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Mortgages
Other basic but important terms to understand are:
- Principal is the amount borrowed (on which interest acts) which is repaid
monthly
- Amortization is the process of repaying the amount borrowed through monthly
payments of principal and interest.
- Negative amortization is when the monthly payment is not high to adequately
pay the loan off. In this case interest builds too quickly and the principal
grows instead of decreasing. This can occur because of lender scams or because
of monthly payment caps.
- Equity is the value of your house left over after subtracting the total
of your mortgage. If your house has a market value of $130,000 and a mortgage
of $100,000, the equity is $30,000.
- An index is used to determine the rate on an adjustable rate loan. For some
loans this rate may be the Prime Rate or the average rate of a one year Government
Treasury Security.
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Bad Credit Refinance
If interest rates have dropped considerably since you obtained your loan, refinancing now can help you lock in the current low rate. Also, if your loan term is too short or too long, refinancing can help you find the repayment period that suites you best. If the terms of your loan are not what you need, you do not have to suffer with it for the next ten to twenty years. Refinance and find the loan that you want.
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Home Equity
There are a variety of loans based on the equity of a home that are available. Home equity loans, home equity lines of credit, and reverse mortgages are a few. A home equity loan, or second mortgage, is a secured fixed rate loan that uses property as collateral. This type of loan is given in a lump sum to be repaid monthly by the owner and is perfect for home owners wanting to fund home improvement or purchase a new car.
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Land Loan
For a land loan, the building company is expert on what kind of property can feasibly be built where. A good builder will provide all of the necessary tests of the land to ensure that it will past muster when put under the scrutiny of a lending institution. Often this added work involves soil sample testing and reviews of zoning laws that apply to the area. All types of qualifications must be met before a lending firm will back the loan.
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Mortgage Calculation
Buying a new home can be one of the most exhilarating experiences of your life. However, paying for your new home is far from exciting. Taking on a new mortgage does not have to be a stressful situation. Planning and preparation can help you find the loan that will fit your finances. Mortgage calculation can show you which loans are affordable and which will break the bank. Use our mortgage calculator to get a better idea of your kind of mortgage or fill out our free short form to contact up to four lenders.
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Mortgages Online
The best way to find the right mortgage is to know yourself and know your credit. Getting a copy of your credit report is an excellent way to start. This way you can know if your credit has improved or if it has gained a few blemishes. Also, it will give you a chance to see if there are any mistakes on your report that could damage your chances of finding the right mortgage and allow you time to have these mistakes removed. Knowing your credit will help you to have realistic goals while shopping for your mortgage.
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Reverse Mortgage
Though generally most applicants for a reverse mortgage own their homes free and clear, a homeowner can qualify even if they still owe if the first cash advance can pay off this debt. There is no maximum age or penalty against older borrowers; in fact, generally the older the borrower, the larger the amount received.
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