Some Money Saving Mortgage Tips

Buying a house is a great long term investment. If you’ve never had a mortgage payment, it simply means you’ll have to be more careful regarding the management of your finances.

The first step before venturing into a mortgage if you’re not already in one, is to consider your financial situation. Then decide to buy a home where the mortgage and down payments meet your financial situation, so that you can enjoy life and have a roof over your head at the same time. If you have no idea what your monthly budget can afford then you should take some advice from a finance professional first.

Regardless of your situation here are several ways to reduce your monthly mortgage payments:

As interest rates keep on changing you should keep track of changes and consider refinancing at the right time. This will reduce your expenditures. Do the calculations to know your savings after paying closing costs and other expenses. Closing costs can be added to your new mortgage to avoid out of pocket expenditures, while still saving you money.

Check your monthly mortgage statement properly and regularly to make sure that all adjustments are made correctly; even banks sometime they make mistakes.

Choose a mortgage that offers flexibility. You want a mortgage that allows you to pay in an easy way according to your earnings.

Consider biweekly payments or accelerated equity plans. This will give you an additional payment each year and begin to reduce your mortgage quickly right from the start.

Consolidate all your loans into a single one with lower monthly payments. Make a table and analyze all your loans; education, car, home and bank loans for example. Study your expenditures. Try to consult a mortgage specialist, ask him or her about debt consolidation, and how much it can reduce your monthly payments.

Go for a 30 mortgage. This will allow you to pay lower monthly payments, which will lower the amount of interest you pay. Make sure there is no prepayment penalty on your loan, because the best move you can make is to pay way more each payment than the minimum. Each time you do this you’ll be reducing the principle of your mortgage.

A mortgage or home loan is a long term debt but it doesn’t have to be a burden. You are advised to pay it off as soon as possible but arrange your budget tactfully by keeping an eye on insurance, loan disbursements and their interest rates. Enjoy your new home; hopefully with a few of these tips it will be all yours sooner than the banks desire. Remember, if it’s paid for it’s yours.

Consolidate Bills with Cash-out Mortgage Refinancing and Make Your Monthly Payments Fit Your Budget

Have you seen enough commercials about credit card and other types of debt? Do you feel like all these commercials are directly talking directly to you? Have you finally decided it’s time to take advantage of these offers and get your finances under control? If your goal is to consolidate bills and bring your finances back under your control, a refinance of your mortgage that will allow you to do this is exactly what you need.

If you are paying each month on three or four different credit cards at an interest rate of at least fourteen percent, those monthly minimums will certainly add up. Each of those balances are charged the interest rates each month. When you consolidate bills instead of spreading them out, you are being charged interest on only one amount at what can be a fixed and, usually, lower rate than what your credit cards will charge you.

Several mortgage companies, including our own, offer mortgage refinances that are specifically designed to help you pay off your credit cards and consolidate bills by rolling those bills into your mortgage amount. One of the benefits of getting this type of loan is the fact that you will go from several bills each month coming due at different times to one bill due at the same time each month. In this way, you will only have to keep track of one bill each month and this bill will cover your mortgage as well as your debts. The only other monthly bills that you should have coming in will be your utilities.

In combining all of your debts, you are actually saving money each month. As stated earlier, when you consolidate bills in this way, you will be charged interest on one amount rather than several amounts. Since mortgage loans have lower interest rates than credit cards, you are charged less each month, which leaves more money in your pocket each month. This extra money can be used to pay off extra each month toward your balances or any other way you decide.

Consolidating bills in this way is a decision that will make life easier and give you control again of your finances. Your interest rates will be lower as will your monthly payment. You will save money while paying off your bills and keeping your credit score high. And don’t forget, mortgage interest is tax deductible, while credit card interest is not. So you will be getting a bonus from Uncle Sam as well. Ask your accountant or tax professional for further details.

Cash out Refinance – Things to Know about Refinancing Your Mortgage to Get Cash Out

While there are costs associated with a cash-out mortgage, you should also remember the benefits.

A cash-out mortgage allows you to refinance your mortgage and pull out part of your equity. Before deciding how much to cash to use, be aware of the impact of PMI and equity amounts. However, you may find the benefits of refinancing outweigh the costs.

Cash-Out Mortgage Basics

With a cash-out mortgage, you can refinance for lower rates or to just get part of your equity out. Once the refinancing process is completed, you will end up with a check. You can decide to take up to 85% of your home’s equity in some cases. However, cashing-out a large percent of your home’s value will impact your refinancing rate and might require you to carry private mortgage insurance.

Higher Rates

You may also find yourself paying higher interest rates, at least a quarter percent, for cashing out over 75% of your home’s value. Lenders charge higher rates because there is an increased risk level. Your credit history will also be a factor in the type of financial package you qualify for.

Benefits of Cashing-Out

While there are costs associated with a cash-out mortgage, you should also remember the benefits. You can write off the interest on your taxes (ask your accountant) and you qualify for lower rates than with other types of credit. You can also spread out your payments over a longer period, lessening the monthly financial burden.

Taking out more than 75% of your home’s equity is not necessarily a bad decision. You just need to weigh the financial costs. You may find that in the long-run, tapping into your home equity is better than the other types of credit available to you. You may also discover that the tax benefits offset the slightly higher costs.