the specified amount. There is also a term for the interest rate,
established to respect the seller and also the buyer conditions.

Most people think at a bank when thinking at a mortgage. It is the most trustful way to
get a mortgage; even the banks are asking the most rigorous set of documents to approve
it. The stability has its price: banks don't give the best interest rate, but there is also the
possibility to negotiate for the best acceptable solution.



Pertinent information empowers the burrower with the knowledge to make appropriate
decisions for his family and themselves.

The banks are making their money from activities like mortgage, so there will be always
good solutions for everyone. People can "shop around" to find the best mortgage
condition.

What are the mortgage brokers? They are making all the legwork for the customer.
Specialized websites are offering "perfect loan programs" in a few minutes.



A
professional research must be made to find the appropriate opportunity to buy the house
of our dreams.

Financial brokerage is a licensed company or individual who obtains a loan for borrowers
by selecting the best available solution at the best available rate. Real estate brokers help
borrowers to get a loan in accordance with their needs, making in the same time a
profitable investment for the financial brokerage or lender. All the work can be done
online, leading to a fast win-win situation for all.



The load mortgage broker has a professional expertise with direct access to many loan
products, providing customers efficient and cost-effective options that are meeting their
specific needs. He will provide customers with choice, convenience and expertise.

A good broker is the customer's mentor, guiding him to the entire loaning process,
balancing the client's financial goals, offering extensive choices.

A professional mortgage broker is using loan packages with less than perfect credit histories,
permitting to his customers to enjoy the benefits of home-ownership.



A mortgage broker isn't a banker, neither another financial lender. He is (or must be) a
real estate professional offering products and services. A broker can act as a banker too,
when funding loans.
Maybe the best part of a home mortgage broker activity is the help he is giving in
assessing the requirements and saving the customers time. Having contact with many
banks they can offer advices on the ways to overcome the frontiers to loan qualification.
A mortgage broker also knows the laws and regulations, simplifying the borrowers' task.



He is taking the application and obtains the credit report and appraisal. He counsels the
customer on the approval process; obtain the credit report and appraisal, collecting the
necessary documents. He also provides separate services and facilities to wholesale
lenders; market the lender's product also. Mortgage broker also is assembling and
delivering the completed loan package.

The mortgage broker really cares about the quality of the loan; the safety and soundness
of the mortgage lending community is linked to the success and efficiency of its home
loan originations.



Consumers who exercise their choice choose mortgage brokers because
they are dedicated to their customers, who are the consumers, and in the same time the
wholesale lenders.

May the broker steer consumers to the lender who pays the highest fees to the broker?
Isolated instances of steer can occur, but the free-market economy is protecting the
customer giving him a powerful weapon: the vigorous open competition. Each consumer
can shop and compare the prices; his final option will lead him to the best solution.



The
level of choices has no precedent.

For more information about Mortgage Brokers please visit our website at: http://www.better-mortgage.net

How To Reduce Your Mortgage Interest Rates

When it comes to buying a home, your mortgage matters just as much as the cost of your home. Interest might seem like a small percent, but when compounded over thirty years, it can literally double the amount you actually pay. If you want to lower your payments and pay less for your house, you should consider the many ways you can lower your interest payments by refinancing.



Taking advantage of a changing housing market is one of the easiest ways to lower your interest payments on your mortgage.



If you have a fixed interest rate and interest rates are dropping, you can refinance to an adjustable rate or a lower fixed rate mortgage. If rates are rising, you can do the opposite and change from an adjustable rate to a fixed rate; this can keep your interest rates from skyrocketing.



You may be able to lower your interest rate by taking advantage of an improved credit history. If your credit rating was low when you first acquired your loan, you may have a high interest rate.



If you've been paying your bills on time, your credit may have improved, in which case you might qualify for a lower rate. There are many credit repair companies that can help you improve your credit. Beware of credit consolidation companies, which actually can further damage your credit!



If you have two loans, a first lien and a second lien on your home, you may want to consider consolidating those two liens into one. Many people get equity lines on their homes, but don't realize that the equity line is adjustable, and often has quite a bit higher interest rate than the first loan.



Refinancing the two loans into one can often save money. Another strategy would be to pay down the equity line as soon as possible.



10-year and 15-year fixed mortgages usually have lower interest rates because the loan is getting paid twice as fast as a 30-year mortgage. The down-side is that the payments will be quite a bit higher.



No matter why you decide to refinance, always be sure to speak with several lenders first, or find out who your friends and colleagues use.



Good referrals are the best way to find a mortgage professional you can trust. Sometimes brokers may give you a quote that is not what you eventually get. Be sure to ask for a good faith estimate and ask to see proof that your loan is locked at the rate you are quoted to ensure it is the rate you actually get.



Beware of low start rate programs. They are usually not the actual interest rate, and may be simply a teaser or a negative amortization program that defers your interest payment until a later date.



This can help lower payments, but not the actual interest rate or amount you'll owe in the end.



Remember, before you take advantage of any refinancing offer, find out if it will actually save you money. On-line mortgage calculators help determine how much you'll pay using your new and old interest rates. Then you can just deduct the points and fees (unless they're included in the new mortgage) and find out how much you'll actually be saving.

Myths and Mortgages

Some of the mortgage companies today, sell their mortgage

packages with every kind of mythical benefit known to man, from

the belief that interest only is a real mortgage that will

eventually payout (slight of words, there) to the belief that an

interest only mortgage carries a lower interest rate(which is

does, but only for the short term). Let's start with some of the

more traditional loans, and move into the weird and unusual.



There has been a tremendous jump in the available interest only

mortgage packages in the last three to five years so maybe we

should take a minute to break down some of these mortgages into

a language everyone can understand



There's a 3/1 ARM. A 3 year ARM, means that the interest rate is

locked in for 3 years. For the first month, the interest payment

is only 1%, for the next 3 years following only the interest is

due as the monthly payment. After the 3 year term, and for the

remainder of the life of the loan, normally thirty years, the

interest rate will change, and the payments will begin to

include principal and interest.



There's a 5/1 ARM. A 5 year ARM, means that the interest rate is

locked in for 5 years. For the first month, the interest payment

is only 1%, for the next 5 years following only the interest is

due for the monthly payment. After the 5 year term, and for the

remainder of the life of the mortgage, normally thirty years,

the interest rate may change, and the payments will begin to

include principal and interest.



These mortgages also come in 7/1 and 10/1 ARMs, but analysts

really don't recommend extending the interest only option out

that far, since too many things can change before the 7 or 10

years is up.



The 10/30 interest only mortgage works in the following way: you

borrow money in the form of a 30 year mortgage, with a fixed

interest rate. The first 10 years are interest only payments,

with the full amount of the principal being amortized (interest

payments included) over the last 20 years of the loan.



The 15/30 interest only mortgage works in the following way: you

borrow money in the form of a 30 year mortgage, with a fixed

interest rate.



The first 15 years are interest only payments,

with the full amount of the principal being amortized (interest

payments included) over the last 15 years of the loan.



These mortgages are really appealing to the consumer with any

sort of investment knowledge. If I were going to borrower with

the interest only mortgage option, it would be one of these two,

the 10 or 15 of 30.



Now what other myths can we find? There's the belief that the

home mortgage income tax deduction is a substantial benefit to

the taxpayer, and that 1% interest only loans are for the life

of the loan! Ha! There's also the balloon note myth that

proliferates the belief you can automatically refinance through

your current lender when the note matures, or that adjustable

rate mortgages are a better deal than fixed rate!



Another mythical idea is that the real estate market can't go

bust.



An exploding growth rate in the mortgage loan industry,

and the continued surge in real estate prices, has put the

interest only mortgages in a huge category all their own. Up

from the first part of the century, the interest only mortgage

loans are now garnering nearly one-fourth of the mortgage loan

market. That kind of growth is almost frightening, to even the

most experienced lender. Can you imagine the possibilities, say

four to five years from now, when many of these loans come due

to pay the interest and the principal; what happens if our

economy isn't still a thriving bustling place?



The benefit of the interest only loan is that the consumer is

eligible to buy much more house, than with a standard mortgage.



That's great if you're certain in a given period of time, you'll

be able to afford a higher mortgage payment. But is anything

guaranteed and given in this day and time? What if you can't

afford the payment when the interest only term expires?



We have only to look at the disastrous consequences of the crash

of the stock market during the 1920s to appreciate where this

may be leading us today. Many people had financed their homes

with an interest only mortgage, and when the stock market

crashed and there was no work, they lost everything, including

their homes.



So, we not only promote mythical nursery rhymes, we promote

mythical mortgages, too!

Mortgage Calculator Helps You Find The Right Mortgage

Your dream house may not be everyone else's idea of "Home, Sweet Home," but it's going to be all yours.



Now if you can just figure out how to finance that bit of real estate. Not wanting to leave any stone unturned, you're on this site to get some background for your decision.



One kind of mortgage calculator ("how much house can I afford" type) takes a look at your budget and, with your input, works out how much you can afford to pay, either monthly or annually. Some are not comprehensive enough to take into account taxes, insurance and the increased costs of homeownership.



It's worth your extra time to pull up several of these mortgage calculators and run your numbers through them for comparison. Then you're ready for the next step.



The fixed rate mortgage gives you the same monthly payment for the life of your mortgage. That's what you just worked through. This means you can set up your household budget more precisely and have greater control over how your money is spent.



A "how much can I borrow" mortgage calculator helps you work out how much you can afford to pay for the house altogether.



Can you afford that dream home? Maybe yes; maybe no.



It also depends upon the interest rates you negotiate with the lender, an increase in the size of your down payment, the number of years you want the note for and the actual price you negotiate for the house.



Using the mortgage calculator, you can input these factors individually and see what happens to your bottom line. A small additional prepayment to your regular mortgage payment may be what pushes you over the top.



A prepayment mortgage calculator can show you what it means over the life of your note. The beauty of the prepayment is that it is optional, not contractual.



Unlike an Adjustable Rate Mortgage (ARM), you are not locked in to an increase every one to five years. You're only responsible to make the original mortgage payment. If you are not so financially constrained with a monthly budget, and prefer to have a lower rate of interest to start, then use an ARM mortgage calculator.



This will give you a rough idea of monthly payment over a period of time. ARMs do have the distinct disadvantage of putting your home in danger financially should the interest rates rise dramatically.



You need to use the mortgage calculator to find out what your optimum interest rate would be before you reached that financial crisis. Make sure that the price of the house you buy gives you quite a large safety net so that the interest rate can rise without danger. The beauty of mortgage calculators is that you get experiment before committing anything to paper or even speaking realtors or lenders.



You find the information you need to complete the mortgage calculator's questions by using your own financial information, an approximate house price and the rates advertised on any piece of junk mail that's arrived in your mailbox. You work in the privacy of your own home without the fear of being hounded by a salesman doing follow-ups!



Take the preferred options you worked out on the mortgage calculator with you when you begin discussions with the broker.



It's proof of your intentions and serves warning of your willingness to follow up on those you're negotiating with.

Credit History Stopping You From Getting Mortgage Loan You Want? Learn What's On Your Credit Report

Credit History Stopping You From Getting Mortgage Loan You Want? Learn What's On Your Credit Report Have you ever been denied a credit card or home loan, Visit Here http://credit-cash-loan.blogspot.com and you simply just didn’t know why? The credit provider or lender told you that your credit history just wasn’t up to par in order to qualify for the line of credit or loan. Well sure you made a few mistakes in the past, perhaps a few late payments, and of course there is some debt that you are aware of.



But then again, doesn’t everyone? You certainly didn’t believe that your credit report history was bad enough to not qualify for a credit card or loan, even at a higher interest rate. Let me tell you a secret, many people have absolutely no idea what is on their credit report! Your credit report has, in the past, been something not readily available to you, or an expensive item to attain. Many people are just not aware that your credit history can determine your financial activities for your entire life.



This is becoming more prevalent as credit awareness and education is deemed necessary. So it is important to always be apprised as to what is really on your credit report! There can be either two items on your credit report: accurate or inaccurate. Credit providers may have reported inaccurate information on your report! Mistakes happen that you may not even be aware of. A move, changed phone number, lost mail, open credit cards from 15 years ago that you simply didn’t know existed, and other easily overlooked or forgotten items do happen, more than one might think.



Hey, who has time to keep track of every single financial item when life, as we know it (busy, fast paced) is hardly ever forgiving? Many people get down on themselves for having a bad credit score. But this is not necessary! It is not a reflection of who you are. Really. You may have never been educated on how to handle your finances or extenuating circumstances may have greatly effected your credit. So in order to stay on top of your credit history, and not be blind sided by an embarrassing, unexpected rejection, check your credit report! Credit reports are no longer some far off document that is hard to get a hold of.



After all, it is YOUR credit report, right? Shouldn’t you have easy access to it? Well somebody else thought you should too, and the Fair Credit Report Act (FCRA) was enacted just for this reason. Here are the terms: • Every person is entitled to a free credit report if a credit company takes an adverse action against you, or if your application for credit or insurance is denied. • You are entitled to a free credit report if you are unemployed and plan to get a job in 60 days, are on welfare, or if your report is inaccurate because of fraud including identity theft.



• Equifax, Experian and Transunion, all nationwide consumer reporting companies, are required to provide you with a free copy of your credit report every 12 months. Now there is no excuse for you not to keep on top of your very important credit report. All you have to do is go to and request your free report! Or, you can call 1-877-322-8228. Always check your credit report before you apply for any mortgage loan or line of credit. So you have your credit report, what next? Evaluate each item as accurate or inaccurate.



Which items can you clear quickly by simply closing a card or calling a creditor and paying off an old debt? If there are inaccurate items, you must make a dispute in writing with supporting information. This means copies of any documents that support your claim. You must send this information to both the credit consumer company as well as the credit provider. If your dispute is accepted and changes are made, the company must send you the changes in writing as well as send you a new credit report with the inaccurate information removed.



The credit provider may not make the same claim against you again. If you find inaccurate information and get it fixed, then your credit report will be better, and another step towards getting that lower mortgage rate has been made! If there are negative items that are accurate on your report, then you must take action towards fixing them! If you are not sure what to do, consult a financial advisor at your bank who can help you set up a repayment plan, consolidate debt if need be, or even investigate debt forgiveness.



Negative items will stay on the credit report up to seven years, but if you make an effort to begin paying back debts, and show you are serious about qualifying for a mortgage loan, then you are yet closer to proving to a mortgage lender that you are both willing and able to pay back a loan. And these two things: willingness and ability are exactly what a lender evaluates when considering a person for a loan. Fixing your credit of accurate negative items takes personal effort and time.



However, fixing inaccurate information that can greatly increase your credit score, can be done fairly quickly. If you are serious about getting a mortgage loan, or even a better mortgage loan to save you money, consult your credit report before you take any steps at all!Visit Here http://credit-cash-loan.blogspot.com

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.



On the contrary, it means that shopping around for the best mortgage possible may be even more beneficial then during a high market period.

If you solicit mortgage rate quotes from enough lenders and pay attention to economic news, you might be able to secure a home mortgage loan at an interest rate that you will not see offered again in your lifetime.

Solicit Several Mortgage Rate Quotes

In order to get the best deal on anything in America, it is important to shop around.



Securing a home mortgage loan or a and 2nd mortgage is no exception to the rule. If you are the type of consumer who likes to walk into the first store that you see and buy what you need without comparing your options, then you might also be inclined to accept the first home mortgage loan offered to you.

Doing so would be a big mistake. Unless you have a long term established relationship with a lender who considers you one of his best customers and is willing to loan money to you at the prime interest rate, then in order to get the best possible home mortgage loan you will need to "shop" and compare lenders.



Because the home mortgage rate is so volatile right now, it often changes during the course of one business day. Therefore, it is best to solicit all of your mortgage rate quotes on the same day. Compare offers from various lenders, and request a rate lock from the lender offering the best choice.

Why the Home Mortgage Interest Rate Matters So Much

The interest rate that you secure your home mortgage loan at will have a big impact on the total amount that you end up paying for your home by the time the loan is paid in full.



To illustrate this, let's say that you buy a home for $150,000 using a 30 year fixed mortgage with a 6 percent interest rate. By the time the home mortgage is paid in full it will have ended up costing you almost three times the original cost of the home. Using the same home and the same 30 year fixed mortgage, but lowering the interest rate by only one percentage point, down to a 5 percent interest rate, will save you approximately $100,000 over the life of the home mortgage loan.



Clearly, getting the best possible interest rate on your home mortgage loan is one of the most important economic decisions you will face. Since mortgage rates are at an all time loan, now is a great time to gather some home mortgage rate quotes!

Copyright 2005 Tracy Price

Tracy Price is a staff writer at http://www.2nd-mortgage-tips.com
Providing free educational information on mortgages, 2nd mortgages, home refinancing, etc.



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