Home Loan Calculator, Advice, and Background

More and more people who have never owned homes before are starting to look into buying their very own, owing to a trending significant drop in interest rates. But before you go out and look for that dream home you’ve always wanted, you’ll need to learn a lot about what to expect and the processes you would inevitably undergo. Indeed, such a big decision entails that you at least know what you’re going to be delving into; and the more you know, the less complicated the procedures will be. If you are interested in getting a home loan, you can find guides, advice, information, and even a home loan calculator. Among the pieces of home loan wisdom you can garner from the site, here are a few you should know beforehand:

Home loan jargon can become really technical, so you should learn it. Since the home loan market has several various mortgage plans, each having unique features and advantages, basic jargon and technicalities like fixed and adjustable mortgage rate, FHA and VA mortgage, and others will be used quite often and in different perspectives. It would only be prudent to familiarize yourself with home loan jargon 101 as well as standard loan math-like how your mortgage rates would impact your income. Knowing about other stuff like PMI and points would also be an added advantage.

After familiarizing yourself with basics, the next thing to keep in mind is wisely choosing a lender. Only work with a trusted and reliable lender whose reputation can be confirmed from many sources. Of course hand in hand with this is knowing just how much of a loan you can afford; here’s where a home loan calculator comes in handy. Use one to be sure of the amount you are comfortable with, and do include taxes and insurance into calculations. And a standard tip would be to make a high down payment because this would make for reduced mortgage repayments in the future.

After deciding on the lender and the amount, beware lines of credit. Do not open accounts for credit cards or the like. Opening one would negatively impact your credit history and would thus likewise negatively affect the loan type and interest rate you would be allocated. Plus, credit cards are major temptations that could get you deep in debt even without a home loan to think about anyway, so better do without it. And in the same vein, avoid closing active accounts as they help maintain your current (presumably) good credit standing.

After all this is taken into consideration, the last thing you can do to ensure a relatively easy home loan process and repayment is to not change jobs or worse, quit your job in between repayments. This is true before applying for a loan and during paying it back. A steady and solid employment history is always favorable, as in fact lenders would prefer that you’ve been working for the same company for at least two years before applying for a loan. Though of course this is just a preference, not a requirement.

7 Tips To Help You Save Interest On Your Home Loan

Buying a home usually means applying for a home loan. This means that a lender forwards the entire purchase price for the purchase of the home and the borrower undertakes to pay regular amortizations consisting of principal and interest for a specific period of time. This article will provide information on how to save yourself from paying hefty interest rates.

Why Save up on Interest?

Home loan interest rates usually range a few decimals or points from each other. For example, let us say a good interest rate, is 1.75% interest per month and a bad interest rate can be 2.5% interest per month. In the given example the difference is less than 1% therefore at first glance they may seem insignificant but bear in mind that the former amounts to 21% interest per annum while the latter amounts to 30% per annum.

Credit Repair

Simply put, the higher your credit scores and ratings the lower your interest rate and vice versa. One sure way to increase your credit score is to pay for your unpaid and overdue debts, If that is not possible or it is still not enough then you can try disputing false, inaccurate, obsolete information on your report.

Debt Negotiations

Paying debts can be financially burdensome, especially if a significant portion of the same was incurred through interest and penalties. That is why it is important to negotiate for the removal or reduction of the interest and penalties to minimize the total debt paid. Tip, threaten unsecured creditors with a bankruptcy filing to get them to see reason but never do this with secured creditors who have the power to attach your property in satisfaction of a debt.

Debt Consolidation

If the total amount of the debt is too much then you can try taking out another loan to consolidate some or all of your debts. Remember the debt consolidation loan must be realistically payable and the payment plan must be for less interest than what is being charged from your overdue debts. Otherwise you may end up under more debt.

Collateral

Interest is a means to control the risk involved in lending money. As such, if you can lower the risk, or ensure collection then the interest rate should go down accordingly. A sure way to lower that risk is to provide sufficient collateral that if sold can pay for the entire debt.

Down Payment

Another way to lower the risk involved in lending money is to lower the amount owed. This is because a substantial down payment:
1. lowers the total debt owed, making payment more likely
2. lowers the payment period within which interest is earned

Pay On Time and in Full

Interest can be earned in two ways. The first is already a given since it is attached to the principal and is paid regularly. The second is through nonpayment or incomplete payment which allows the interest to be compounded. Therefore the simplest way to save on interest is to pay on time and in full

Fixed Rate

Applying for a fixed rate mortgage means the interest rate payable does not increase from its initial state. This is as opposed to adjustable rates that usually increase in as many installments as possible, after the initial fixed rate expires.

Home Loans – Some Simple Tips

When you are looking for a home loan in the area of San Diego, you need to know the process, even if it has to do with refinancing. Here are some things you should know about the process:

• When financing or refinancing a home loan, you will need to show documentation that will verify your employment status, your credit situation and your financial situation. These documents will be used to help investors so that they will know if you have the ability to pay them back. Documentation can include tax returns, pay slips, banks statements, employment certificates, appraisals, purchase agreements, and any other information that will be asked of you.

• You will next need to undertake a complete loan analysis or an application that you need to fill out with someone or an organization that can help you. It’s best that you have a financial advisor to help you out. The financial advisor will be the middleman between you, the borrower, and underwriter. The underwriter is just the person who will see through the documentation and info that you provide. That person will really dig to make sure that you have all the requirements needed.

• Home loans in San Diego will often take time, two to four weeks to be exact. It can also take longer than that. This all depends on the situation that can include the investors needing more information or documentation. This is particularly true with people who have poor credit. Just make sure you complete all requirements and you should have your application approved.