Colorado Home Loans

Why Colorado is a Great Place to Invest

Thu, 22 May 2008 14:02:31 GMT

Investing on something is not a simple thing that can easily be achieved. It takes a lot of knowledge and understanding on what and where you will start your investment in order to attract numerous clients.

All across the state, there are possibly hundreds and thousands of considerable investment locations, and that includes the state of Colorado. Why is Colorado a suitable place to invest then?

Colorado, situated in the regions of the rocky mountains of the United States of America, is one of the three states in the US that have both the longitude and the latitude lines for boundaries. Colorado has an invigorating climate that is perfect for its continental location. Summer is great in this eighth largest state in the US, with hot days around the plains, or cold to humid seasons on mountain regions.

Because of its geographical locations, plus its relaxing climate and weather conditions, it is therefore a great idea to invest for a real estate property in the state. In nearly twenty years, the real estate industry of Colorado has experienced at its lowest point. However, while some people think of this downfall as a problem, there are others who believe this is a perfect time to consider a real estate investment.

Real estate may be an expensive investment but if you truly grasp the whole idea and understand the benefits of investing, it is truly a great consideration after all. In Colorado alone, because of the fact that there are hundreds and thousands of available real estate properties that you can choose from, finding the right property that suits your preference is not that complicated to attain.

To find the best deals of real estate properties in Colorado, make sure to find real estate agents that provide you with the most amenable locations.

What is great about Colorado is its rich history and beautiful site and sceneries. The shops, the outdoors, the nature, and the locals will really make you feel at home. When you buy a home in Colorado, you will certainly experience that special sense of serenity and solace not found in any other parts of the globe.

With the best location and the perfect climate, from the relaxing streams to the calm mountains; and with that great down-home feeling and timeless property value, no doubt Colorado is indeed one place worth investing for.

Check out our Colorado Home Loans website at http://www.colorado-loans.net - The Best Loan Rates Available!

Colorado Home Loans: Simple but Practical Guides for Home Investments

Thu, 22 May 2008 13:52:58 GMT

Colorado is one place that has tons of real estate properties. Since the options are far too many, finding the most suitable one may seem to get too confusing. Below are some simple but practical guides to consider before considering a home loan in Colorado.

Investigate. If you have a real estate property that you think serves you right, take time to investigate it and check from all the angles, making sure that it falls according to your preferences. There may be some properties that you might think promising enough so be sure to investigate the property.

Be Responsible. Next to your friends and your family, no one really seems to care at all about your considering a home loan or a real estate property. Take ample time to understand the laws. Avoid getting too dependent to the sellers because chances are, they might have no strong background on the legal system, or worse, they might not tell you about it. Although records show that property investments are notable minus the hitches, it’s still safe to be sure.

Read the Contract. Make sure to properly read the home loan contract. Be aware that contracts should give you enough time, say a week or more, to give you enough time to fully understand the deal. There are a lot of issues and concerns discussed on the contract and if you think you have no time to grasp the whole idea, a real estate professional is a great help. You can also contact a lawyer with enough experience in commercial real estate. If you notice the seller getting too pushy to the point of shortening the whole of your time-frame, keep in mind that this might be a warning of a not-so-good deal.

Inspect. Before considering any Colorado home loan, or any real estate investment, see to it that you hire a certified real estate inspector. Also, it is imperative to obtain an environmental inspection so that all concerns of the important areas on a property are properly dealt with. Find an inspector whom you can trust. Although he might not know everything there is to know about a particular property, he can still give you ideas that might help.

There are really a lot of things to consider especially when buying a real estate property or considering a home loan. Take time to know more about particular concerns before you finally decide on which property to consider. That way, your hard-earned money will not end up losing in the long run.

Check out our Colorado Home Loans website at http://www.colorado-loans.net - The Best Loan Rates Available!

Why Now is a Great Time to Buy a Home in Colorado

Thu, 22 May 2008 13:51:52 GMT

Ever wondered how it feels like to have a home of your own? Let alone have it on the perfect location? How would you like to live in a place where you can find solace right at your very own neighborhood?

Colorado is the place if you are looking for a location conducive to living. The fresh air, the mountain ranges, and the wilderness that surround Colorado; all sum up to a place perfect for you and your family. So why should you consider buying a home in Colorado?

Colorado is undeniably the perfect place to live and to retire. Most prospective home buyers, in fact, believe that Colorado has the best places to have a home. The rates are just right, and the options are way too many to consider. This is one of the reasons why upon deciding on buying a real estate property in Colorado, you should have a good real estate agent that can show you all there is and all the possibilities that are available in this state.

Home prices in Colorado have gradually depreciated over the last five years. Concomitantly, this year alone, the prices have continuously declined. Home properties in Colorado are considerably the best priced and the best conditioned. With the increase of demands for newer homes, home suppliers in Colorado have obviously increased. Newer homes with the most acquiescent amenities are selling like popcorns these days.

Today, the number of homebuyers who consider for a home in Colorado is substantially increasing. More and more people are investing for a home in this state. The place is simply perfect for couples who are just starting to have their own family, or for people who wish to retire in one place that has not only the best location, but also the friendliest and most approachable neighborhood.

What’s with the Location?

In any home hunting experience, the main consideration any homebuyer should have in mind is location. Experts say that you can live with any imperfections at home provided that you have the best locations with the perfect neighborhood. In Colorado, because of its magnificent location that boasts of its mountain ranges, it is normal to see a neighborhood of friendly and nature-loving people.

With all its natural beauty surrounding the state, Colorado is indeed perfect to invest for your own home. Affordable, conducive to living, and astonishingly surreal! So why settle for anything less when you can have all your living pleasures right in the heart of Colorado!

Check out our Colorado Home Loans website at http://www.colorado-loans.net - The Best Loan Rates Available!

Why Investing in Boulder Colorado is a Great Idea?

Thu, 22 May 2008 13:51:18 GMT

Plus Simple Steps to Finding the Perfect Boulder Property

Who doesn’t want to live in a place where you can find solace and serenity right at your very own doorstep? Have you ever thought of living in a place where mountain ranges are just stone’s throws away?

If you are the type who loves anything and everything about nature, why not try to invest in Boulder, Colorado?

So why consider living in Boulder, Colorado? The state is generally surrounded by an open space. Lying on the foothills of the infamous Rocky Mountains, Boulder is basically deemed as the city that is nestled in between scenic mountain ranges and reality. Boulder is also considered as America’s premiere sport’s town and is popular for its diverse culture with friendly and nature-loving residents.

Aside from being the premiere in sports destinations and stunning mountain ranges and views, Boulder is also the main location of the University of Colorado, the home for the entrepreneurial and intellectual spirits. And because there are hundreds and thousands of locals already living in this place, finding the perfect spot for your home investment tend to be a bit hard to achieve. But below are some practical ways on how you can find the perfect Boulder, Colorado home for you and for your loved ones.

Choose the Location. Boulder has varied options when it comes to home locations. If you are that someone who loves the outdoors and play sport, or you have kids that go to school, you can find a lot of real estate properties right in the heart of the city. The price range varies from the smaller and more affordable types of property, down to the highly expensive and stunningly posh abodes. On the other hand, if you are the type who loves driving around and prefers to stay in a more secluded and a bit far-flung location, there are also urban locations that might suit your taste. The options are really far too many and you can never go wrong!

Check the Neighborhood. Although this concern is mostly shrugged by some home buyers, it is practical to check around the neighborhood and see what the environment is. Do you like to have a more peaceful and laid-back environment with less neighbors? Or do you prefer to stay in an environment with lots of friendly residents whom you can talk to anytime of the day? Your options are practically a lot. All it matters is finding the one that could meet your expectations.

The Size. The size and the floor plan of your home should fall according to what you perceive it to be. Yes, everybody has his dream home; with numerous bedrooms or spacious backyards, and the likes. But do you really think that is practical? Not unless you can afford it, go for a house that is fair enough on your budget and your taste. Especially in a more crowded neighborhood in Boulder, the size of your house matters a lot. Be sure to discuss this area of concern to your local real estate agent and carefully share your expectations.

Boulder is indeed one great place for a more laid-back and relaxing environment. Have your own home at Boulder now!

Check out our Colorado Home Loans website at http://www.colorado-loans.net - The Best Loan Rates Available!

Boulder Real Estate: Tips and Advice when Buying a Home in Boulder

Thu, 22 May 2008 13:50:33 GMT

Finding the right real estate property can be quite tricky because of the numerous options available for you. Because Boulder is a place excellent to work and to live, or even to retire, it is normal to hear people talking about investing on a real estate at Boulder.

Hunting for that perfect house in Boulder takes a lot of time. The competition among sellers is surprisingly as fierce as those among buyers. That’s simply because thousand of people can afford to invest in Boulder. So how do you find the perfect one that is just for you? Here are some practical steps.

Search thru the Real Estate Market in Boulder. Make use of the information superhighway! Identify the size of your preferred home. It is useful as well to know where particularly in Boulder do you wish to live in. When you search online, you can possibly take virtual tours on most real estate properties. You can also check out photos and read about the features of a home. Additionally, checking the neighborhood on your preferred property is also possible. Price ranges are available also when you check thru the Internet.

Check out Hospitals and other Facilities. Not unless you do not have kids, it is important to check out locations in Boulder where reputable schools, hospitals, as well as other important facilities are available nearby. Discuss this with your real estate agent for better options.

Consider your Budget. Real estate properties in Boulder have varied price ranges, depending on the location and the size. You have to determine the overall costs and the monthly payments along with other fees, upon considering a Boulder real estate property. This can easily be done because today, most websites of real estate agents provides mortgage calculators to determine particular charges. Be sure to check out all the necessary information like the closing costs, the tax deductions, the interest rates, and a whole lot more. However, if you have a hard time understanding the number and figures, your real estate agent is just a phone call away. Ask your agent to clarify those things that tend to get too confusing.

Those are but some of the important things you need to consider upon deciding to purchase a Boulder real estate property. When you are about to move to your new home in Boulder, there are U-haul trailers available for rent that gives you the luxury to do the moving yourself.

To have the best and most relaxing home, consider a property at Boulder, Colorado.

Check out our Colorado Home Loans website at http://www.colorado-loans.net - The Best Loan Rates Available!

Telecommunications and Mortgages: What’s the Connection?

Thu, 22 May 2008 13:33:51 GMT

Most people don’t think ‘telecommunications’ when they hear the word ‘mortgage’, but technology’s impact on society, and, especially the mortgage industry, has revolutionized the way things are done and has led to lower costs and more benefits for buyers and firms alike. In a research paper, dated 2004, Armando Falcon writes, “Changes in technology have made possible improvements throughout the lending process that allow prospective borrowers to apply for loans, and enable lenders and investors to service, price, sell, and trade mortgages, more quickly and efficiently.”

So, the explosion of telecommunications technology has had an immediate benefit for both the industry and for potential buyers. One of the first areas impacted by the new telecommunications technology was data transmission and storage. The cost of this drops every year, allowing mortgage companies to pass the savings on to buyers. Communications speed increases every year, allowing companies faster and faster access to information, faster communications with clients and higher quality document transfer.

The change in telecommunications technology has also affected internal communications for mortgage companies. Information is sent digitally, now, allowing agents access to real time changes in prices, policies, interest rates and programs. This grants agents the ability to provide their customers with quality service, analyzing their customer’s needs and finding the program that fits them best within today’s dynamic lending structure.

Cost reduction through office automation has had a great impact on the mortgage industry. Where departments were once segregated, using proprietary software, now the same software can be used throughout the entire office and integrate automation through the firm to lower operating costs. Paperless offices are becoming a reality, rather than a potential, though some firms may be slow to adopt this strategy. With the increase in telecommunications technology and ever better computer performance, documents no longer need to take up physical space in a storage room.

Telecommunications technology has also empowered buyers. Through the rapid spread of information, buyers are able to look to the Internet to find loan information, allowing consumers to be informed about their options and helping them to judge judiciously between mortgage companies. Mortgage companies have changed their focus to be highly service oriented, helping to improve customer relations through email, websites and online advertising campaigns.

Virtual networks have allowed mortgage companies to have branches anywhere in the nation without the need for them to be hard wired into the company’s headquarters. This allows lower start up costs for branches, lower operating costs and fewer funds spent on paper and ink correspondence with existing branches. Again, these savings are all passed on to buyers; the lower the cost to originate a mortgage, the lower the end price of that mortgage.

The Internet is the fastest growing communications medium ever created and mortgage companies are taking full advantage of its benefits. Online search firms allow companies access to real time information about changes in the market, allowing them to change their rates the instant a market fluctuation occurs. This lets them remain extremely competitive and provide the best in service to their customers.

Check out our Colorado Home Loans website at http://www.colorado-loans.net- The Best Loan Rates Available!

Working with your Loan Officer

Thu, 22 May 2008 13:30:15 GMT

Trust is the most important aspect of working with your loan officer. If you don’t trust your loan officer, don’t deal with them; find one that you do trust. Buying a home is one of the biggest investments, if not the biggest, you’ll make in your life. You don’t want to trust your future financial obligations to someone who’s simply rubber stamping you and your application. There are several questions you need to ask yourself when working with your loan officer; let’s look at it like a fast food restaurant:

Does your loan officer take the time to explain the benefits and concerns about each mortgage option? If they simply show you a menu of your options and then take your order, you can be sure they are not working with your best interests in mind. Loan officers are paid on commission, so if you think they’re steering you in a direction that’s not what you want or need, then you may not have an honest loan officer. If they have a particular option that they feel you should explore, they should be able to explain the reasons that this option is to your benefit and why another option wouldn’t be better.

How knowledgeable is your loan officer? Do they have an in-depth knowledge of the industry or do they seem like the guy asking if you’d like fries with your value meal? A comprehensive understanding of the packages offered, the impact of different financial aspects and a desire to help buyers get the best loan for their needs are all key characteristics to look for in your loan officer. The loan industry should not be treated in a “may I take your order” fashion, it’s far too important and has far too much impact on the lives of those involved to be taken as anything but a serious matter.

Your loan officer should treat you like family. I don’t mean like awkward or hateful brothers or sisters acting with spite; I’m mean they should treat you like a member of their family, with respect, humor and an eye for your future well being. Your loan officer will set up a mortgage that you will have to live with as long as you own your home, so choose one that you can work with easily, one who has a reputation for fantastic service with an open and honest demeanor.

While it is very important that your loan officer work with you, rather than against you and it’s important that you are recognized as an important aspect rather than another person standing in line to place your order, it is also very important that you work with the loan officer. They cannot provide excellent service if you do not help them. There are a lot of things a loan officer will require from you and it’s extremely important that they have them-you won’t get a good loan without them! W-2 forms for that past 2 years, pay stubs for the past 3 months, long term debt information, tax returns for at least the previous 2 years, proof of all other income and the address of the property you are interested in purchasing.

Without this information or with faulty or incomplete information, your loan officer will not be able to do their job properly. Most loan officers are more than happy to provide excellent service to you, but you must be prepared to work with them. Before you call to make an appointment with any loan officer, make sure you have the information listed above in hand.

Check out our Colorado Home Loans website at http://www.colorado-loans.net- The Best Loan Rates Available!

Realtor and Mortgage Agent Relations

Thu, 22 May 2008 13:27:02 GMT

It’s important that your realtor and your mortgage agent get along well. If your realtor and mortgage agent are on good terms it makes the whole process of home buying move much more smoothly. Imagine a situation where the realtor and mortgage agent don’t get along; in a best case scenario they don’t speak to each other more than necessary, leading to you, the buyer, possibly not receiving the maximum benefits from such an arrangement. In a worst case scenario the two individuals could actually cause the process to drag on while they bicker over particulars that should have been ironed out before the project truly got under way or even harm the situation by ignoring duties they are supposed to perform.

In an industry fraught with complexity and complication, a good working relationship between the realtor and mortgage agent can save you time, money and hassle. Individuals that work well together form teams that make the home buying process feel seamless to the buyer. This relationship provides benefits to the buyer and to the realtor and mortgage agent; if they work together well, the process moves faster for all parties involved, letting the realtor/mortgage agent team finish projects quickly, at great benefit to the buyer and move on to new home buyers.

Realtors are often good individuals for mortgage agents to cultivate relationships with. Many times, people will contact their realtor concerning all aspects of home ownership, like refinancing and home equity lines of credit. For this reason, many mortgage agents will go to great lengths to locate knowledgeable realtors and form lasting relationships with them. These relationships are excellent ways for the mortgage agent to find potential customers and the realtor will be able to provide background on all applicants that are channeled through them.

Mortgage agents can team up with realtors by offering relevant services that are essential to the realtor. These services are ones that allow the realtor to pass the value along to the buyer, boosting the realtor’s and the mortgage agent’s reputation. Realtors are always in need of new information about the loan industry and providing them with training on the loan industry will allow mortgage agent to showcase new loan packages, different formats and more. This goes a long way towards growing a trusting relationship with realtors and real estate agencies on a business entity level.

A close relationship between realtors and mortgage agents has benefits that go far beyond the two professionals actually interacting. It impacts the mortgage agency and the real estate office as well, generating more business for both sides and benefiting all involved.
For buyers actively looking for a home to buy, finding a realtor with close ties to a mortgage agent can have vast benefits. Relationships like this will provide you, the buyer, with detailed information about the entire home buying process through a single source. Relationships like this allow the realtor the comfort of knowing that the information he or she has is correct, the realtor is able to inform you better and provide many other options than otherwise. Finding a realtor with a good relationship to a particular mortgage agent will help you avoid time consuming hassle and save money.

Check out our Colorado Home Loans website at http://www.colorado-loans.net- The Best Loan Rates Available!

What is an All-in-One Mortgage?

Thu, 22 May 2008 13:25:38 GMT

For various reasons, many homeowners find they need to take out a home equity line of credit or refinance their current mortgage. This usually means more fees, more documents to sign and store and general hassle for the homeowner. If you’re looking for a new home loan, an all-in-one mortgage just might be the way to go. These loans incorporate a home equity line of credit and very flexible options during the life of the loan to help homeowners avoid the hassle of refinancing. What does an all-in-one mortgage include and what benefits do homeowners get from applying for one? Read on.

An all-in-one mortgage is a recent innovation by the lending industry. Pioneered by Washington Mutual, the nation’s largest mortgage lender, an all-in-one mortgage is an innovative approach to making life simpler for homeowners and lenders alike. After its inception and enthusiastic reception, many lenders are creating their own version of this beneficial mortgage.

An all-in-one mortgage is exactly what it sounds like. It allows buyers to incorporate a home equity line of credit into a first home loan, lets buyers adjust the interest rate of their mortgage during the life of the loan without the hassle of refinancing through a third party and choose between interest-only and fully amortized payment options.

Once buyers have paid 10% of the loan, they are able to tap into their home equity. Whether they choose to receive a check, cash advance or a credit card, the only thing they need to do is contact their loan company and the mortgage company will set up the account to make the funds available to the homeowner.

With this type of mortgage, homeowners no longer need to go through the complicated and time consuming hassle of refinancing. During the life of the loan, buyers are able to change from interest-only to fully amortized payments and back at no cost. Buyers can also switch between fixed interest rates and variable at no cost, depending on their payment needs at the time. With Washington Mutual, the first switch is free, after that they are at a flat fee of $250.00 and can be done twice per year. This avoids the annoying and sometimes painful process of changing lenders and keeps your account with people familiar with you.

All-in-one mortgages can be set up to accommodate almost any buyer’s particular needs and are widely available, either through Washington Mutual or one of their competitors. While not every buyer will benefit from an all-in-one mortgage, and not every buyer is eligible for these loans, the vast majority of home buyers should see this pioneering loan type as a boon, giving buyers more control and flexibility over their loan, while making it easier to avoid a lot of the hassle commonly associated with home loans.

Buyers who are not eligible for an all-in-one mortgage are those in the sub-prime market, buyers with credit problems and those with low incomes, though many lenders can offer help with these qualifiers. Bad credit and no credit can be issues that are hard to overcome as most lenders are unable to adjust requirements to meet these problems.

Check out our Colorado Home Loans website at http://www.colorado-loans.net- The Best Loan Rates Available!

Lending Tree: Lender or Scam?

Thu, 22 May 2008 13:23:25 GMT

You’ve seen the advertising online “When banks compete…” and all that. Lending Tree’s advertising looks great. It’s got flash, pizzazz and really makes consumers feel that Lending Tree will provide them with the lowest possible rates. After all, it makes sense, right? Competition is what lowers prices, right? Isn’t that the basis of a good economy? Suppliers and manufacturers compete to gain customer’s business by offering comparable quality at a price less than their competitors. So, what’s the real deal with Lending Tree? Are they legitimate or is there something fishy in their practices?

A brief perusal of the Web will yield far more results than you might expect. I typed the words into my search engine’s text box, hit enter and received over 600,000 results for the words Lending Tree+scam. Now, obviously, they don’t ALL relate to scams by Lending Tree, but a surprising amount of them do. I know I was surprised. Lending Tree seems to have some questionable processes concerning customer’s sensitive information and they definitely seem to partner with some unsavory lending institutions.

Almost every complaint found on the Internet states that the companies sponsored by Lending Tree take between $400 and $600 up front and whether the loan goes through or not, the money is never seen again. That sounds a little suspicious, especially when the agreement on the back of the forms used by these companies states that no money is needed to get the ball rolling. Definitely raises questions on my part.

Thousands of posts abound on the Web about Lending Tree selling customer’s private information (phone numbers, address, etc) to third parties. One memorable poster stated he had been contacted at all hours of the day and night, months after declining to work further with any of the companies Lending Tree sponsored.

Many complaints center on a large sum of money being required to ‘lock in’ the rates of the quote. The lock in period is usually for 45 days, but the process drags on and on, usually to at least a day or two past the lock in period. The customer’s money is then gone, more points are added to the contract and the customers walk away angry and with lighter wallets.

Another memorable post states that Lending Tree asked for the applicant’s information sent in the body of an email with no encryption. This information was stuff like his social security number, address, phone number, W-2 information, like earnings statements and other high theft stuff. When he asked about security, he was informed that it was the way they did things. He found another lender.

Lending Tree practices very sketchy and decidedly unsafe business practices. While not all the posts bashing them are to be believed, there are far too many horror stories out there for it to be a mistake. I would never use the company and highly urge anyone else looking for a home loan, a home equity line of credit or anything else, for that matter, to avoid Lending Tree at all costs.

Check out our Colorado Home Loans website at http://www.colorado-loans.net- The Best Loan Rates Available!

New Mortgage Programs: Web Based Lending

Thu, 22 May 2008 13:18:27 GMT

Online mortgages? Really? Sure. A recent benchmark study by Mortgagebot.com states that of the mortgage agencies with an online presence, fully half of their loans have come through the online channel. This speaks volumes about how Americans are searching for information on home loan lending and how much information they’re willing to get from Internet sources. It also says a lot about the future of the mortgage industry as a whole. With the incredible movement to Web-based commerce still going strong, it should come as no surprise that people are readily engaging in every form of e-commerce, including mortgage applications.

Even less surprising is the market segment doing the online mortgage hunting. Young, affluent and creditworthy, is the description on a popular mortgage news site. These folks are creating the future, now. The market will follow where the money goes, and the money is going to the Internet. While the e-commerce boom has long since died down, the real e-commerce surge is just beginning. The fad that everyone called the ‘boom’ of e-commerce was nothing more than that, a fad. The real interest and movement of business to the Web began slowly and has continued while the .Com folks have mostly faded away.

It’s only natural for the mortgage industry to make the move to the Web. After all, they’re following the money, like everyone else. The real blossoming of the Internet as an outlet for all types of industry and business has yet to come, but we’re seeing the first budding right now. The Web offers engaging visual interaction with enough information to sate anyone’s hunger for knowledge. Websites can be incredibly interactive, even beautiful, and mortgage industry websites are no different. With the right tools, websites can be built that truly promote the beauty and immediacy of the “American Dream”.

Web-based lending is making headway, a new mortgage program for a new generation of home buyers. As with most new business formats, web-based lending may take a little while to catch on with the majority of Americans and the need for brick and mortar lending institutions will never go away. Web-based lending, new mortgage program or not, is here to stay. An example of its growing popularity is the simple fact that Mortgagebot.com’s study was done in the first place. If there weren’t vast potential in the technology, it would have been dismissed completely and many mortgage lenders have realized the error of doing this to their chagrin.

The 21st century’s answer to the mortgage industry is web-based lending and it offers lending powerhouses the opportunity for secured future growth. Even with our society’s increasing technology, most consumers still shop by brand name. Lenders with established names and reputations stand in good stead of reaping the rewards of web-based lending. New mortgage programs like online lending also increase company productivity with all or most of the customer’s information originating from Internet portals. Web-based lending also promises greater competitive opportunities for small companies to grow brand recognition across the nation and even the world.

Check out our Colorado Home Loans website at http://www.colorado-loans.net- The Best Loan Rates Available!

Why Choose an Interest-Only Mortgage?

Thu, 22 May 2008 13:15:48 GMT

You’ve heard the word before, interest-only mortgage. The term has been tossed around until everyone knows the words, but the meaning has become a little murky. An interest-only mortgage can be a great thing for borrowers, but why? Who should get them? What’s the difference between and interest-only mortgage and a traditional mortgage? Let’s dig into what an interest-only mortgage is, why someone would want one and who should actually get them.

An interest-only mortgage is a loan which in which the interest is paid off first, before the principle is paid. If an interest-only mortgage is chosen, the borrower and lender agree on a specified time period, usually five to ten years, during which only the interest is paid. The principal amount of the loan is not reduced by these payments. They borrower has the right to pay more than the interest if they wish too, but it is not required under these terms. This results in lower initial payments for the borrower, sometimes by a substantial amount.

A traditional mortgage is called a “fully amortized mortgage” and payments consist of both interest payments and money directed towards the principle loan amount. These payments are higher than in interest-only mortgages, but the principle amount is reduced much more quickly. Assuming the interest rate stays the same during the life of the loan, a traditional mortgage maintains the amount of the original payment for the life of the loan, while an interest-only mortgage increases in payment size after the initial interest paying period.

Who should get an interest-only mortgage? Anyone with a legitimate need for lower initial payments; they must be prepared to deal with the consequences of choosing this type of mortgage, however. While it is true that an interest-only loan will save you money, that is only the case in the first part of the loan. Since the payments increase after the interest is paid off, the benefits are only applicable for the first part of the life of the loan.

An interest only loan is great for buyers who expect to have a windfall before the loan goes to principle. Borrowers with fluctuating incomes find interest-only loans attractive as well; when income is high, they can pay over the amount and reduce the principle but during low income periods they only have to pay the lower, interest-only payment. Buyers interested in skipping the ‘starter house’ and jumping straight to the house they will eventually need find this type of loan attractive since it can ease the strain of buying a more expensive home.
Many homeowners invest the extra money they save every month, putting the money into investments that will pay off before the loan payment increases. In this way they save money through the life of the loan.

An interest-only loan is not for everyone. Borrowers should examine any interest-only loan for actual benefits; don’t take out an interest-only mortgage if the only difference between that and a traditional mortgage is the interest-only aspect. Look for benefits like reduced future payments after a large mortgage payment and watch for deceptions like “lower interest rates” that are usually not true.

Check out our Colorado Home Loans website at http://www.colorado-loans.net- The Best Loan Rates Available!

Native Americans and Mortgages

Thu, 22 May 2008 13:09:02 GMT

American Indians, while still falling below many minorities, have several avenues open to them to facilitate acceptance of mortgage applications. The Federal Govt. has established these agencies in response to problems American Indians may face when applying for a traditional mortgage. American Indians can face extraordinary difficulties in obtaining a traditional mortgage due to economic depression in tribal lands and unfair lending practices.

HUD provides Native American’s with recourse to mortgages through the establishment of its Office of Native American Programs, or ONAP. ONAP offers American Indians several options in mortgage types, loan duration, interest rates and amount of down payment. HUD’s ONAP can be accessed through mail, in person or through Web access; in addition, many websites offer a rundown of the benefits of ONAP’s loans providing valuable information to American Indians interested in HUD’s mortgage loans. Some of the benefits from using HUD’s One Stop Mortgage Center are zero down payment, potential refinancing, mobile home financing and veterans programs.

A partnership between the Native American Bank, LenderLive and Greenpoint Mortgage has resulted in turnkey home mortgages for American Indians for a number of purposes like rehabilitation, refinancing and home buying. This partnership provides American Indians with great resources to help in getting a home loan. The Native American Bank is now in position to be the number one lender to American Indians and to reap the rewards of serving this growing sector of the industry.

The Fannie Mae Organization has also created mortgage programs for Native Americans. These do not have as broad a spectrum as the HUD loans and some of the terms may be somewhat less attractive but they are quality mortgage loans offered at good rates. The Fannie Mae organization is a well respected entity in the nation, providing loans and mortgage information to people nationwide.

Freddie Mac also has a specialty division to assist American Indians with attaining a home mortgage.
They provide access to HUD loans and several other programs designed to help Native Americans. This institution provides information to help Native Americans understand the options available to them and the difference between what once was and what the industry has become today.
Home loans to Native Americans consistently fall behind mortgages to whites and several other minorities. The programs listed above were designed with this in mind, to bolster the numbers of American Indian’s successful loan applications. Traditionally, American Indians have been poorly received by many institutions due to tribal autonomy, poor economy in tribal lands and other issues of concern.

One of the factors behind Native Americans’ difficulty in obtaining mortgage loans is the situation on tribal lands. Many times, the economy of these lands is depressed, leading to low paying jobs and high unemployment rates. The American Indians have begun a promising change, however. Jobless rates, though still worse than national levels, are plunging. Social reforms, land acquisition and internal tribal change are revitalizing tribal lands and thus the economy and feasibility of acquiring home loans. Many groups are beginning to recognize the potential of the Native American peoples and are actively courting their interest.

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Which Mortgage Should I Choose?

Thu, 22 May 2008 12:33:37 GMT

The lending industry can be a confusing place for potential buyers. There are adjustable rate mortgages (ARM’s), interest-only mortgages, traditional mortgages, all-in-one mortgages and more. There are loans with no points that have higher interest rates and loans that you can allocate funds towards points that carry lower interest rates. How does a potential buyer choose which mortgage is right for them, what makes the different mortgages, well, different? Why do certain lenders advise buyers on a specific type of mortgage?

To provide a little more clarity in a murky world, you need to ask yourself and your lender some questions. Knowing as much as you can about the different types of mortgages will help you be an informed buyer and make wise decisions when it comes time to choose a mortgage.

The first question you should answer is: how long you expect to be in this particular home? If you don’t plan on being there for very long, then a 30 year mortgage with a fixed interest rate may not be right for you. An interest-only loan may be a better option if you plan on only living there a short time and then selling.

Check out the lender’s reputation as thoroughly as possible. Some lenders are underhanded, stacking hidden fees and charges against the buyer while never revealing everything that’s going on. The Internet is a great way to find feedback on particular lenders; checking forums and message boards will reveal a lot of information about lender practices and performance. Trust is imperative in choosing a lender, so do your homework and make sure you’re comfortable with the lender.

Check out the interest rates the lender offers and how long they will guarantee them. Is the rate variable or fixed? Get any promises in writing.

Determine how much you can provide as a down payment. The larger the down payment, the lower the monthly payments will be. If you don’t have a lot of cash upfront you can always choose a higher interest rate or an adjustable interest rate; these will lower the amount required for down payment.

What risks are you willing to accept? If you have the resources or the willingness to take the risks, an adjustable rate mortgage can give you a lower rate, while a fixed rate will provide you the knowledge of exactly what your monthly expenses will be, but at a higher interest rate.
Another option for determining which mortgage is right for you is the use of an Independent Financial Advisor (IFA). These folks provide incredible services, taking your needs and desires into consideration and showing you which mortgages are currently the best on the market and what types of mortgages work with your current needs and monetary situation. IFA’s are usually independent entities and have no reason to advise you to choose one type of mortgage over another or one lender instead of their competition. Using an IFA can greatly reduce the amount of stress involved with deciding what mortgage is right for you.

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Mortgages for Minorities: How much is too much?

Thu, 22 May 2008 12:14:36 GMT

The Fed has released several reports over the last few years that express, in detail, the differences between mortgages offered to minorities and mortgages offered to whites. While the industry tries to maintain that they offer fair business practices, the results don’t support this at all. Minorities are more likely to be denied a home loan, often pay higher interest rates than whites and frequently must provide a larger down payment. The gap between minority home owners and whites continues to narrow at a snail’s pace, but steps are being taken to help change the situation.

Loan Rejection

African-Americans and Latinos suffer a large percentage of rejections when applying for mortgages, research suggests. Latinos have the highest denial rate, nationwide, with African-Americans coming in 6th, behind Latinos and other minorities. Lenders say it has nothing to do with minority status and much more with credit ratings and debt loads that are not taken into account by the surveys.

Local and national programs have been instituted to help minorities achieve home ownership, including Self-Help, HUD and other programs. Wachovia and BB&T also offer several programs on local levels geared towards providing sustainable mortgages for minorities.

Higher Interest Rates for Minorities

African Americans and Latinos are much more likely than whites to have higher interest rates, according to a study by the Federal Govt. The study shows that the disparity lies across the board, in all income brackets, but is especially prevalent in the instance of minorities with higher incomes. As strange as it seems, high earning minorities are more likely to get a higher interest rate mortgage than lower earning applicants. The study shows that discrimination certainly plays a role in lending, today.

Legislation, though slow moving, is before law makers to help correct the situation and several groups are lobbying Washington for more action and penalties for lenders practicing racial discrimination. Again, lenders say the study did not take into account credit ratings or debt load for the applicants.

Down Payments

Due to the nature of the loans they are able to attain, minorities are sometimes required to put down larger down payments than whites. This is a major reason for the lower percentage of home ownership among minority groups. The same study cited above released their findings that many minorities are able to pay the equivalent of a mortgage payment in monthly rent, but are unable to save enough money to make a large down payment.

The President’s much maligned “zero down” plan is aimed at providing homes for minorities with little or no money down through the American Dream Down Payment Fund. This program is designed encourage home ownership in minorities, helping to close the gap between minority home owners and whites.

Conclusion

While steps are being made, they are not enough to close the gap between minority home ownership and that of whites. Minorities face a myriad of discriminatory practices in the housing and lending industry and only a concerted effort by citizens and lawmakers will make a difference. Old stereotypes need to be wiped away and new practices instituted to change the face of the lending industry.

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