Knowing the ICE of Home Mortgages
When you want to purchase a home for the first time or you are in the process of refinancing an already existing one, you need to know the basics of how a home loan works. The first thing that you need to know is the major factors that would determine whether you will be eligible to get a home mortgage or not.

There are basically three major factors that determine if a person will be qualified to apply for a home loan. These big three, commonly referred to as ICE, will also determine the type of mortgage program that can be offered to a person planning to obtain a home mortgage.

INCOME: The I in ICE refers to income. A persons gross monthly income and total housing expenditure are used to calculate the Debt to Income ratio. This value gives the ability of a person to pay his or her debts. The DTI is actually the percentage of a persons gross monthly income that can be used to pay his/her home mortgage. There are two main types of DTIs used to determine whether a person can be given a home loan. The first type is called the Front-end ratio which indicates the amount or percentage of the persons income that will go towards the payment of the housing costs. The second type, called the back-end ratio, indicates the percentage of the income that will go to paying all other recurring debts that the person has.

For you to qualify for a home mortgage, you must have a debt-to-income ratio rating of at least 28/36. Here, the value 28 indicates the front-end-ratio, whereas 36 is the back-end ratio. It means at least 28% of your income will be allocated for paying housing expenses while 36% is for paying all housing expenses as well as all other recurring expenses that you need to pay per month. The amount of home loan offered to you will be partially based on your DTI.

You can easily determine the amount of mortgage that you will be qualified to have by comparing your DTI value with the amortization payments computed through the use of a mortgage calculator.

CREDIT: Credit scores are used to evaluate what type of customer you are. Having a bad credit score means if often missing regular payments. This is considered as a high risk investment. Banks and other lending institutions heavily rely on credit score to know whether a person is a potent applicant for a home loan or any type of loan.

There are three major credit reporting agencies namely: Experian, Trans Union, and Equifax, which compute the credit score of a person, based on his/her financial activities. Banks make use of these agencies to determine factors such as a persons credit mix, credit balances and credit limits. Credit scores may range from 300 to 850. A person having a low credit rating may be denied a mortgage loan. However, banks may still give him a mortgage but one with high interest rates. On the other hand, a person with high credit score may qualify for a home mortgage loan with better interest rates.

EQUITY: Equity refers to the The difference value between the appraised value of your home and what you still owe on an existing mortgage. For example, if your home has an appraised value of $100,000.00 and you still owe the bank $50,000.00 in a previous mortgage, then your home has an equity value of $50,000.00. This equity or home value is another important factor that will let the banks or lending institutions know if a person will qualify for a home loan.

The three above factors determine a persons qualifications for obtaining a home mortgage. Depending on a persons ICE mix, he or she may be offered good or bad home mortgage options. For example, if a person has a relative low income with a ten percent equity interest in his home however a high credit score has; this person will qualify for multiple home mortgage options at very competitive interest rates.

Article by John Hoots of Chicago, who is a specialist in real estate investments. For more information on Chicago home loan, visit his site today.

Advantages And Disadvantages of Fixed-Rate Vs Adjustable-Rate Home Mortgages
A home is where the heart is. When you want to build your very own family, you will need a home of your own. However, owning a home is not as easy as it seems. Well, if you are very wealthy and have lots of money saved; owning a house will be easy because you can pay the total price of the house you want in cash. However, if you do not have enough money saved up yet, you can still purchase a house by financing it through a mortgage loan.

Mortgage loans are loans given by banks and other lending institutions so that people can afford to purchase a house. A mortgage loan is given when a bank allows a person to use the banks money so that the person can purchase the home that he/she wants. The bank releasing the loan will earn by adding interest on the total amount of cash value, known as the principal, borrowed by the person. The interest added to the loan will depend on the current economic indicators.

There are basically two types of home mortgages which a person can choose to purchase the first home or for a home refinance. These are the fixed-rate mortgage and the adjustable-rate mortgages. Each type of mortgage has its own advantages and disadvantages. You must understand the differences between these two types so that you can choose the best one that suits your needs.

The Fixed-Rate Home Mortgage. If you are having a hard time with budgeting your money; the fixed-rate home mortgage is ideal for you. Fixed-rate home mortgages which are offered by lending institutions are charged with a set rate of interest. This interest rate does not change throughout the term of the loan. The advantage of a fixed-rate home mortgage is that the total amount that you have to pay will remain the same. The payments that you will make in a fixed-rate mortgage consist primarily of interest payments during the initial years of the term. However, during the later part of the term, the payments that you make will go towards the reduction of your loan principal.

Another advantage with a fixed-rate mortgage, which is actually considered as the main advantage is: the person who takes the loan is protected from any sudden and potentially significant increase in monthly mortgage payments due to the rise of interest rates. Economies of even the most developed countries such as the US are very volatile and can change dramatically at any moment. This leads to inflation will cause an increase in the interest rates charged by banks on their loans. A fixed-rate mortgage protects a loan borrower from these changes. This means that whatever payments computed through a mortgage calculator will not change throughout the loans term.

The Adjustable-Rate Home Mortgage: An adjustable-rate home mortgage (ARM) has interest rates that keeps changing over time. At the start, the interest rate offered by ARM is lower than that offered by fixed-rate mortgages. However, this rate is only for a specific part of the total loan term. As the term progresses, the interest will keep on increasing until it surpasses the going rate for fixed-rate mortgages.

The interest rate of the ARM will remain constant only for a specific period. Once this period is over, the interest rates will be adjusted as per the pre-arranged frequency.

Adjusted-rate mortgages can be hard to understand because of the many factors affecting the adjustment of interest being charged on the loan. The adjustments of the interest rates depend on different adjustment indexes such as the interest rate on certificates of deposit, the treasury bills or the LIBOR rate. However, a person who plans to apply for an adjusted-rate mortgage to purchase a home may negotiate with the lending institution to apply caps and ceilings on the interest charges on the loan. Ceiling refers to the highest amount of interest that can be charged on the loan.

ARM is an ideal option for most people because they offer lower initial payments and allow them to qualify for larger loans. Not only that. In an economy with a falling interest rate, the person with an ARM will be able to enjoy lower interest rates as the loan term progresses. However, when interest rates rise due to poor economic indexers, a person may find himself paying a significantly higher monthly payment than what he bargained for.

Article by John Hoots of Chicago, who is a specialist in real estate investments. For more information on Chicago home loan, visit his site today.

How to Choose the Best Home Mortgage Loan
A home mortgage is mainly of two types: a fixed mortgage and an adjustable-rate mortgage. Each one has its own pros and cons. The common point is: each of these mortgages has a monthly payment that includes the interest and the principal loan amount.

A home mortgage can have either a fixed or floating interest rate. The interest will be paid monthly along with a contribution to the principal loan amount. Most of the people prefer this form of debt because it comes with lower interest rates than almost any other kind of debt. If you have good credit score, you can easily get home mortgage loan at low interest rates. Otherwise, it may not possible for you to qualify for a home loan mortgage due to stricter lending norms. Even if you get the loan, you will have to pay high interests. Check for the best city home mortgage offers. Try to contact different types of lenders, like home mortgage companies, commercial banks, saving banks, savings and loan association and credit unions.

You may also contact a few mortgage brokers, who will tell you about loan products which can be offered by different home lenders. If you are still having difficulties deciding which type of home mortgage is the best for your needs. The world of home finance offers so many options that it is often hard to keep them straight. There are different types of books that you may use as your reference guide and the authors of these books provided you all the information you need to compare home mortgages and find a home loan thats right and will fit you.

1. All about Mortgages by Julie-Garton Good this provides a thorough analysis of home finance and refinance. You also can find in this book the detailed information about specific types of home mortgages and will answer questions about home loans.
2. How to get the Best Home Loan-2nd Edition by W. Frazier Bell this book gives you complete details about the mortgage industry. This book contains the discussion about secondary loan market which will help you know how lenders earn money and why loan underwriters must follow certain guidelines.
3. The Mortgage Kit by Thomas C. Steinmetz this book will teach you how simple number crunching formulas can be used to compare different types of loans.
4. How to Save Thousands of Dollars on Your Home Mortgage by Randy Johnson this book will lead you through the maze of home loans, and will explain the different types of loans available that lenders specialized in each type. The author will also teach you which questions you must ask just to make sure that you are getting the best possible deal.
5. Steiners Complete How-To-Talk Mortgage Talk by Shari and Clyde Steiner this book will help you understand what the lender is actually offering you. It will also help you protect your interests by knowing how to answer the lenders question.

When it comes on borrowing the mortgage amount, an online home mortgage calculator can help you assess your options and to decide about how much you can afford to borrow. Some mortgage calculator can be found in the websites of most lenders. In there you can try to change the mortgage amount, term and interest rate until you find a loan option that is just right for you.

A lender will compare your total monthly income and your total monthly debt load. Mortgage calculator can also help you add up all your income sources compare to this to your entire monthly debt payments. Using mortgage calculator will have the following advantages like:

1. This can know exactly what you can afford. Some people may know what they can afford as monthly payments but they may not know how interest and everything else works in terms of numbers
2. This can make small changes. You can get the freedom to play with numbers and you will know exactly how these number changes can affect your monthly payment and get the best deal in a realistic way.
3. This will inform you the price range in order to help you to strike a better deal.
4. It will help you compare different mortgage offers. You can compare those offers from different banks and plan for a better refinance offer. This will allow you to be in a strong position for buying the home you want.

These benefits will all act as a great step to obtaining a loan or a mortgage you want.

Article by John Hoots of Chicago, who is a specialist in real estate investments. For more information on Chicago mortgage brokers, visit his site today.

Home Mortgages And Its Terminologies.
Owning your very first house for your family is very easy if you have enough money saved to purchase one on a cash basis. However, if you are like the average American, you will need to get a loan to be able to afford to purchase a house. There are different terminologies that you need to know regarding home loans that may help you in choosing the best loan that you can afford.

To purchase a house on a loan, you are actually applying for a mortgage when you are planning. In order to pay for any real estate a mortgage is a loan that you can avail. Where the house sits on this includes the house and any land. Through a mortgage loan will be used as collateral for your loan the house and the land that you are purchasing. The lending institution such as the bank who gave you the mortgage has the right to take your house and land away in order to cover your missed payments this means that if you are not able to make your loan payments anymore.

Other terminologies that you need to understand are related to the loan payments themselves. The amount that you have to pay regularly on you loan can easily be computed by a home loan calculator. However, even if you will use a home loan calculator, you must know the different terminologies associated with computing for the amount that you have to pay regularly. Here are the following terminologies:

Principal. The principal is the term used for the actual amount of money that you are loaning in order to purchase the real estate of your choice. This is the amount of money the bank will allow you to use so that you can purchase the house that you want.

Interest. For using their money to purchase your home the interest is the amount that the bank will charge you. On your real estate project the interest is the amount that the bank will earn from investing their money. To mortgages is computed as a percentage of the principal loan amount the interest rate given. As compared to the smaller banks larger commercial banks may offer lower interest rates on loan. Interest rates also depend on current economic indicators.

For loans may be fixed or adjustable depending on the lending institution giving out the loan interest rates. Throughout the term of the loan fixed-rate mortgages offer a set rate of interest that will not change. Through your loan amortization will vary each month, the total amount that you will pay (principal and interest) remains the same although the amount you will pay. For homeowners who are on a budget this type of mortgage is ideal.

On the other hand have interest rates that vary over time adjustable-rate mortgages. For this type of loan is given at a lower rate than a fixed-rate loan the initial interest rate offered. As the loan term progresses, the interest rate rise until the interest rate surpasses those of the fixed-rate loans however.

Term. To pay the lending institution the amount of money that you borrowed from them to purchase your home the term is the amount of time that you are allowed. From a fifteen-year to a thirty-year term because purchasing a home requires a large amount of money; lending institutions and banks usually give out mortgage loans.

Amortization. To the process of dividing the total amount of mortgage (principal + interest) into equal payments over the term of the loan amortization is the terminology given. During the earlier part of the term the payments that you pay regularly through amortization will go toward the payment of the interest. Through your amortization will then go to the payment of the principal amount later payments.

PITI. Towards the fulfillment of you mortgage is not always the combination of the principal plus the interest the payments that you make regularly. In the amortization of your real estate loan the acronym PITI stands for principal, interest, taxes, and insurance which are included. For mortgage insurance by negotiating it with your lender however, you can avoid paying.

Knowing these different terminologies will enable you to understand better how home mortgages work.

Article by John Hoots of Chicago, who is a specialist in real estate investments. For more information on Chicago refinance, visit his site today.

Five Methods to steer clear of not paying additional Money For Home Mortgage
Every individuals should have their own house. Own place to live with their family, this is also considered to be the greatest achievement and best investment. Moreover your future family will also lead a secured life. The fact is several Americans don't have a habit of saving. Saving factor is not all considered until they attain a particular age? When they are single they can live where they want, this not possible for a married man he has to provide his family security. To fulfill this you have an option of purchasing a house with the help of reality mortgage.

On the other hand, When you are planning to get a new home with the help of home mortgage, You have to take a look at various things which involves in the home mortgage. While you have decided to buy a house with the help of mortgage it is enough if you pay few ten thousands out of your hard earn money. This is actual cost involved in the mortgage loan. Lenders are the people act as an intermediate and help us to get a mortgage loan. Now you have to be more careful these people will try to get more money from you stating closing cost and other hidden cost. If you reach them without having the knowledge of the mortgage loans, this is the greatest advantage to them they will get more money from you including unwanted expenses in it. Here are the ways to protect you from not spending more than the actual cost.

1. Choose the right type of home mortgage. There are a lot of home mortgages to choose from depending on their duration. The total cost of the loan depends on the length of time that you will choose to pay it. If you opt for a mortgage loan with a very long duration such as a 30-year fixed-rate home mortgage; you will find that this is the most expensive mortgage loan when you add up all the interests that you had paid. However, if you are planning to live in your home for the entire length of the loan, you will find that this is the most ideal type of loan mortgage because you are assured of a fixed-rate interest. If you are planning to get a mortgage for only a short period of time, it is better to choose a mortgage with an adjustable interest rate.

2. Enter into negotiations with your lender. Different banks offer different types of mortgages. Sometimes, the amount of interest rate that the bank will offer for your mortgage will depend on the bank officer in charge of loans. There is nothing wrong with asking the bank officer handling mortgages for a better interest rate. You can also negotiate for the elimination of other fees associated with getting a home mortgage. Some fees associated with obtaining a home loan such as costs for appraisal, inspection, processing, title, and insurance do not give any additional income to the bank and therefore these fees are necessary. However, there are other fees besides these that can be negotiated with.

3. Payments to be made on date: One have to decide how to make their payments if you are the person who will receive your salary only on bi-monthly basis, then you have to pay your home mortgage loan in a bi-monthly manner. If you have extra money in your hand you can make the payments and this will be deducted from the principal amount you have borrowed. This also decrease the length of the time taken to repay the loan. By using this method you will be able to close the loan as soon as possible. If you make two payments a month instead of one now the duration will be decreased from 30 years to 23 years. Home loan calculator are used to find the amount involved to make the payments in the regular basis.

4. Make surplus payments; If you get a good amount you have an option to pay them to the loan principal amount, the amount paid will decrease the loan principle amount while there will be no change in the interest rates, this will help you to repay the loan as soon as possible. If you make lots of extra payments you the amount of mortgage payment will have a decrease gradually. This amount will not affect the interest rate in some case only the principal amount will be decreased. Nevertheless before doing so have look at the document provided to you during the initial stages and look there is any conditions stating that extra payments will have a charge to be paid.

5. Paying for private mortgage insurances can be restricted: When you make a down payment for a home mortgage loan less than 20 percent of the whole loan amount, bankers and the other lenders may guide you to pay for a mortgage insurance. If you have made the down payment 20percent of your loan you can pay for your mortgage insurance.

When you acquire the knowledge about the basics of the home mortgage there is no need to pay any extra money to the lender. If they come to know that you are not aware of the loans this will be the greatest advantage, hence to avoid this confusions do get some information about the home mortgage loan.

Article by John Hoots of Chicago, who is a specialist in real estate investments. For more information on Chicago mortgage loans, visit his site today.

Types of home loans.
Amount that is taken as loan and returned in the form periodic payments with interest is known as loan taken. Depending on the source of the loan taken it is called differently based on the amount taken. In countries where inflation is on the high, the interest rates offered by banks are typically very high. Getting loans from banks should be only due to an unavoidable instance. There are generic differences in the way lenders organize their loan modules.

1. This is extremely preferred by customer specifically for smaller businesses. Line of credit loan is a short term loan offered to small businesses in which the cash present in business checking account will be given as loan to a maximum limit on the contract. These are typically used to purchase inventory and to pay out operating expense as part of the business cycle to generate enough working capital. However, this loan is not to buy real estate or equipments.

2. Installment loans. This will be equal covering both principal and interest. After signing your contract you will then receive the full amount and interest will be calculated from that date to the final day of the loan. There will be no penalty if you repay an installment loan before its final date, aside from that, there will be no penalty and an appropriate adjustment of interest.

3. These are typically made for businesses which often wait for a particular date of payment from the clients or customers for a product or service sold.

4. These are used by the contractors for constructing the building or site. By taking a mortgage on the property the interim loan will be paid off.

Besides banks, there are other modes which give loans these days. They are typically the finance houses and money trusts. Recently, many have not spent the time needed to read and understood the terms and conditions that are involved in taking home loans. They have simply taken these loans with very little knowledge and stand a chance to get exposed financially later. There are various types of mortgages that are offered to borrowers these days. Here is a list of usually preferred types.

1. This type of home loan is usually preferred by all sections and considered to be very safe as this gives the borrower a chance to take the loan at a common interest till the entire term. This means, the initial and the final monthly installment amount will be the same.

2. There is one thing that is unique in this type of mortgage loan in today's market. The payment is likely to increase thru time. It gives an enticing interest rate to the borrower to start with the home loan and the increased installments are due later as the interests rates are changed quarterly or annually. Adjustable rate mortgage can be really troublesome if your payment gets doubled within a few years time of purchase of this loan.

3. Typically, consumers who have opted for this type of loan have kept their payments to a minimum in the recent years as they have found out that they owe more. For instance, due to fall in house prices, they tend to pay more than what the home is actually worth for. Agreed, that these loans provide an opportunity for the buyers to get the homes under their names earlier than other loans, one must exercise caution as they are getting this at what cost?

When new home is purchased by a consumer, they tend to typically mortgage the property for a major percentage cost involved. Mortgage calculators can help the customers achieve their objective of getting a mortgage without getting into a financial implication. This will help the borrower understand whether or not to go for a real estate today or even in the future. This will also ease the consumer decide whether the deal would be ideal and will not jeopardize the financial situation of the consumer at any cost. It is a self driven automated tool, easy to navigate and access to quickly estimate whether this can be ideal for the buyer. This will also help the borrower understand and get familiarized with the number of variables associated such as interest rates, payment schedules, duration of the mortgage period etc.

Article by John Hoots of Chicago, who is a specialist in real estate investments. For more information on Chicago home mortgage, visit his site today.

Everything About Refinancing.
Refinancing is the replacement of the existing debt obligation with a debt obligation which is under different terms. It may also vary depending on the country, province, or state, based on several economic factors which may include projected risk, inherent risk, political stability of nation, currency stability, banking regulations, and borrowers credit worthiness. A loan or debt may also be refinanced for some various reasons and those are:
1. to take advantage of a better interest rate
2. to consolidate other debt into one loan.
3. to reduce the monthly repayment amount
4. to alter risk
5. to free up cash.

Besides the points explained above, reasons such as lesser number of mortgage term years or moving from a fixed-rate to an adjustable-rate mortgage or reduced interest rate on the loan. If there are pre payment fees that exist to the existing borrower as a result of increased cost to the borrower especially the time of refinancing, this option would lose its shine and not many would approach refinancing.

As there are number of benefits that exist under refinancing, one can try the following hints to get the right loan and to save money.
1. One must know when to opt for Refinancing. It must be a timed to nicety.
2. One must drop one credit card for another.
3. Considering refinancing auto loan would be ideal if there are number of years of auto loan left for closure.
4. Combining multiple student loans into one would be convenient considering the rates provided, terms and costs associated.

One can also think of why there is a need for home finance. This will reduce the home mortgage interest rate lower. This will reduce your monthly payments and consolidate your multiple debts. You must also give due credit to the market conditions to determine whether in fact it is right time for home refinancing. You must have a home financing lender to provide home refinancing option to you.

At times, refinancing can be ideal for saving money thru easy monthly installments. If you believe that you may at loss by going for flexible rate, you can opt for fixed rate refinancing to help you not to lose sleep over it. Whether you opt to cash out your refinance or use it as home loan equity, you would lose your home in case you happen to miss payments of your loan.

All you are doing when you decide to refinance is to change your existing mortgage with a new mortgage on the exact same property. Once you are done with all clarifications you may need to, you can go ahead with a new mortgage based on whether you have suitable conditions to do so.

Mortgages can be very confusing and intimidating but with the help of mortgage calculators you can research, plan and obtain a mortgage as well as learn more about your existing mortgage. This calculator also gives the potential borrower the ability to make calculations on their own time without the help from any professional mortgage. This has been great software that you can use to compare mortgage rates from different sources and may lead on having the best mortgage deal. This are especially helpful for first time home-buyers who are still learning about the process of buying a home and are also trying to better understand the impact of purchasing a home. This mortgage calculator is relatively simple and fast to use.

Various types of mortgage calculator are available, using this calculator you can choose the mortgage which suits you.
1. Repayment can be calculated using this calculator you are entitled to pay.
2. This will help you to calculate the total debts and the advantage out of it.
3. Cost of the house can be determined by using this calculator.
4. Monthly payments can also be ascertained using this type
5. Repayment basis and the cost involved in it can also be calculated.
6. Capacity to borrow can also been determined using this calculator.

There are pros and cons which is commonly found. Since it is a software tool the calculator also have some cons to be discussed. Due to this mortgage there should be definite impact on your financial status, credit will have a fall on it. For refunding of the mortgage this calculator cannot be used. Anyways there may be drawback in it, Even though obtaining the mortgage will win the race.

Article by John Hoots of Chicago, who is a specialist in real estate investments. For more information on mortgage broker in Chicago, visit his site today.

Elements of Home Mortgages.
Usually the repayment period would be extended from 10 years to a maximum of 30 years. This could also go down to a minimum of 2 years. Some of the mortgage lenders provide commercial mortgages which offer interest-only payments for the initial 2 years and some type will let you defer it up to 2 payments per year. Whatever may be the plan, mortgages provide critical advantages as against rental property or a land. Thus, one has to consider advantages and disadvantages critically prior to taking this kind of a step forward.

Benefits of commercial mortgages
Your business and the premise on which the business is functional will still be owned by you.
You would be able to get great amount of cash as a result and can be a great boost to you in the long run.
They do not fluctuate as compared to rent paid of residential properties and hence it can give you a standard business planning environment.
Interest payments can be exempted under Tax deductions.
Increased cash flow to let you use it the way you want it.
Critically, low interest rates other than unsecured loans/overdrafts, offer low monthly costs.

Disadvantages of commercial mortgages
you need a decent sized deposit.
if you own the premises or business it can be harder for you to move it. But you can negotiate ending your rental agreement or find another business to take up your tenancy.
you can leave yourself vulnerable to interest rate increases, if you have a variable rate mortgage.
You are responsible for any of your property including maintenance, insurance and security
Losing value on the property may reduce your capital.

You can compare the advantages and disadvantages to know what you actually want as against what you ideally need, one could be getting a new home.

A home mortgage is given by a bank, mortgage company or other financial institution for getting a primary or investment of a residential property. The property owner will give the title to the money lender or institution in agreement that the title will be given back to the owner once the complete payment is made and other conditions are satisfied. It will be flexible or fixed interest rate, which has to be paid in the form of monthly installments, in accordance to the principle loan amount taken.

If you are serious about buying a home, the first item you need to check is to clean your credit. That has to be the first agenda. After going through the report, identifying, paying off and closing most of your credit cards, the next step is to shop for a mortgage. But before that, you have to go over the preliminary steps of getting pre-qualified for a mortgage.

If you want to become eligible for a mortgage, you must give all information such as your assets, income and other liabilities to the lender. Based on these the lender will give you an estimate of how much you can borrow. The whole procedure is informal, the lender does not charge you fee or verify any of the information provided by you and does not guarantee an approval for a mortgage amount applied.

The pre-qualification process does not give you any guarantee loan approval as such; it provides a fair estimate on how much money are the banks or the mortgage lenders ready to offer you. This will give you an estimate to work with and gives you the freedom to choose the type of properties that fall within your range.

If you care about lifetime cost or monthly payment, one of which that can help you with is Mortgage Calculator.

This are designed for individuals who would like to assess how much money they can afford to borrow for the purchase of a property, or to refinance a mortgage. It can also be used for comparing different scenarios for which a potential borrow maybe considering. This type of system may also helps to provide the knowledge of what the monthly payments may be. Consumers also learn any specific rates of interest that may be present within the loan. And finally, mortgage calculator provides an incredible peace of mind to most buyers.

Article by John Hoots of Chicago, who is a specialist in real estate investments. For more information on mortgage brokers in Chicago, visit his site today.

Home Loan To Get Your Dream House
One must have careful and in depth study of the home loan process before getting into it. It will not only demystify it but also enable him to get the best home loan plan. When you decide to get a home loan to finance your dream home, there are a few procedures you have to follow. You will have to provide the lender with various documents such as include tax returns, salary statements, employment verifications, bank statements and such.

All these documents will be scrutinized meticulously by the underwriter. He will take a week or ten days to complete the initial appraisal. After that he can ask you for further documentation or even disapprove the loan if he feels you are a bad investment. If the initial documents have been approved, provide further documents and wait a few more days.

The entire loan process can even take a month to complete. If the person has a bad credit history or self-employed, the process can even take longer. If the loan has been conditionally approved by the underwriter, it is then sent to your attorney or the title company. Either of these two parties will add to the list of documents, any further information needed.

Once you submit all the relevant documents, you will be called for an interview with your attorney or the title / escrow company. You will be given a copy of all the relevant papers to study. Then you will have to sign on original documents. A couple of days later, the home loan amount will be transferred to your account. Once it is recorded with the county, the transaction is complete and you can happily purchase your home.

Getting a home loan with poor credit rating can be difficult or even at times impossible. Unscrupulous lenders will exploit peoples desperation to own a new home and give them a home loan even with poor credit at high rates, fees and penalties. Very often, these people will end up being unable to pay the home loan over and above their other loans and lose the home to foreclosure. Those who have bad credit and still want to get a home loan can avoid these pitfalls by taking a few sensible precautions.

Some of these precautions are:
Check credit rating with credit bureau - a rating of below 620 is bad credit.
Raise credit score by paying off overdue debts and credit card dues.
Consider exactly how much you can repay comfortably by way of a home loan.
Save for sometime to get enough to make a large down payment.
Bad credit will attract higher interest rates, so check these.
Track all extra costs like points, closing costs, penalties etc.
Get someone with good credit rating parent to cosign the loan.
Do not get ARM where mortgage amounts can increase drastically over time.
Search for a good FRM with fair fees and lowest possible interest rates.

People with good credit rating and enough confidence and finances to opt for an adjustable rate mortgage can use a mortgage calculator to calculate ARM rates. The ARM mortgage calculator can help you calculate adjustable rate mortgage figures. It can even help you compare these figures against those of a fixed rate mortgage. You have to input into the calculator the details such as interest rate, loan amount and period of ARM. Since with adjustable rate mortgages, the interest rates keep fluctuating depending on market trends, the figure entered for the calculator will be the initial interest rate.

Though you cant predict future interest rate, you can still use ARM calculator and input different interest rates to check what your liabilities can be. Apart from the conventional figures, you need to input other details like period of initial interest, margin, index, lifetime cap and expected interest adjustment amount. If you are not clear about what these parameters are, take the help of a real estate agent or go through the loan documents. Understanding the home loan process and using mortgage calculator can help a person to a great extent to acquire his dream home.

Article by John Hoots of Chicago, who is a specialist in real estate investments. For more information on Chicago home loans, visit his site today.

Opting For Refinance-A Nice Way To Save Money Substantially
A homeowner is said to be opting for home refinance if he trades in his first mortgage for a new mortgage. When someone opts for home refinance, his property will be appraised afresh and his credit history will be studied once again. The homeowner on his part can ask for a property report and see if there are any more security interests or liens attached to the property. Once all these factors are determined and approved, the homeowner can meet the lender and move the home refinance application process.

The new loan amount got through home refinance can be used to repay existing mortgage and helps the homeowner save money only if the current interest rates on the principal are lower than what he is already paying. Apart from repaying an existing mortgage amount, the homeowner can use the home refinance amount to refurnish or repair his home, make additions or expand his property. He can also use the money for other expenses like medical bills or college fees. He must be very careful when using the money for purposes other than the home for then he will have 2 mortgage amounts to repay.

Here is the simple methodology that is followed in the home refinance process:
Check credit
Estimate property value against amount due
Study interest rates
Get expert advice

Cleaning up credit history with the credit bureau can help a borrower get quick home refinance at low rates. If there are discrepancies, check and correct them. If you owe any money, make sure that all debts have been paid correctly so that there are no outstanding amounts that will reflect poorly on your credit history.

Once this is done, you must check the property value against the amount of your mortgage that is still outstanding. A real estate broker can help a person get an accurate estimate of his property's worth. If this value is less that what is still owed, then the home refinance rates will not be attractive. If the value of the property has appreciated considerably, you can go ahead and check out prevailing interest rates. You do not have to go with the current lender you are doing business with. Instead, go online and check prevailing interest rates and home refinance terms among other top lending institutions and opt for the one who makes you the best offer.

It is always wise to get help from a well-established local real estate agent if you want to go for home refinance. He can give you accurate details of the existing real estate market, interest rates and other options like fixed rate refinancing, cash-out refinancing, adjustable rate refinancing and more. This will help you arrive at the best decision that will suit your personal budget. Using a specific refinance calculator can help you cover all your financial possibilities regarding home refinance.

A mortgage calculator meant for refinancing gives a person a good estimate about whether refinancing is a good option for his needs. You will need to enter information like current loan amount, term period, interest rate, refinanced mortgage, refinance costs, prepayment penalties, discount points, closing costs and so on. The mortgage calculator will indicate to the borrower if the current rate of interest will actually help him save on mortgage payments in the days to come. One can find these calculators in many mortgage sites.

The refinance mortgage calculator uses a break-even formula to give information on the value of refinancing. It will give you details about the difference in existing and future mortgage payments. This difference amount will be the savings you will make if you opt for home refinance. By dividing the closing costs of the new loan by monthly savings you will receive a break-even point, which will be stated in months.

If a homeowner plans to live long term in his home, the break-even analysis will show him that refinancing is a good option for he can then regain his investment. Consult your tax attorney too to ensure that your tax deduction amount can be reduced by lowering mortgage interest amounts. Get expert advice whether it is better to refinance now or wait for a few months. Analyze the market and make the right decision.

Article by John Hoots of Chicago, who is a specialist in real estate investments. For more information on Chicago mortgage loans, visit his site today.


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