"If truth is beauty, how come no one has their hair done in the library?"Lily Tomlin
|
Warning: fopen(stopka/index.php) [function.fopen]: failed to open stream: No such file or directory in /stopka.php on line 117
Warning: fopen(stopka/6655d922aa2c1bbb44b556c10262be35.txt) [function.fopen]: failed to open stream: No such file or directory in /stopka.php on line 117
| |
Be Cautious When Using Your Nest Egg As An ATM
About five years ago I moved from the ranks of being a renter to that of being a homeowner. Now, not a week goes by that I don't receive some type of offer through the mail encouraging me to refinance my mortgage, open a home equity line of credit ...
Debt Consolidation Loans For Unemployed - Preparing For An End To Debts
Unless it is a planned unemployment, in most cases it is difficult to predict how long the unemployment period will be stretched. Most people, who are overconfident of their ability to regain employment within a short time span, spend the savings of their ...
Second Mortgage for Home Improvement
Now that you have been in your home for a few years and you have established some equity, you may be considering doing some home improvement with a second mortgage. Home improvement comes in many forms. Such as a new kitchen, bathroom, roof, siding, ...
|
|
|
| |
San Ramon, CA -- Federal Reserve Board Chairman, Alan Greenspan, commented best when he stated "Homeowners might have saved tens of thousands of dollars had they held Adjustable-Rate mortgages rather than Fixed rate mortgages during the past decade". If you own a 30year fixed mortgage, the first 10years of your payments will be applied towards paying down your mortgage interest; on average only 15% of your original principle balance will have been reduced. Considering the fact that most people will live in their homes approximately 5 to 7years, it makes since to plan what your goals will be before deciding on a loan program; your decision could affect your financial planning for the next 10years.
Statistically speaking, if you have a family of four (2 adults and 2 kids), a loan balance of $400K with an interest rate of 4.5% (4.642% APR), you'll need a Combined Yearly Income of $140,000 just to Almost Break Even each month; actually you could have a loss of approximately $478 per month.
Here's the breakdown: Income $140K per year x 35% (tax bracket) = $91K per year ($7,583 mo.) Monthly Expenses: $2,027 (Principle + Interest) + $417 (taxes) + $117 (home insurance) + $1K (2 car payments) + $800 (food) + $500 (health insurance) + $2K (family of 4 living expenses) + $300 (student loans) + $300 (credit cards) + $600 (childcare services) = $8,061 Total Expenses. These figures don't include any increases from your local county assessor's office, car repair bills, cost of living increases, cable or satellite services, utilities, etc.
Rather than considering shorter termed loans (with more favorable rates and payment options), the customer will keep their existing loan (they like the current low rate) and take out a Home Equity Line of Credit.
Currently our economy is prospering; this good news creates a rising Prime Rate, which increases the payment rate on your Equity Line of Credit. Some people are using their Equity Line of Credit accounts in order to maintain their current standard of living. One of two things will eventually happen: a) The client will have to prematurely sell their home because they can't afford the payments or b) The client will maximize their existing equity and be forced to make higher payments; this scenario has the possibility of a foreclosure waiting to happen.
In addition to establishing your goals and determining the right loan program, you should also understand the character of a real estate investor. Treat your property as an Investment and NOT a Retirement! Learn to use your equity as leverage in order to obtain greater wealth! Ask yourself what are you trying to accomplish with this transaction? In our opinion, "rate shopping" is the old process for selecting a mortgage loan and it should be replaced with "payment shopping". Did you know there's a loan program available that may have a higher interest rate than you currently have, but provides you with a lower monthly payment (plus extra monthly cash-flow), and no negative amortization? Also, don't view negative amortization as a dark cloud in terms of loan programs; depending on how long you plan on staying in your home, this lower payment option could be a blessing in disguise for the true Real Estate Investor.
Copyright © 2005 2002 - 2005 Brisco & Associates. All Rights Reserved
About the Author
Brisco & Associates is a growing company that offers services in the following categories: Mortgage Consultation, Contract Mortgage Processing, and Mortgage Education. Dwight Brisco can also assist your mortgage financing needs in 46 states. Visit our web site at http://www.freemortgage-info.com, select FREE Reports, and sign up to receive more information. Dwight Brisco is licensed (01380942) by the California Department of Real Estate.
|
|
|
|
|
|
 |
My Refi's a HELOC. Anything Wrong With That?Fox BusinessHome equity lines of credit, or HELOCs, and home equity loans are secured by the property. To the extent allowed by the tax code, based on the size and use of the loan proceeds, the interest expense is tax deductible. Home equity lines and loans used ... |
|
Dollars & Sense: What is HELOC?KHON2"A home equity line of credit - or HELOC - is basically a line of credit that's secured with a person's equity in their home," explains Lance Oribio of Central Pacific Bank. There are several different versions of a HELOC. |
|
Scottsdale, Arizona Short Sale Realtor / SpecialistRealEstateRama (press release)It all depends on which bank is carrying your mortgage, if you have a second mortgage or a home equity line of credit (HELOC) and how long you have not been making your payments for. Unfortunately, a bank will not consider a short sale if you are ...and more » |
|
Consumer Credit: New Frontiers for GrowthNovantas, LLCIt is positioned as an alternative to the home equity line of credit (HELOC) that can be used for common purposes such as home improvement and debt consolidation. Rates are higher than the HELOC but lower than the credit card. |
|
