Mar
28
Mortgage After Chapter 7
Filed Under Real Estate | Leave a Comment
James McKerr asked:
Going through a chapter 7 can seem to take forever. Before you can get back on the real estate ladder the bankruptcy must be fully discharged by the court. In addition before you apply for any new home loan ensure that you have full control of your finances and for example are not part of some enforced credit program. Even if your chapter 7 has not been finalized there are many things you can be doing in order to prepare.
One of the most important things you need to start doing straight away is to start saving for a down payment. The larger the down payment you have the easier you will find it to get a deal. If you have a down payment as large as say 15% then you should be able to get accepted for a home loan within days after bankruptcy.
Naturally you will not get the best deal by getting a mortgage straight after bankruptcy, however by having a mortgage and making your repayments you will be building your credit score back up so much so that after about 12-24 months you should be able to refinance and get a regular home loan. This is far better than waiting for 2 years, then applying for a mortgage to find that the lenders still classify you as a sub prime borrower.
You may find that the value of your home means you have enough equity so that you can refinance almost straight away after bankruptcy. If you do, take the opportunity.
Assuming you are not in this lucky position what should you do? Well the first thing to do is to start researching your options. It is crucial that you invest some time researching the market to see what kind of deals are out there. That way once you come to start applying you should already know where to look and what sort of deal is within your reach.
William
Going through a chapter 7 can seem to take forever. Before you can get back on the real estate ladder the bankruptcy must be fully discharged by the court. In addition before you apply for any new home loan ensure that you have full control of your finances and for example are not part of some enforced credit program. Even if your chapter 7 has not been finalized there are many things you can be doing in order to prepare.
One of the most important things you need to start doing straight away is to start saving for a down payment. The larger the down payment you have the easier you will find it to get a deal. If you have a down payment as large as say 15% then you should be able to get accepted for a home loan within days after bankruptcy.
Naturally you will not get the best deal by getting a mortgage straight after bankruptcy, however by having a mortgage and making your repayments you will be building your credit score back up so much so that after about 12-24 months you should be able to refinance and get a regular home loan. This is far better than waiting for 2 years, then applying for a mortgage to find that the lenders still classify you as a sub prime borrower.
You may find that the value of your home means you have enough equity so that you can refinance almost straight away after bankruptcy. If you do, take the opportunity.
Assuming you are not in this lucky position what should you do? Well the first thing to do is to start researching your options. It is crucial that you invest some time researching the market to see what kind of deals are out there. That way once you come to start applying you should already know where to look and what sort of deal is within your reach.
William
Mar
28
Renegotiate Your Mortgage Terms – Think It’s Impossible, Think Again
Filed Under Real Estate | Leave a Comment
Anthony Frankson asked:
If your mortgage due date arrives and you’re not able to make your mortgage payment don’t panic, or conversely, disregard the whole event entirely. Often individuals are incapable of making their mortgage payment because of a job loss or another cause beyond their control. It is at this time, one must pick up the phone and call their lender because they can, in all probability, help protect your credit rating, keep you in your home and give you peace of mind. You can renegotiate your mortgage terms with many lenders when hardship strikes.
When you call your lender, they will want to know if your income loss is temporary or more serious. If you have lost your job, and future payments are in jeopardy, advise them immediately of the exact nature of your financial distress. There are certain steps that you can take quickly that will reduce or prevent the possibility of foreclosure on your cherished home. How much help a lender can provide depends on the nature of the loan you have.
If you have a conventional loan, it is possible for some lenders to look at your financial position and work out some resolution that is advantageous both to you and the lender. If you have a loan that is backed or underwritten by the US government, lenders may be precluded from offering any advice until your loan falls to ninety days in arrears. Regardless, you have to communicate with your lender given the severe consequences that may result otherwise.
Your lender may be able to help you in one of seven ways: 1) By providing you with interest rate or principal reduction on your current loan, 2) By providing you with a re-amortization or loan refinancing on your current loan, 3) By granting you a special interest-free or low interest personalized loan based on the amount of money due on your missed payment, 4) By moving your current payment to the end of your loan, giving you time to get your finances straightened out, 5) By willing to accept a partial mortgage payment instead of the normal full payment, 6) By giving you an extended time period to get caught up on your mortgage payment. The time period may be as long as 1 to 2 years. This is achieved by appending a fraction of your unpaid loan payment remainder to your payment on a monthly basis until you are finally up to date with the payments, 7) By dispensing with the harsh late payment penalties that are often imposed as late fees.
Lenders actually have no vested interest in foreclosing on your home; they only have a vested interest in keeping you in your home making monthly mortgage payments on time. Lenders are aware of the many fiscal difficulties borrowers have in making their mortgage payments when hardships arise. Your lender likely won’t volunteer their help, specifically if they don’t recognize you’re having problems making your payments. That is why, as a responsible homeowner, you must take the initiative and contact your lender and give them a heads up on your current financial hardship.
Many lenders do not offer borrowers all 7 of these possible renegotiation alternatives, however, it is likely that your lender has access to several of these methods. Generally, you do need to qualify for this type of help from your lender. Often it consists in the form of a detailed financial statement and substantiation of income loss. It is sometimes hard for certain individual’s ego to have to admit to financial difficulty, but if doing so helps maintain you in your home, it certainly is worth the admission. I would think that you would rather make a phone call to your lender if it keeps you from the chance of losing your precious home and part of the American Dream.
Tyler
If your mortgage due date arrives and you’re not able to make your mortgage payment don’t panic, or conversely, disregard the whole event entirely. Often individuals are incapable of making their mortgage payment because of a job loss or another cause beyond their control. It is at this time, one must pick up the phone and call their lender because they can, in all probability, help protect your credit rating, keep you in your home and give you peace of mind. You can renegotiate your mortgage terms with many lenders when hardship strikes.
When you call your lender, they will want to know if your income loss is temporary or more serious. If you have lost your job, and future payments are in jeopardy, advise them immediately of the exact nature of your financial distress. There are certain steps that you can take quickly that will reduce or prevent the possibility of foreclosure on your cherished home. How much help a lender can provide depends on the nature of the loan you have.
If you have a conventional loan, it is possible for some lenders to look at your financial position and work out some resolution that is advantageous both to you and the lender. If you have a loan that is backed or underwritten by the US government, lenders may be precluded from offering any advice until your loan falls to ninety days in arrears. Regardless, you have to communicate with your lender given the severe consequences that may result otherwise.
Your lender may be able to help you in one of seven ways: 1) By providing you with interest rate or principal reduction on your current loan, 2) By providing you with a re-amortization or loan refinancing on your current loan, 3) By granting you a special interest-free or low interest personalized loan based on the amount of money due on your missed payment, 4) By moving your current payment to the end of your loan, giving you time to get your finances straightened out, 5) By willing to accept a partial mortgage payment instead of the normal full payment, 6) By giving you an extended time period to get caught up on your mortgage payment. The time period may be as long as 1 to 2 years. This is achieved by appending a fraction of your unpaid loan payment remainder to your payment on a monthly basis until you are finally up to date with the payments, 7) By dispensing with the harsh late payment penalties that are often imposed as late fees.
Lenders actually have no vested interest in foreclosing on your home; they only have a vested interest in keeping you in your home making monthly mortgage payments on time. Lenders are aware of the many fiscal difficulties borrowers have in making their mortgage payments when hardships arise. Your lender likely won’t volunteer their help, specifically if they don’t recognize you’re having problems making your payments. That is why, as a responsible homeowner, you must take the initiative and contact your lender and give them a heads up on your current financial hardship.
Many lenders do not offer borrowers all 7 of these possible renegotiation alternatives, however, it is likely that your lender has access to several of these methods. Generally, you do need to qualify for this type of help from your lender. Often it consists in the form of a detailed financial statement and substantiation of income loss. It is sometimes hard for certain individual’s ego to have to admit to financial difficulty, but if doing so helps maintain you in your home, it certainly is worth the admission. I would think that you would rather make a phone call to your lender if it keeps you from the chance of losing your precious home and part of the American Dream.
Tyler
Mar
16
Susan V. Gregory asked:
Distressed borrowers who need Wells Fargo loan modification help are advised to learn about the lenders guidelines and requirements before submitting their application. Wells Fargo has implemented two programs that promise to give delinquent borrowers options to help avoid foreclosure and stay in their homes. Here is a basic outline of the programs that may benefit borrowers:
1. Project LifeLine: A Wells Fargo loan modification program that pauses the foreclosure process for up to 30 days to allow a loan workout solution to be implemented. Targeted at borrowers who are 90 days or more delinquent, each loan is reviewed on a case by case basis. Wells Fargo is contacting borrowers who are 90 days or more late advising them to contact the bank to find out if they are eligible for loan modification help. Homeowners must provide financial statements, documentation of financial hardship and proof of income to determine if they will qualify.
Not all loans will qualify for this program. Loans that are excluded from Project LifeLine include:
Loans in active bankruptcy Active foreclosure with sale date less than 30 days away Loans on vacant or investment properties
Interested borrowers may contact the Project LifeLine department at: 1-866-488-2028.
2. Fast-Trac Solution for ARM loans: Homeowners who have an adjustable rate loan that is scheduled to reset to an unaffordable payment may be eligible for a 5 year freeze on the introductory rate. Approximately 1.8 million subprime adjustable rate mortgages are set to reset by the end of 2009 and Wells Fargo loan modification help may be available to eligible customers. In order to determine eligibility, loans must be:
Originated between January 1, 2005 and July 31, 2007 Scheduled for an initial interest rate reset between January 1, 2008 and July 31, 2010 Have an initial fixed interest rate period of 36 months or less (2/28 and 3/27 loans are the most common)
Wells Fargo will notify customers as soon as it is determined that they may meet eligibility requirements. Borrowers will have to provide income and expense documentation as well as proof of financial hardship to qualify for this Wells Fargo loan modification help. It is important for interested homeowners to have a good, general understanding of how to complete the required loan modification application properly to increase their chance of approval. Even a deserving borrower may be declined if they do not understand how to meet the debt ratio requirements, provide the bank with a compelling and convincing hardship letter and complete the financial statements properly. Wells Fargo borrowers who cannot make their mortgage payments can call the bank at 1-866-398-7556 to begin the application process.
Stacy
Distressed borrowers who need Wells Fargo loan modification help are advised to learn about the lenders guidelines and requirements before submitting their application. Wells Fargo has implemented two programs that promise to give delinquent borrowers options to help avoid foreclosure and stay in their homes. Here is a basic outline of the programs that may benefit borrowers:
1. Project LifeLine: A Wells Fargo loan modification program that pauses the foreclosure process for up to 30 days to allow a loan workout solution to be implemented. Targeted at borrowers who are 90 days or more delinquent, each loan is reviewed on a case by case basis. Wells Fargo is contacting borrowers who are 90 days or more late advising them to contact the bank to find out if they are eligible for loan modification help. Homeowners must provide financial statements, documentation of financial hardship and proof of income to determine if they will qualify.
Not all loans will qualify for this program. Loans that are excluded from Project LifeLine include:
Loans in active bankruptcy Active foreclosure with sale date less than 30 days away Loans on vacant or investment properties
Interested borrowers may contact the Project LifeLine department at: 1-866-488-2028.
2. Fast-Trac Solution for ARM loans: Homeowners who have an adjustable rate loan that is scheduled to reset to an unaffordable payment may be eligible for a 5 year freeze on the introductory rate. Approximately 1.8 million subprime adjustable rate mortgages are set to reset by the end of 2009 and Wells Fargo loan modification help may be available to eligible customers. In order to determine eligibility, loans must be:
Originated between January 1, 2005 and July 31, 2007 Scheduled for an initial interest rate reset between January 1, 2008 and July 31, 2010 Have an initial fixed interest rate period of 36 months or less (2/28 and 3/27 loans are the most common)
Wells Fargo will notify customers as soon as it is determined that they may meet eligibility requirements. Borrowers will have to provide income and expense documentation as well as proof of financial hardship to qualify for this Wells Fargo loan modification help. It is important for interested homeowners to have a good, general understanding of how to complete the required loan modification application properly to increase their chance of approval. Even a deserving borrower may be declined if they do not understand how to meet the debt ratio requirements, provide the bank with a compelling and convincing hardship letter and complete the financial statements properly. Wells Fargo borrowers who cannot make their mortgage payments can call the bank at 1-866-398-7556 to begin the application process.
Stacy
Mar
15
Mnick Sandr asked:
Does getting a high credit score lower my mortgage loan charge? The solution may perhaps surprise you, a excessive credit scores alone will not get you a low mortgage loan amount.
Does getting a high credit rating lower my mortgage loan charge? A lot of home owners who have better credit ratings now than when they originally financed their properties. The answer is more difficult than a simple Yes or No. Although getting a excessive credit rating definitely does increase the probabilities of a borrower getting an improved interest rate with their mortgage, it’s not the only factor considered. Many other factors are weighed, some a lot more vital and some less. Whilst acquiring a excessive credit rating is practically constantly a very good factor, its not the be all and end all.
I just switched jobs, does obtaining a high credit scores minimize my mortgage rate?
Whilst acquiring a higher credit score will never hurt the possibilities of a debtor securing a reduced interest price on their mortgage loan, position background is one of the most heavily weighted aspects when a lender determines a mortgage fee. If a borrower is contemplating financing a new residence or attempting to lower the mortgage price on their existing bank loan it would be wise to wait for year or two to ensure that position record functions within the borrowers favor.
If I have got a steady task historical past and also a greater credit score now than when I applied for my household mortgage does acquiring a large credit score lower my mortgage amount?
With a stable position background, a stable lending history, along with a high credit scores a debtor is pretty much specific to reduced the interest price on their mortgage loan price. A high credit rating helps to reassure the lender the debtor will not default on the home bank loan. The debtors substantial credit rating does this by proving that the borrower has a stable historical past of payments and just isn’t overextended on their credit rating.
If you want to know more information & tips please visit my blog: Bad Credit Mortgage Rate
Jason
Does getting a high credit score lower my mortgage loan charge? The solution may perhaps surprise you, a excessive credit scores alone will not get you a low mortgage loan amount.
Does getting a high credit rating lower my mortgage loan charge? A lot of home owners who have better credit ratings now than when they originally financed their properties. The answer is more difficult than a simple Yes or No. Although getting a excessive credit rating definitely does increase the probabilities of a borrower getting an improved interest rate with their mortgage, it’s not the only factor considered. Many other factors are weighed, some a lot more vital and some less. Whilst acquiring a excessive credit rating is practically constantly a very good factor, its not the be all and end all.
I just switched jobs, does obtaining a high credit scores minimize my mortgage rate?
Whilst acquiring a higher credit score will never hurt the possibilities of a debtor securing a reduced interest price on their mortgage loan, position background is one of the most heavily weighted aspects when a lender determines a mortgage fee. If a borrower is contemplating financing a new residence or attempting to lower the mortgage price on their existing bank loan it would be wise to wait for year or two to ensure that position record functions within the borrowers favor.
If I have got a steady task historical past and also a greater credit score now than when I applied for my household mortgage does acquiring a large credit score lower my mortgage amount?
With a stable position background, a stable lending history, along with a high credit scores a debtor is pretty much specific to reduced the interest price on their mortgage loan price. A high credit rating helps to reassure the lender the debtor will not default on the home bank loan. The debtors substantial credit rating does this by proving that the borrower has a stable historical past of payments and just isn’t overextended on their credit rating.
If you want to know more information & tips please visit my blog: Bad Credit Mortgage Rate
Jason
Mar
9
How To Figure Out Mortgage Payments Without a Mortgage Calculator
Filed Under Real Estate | Leave a Comment
Edward Lathrop asked:
In today’s world, taking out a mortgage is necessary for anyone who wants to invest in real estate or simply wants to put a roof over his head. Usually, to find out what a mortgage payment will be on a particular property, a potential buyer needs to contact a realtor or bank to get a quote.
By contacting either one, the buyer risks harassment from a realtor who won’t let go of a qualified buyer, or a lender who needs to lend mortgage money to stay in business. Any buyer in his right mind will only go to one of these salespeople when he is ready to go full speed ahead toward a closing.
So, what does a person who is in the early thinking stages of buying a home do? How do you know what the payment will be on a house a seller is asking $250,000 for when the bank is advertising 30-year mortgages at 7%?
By the end of this article you will be making such a calculation in your head. You will be sprouting out the answer to complicated home buying scenarios just as fast as you can find the terms on the mortgage and the price on the house.
$66.53 a Month
First, remember this: $10,000 borrowed for 30 years at 7% will require a monthly payment of $66.53. So, it stands to reason $100,000 for 30 years at 7% requires a monthly payment of $665.30. Also take note you could figure out on a piece of paper with a pencil, $50,000 for 30 years at 7% is $332.65.
Knowing these figures, you automatically know a $250,000 mortgage at 7% for 30 years will require a payment of $665.30 (for $100,000) and another $665.30 (for the next $100,000) and $332.65 (for $50,000). This means the payment will be $1,663.25, or really, really close. A mortgage calculator gives the answer as $1,663.26, but for a wild guess, I’ll take it.
A 6% or an 8% Mortgage
Of course, here you ask, “What if I find a mortgage with a lower interest rate?” Well in that case, remember this, $10,000 borrowed for 30 years at 6% costs the borrower $59.96 a month. This means a $1,000,000 mortgage for 30 years at 6% will be 100 times $59.96 or, a monthly payment of $5,996.00. Now, certainly that was easy. All we had to do was add 2 zeros!
Okay, what about if the interest rate is 8%? Here, a 30-year mortgage for $10,000 is $73.38 each month. So a $300,000 mortgage will come at a cost of 30 times that or, $2,201.40 a month.
How About a 7 1/4% Mortgage?
In reality, most times interest rates will not be exactly 6 or 7, or 8%. Even when this is the case, you still don’t need a mortgage calculator. If you read about a 30-year $260,000 mortgage at 7 1/4%, for instance, and you want to know what the monthly payment will be, here’s what you do. Are you ready? Guess!
That’s right! Just guess! You know 7% will cost you $66.53 per $10,000 a month and 8% will cost $73.38 per $10,000 a month. You also know 7 1/4 is somewhere on the lower side between 7 and 8 so take a guess how much 7 1/4% will cost per $10,000 a month. My guess would be maybe, $68.50?
I’ll go with that. So, since it is a $260,000 mortgage we’re trying to figure the payment for, we will multiply 26 (260,000 / 10,000) X $68.50. The answer is: $1,781.
When I run $260,000 at 7 1/4% for 30 years through a mortgage payment calculator the answer comes out $1,773.66. So, our answer wasn’t precisely right, but it was pretty close.
In a case like this, even if we came out with an answer that is $20-$30 off, who cares? Before the real mortgage payment is determined, the cost of a homeowner’s insurance policy and property taxes will have to be calculated anyway. So, the best anybody can do at this point is guess.
There you have it. Now, you’re a human calculator! As long as you’re only concerned with 30-year mortgages, and today’s going interest rates, which are 6% to 8%, you can figure out mortgage payments in your head, or maybe with just a little help from a pocket calculator. Congratulations!
Kristin
In today’s world, taking out a mortgage is necessary for anyone who wants to invest in real estate or simply wants to put a roof over his head. Usually, to find out what a mortgage payment will be on a particular property, a potential buyer needs to contact a realtor or bank to get a quote.
By contacting either one, the buyer risks harassment from a realtor who won’t let go of a qualified buyer, or a lender who needs to lend mortgage money to stay in business. Any buyer in his right mind will only go to one of these salespeople when he is ready to go full speed ahead toward a closing.
So, what does a person who is in the early thinking stages of buying a home do? How do you know what the payment will be on a house a seller is asking $250,000 for when the bank is advertising 30-year mortgages at 7%?
By the end of this article you will be making such a calculation in your head. You will be sprouting out the answer to complicated home buying scenarios just as fast as you can find the terms on the mortgage and the price on the house.
$66.53 a Month
First, remember this: $10,000 borrowed for 30 years at 7% will require a monthly payment of $66.53. So, it stands to reason $100,000 for 30 years at 7% requires a monthly payment of $665.30. Also take note you could figure out on a piece of paper with a pencil, $50,000 for 30 years at 7% is $332.65.
Knowing these figures, you automatically know a $250,000 mortgage at 7% for 30 years will require a payment of $665.30 (for $100,000) and another $665.30 (for the next $100,000) and $332.65 (for $50,000). This means the payment will be $1,663.25, or really, really close. A mortgage calculator gives the answer as $1,663.26, but for a wild guess, I’ll take it.
A 6% or an 8% Mortgage
Of course, here you ask, “What if I find a mortgage with a lower interest rate?” Well in that case, remember this, $10,000 borrowed for 30 years at 6% costs the borrower $59.96 a month. This means a $1,000,000 mortgage for 30 years at 6% will be 100 times $59.96 or, a monthly payment of $5,996.00. Now, certainly that was easy. All we had to do was add 2 zeros!
Okay, what about if the interest rate is 8%? Here, a 30-year mortgage for $10,000 is $73.38 each month. So a $300,000 mortgage will come at a cost of 30 times that or, $2,201.40 a month.
How About a 7 1/4% Mortgage?
In reality, most times interest rates will not be exactly 6 or 7, or 8%. Even when this is the case, you still don’t need a mortgage calculator. If you read about a 30-year $260,000 mortgage at 7 1/4%, for instance, and you want to know what the monthly payment will be, here’s what you do. Are you ready? Guess!
That’s right! Just guess! You know 7% will cost you $66.53 per $10,000 a month and 8% will cost $73.38 per $10,000 a month. You also know 7 1/4 is somewhere on the lower side between 7 and 8 so take a guess how much 7 1/4% will cost per $10,000 a month. My guess would be maybe, $68.50?
I’ll go with that. So, since it is a $260,000 mortgage we’re trying to figure the payment for, we will multiply 26 (260,000 / 10,000) X $68.50. The answer is: $1,781.
When I run $260,000 at 7 1/4% for 30 years through a mortgage payment calculator the answer comes out $1,773.66. So, our answer wasn’t precisely right, but it was pretty close.
In a case like this, even if we came out with an answer that is $20-$30 off, who cares? Before the real mortgage payment is determined, the cost of a homeowner’s insurance policy and property taxes will have to be calculated anyway. So, the best anybody can do at this point is guess.
There you have it. Now, you’re a human calculator! As long as you’re only concerned with 30-year mortgages, and today’s going interest rates, which are 6% to 8%, you can figure out mortgage payments in your head, or maybe with just a little help from a pocket calculator. Congratulations!
Kristin