08
Apr
By support
Home Mortgage Tips

Can You Refinance into a VA Mortgage from Another Type of Mortgage? Yes, If You Qualify

Can You Refinance into a VA Mortgage from Another Type of Mortgage? Yes - if You Qualify VA mortgages stand out as one of the biggest benefits to men and women serving in the military. Although private lenders make the loan, the Department of Veterans Affairs guarantees all VA mortgages, which is why these loans come with favorable terms and benefits not found with other mortgage types.

The Benefits Of Refinancing To A VA Mortgage

A VA loan may very well be the borrower’s only option for putting no money down, as many lenders will cover 100% of the value of the home, thanks to the backing of Veterans Affairs. There is a ceiling on the amount covered depending on the area of the country, so contacting a qualified VA mortgage professional is the preferred way to discover limits locally.

VA loans also require no mortgage insurance, cover many of the costs associated with closing or refinancing and, in many cases, have lower mortgage rates than comparable loans.

Veterans who had never considered a VA mortgage may wish to take advantage of the flexible terms and the favorable market to refinance their current mortgage into one that offers tremendous benefits.

Qualifying For A VA Mortgage

Veterans Affairs mortgages are limited to service men and women and their spouses, a benefit for serving their country. After a set amount of service time veterans are able to apply for a certificate of eligibility that will allow them to apply for the loan.

Those who are eligible include most military members in active duty, members of the National Guard, veterans both discharged and retired, military academy cadets as well as any spouse of a deceased serviceperson.

Eligible Homeowners Can Refinance Through Cash-Out Refinancing

The Department of Veterans Affairs considers a conventional mortgage to VA mortgage refinancing to be the same as cash-out refinancing and treats it accordingly.

This process is as intensive as an initial mortgage because it will replace the current mortgage altogether, so all applicants are expected to go through the standard credit and underwriting process.

VA loans are incredibly beneficial to current military members as well as retired veterans who may have never considered taking advantage of the program. Although the mortgage can cover 100% of the value of a home, the actual amount varies depending on the area. The only way to know for sure how much will be covered and whether it’s the right time to refinance is to contact a mortgage professional who has experience with VA mortgages.

06
Apr
By support
Home Mortgage Tips

5 Tips to Reduce Your Monthly Mortgage Payment

5 Tips to Reduce Your Monthly Mortgage PaymentBuying a home isn’t cheap – and even though mortgage rates are low, your own financial circumstances may mean that your monthly payment is more than you can afford. Whether you’re a new buyer looking to save money or a cash-strapped owner who needs to free up extra income, there are several ways you can lower your monthly payments – here are just five of them.

Make 13 Payments Every Year

If you have some extra money and you’re looking to pay down more of your principal amount, making 13 annual payments instead of the usual 12 is a great way to not only reduce what you owe, but also lower your monthly costs. Most lenders will allow you to make one additional lump sum payment per year on top of your regular monthly payments. Pro tip: Combine your tax refund and Christmas bonus into one big lump sum to pay down your mortgage.

Still Paying PMI? Ask Your Lender To Cancel It

Private mortgage insurance is a standard cost that you’re legally obligated to pay if your down payment was less than 20% of your home’s value. But once you’ve paid off that 20%, you’re no longer required to have PMI on a conventional mortgage. If you’ve built up 20% equity, talk to your lender about removing PMI from your mortgage agreement – it could save you thousands.

Recast Your Mortgage

If you’ve been diligently paying your mortgage for years but suddenly run into money problems, recasting your mortgage is a great way to make your monthly payments easier to manage. Recasting is fairly simple – it takes your remaining loan balance and stretches it across your original loan term. For example, if you’re 15 years into a 30-year mortgage that has half of its balance remaining, you can recast your mortgage to pay off the balance over another 30-year period.

Facing Financial Hardship? Get A HAMP Modification

If you encounter financial hardship, you can ask your lender if they offer a Home Affordable Modification Program (HAMP). HAMP is a government program designed to make housing more affordable for low-income citizens. It’s possible to save a significant amount of money with a HAMP modification.

Mortgages can be expensive – but with a professional mortgage advisor on your side, you’ll know how to handle or even reduce the costs. Contact a mortgage professional near you to learn more.

05
Apr
By support
Home Mortgage Tips

Budgeting for a New Home?: 3 Unlikely Costs to Consider in Your Overall Budget

Budgeting for a New Home? 3 Unlikely Costs to Consider in Your Overall BudgetIf you’re planning to buy a new home in the near future, you’re probably working hard to prepare a budget and determine how much you can afford before you start viewing homes. While it’s good to have an idea of what you can pay for a new house, many buyers routinely miss several key home buying costs that can later cause a variety of problems. Before you start looking for your new home, make sure you add these three commonly forgotten costs to your budget.

Title Insurance: Critical Protection Against Title Claims

Title insurance is something that most buyers forget about until closing, but it’s a necessary form of protection for every soon-to-be homeowner. Title insurance provides you with protection against financial losses in the event that you later discover title defects. For example, title insurance can protect you from losses in situations where the seller doesn’t actually own the home, where there is a lien on the property, or where a previous owner accidentally omitted or deliberately falsified critical property records.

In a standard real estate contract the seller will pay for the buyer’s title insurance, but in most states, the buyer is also required to buy title insurance to protect the mortgage lender. Title insurance for lenders usually costs, on average, $2.50 per $1,000 of assessed property value.

Unexpected Renovations: Home Inspectors Aren’t Perfect

Typically, your home inspector will alert you to any issues requiring renovation or repair before you buy your new home. But if your home inspector is negligent and misses a critical problem with the home, you may need to find money for surprise renovations – and fast.

While you can file an insurance claim or sue the inspector for negligence in order to recoup damages, court cases and insurance claims take time – time that you may not have if you’re facing an urgent home problem. Most real estate agents suggest budgeting 1% of your home’s budget each year for maintenance costs.

Initial Interest: Your First Month Comes Due Before You Know It

Your mortgage starts accruing interest on the day you close the home sale, not on the day you move in. So in order to make sure that you have a consistent payment, the lender collects the first partial month of interest at the closing table.  It’s called “prepaid interest” and is included in your overall closing costs.  That means if you sign the contract on March 15, you’ll need to make an interest payment for the period of time lasting from March 15 to March 31 at closing. Your payment will then come due on May 1 – so be sure to include your first interest payment in planning for your closing costs.

Buying a home isn’t cheap. But when you clearly understand the various costs involved, it’s easier to plan your home purchase and budget for expenses, both expected and not. Contact your local mortgage professional to learn more about home buying costs.