Clear Your Debts and Improve Your Lifestyle with a 2nd Mortgage Home Equity Loan
Posted at 1:05 am | Filed Under mortgage-financing-tips.info
Property Equity Explained
Equity in our home is simply the value of the property minus the total of the mortgage or mortgages outstanding that are secured against its value. When we first purchase the property the equity value will be fairly minimal unless we have had the good fortune to have been able to put down a fairly large deposit. As time goes by the amount of the mortgage will reduce as a result of the monthly repayments and hopefully, the value of the property will rise in line with market forces and inflation. By taking out a 2nd mortgage home equity loan we can release some of this equity.
What would we use a 2nd Mortgage Home Equity Loan for?
The 2nd mortgage home equity loan can be used for a variety of purposes. Buying, maintaining and refurbishing our property create a severe dent in our family budgets and this budget is most often held together by increasing short term debt e.g. credit cards. By using a 2nd mortgage home equity loan to repay these debts we can reduce our monthly expenditure (repayment of the 2nd mortgage will be over a longer period of time) and provide a good excess of income over expenditure to ease a tight family budget. Also, the interest rate on the 2nd mortgage, whilst being more expensive than our principle mortgage, will be far cheaper than the credit card debt and is also tax deductible.
College or continuing education costs for our children are not cheap and whilst we should have probably budgeted for this many years ago, the practicalities of life are rarely that easy. A 2nd mortgage home equity loan will enable you to cover these commitments and spread the cost over a period of time to enable them to be affordable.
Home refurbishment or extensions can be financed through a 2nd mortgage home equity loan and this will not only provide more comfortable living accommodation but it will add increased value to your property.
You may possibly be thinking of buying an additional property on an investment basis. The 2nd mortgage home equity loan can be used to cover the cost of the new property or as a vehicle to raise the down payment required.
You may be planning a dream vacation for a special anniversary that is coming up. Whilst this may be viewed as a somewhat frivolous one off expense and not provide added value in terms of an education, reducing interest rates, increasing property value etc., you may feel that given the hard work undertaken to get to the position you are in today, it may well be worthwhile using equity in your property for this purpose.
Whatever the reason you are considering a 2nd mortgage home equity loan, they are an easy and flexible product to take advantage of the value built up in your home.
If you need more information or resources to help research for a planned mortgage to perhaps consolidate your debts or looking for a 2nd Mortgage Refinance Loan, please visit our informative web site: Mortgages.
Click here to try our Free Mortgage Calculator.
Tags: 2nd mortgage, 2nd mortgage home equity loan, home equity loan, Mortgage Interest Rate, second mortgageFixed Rate Home Equity Loan Versus Adjustable HELOC Comparing 2nd Mortgage Loans
Posted at 1:24 am | Filed Under mortgage-financing-tips.info
Many people think of a second mortgage as a fixed interest, lump sum loan. However, that is only one form of a second mortgage. A second mortgage is actually ANY secondary lien on your home–secured loan with your home pledged as collateral. Second mortgages are typically categorized as fixed mortgage rate home equity installment loans (HELs), also known as home equity loans, and home equity lines of credit (HELOCs) which are adjustable rate mortgages.
The Federal Reserve states that the home equity line of credit annual percentage rate (APR) is a variable rate loan based solely on a publicly available index (such as the prime rate published in the Wall Street Journal or a U.S. Treasury bill rate). The APR does not include points or other finance charges. The monthly payment amount will adjust as your loan balance and interest rate changes. Loan terms can be anywhere from 15 to 30 years.
HELOCs have a draw period, typically occurring in the first 10-15 years, with the remaining term on the loan referred to as the repayment period. During the draw period, you can draw out money on a revolving basis similar to a credit card without applying for a new loan, as long as the amount does not exceed the total amount of the original HELOC. During the repayment period you may be allowed to renew the credit line. If your plan does not allow renewals, you will not be able to borrow additional money once the draw period ends. Interest is paid only on the amount of equity you use.
A Home Equity Installment Loan (HEL) is a fixed mortgage rate loan, which means the annual percentage rate (APR) and monthly payment will stay the same for the life of your loan. The APR for a HEL takes into account the interest rate charged plus points and other finance charges. Loan terms can be anywhere from 5 to 30 years, but are typically 15 to 20 years. Unlike a HELOC, you get a lump sum for which you immediately start paying principal and interest. If you decide later that you need additional funds, mortgage refinancing or getting an additional loan with additional closing costs are your only options.
Which type of loan you choose depends on your financial needs. A HELOC may be best if you have a recurring need for money (e.g., home improvements or a home repair project that has anticipated additional expenses). The security of a fixed-rate 2nd mortgage will probably provide much-needed relief for a large one-time expense (e.g., debt consolidation).
Maria Ny is a well-known free-lance writer from California. She has written many articles that covered a broad range of subjects ranging from Home Equity Loans, Bankruptcy Reform, Credit Repair to Subordinate Financing. Check out her informative articles online at Second Mortgage & Home Equity Loans.
You can learn more about financing for cash out and get additional loan program information. Get a free loan quote for a cash out equity 2nd mortgages. We suggest you get more information and learn more about the guidelines for home equity loans that could help reduce your monthly expenses and get you cash back at the same time.
Tags: 2nd Mortgages, Adjustable HELOC, Fixed Rate Home Equity Loan, home equity line credit, second mortgageSecond Mortgage Loans Are Cool for Debt Consolidation and Cash Out
Posted at 3:09 am | Filed Under mortgage-financing-tips.info
With the refinance boom officially over, second mortgage loans are cooler than ever. Many homeowners have been blessed with low interest rate first mortgage loans that they want to keep. The need for cash did not disappear with the refinance boom, so 2nd mortgages and home equity loans will be the loans of choice for the next few years. Anyone who has a 30-year fixed rate loan at under 6% should keep their existing loan in tact and take out a second loan on their home if they need cash. The Federal Reserve has hinted that there are more rate hikes coming, so if you are a mortgage broker or lender, it is time to brush up on your second mortgage product line, because people still need to access cash, and there is no better way to accomplish this.
Home Equity Loans to 125%
You don’t need any equity, and this loan program will actually allow you to exceed the value in your home up to 125%! These 2nd mortgages are typically offered with a fixed interest rate for 15, 20 or 25 year repayment terms. If you have credit card debt, or high rate loans, this is an excellent loan for eliminating compounding interest and saving money! IHE executive, Sandy Sarconi stated, “There is no better way for a hard-working family with no equity in their home to lower bill payments and get out of debt.”
* Fixed Interest Rate 2nd Mortgage
* No Mortgage Insurance Ever
* No Equity Second Mortgage
Stated Income Second Mortgages
More and more people are seeking reduced documentation loans. More and more people have become self-employed, and many people simply like the streamlined process.
* Stated Income Equity Loans
* No Income No Asset 2nd Mortgages
* No Income Verified Home Equity
* No Doc Equity Refinance
Second Mortgage Credit Lines
Sure the interest rates are variable. Yes the Fed has increased the prime rate index eight times in the last few years, but people love low payments that interest only loans provide. People also love the flexibility of only having to pay interest on the money you access. Where else can you get money waiting for you without having to make payments until you use spend cash!
* Interest Only Payments
* Home Lines of Credit
In 2006, the often bashful, second mortgage has emerged from the shadow of first mortgage, and evolved into the cool loan of choice.
Lynda Nelms writes a popular column, called “Ask Lynda” in which she offers useful home refinancing tips to consumers from an experienced loan officer’s perspective. Currently, Lynda originates loans for BD Nationwide Mortgage, who is located in San Diego, California.
To get learn more about no equity loan options, please check out 125 Second Mortgage programs.
If you need more useful tips for the Home Equity Loan process, please visit the BD Nationwide Mortgage online.
Tags: 125 home equity loan, equity line of credit, fixed rate, low rate loan, second mortgage, second mortgages keep looking »