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Second Mortgages
There are many different types of second mortgages available:
- A reverse mortgage is a line of credit available for homeowners of 62 years
and older. This type of loan allows you to draw money as you need or receive
monthly payments for the rest of your life or until you move, even if the
amount of your loan exceeds the value of your house (usually because the home
did not rise in value as expected or the homeowner lived longer than was expected).
This loan, like the home equity line of credit, has an adjustable rate, but
this rate is based on a different index, the Prime Rate which can often be
more reliable than other indexes.
- If you have little or no equity in your home, many lenders will still allow
you to obtain a second mortgage, but it can be risky to secure a loan with
your home if there is not enough equity accrued.
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Bad Credit Refinance
An adjustable rate loan is often taken on by people with bad credit. If your situation has improved since you closed your first loan and you believe you can qualify for a fixed rate loan, or if you desperately want a lower adjustable rate cap, refinancing can help you. Refinancing to a fixed loan will give you the security of know exactly what your monthly payments will be for the life of your loan, and a low rate cap will give you the knowledge that your adjustable rate will not climb too high. Refinancing may get you a loan with the security that you did not obtain the first time around.
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Home Equity
A home equity line of credit is like a home equity loan in that the house is used as collateral. However, home equity lines of credit allow borrowers to set up a credit line that can be used much like a credit card. During a period of time, usually five to ten years, the homeowner is able to take large or small amounts from the account until the drawing period ends or the amount of the loan is exhausted. This type of loan is an adjustable rate mortgage, which varies with the market.
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Land Loan
Land loans, unlike mortgage loans, are provided solely for the purpose of acquiring land on which to build a new home. Land is a finite quantity anywhere you go and in today’s world it is at a premium because there is only so much to go around. Finding an appropriate lot for a home can be on the level of difficulty of finding an affordable loan for land. Financing can also be more difficult if the borrower intends to wait for more than a few months to build on the property because it adds to the perceived risk if the lot turns out to not be suitable for the building without major work done on the land.
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Mortgage Calculation
Amortization is the repayment schedule for both the principal and interest of your mortgage which is usually made by equal payments on a monthly basis.. Mortgage calculation shows what this monthly payment will be, depending on certain loan terms, including, loan amount, interest rate, and term. If your loan term is 15 years, your interest rate is 7%, and your loan amount is $150,000, your monthly payment comes to $1,348. Mortgage calculation can also show you that your total interest paid of the life of this loan would be $92,683. Some people would look at these figures and decide that $1,348 is too high a monthly payment that will not fit into the budget. In this case, you could change around the terms, for example, switch to a 30 year term, which would drop the monthly payment by $351, making it $997 monthly, but would double the amount of interest paid over the life of the loan.
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Mortgages Online
Points equal up to 1% of your loan and are paid at the beginning of your loan. The more points paid, generally the lower the interest rate.
Find out more about the mortgage that would be perfect for you and your home. Apply online to contact up to four lenders.
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Reverse Mortgage
Once qualified for a reverse mortgage a homeowner can receive it all at once, through monthly increments, or through a line of credit. Depending on the lender and the expected needs of the borrower, any of the above could possibly be the best fit
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