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Home Mortgage and Your Options

Find out what a mortgage loan can do for you.

Whether you are planning on purchasing a new home, would like to refinance, pay off a home, or would like to get cash out of your existing home, it’s time to venture into the world of home mortgage and mortgage loans.

In the broadest sense, home mortgages are a lien against a property that is held by a bank or lender. When you take out credit home loans, you are borrowing money against the market value of the property you wish to purchase and then agreeing to pay back the cost of the loan – plus interest – to the lender.

Learn more about a home loan mortgage

Most home loan mortgages fall into one of two categories – a fixed rate mortgage or an adjustable rate mortgage loan. A mortgage loan can also be a primary (1st) mortgage or a second mortgage.

Each type of mortgage provides a solution for a different situation. As a homeowner, there are many options available to you by using loans mortgages to your advantage. For example, the equity in your home is an asset that can be used as collateral on a second mortgage in the event that you need to borrow a large sum of money.

Whatever your unique needs are, there are mortgage services and mortgage interest rates that are designed just for you.  A home mortgage calculator will give you a good idea about what you can expect.

Before you begin to refinance home loans, you need to ask yourself the following questions:

  • Have interest rates fallen?
  • Do you expect them to go up?
  • Has your credit score improved enough so that you might be eligible for a lower-rate mortgage?
  • Would you like to switch into a different type of mortgage?

Not sure which mortgage lenders to use?

Believe it or not there are actually 5 different types of mortgage lenders:

  1. Mortgage Bankers – lenders that originate and sell their loans in pools to investors such as Freddie Mac and Fannie Mae, as well as to private investors.
  2. Portfolio Lenders – originate and fund their own loans, and may service for the entire life of the loan.
  3. Correspondents – originate and fund in their own names, then sell them off to larger lenders, who in turn service them, or sell them on the secondary market.
  4. Direct lenders – banks or lenders that work directly with a homeowner, with no need for a middleman or broker.
  5. Wholesale lenders – similar to mortgage bankers in that they originate and service loans, and sell them on the secondary market.
What is an interest-only mortgage?

An interest-only mortgage is a scheduled monthly mortgage payment in which the loans payment the borrower is required to make consists of interest only. The option to pay interest only lasts for a specified period, usually 5 to 10 years. Borrowers have the right to pay more than interest if they want to.

If the borrower exercises the interest-only option every month during the interest-only period, the payment will not include any repayment of principal. The result is that the loan balance will remain unchanged.

Understanding home mortgage and mortgage loans can really help you plan for the future and give you opportunities you never thought existed before.

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