30 Year Home Loans
Sunday, March 12, 2006
It used to be the first choice of most borrowers, because since the total payments are spread over a longer period of time with the interest rate set for the entire time of the mortgage. 30 year home loan rates are an industry standard but is it the right choice for you?
The 30 year home loan is an industry standard, but is it the right choice for you? Because the total payments are spread over a longer period of time and the interest rate set for the entire time of the mortgage. This was the first choice of most home owners.
As we mentioned, the plus side for a 30 year home loan is lower monthly payments. This attraction is somewhat dimmed by the fact that you pay thousands extra in interest. But, your interest is 100% tax deductible which does lower your after tax cost. It offers you some flexibility so that if your financial situation changes and you have more money you can pay it off in less than 30 years, this while keeping the low monthly payments. Your payments are smaller so in reality you can purchase a larger roomier home.
To show an example of the interest difference between 30 year home loan rates and one of the other rates. On a 30 year, 100,000 dollar loan using 7% interest rate your monthly payment of interest and principle would be $665.30 dollars. Over the next 30 years you will have paid $139,511.04 in interest alone. Now with a 15 year home loan rate on the same amount you will pay $871.11 per month and over the next 15 years, you would pay $56,799 in interest. This would save you $82,712 dollars.
If you have the will power to invest the savings from the monthly payments, it still could be a good choice to go with the 30 year mortgage. Especially if you can find an investment that the long term payoff matches or exceeds what you would save in a 15 year mortgage. Another factor to consider is how fast you want to accrue equity in your home or to own it out right. 30 year home loan rates take much longer to build equity.
30 year home loan rates are certainly attractive and the vast majority of home buyers get 30-year loans because that is the longest home loan available today. Experts agree if they could get a 35- or 40-year loan, they probably would. There are many other options to consider. Probably the biggest question you have to ask yourself when considering a loan is what are your financial goals? What loan plan will help you the most to reach that goal? It is clearly to your advantage to look into other loan options for the best loan available for you and your financial goals. It may surprise you that because of your personal situation there may be other plans more suitable for you.
posted by Dennis Cheesman @ 10:36 PM,
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Your Home Improvement, Your Way!
Wednesday, March 08, 2006
How many times do you find your kitchen small and how many times have you thought of making it little larger, now don’t give it a second thought and just go for it. Take a Home improvement loan. Home Improvement loans are usually borrowed for the purpose of carrying out improvements that will increase the value of the home as well as for repairs that will help hold its value.
There are numerous ways of acquiring home improvement loans:
• Home equity loan
• Secured Home improvement loan
• Bad credit home improvement loan
Home Equity Loan: In case of home equity loans, you are borrowing money against the value of your home. It is a prudent choice if the home improvement project that you are undertaking increases the value of your home. You can borrow up to 80% of the equity in your house. Home improvement loans must be taken after weighing the pros and cons carefully. One should be able to afford the monthly repayments and ensure that the house is worth more than what you owe for the loan.
Secured Home improvement loan : It is a loan laid out by either a finance company or bank to finance your home improvement project. You need to pledge your home as collateral in order to avail a secured home improvement loan.
Bad credit home improvement loan:
It is true that if you have a bad credit history then it is difficult to obtain a home improvement loan, but it is not impossible. You can get yourself a home improvement loan even if you have arrears, county court judgments (CCJS), bankruptcies to your credit. Though you will get the home improvement loan but the interest rates would be quite high.
Acquiring a home improvement loan
When going in for a home improvement loan, one should plan the home improvements that he has to carry out. This should include costs of all improvements and the estimates put forth by the contractor. The home improvement you have been thinking of should be thus well planned.
About the author : The author is a business writer specializing in finance and credit products and has written authoritative articles on the finance industry. He has done his masters in Business Administration and is currently assisting adverse credit home improvement loans as a finance specialist.
For more information please visit: http://www.adverse-credit-home-improvement-loans.co.uk
posted by Dennis Cheesman @ 5:26 AM,
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Poor Credit Home Equity Loan Tips – What Factors Do Lenders Consider?
Home equity loans have many useful purposes. On average, homeowners select these loans as a way to reduce and eliminate their credit card debts. This is a wise tactic considering that home equity loans have lower rates than most credit cards. Homeowners also have the option of choosing an equity loan with fixed rates and terms. Even though home equity loans are easier to qualify for than most loans, lenders consider several factors before approving a loan.
Understanding Home Equity Loans
If applying for a home equity loan, homeowners must assess their personal finances beforehand. Home equity loans are very popular. Because of low rates, they present the perfect opportunity for becoming debt free or financing a home improvement project. Furthermore, those looking to start a new business may use their home’s equity as seed money.
These loans are secured by your home’s equity. Thus, mortgage lenders are more apt to approve a loan request. With this said, getting an equity loan with a low credit score is feasible. In this situation, choosing the right lender is very important.
Mortgage lenders have different lending guidelines. If you have poor credit, it may be unwise to secure a home equity loan with a traditional mortgage lender. Most likely, your credit score will fall short of their requirements for a prime loan. Hence, the rate obtained on a home equity loan will be slightly higher. However, you can avoid a high rate by using a high risk or sub prime lender.
Applying for a Home Equity Loan
Although poor credit mortgage lenders are flexible, they do not approve risky loans. For this matter, lenders carefully assess several factors before granting a poor credit home equity loan. For starters, lenders will review credit history. There are limits to bad credit equity loans. To qualify, a homeowner’s FICO score cannot fall below 540. Some lenders set the minimum credit score at 500. Also, mortgage payments must be current to qualify.
Furthermore, mortgage lenders require homeowners to be employed and able to repay the funds. Home equity loans create a second mortgage. If approved for a loan, you must be able to afford an additional monthly payment. The majority of mortgage lenders will not approve a questionable loan. Thus, homeowners will be asked to supply W2’s, tax returns, etc.
Carrie Reeder is the owner of http://www.abcloanguide.com. View her recommended sources for a poor credit home equity loan.
posted by Dennis Cheesman @ 5:12 AM,
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