Mortgage Loans
rcbob
9 years ago
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sushipup1
9 years agoncrealestateguy
9 years agoRelated Discussions
Advice needed: rent, mortgage, construction loan,
Comments (7)Only you can decide what the right scenario is. Your gut will usually steer you in the proper direction. I can only tell you how free my husband and I feel right now without any loans on our property. No one can take it away from us if times get really sour. Naturally, you still have taxes, insurance, and upkeep, but building a reasonable home takes the pressure off of that. We look at our land and feel thrilled that it is truly ours. As long as someone has a loan on their home or land, they do not own it, the bank does. Try missing a payment or two if disaster strikes and see what happens. Disaster can be a major unexpected illness or accident, natural disaster in an area, or economy based. Was it a hassle to sell a house while living in it? For sure! I hated that process. (Fortunately, we sold in under a year). We decided the short term nuisance of selling while in the house was still better than owing a bank for more money. The interim of not being in my new home yet is difficult at times. I'm in a small place in the meantime. I'll admit, I'm spoiled and want it now. However, in the home scheme of things, it's only a short term inconvenience, and then I'll be through with construction and in my home. And I do have a decent roof over my head in the meantime. Also totally ours. As far as construction loans go, yes, they are given out in draws, but we had been locked into an interest rate that was good for the life of the construction loan, and grandfathered into the mortgage itself. However, the way the banks are now, that may no longer be the case. Keep in mind that a lot of banks will not let you be the owner/contractor, but it doesn't sound like that is the way you want to go anyway. Now the issue about equity loans. They are hard to come by these days, even with a perfect credit score. I have a friend who is vice president of a bank. She said that they have had many people borrow against a home they are currently in, and no longer wanted. Of coarse, they never tell the bank they no longer want the home. They say they want to make improvements, or whatever. With the real estate market what it is, it can take time to sell. So, they are buying another home with the equity money and letting the bank foreclose on the one that was no longer wanted. This has made getting home equity loans harder to get than hens teeth, and hurts the honest people. You may also find it very difficult to get the equity loan processed, funds dispersed, and a new home totally constructed ready to move in, within a year. Even with a reputable builder, homes are seldom done in the exact time frame we want. The banks are approving loans, setting closing dates, and then either pulling the plug for some lame excuse three days before closing, or re-setting closing dates over and over, due to "needing more papers filed" that come out of nowhere. Good luck in whatever decision you make. It's never an easy one, and I wish you the best....See MoreMortgages vs. loans
Comments (10)Hi Marys, I'm fuzzy about mortgages (fuzzier than I should be for sure) but it seems there are a lot of fees, points and insurance fees involved. All such fees are for the myriad of legal processes and diligence required for that degree of risk on that size of a loan related to real property. If one had a pretty significant chunk of a down payment but was short say 50,000 on a 200,000 house - is there anyway to secure a "regular" loan? What do you mean by "regular"? If you mean NOT secured by real estate, the answer would be; Maybe... if you otherwise have a strong enough credit history. Possibly a truly stupid question i don't know. I know most loans require some sort of collateral whether a mortgage or a loan. Not at all... you can get cash-advances on your credit cards, and signature (personal) loans from your checking bank without any collateral at all. But if your buying a house with a down payment that results in significant instant equity, why can 't that be collateral for a loan? It can be, and is used to collateralize home loans all the time. Realize, however, that you are once again asking the bank to now link your real estate back into the transaction, which pulls back into play all the legal process & diligence once again, and all the related fees to pay for all the related service providers. Your cheapest borrowed money is the funds you pay "all those fees for" in relation to your mortgage... simply because the lender has the greatest and most secure collateral in place to guarantee their principal. Hope that helps in the clarification. Cheers, Dave Donhoff Strategic Equity & Mortgage Planner...See More1.95% Mortgage Loan
Comments (13)Thank you all for responding to my post. All of you were correct in your comments. First, the reputable company that I was told was reputable turned out not to be so reputable afterall once I did my own Private Eye Work :-) on the internet (Can I mentioned the company name on this site?) Plus this type of loan is considered a negative amortization as stated in the comments which mean instead of your balance decreasing it increases...who in their right mind would assume a loan of this type? Anyway, the gentleman called me at work today and I was very nice but I did not give him any impression that I knew what type of loan this was. He goes on to tell me how much money I would save with this 1.95%, 5-year fix but left out the most important info but being me I let him continue with the lies he were telling. I think it bothered me more because if I had not made myself familiar with this type of loan after reading all of your responses, I would have been one of those SUCKER!!!! that he would have licked all the way to the bank. I think at one time he felt as though he had sold the info to me and I was going to accept but that's when I asked him...WHAT IS THE REAL PERCENTAGE????? I further explained to him that I read a 1.95% loan could actually be a lot higher (i.e., 7.15%) but of that 7.15% you only pay 1.95% for the 1st 5 years...so say for instant the figures comes out to be 5000.00 a month for the mortgage based on the principle balance of the house....you take 1.95% of that then deduct that figure from the 5000.00 original mortgage...BUT THIS IS THE KICKER....whatever the difference...it is added to your principle balance for the next 5 years....so say it was 1/2 of 5000.00, $2500.00 would be added to your principle balance for the next five years. The gentleman also stated...oh by the way your mortgage will go up slightly each year during those five year in the amount of around 200.00. ARE YOU CRAZY FOR EVEN TELLING ME THAT :-) I then asked him, so a person getting this type of loan will put them right back in the same status when they initially applied. Sounds to me this type of loan is for someone who is HOUSE POOR or about to lose their home which I neither of the two. I politely told him NO and I am just fine with the current loan I have. There is an article on www.money.cnn.com that talks about these types of loans and how dangerous they can be. Thank you guys so much. Without your responses I would not have dug so deep into the internet for info regarding this subject. Who wouldn't want a 1.95% loan...I DEFINITELY WOULD but only if it was legitimate. Once again, thanks....See MoreHelp need advice on mortgage loans!
Comments (6)Hi uaprofessor, Also, I keep running in to these horror stories of people that were lied to. Any thoughts on how I can avoid this? A) Avoid the fallacious assumption that you can safely & successfully "shop" for personal mortgage financing in the same manner an actual standardized commodity can be comparison shopped. A good mortgage is always a custom-fit process, and the quality of the end results is a direct function of the financial quality & knowledge of the person that does the fitting. B) Shop the providing individual, seeking professional quality (as you would for a specializing surgeon, or legal representation,) rather than shopping the numbers ahead of the provider. C) Keep in mind that the best structure and terms are exponentially more important to your long term best financial interests than the face interest rates are. The lowest rates on the wrongly structured program will cost you more in the end than the opposite. Hope that helps! Dave Donhoff Strategic Equity & Mortgage Planner...See Moreweedyacres
9 years agoMandyvilla
9 years agoStax
3 years agoTheignorantway
last yearlast modified: last year
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