Are Reverse Mortgages Too Risky

Are Reverse Mortgages Too Risky

The Risks and Rewards of Reverse Mortgages

Retirees need sufficient income to get them through their golden years. If your home is your largest asset, though, what do you do?

The FHA started the reverse mortgage program for seniors just like you. Unlike a traditional mortgage with required monthly payments, the reverse mortgage pays homeowners age 62 and older some of their home’s equity. You may choose from a lump sum payment, monthly payments, a line of credit, or a combination.

In the last few years, the media ran wild with horror stories of scam artists taking advantage of seniors with reverse mortgages, but they’ve come a long way. Today, the reverse mortgage program offers seniors access to their funds without selling their home.

Like any other mortgage or loan, the reverse mortgage has its risks and rewards. Check them out below. View full post…

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Tempting Interest Only Mortgage

Tempting Interest Only Mortgage

The Good, Bad, and Ugly of an Interest Only Mortgage

An interest only mortgage can appear to be a very attractive offer at the onset. However, it can also be a disaster waiting to happen for many borrowers who don’t completely understand what awaits them five or ten years down the road.

About ten or twelve years ago, a period known as the Great Recession caused havoc for many homeowners. One of the causes of this economic ruin was interest only mortgages held by borrowers who bought expensive homes they couldn’t afford. When the interest-only period ended and they had to begin repayment of principal also, and a higher rate of interest, they defaulted. have brought this option back for certain home buyers. The question we have is, should a home buyer View full post…

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Tips for Buying Investment Property

Tips for Buying Investment Property

Credit tips for buying investment property

(BPT) – If you love the idea of being a landlord and don’t mind being on duty around the clock, buying investment property may be the wealth-building option for you.

Property values have enjoyed a steady increase over the decades. That’s why real estate has earned its reputation as a sound investment that builds wealth and credit.

Most people, however, don’t have the quantity of cash on hand to purchase a house or apartment building outright. Still, if becoming a landlord means taking out a 30-year mortgage, the monthly payments from the tenants should be enough to service the loan and build equity for you, while leaving some cash flow so you can maintain the property.

If buying investment property sounds like a step you’d like to take, here are some credit considerations every investor needs to know.

1. Be mindful of the inquiry stage

Once you decide to purchase an investment property, it’s important to do everything you can to make sure your credit score stays as high as possible until the loan is approved and signed. Your goal is to land the best possible interest rate because View full post…

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First Time Home Buyer Mistakes to Avoid

There are many home buyer mistakes you need to be very careful to avoid

6 mistakes to avoid as a first-time home buyer

(OL) – Buying a home for the first time is a big deal.

To help you get ahead, we’ve outlined some first-time home buyer tips by calling out six of the biggest mistakes that you should avoid going into the purchase of your first home that could end up saving you a lot of time, money, and frustration.

Mistake #1: not getting pre-approved

Many first-time buyers make the mistake of thinking that they don’t need to get approved for a mortgage until they’ve found their dream home.

Unfortunately, that often ends up being too late.

These days, most sellers require that pre-approvals be submitted along with any offer, and, since your finances need to be vetted before the lender will agree to grant you a loan, this process can take days or even weeks.

Instead, we recommend applying for a pre-approval before View full post…

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5 Important Home Buying Tips

5 Important Home Buying Tips

5 home buying tips for first-timers and old-timers

(BPT) – Whether you are buying a home for the first time or you are just looking for an upgrade, it is never a bad idea to arm yourself with home buying tips that can make your search go from overwhelming to enjoyable. Rather than learning the hard way about hidden expenses and difficult neighbors, there are things you can do to feel more confident as you begin your search.

With a seller’s market in many parts of the country, these home buying tips are even more important as you battle other buyers for the home of your dreams. The more efficient and straightforward you are in your search, the better chance you’ll have to hear “offer accepted.”

Consider all the costs

When starting the home-buying journey, the first thing to consider is the cost and expenses. When pre-approved for a mortgage of a certain amount, keep in mind that number is not a target – it is a maximum. While a View full post…

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Why a Mortgage Preapproval

Why a Mortgage Preapproval

Why Should I Get a Mortgage Preapproval Letter?

What is a mortgage preapproval and why would I want to get one? Short of a formal loan commitment, there are two types of letters that a lender will issue to help a house hunter in the purchase of a home.

A prequalification letter is one that is issued by a lender after reviewing certain financial information submitted by the buyer. This letter is rather broad and gives an estimate of the amount of a mortgage that the buyer may qualify for.

A preapproval letter is one that is issued by a lender after reviewing and verifying all of the financial documents that are required View full post…

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Is a Mortgage Refinance the Best Option

Is a Mortgage Refinance the Best Option

How To Know If a Mortgage Refinance Is Your Best Option?

When interest rates are low, applications for a mortgage refinance are a major portion of the total of all mortgage applications. This is due because when mortgage interest rates fall, many borrowers see an opportunity to restructure their debt hoping to get a more favorable rate or term.

Simply having a drop in mortgage interest rates doesn’t mean that its the right thing to do for everyone. We all have different situations and lifestyles and everyone doesn’t fit into the “average” cookie cutter mold. Because of this, the following 9 points may help you if you are considering refinancing your mortgage.

  • The equity in your home

    Equity is one of the first items that a refinance lender will look at. If it’s not there within the banks’ guidelines, most conventional lenders will decline your request. During the last recession, many homeowners were underwater, some very deep.

    The value of homes has been rising as of late and the number of underwater loans has dropped. This varies from state to state and is determined by a number of factors. If your home has little equity, a conventional lender probably View full post…

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Personal Loans – Are They Right for You?

Personal Loans – Are They Right for You?

What Are Personal Loans and When Are They a Good Idea?

A personal loan, however, can be for any of these things—or something completely different. Sometimes they’re a great idea, and sometimes not so much. Let’s dive in to what personal loans are, and how they are most commonly used.

 What are Personal Loans?

Unlike an auto loan or a mortgage, which are secured by the asset being financed, a personal loan is typically unsecured. Its approval is based mostly on the creditworthiness of the borrower.

Personal loans come with far more risk for the lender than View full post…

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How Does Reverse Mortgages Program Work

How Does Reverse Mortgages Program Work

How Does Reverse Mortgages Program Work? – The Ultimate Guide

If you’re getting near retirement age you may have come across this financial product. Just about everyone asks the same question, just how do reverse mortgages program work? They continue to grow in popularity and the basics are relatively simple.

A reverse mortgage is designed for senior adults getting near retirement or already retired. Its similar to a conventional mortgage in one respect – it allows you to borrow against the equity that you have in your personal residence.

However, unlike a traditional mortgage where you are required to make monthly payments of principal and interest to repay the loan, with a reverse mortgage, you don’t. As long as you live in the home, none of the mortgages has to be repaid. Not until you sell the home, or it is no longer your personal residence, or the last borrower dies, is the loan repaid.

This program is administered by the FHA and does have certain conditions that must be met.

From a financial perspective, how does reverse mortgages program work?

A reverse mortgage does differ from a conventional mortgage or a home equity loan. The latter two View full post…

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House Hunting Fundamentals

House Hunting Fundamentals

House hunting? Use this handy checklist before you make the offer

(BPT) – House hunting can feel like an adventurous new chapter in your life. If you’re lucky enough to find the property that checks off all the “must have” boxes – appearance, size, price, location – it’s easy to fall in love.

Not so fast. Before making an offer on any property, it’s smart to take a deeper look at the overall structure and its systems, just to make sure warning signs of major and costly problems are not hiding in plain sight. If the house holds more issues than your budget (and drive to renovate) can handle, it might be best to walk away.

Of course, once the offer is accepted, it’s always a smart idea to hire a third-party home inspector to take an in-depth look at the property. In the meantime, one last pass-through with this checklist in hand can give you peace of mind about taking the next step.

Exterior: Walk around all four sides of the house, scanning it from ground to rooftop. Note the View full post…

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