What to Keep in Mind With Home Mortgage Refinance

Take Your Own Time

A decision taken in a hurry might just backfire on you.  Herein, due cognizance must be taken of the long term-affect of the refinancing option. You might just end up paying more for this mortgage then your original mortgage. So, compare the different rates offered by the lender, look up the pros and cons and then make your decision.

The Fixed Rate Loan Vs a Variable Rate Loan

Are you saddled with a variable rate loan and your rate of interest is increasing day-by-day? Well, home mortgage refinance will help you switch over to a fixed rate of interest.

An adjustable loan rate will help you select protective features like lower cap rates, and cash removal from the home equity.

The Annual Percentage and Rate Fees

This is the prerequisite consideration of any mortgage plan. Before you sign up for a refinance plan, be very sure about your total projected savings. In effect, the cost of financing your new mortgage, in totality, must be less than the savings you incur as a result of interest.

You can cut down on your home mortgage refinance cost by asking for no upfront money and simultaneously going for lower interest rates.

The “Safe Margin”

The “Safe Margin’ allows you to decide whether you must go for the refinance option or not. If the comparison of the balancing cost of savings against refinancing is more than two percentage points higher than the existing market rate, then you can definitely go for mortgage refinancing.

Moreover, you must also be prepared to stay in your home for a sufficient amount of time and harbor no thought of moving out. Typically your savings will be realized in about 3-7 years, dependant on the costs at the time you decide to take out a home mortgage refinance.

Loan Comparison

Comparison between the original loan and new loan has to be done, keeping the future in mind. You must have a fair idea as to how long you want to keep the new loan. In the end, home mortgage refinance is a good option only if the total cost of the current mortgage is more than the total cost incurred as a result of new mortgage. Meaning, your new mortgage will enable you to save money.

Be Wary of the Pre-Payment Penalties

You might want to pay off your original mortgage early but be aware of the pre-payment penalties involved in the process. Lenders are liable to charge penalty fees, if you are interested in paying off the first mortgage earlier then the designated time frame. This takes care of their interest, which would have been their due if the loan payment had been carried out through its life.

The great part of a home mortgage refinance is that, at times, even if the closing cost of your earlier mortgage are added to the new mortgage, the cost of the new refinance mortgage will still be lower than the original mortgage.

As can be seen, there are quite a few things you should keep in mind while taking the path of mortgage refinance. Give due thought to all before you make your decision.

Getting a home mortgage refinance is considered a highly profitable decision by many. However, if not thought through, the decision might end up costing you. Visit LoanWeb below today for the best refinancing services on offer.  

Your Home: a Short Refinance Will Help You Keep It…

Today there are many home owners that have paid their mortgage on time, but have found themselves in an adjustable rate mortgage, that has adjusted or is scheduled to adjust in the near future.  Now they have good credit, good mortgage history, but the problem is they cannot refinance as they owe more than their home is worth.  Well so they’ve been told, but one insider secret option that is available to home owners in this situation is a short refinance.
If the above scenario describes your situation, then your first step towards a short refinance is to contact your lenders Loss Mitigation department to see if they would be willing to participate in a short refinance.  If they say NO, then you will want to ask what other options are available to you, such as a loan modification, and IF they say yes, then great, you now need to find a short refinance expert to get the ball rolling.

You will want to find a Mortgage Expert that has experience with loss mitigation and who specializes in Short Refinances.  This is not time that you want to just pick any mortgage broker from the yellow pages or to let the family friend that is a mortgage broker use you as a guinea pig.  Short Refinances are a complicated transaction and require a lot of attention and a great deal of knowledge of the loss mitigation procedures.

Now to start the process you will need to contact you lender and let them know you are considering doing a short refinance and to send you the short refinance package.   In this package you will have to fill out an application, a personal financial statement that will list all you income and expenses, 2 months recent bank statements, 2 years tax returns, current paystubs and a hardship letter.  The hardship letter is simply an explanation of why you can no longer afford your mortgage payments and why you need to refinance.  You want to make these letters simple and to the point, no need to write a 50 page essay. 

The next step is to get pre qualified with an FHA Lender, the reason FHA Lenders are preferred is because they will give you the highest LTV possible which will make your offer to your current lender more attractive.  Once you have the approval you will want to put it with your short refinance package and submit to your lender for approval.
Once the package is received, then your lender will order a BPO (Brokers Price Opinion), this is similar to an appraisal, but is an inspection normally performed by a real estate broker in the area to give the lender an idea of the current market value.  Once the BPO is reviewed, the lender will give you an offer for the new payoff amount. 

From here you will want to proceed with you new FHA Loan, which will require a separate FHA appraisal, hopefully the appraisal will have the same or similar value to the BPO, if there is a significant difference, then your  mortgage broker will have to go back to the lender and renegotiate.  The ideal situation is to get you refinanced without having to bring any money to the closing table, but in some cased the lenders will not bend, and to make the deal work you will have to bring some cash to close.
Once the mutually beneficial agreement has been reached, then the lender will issue a release of lien.  This document will show what the lender will accept as a net payoff. 

Your Home: A Short Refinance Will Help You Keep It

Today there are many home owners that have paid their mortgage on time, but have found themselves in an adjustable rate mortgage, that has adjusted or is scheduled to adjust in the near future. Now they have good credit, good mortgage history, but the problem is they cannot refinance as they owe more than their home is worth. Well so they’ve been told, but one insider secret option that is available to home owners in this situation is a short refinance.

If the above scenario describes your situation, then your first step towards a short refinance is to contact your lenders Loss Mitigation department to see if they would be willing to participate in a short refinance. If they say NO, then you will want to ask what other options are available to you, such as a loan modification, and IF they say yes, then great, you now need to find a short refinance expert to get the ball rolling.

You will want to find a Mortgage Expert that has experience with loss mitigation and who specializes in Short Refinances. This is not time that you want to just pick any mortgage broker from the yellow pages or to let the family friend that is a mortgage broker use you as a guinea pig. Short Refinances are a complicated transaction and require a lot of attention and a great deal of knowledge of the loss mitigation procedures.
Now to start the process you will need to contact you lender and let them know you are considering doing a short refinance and to send you the short refinance package.

In this package you will have to fill out an application, a personal financial statement that will list all you income and expenses, 2 months recent bank statements, 2 years tax returns, current paystubs and a hardship letter. The hardship letter is simply an explanation of why you can no longer afford your mortgage payments and why you need to refinance. You want to make these letters simple and to the point, no need to write a 50 page essay.

The next step is to get pre qualified with an FHA Lender, the reason FHA Lenders are preferred is because they will give you the highest LTV possible which will make your offer to your current lender more attractive. Once you have the approval you will want to put it with your short refinance package and submit to your lender for approval.

Once the package is received, then your lender will order a BPO (Brokers Price Opinion), this is similar to an appraisal, but is an inspection normally performed by a real estate broker in the area to give the lender an idea of the current market value. Once the BPO is reviewed, the lender will give you an offer for the new payoff amount.

From here you will want to proceed with you new FHA Loan, which will require a separate FHA appraisal, hopefully the appraisal will have the same or similar value to the BPO, if there is a significant difference, then your mortgage broker will have to go back to the lender and renegotiate. The ideal situation is to get you refinanced without having to bring any money to the closing table, but in some cased the lenders will not bend, and to make the deal work you will have to bring some cash to close.

Once the mutually beneficial agreement has been reached, then the lender will issue a release of lien. This document will show what the lender will accept as a net payoff.

In Foreclosure and Want to Keep Your Home? Try a Short Refinance…

This is definitely one of the big banks and lenders best kept secrets.  But with the recent increase in foreclosures and the tightening of lender guidelines, which makes it even harder to qualify in today’s market for a refinance, and not to mention the drop in property values in such areas as Fort Lauderdale and Miami has brought the short refinance to the front lines.  While some might have heard the term Short Sale – which is the process you would go thru if you are trying to sell but you owe more than the house is worth.  Now the Short Refinance – is the process you would go thru if you want to keep you home, but you need a better loan program that will be more affordable and you owe more than your house is worth so you can’t do a regular refinance.  Similar to the short sale, the short refinance is a negotiation with your current lender to reduce the amount you owe to facilitate a refinance with a new lender.  Not to be confused with a loan modification.  With a loan modification you will stay with your current lender and just renegotiate the terms of you loan, with the short refinance you are getting the lender to reduce the pay off, so you can get a loan with a completely new lender.

 

Now with any loss mitigation process, including loan modification, short sale, and short refinance, they are all on a case by case basis and the lender has the final say.  So don’t expect to get the same results as your neighbor or family member received.  Any company out there that offers you a guarantee that you will be approved for any of these loss mitigation options or tell you to stop making payment, you should stay clear of……and I mean run.

 

Now it is important to note, that you don’t have to be behind on payments or in Foreclosure to qualify for a short refinance, although majority of the people that get approved are normally in foreclosure.  Today, with lenders having an abundance of non performing loans on their books has caused them to be more flexible when working with home owners to come to win win agreement for both borrower and lenders.

 

Also South Florida home owners in such areas as Fort Lauderdale and Miami that have found themselves with either an adjustable rate mortgage or have found themselves upside down on their homes, which has prevented them from doing a regular refinance, now have this option, that if approved, can refinance into a more affordable fixed rate mortgage and avoid foreclosure

 

Because of the increase demand for loss mitigation, it has been taking most lenders a minimum of 45 days and up to 90 days to complete the process.  Normally when a homeowner finds themselves in foreclosure, they would only hear about 2 options either file bankruptcy or try and sell.

 

Lately, loan modifications have become more popular, but that still doesn’t mean that is best solution for most homeowners. Here’s why, we offer the lender a short-refinance offer first and if for any reason it is not successful, then we will proceed with an offer to negotiate a loan modification for the client.

A short-refinance can basically create equity in a property, as we are getting the amounted owed to the lender reduced. It reduces the mortgage to the current market value, while eliminating the upside-down loan.   While A loan modification can keep the homeowner’s interest rate down to a comfortable level and put them into a fixed rate loan, while also placing any arrearages back into the loan.

 

But if the property is upside-down and by the adding the arrearages back into the loan, it could be in worse shape than before. Now don’t get me wrong, if the homeowner’s intentions are to keep the property long enough for the market to turn around, then this is a win win situation for both lender and homeowner. The main purpose of a short-refinance or a loan modification is that the home owner is allowed to stay in their home. A lot of Fort Lauderdale and Miami homeowners are realizing that their property is not worth nearly what they owe on it, several of them have opted to just walk away. A short-refinance gives homeowners’ hope, that they can get themselves from an upside-down mortgage problem,  and in some cases can save their home from foreclosure. This keeps them in their home, gives them a peace of mind, and allows them to get on with their lives as the possibility of foreclosure in now behind them.

While Loss Mitigation may not be for everyone, it is important to work with an expert in the field that can analyze your situation and help you determine the best loss mitigation for you and your family.

 

 

 

 

In Foreclosure and Want to Keep Your Home? Try a Short Refinance…..

This is definitely one of the big banks and lenders best kept secrets. But with the recent increase in foreclosures and the tightening of lender guidelines, which makes it even harder to qualify in today’s market for a refinance, and not to mention the drop in property values in such areas as Fort Lauderdale and Miami has brought the short refinance to the front lines. While some might have heard the term Short Sale – which is the process you would go thru if you are trying to sell but you owe more than the house is worth. Now the Short Refinance – is the process you would go thru if you want to keep you home, but you need a better loan program that will be more affordable and you owe more than your house is worth so you can’t do a regular refinance. Similar to the short sale, the short refinance is a negotiation with your current lender to reduce the amount you owe to facilitate a refinance with a new lender.

Not to be confused with a loan modification. With a loan modification you will stay with your current lender and just renegotiate the terms of you loan, with the short refinance you are getting the lender to reduce the pay off, so you can get a loan with a completely new lender.

Now with any loss mitigation process, including loan modification, short sale, and short refinance, they are all on a case by case basis and the lender has the final say. So don’t expect to get the same results as your neighbor or family member received. Any company out there that offers you a guarantee that you will be approved for any of these loss mitigation options or tell you to stop making payment, you should stay clear of……and I mean run.

Now it is important to note, that you don’t have to be behind on payments or in Foreclosure to qualify for a short refinance, although majority of the people that get approved are normally in foreclosure. Today, with lenders having an abundance of non performing loans on their books has caused them to be more flexible when working with home owners to come to win win agreement for both borrower and lenders.

Also South Florida home owners in such areas as Fort Lauderdale and Miami that have found themselves with either an adjustable rate mortgage or have found themselves upside down on their homes, which has prevented them from doing a regular refinance, now have this option, that if approved, can refinance into a more affordable fixed rate mortgage and avoid foreclosure Because of the increase demand for loss mitigation, it has been taking most lenders a minimum of 45 days and up to 90 days to complete the process.

Normally when a homeowner finds themselves in foreclosure, they would only hear about 2 options either file bankruptcy or try and sell. Lately, loan modifications have become more popular, but that still doesn’t mean that is best solution for most homeowners. Here’s why, we offer the lender a short-refinance offer first and if for any reason it is not successful, then we will proceed with an offer to negotiate a loan modification for the client.

A short-refinance can basically create equity in a property, as we are getting the amounted owed to the lender reduced. It reduces the mortgage to the current market value, while eliminating the upside-down loan. While A loan modification can keep the homeowner’s interest rate down to a comfortable level and put them into a fixed rate loan, while also placing any arrearages back into the loan.

But if the property is upside-down and by the adding the arrearages back into the loan, it could be in worse shape than before. Now don’t get me wrong, if the homeowner’s intentions are to keep the property long enough for the market to turn around, then this is a win win situation for both lender and homeowner. The main purpose of a short-refinance or a loan modification is that the home owner is allowed to stay in their home.

A lot of Fort Lauderdale and Miami homeowners are realizing that their property is not worth nearly what they owe on it, several of them have opted to just walk away. A short-refinance gives homeowners’ hope, that they can get themselves from an upside-down mortgage problem, and in some cases can save their home from foreclosure. This keeps them in their home, gives them a peace of mind, and allows them to get on with their lives as the possibility of foreclosure in now behind them.

While Loss Mitigation may not be for everyone, it is important to work with an expert in the field that can analyze your situation and help you determine the best loss mitigation for you and your family.