How Does The Process Of Home Mortgage Approval Work?

The first thing you have to do in order to get a home mortgage is filling out the application at want to deal with and the procedure of funding the buying of your dream house can be long. There is a plethora of ways to fill out the formal request including in the office of the banking institution, through online forms and even by e-mail. Regardless of the method used to fill the formal request it is essential to maintain record of the application to let the house purchaser to follow its evolution.

What is included in the home mortgage application? There are many points of the home mortgage application which are to be completed at the time of application. These are:

Financial Resource Information

All financial information including net worth, assets, liabilities, debt and the credit history of the applicant enters the home mortgage approval process. Actually, the financial value of the applicant will be affected by the combination of all this information.

Employment Information

Job information reporting how long the employee has been a part of the company, the income earned through a yearly or monthly basis and job security will also be analyzed at this time.

Funds Information

Funds which are being provided to guarantee the purchase of the house are carefully studied in the home mortgage approval process. The points analyzed include the first deposit for the home mortgage funded from wages, savings and any other investment account.

Property Value Information

The real estate market prices which are being examined – compared to the purchase price of the house is another point of the home mortgage approval process. This operation let the loaner to calculate the future value of the house.

After the application has been evaluated by the lending institution, the lending institution will often come up with a number based on the amount of the wages combined with the credit history and financial value to repay the debt for the entire amount which the borrower is approved for. This number will make the home buyer able to seek potential houses within the budget or price range that is determined by their affordability.

How much are you able to spend for a home mortgage?

Loaners generally recommend spending no more than 25 up to 30% of the earnings on housing costs – these percentages are often considered when the home mortgage enters the approval forces. There are a lot of elements considered in addition to the cost of the monthly payment in the home mortgage approval process. Fees associated with homeowners associations or condominium fees in addition to city and real estate taxes, public utility costs and other renovation or repairs Expenses such as in addition to city and real estate taxes, public utility costs and other renovation or repairs. It is critical for the potential homeowner to understand that ownership can cost more than the monthly payment – the approval procedure can shed light on this issue for many potential homeowners.

Many homeowners request pre-approval it helps them set the finances and quicken the procedure of researching a house. Pre-approval can shorten the time that it takes to close a deal with the lending company and simply quicken the whole procedure. It is suggested that all customers get pre-approved with their banking institution to ease the home mortgage application procedure.

D. Hallet purchased a home as a single mother and experienced how difficult it is to get home ownership particularly if you don’t know where to start. So, if you research more Home Mortgage Approval Help, feel free to visit Home Mortgage A to Z, your Online Guide.

Wisconsin Reverse Mortgage: How Do Reverse Mortgages Work

Perhaps you find yourself in a very precarious position like a couple of seniors I just helped. I have known a few retired persons who came to me for help because they could no longer afford to live the retired life. By that I mean this. One had condo fees adjust much higher than what it originally was. Then with increased gas prices, general inflation etc. could no longer live on her small social security check and husband’s pension. She was not alone. Another couple came to me because property taxes had risen dramatically the last few years. They too were feeling the pinch of the increased prices and had to work part time bagging groceries to make ends meat. Both of them had social security but that no longer covers much. The sad thing was both of them had done everything correct and paid off all their bills and only had small or no mortgages and car payments left. They both felt it was a hopeless situation and they would have to sell their houses or work forever.

I made a recommendation to them that they should consider a Wisconsin reverse mortgage. I said they are equity rich and cash poor and this might help them with extra income every month for a long as they live in their house. Let me give you a very brief explanation of Wisconsin reverse mortgages. A reverse mortgage allows seniors, 62 and above, to pull cash out of their homes without making any payments. As the name implies a reverse mortgage is opposite of a regular mortgage. Instead of borrowing a sum of money and paying it back to reduce the debt to nothing; a Wisconsin reverse mortgage is getting a sum of money but no payments are made and the debt grows larger over time.

The equity can be pulled out in a lump sum or paid out gradually over time in guaranteed monthly payments. The unpaid interest is added to the reverse mortgage balance each month. Since there are no payments made while the borrowers live there, the loan is only paid off when the home is sold or the owners have passed away. How is the amount of the Wisconsin reverse mortgage calculated? It is determined by four factors:

* The value of the house (fair market value).

* The age of the homeowners (both must be over 62).

* The interest rate the mortgage is qualified at.

* The maximum loan limit of the county you are living in.

The amount that is guaranteed to the homeowners is calculated based on the life expectancy of the borrowers. The loan to value ratio is calculated so home owners won’t outlive their equity. The older you are when you take the loan out the more you will get. For example, a sixty two year old borrower with 250,000 in equity could borrow about 110,000 on a reverse mortgage, while a seventy six year old borrower with the same equity would get about 149,000.

It can get a little complicated so it is important to work with someone who knows what they are doing and specializes in Wisconsin reverse mortgages. This is a very popular tool that many seniors are taking advantage of. If you are cash poor and equity rich I would recommend looking at this option to see if it is right for you.

David Forer is a financial services veteran of 15 years specializing in helping seniors get out of debt, credit repair, and reverse mortgages. You can get more information by visiting Reverse Mortgage

Work With a Mortgage Broker in Settling your Mortgage

In order for you to purchase you dream home, you have to settle your finances.

Before anything else, you have to take good care of your mortgage; you have to work with a mortgage broker. Mortgage broker will act as an intermediary who provide information and look for the best options of mortgage loans on behalf of individuals.

It is better to work with a mortgage broker in applying for mortgage, since the mortgage broker can give you plenty of options for you to choose from. The mortgage broker will shop for best options to different lenders, since a broker works with plenty of lenders and not just with a particular lender. A broker will understand your situation and will give you lists of options with rates and details. So you can learn and study each option so to come up with the one that suits you.

Applying for a mortgage is the first thing you should do to avoid frustration. Some people common mistake when planning to purchase a home, they usually go out of the market and spend their time finding their dream home without any assurance that their mortgage is approved, then as soon as they search their dream home, they will be informed that their mortgage is not approved, so they end up frustrated.

So for you to avoid such circumstances, better to settle your mortgage first and it is wiser to work with mortgage broker. The mortgage broker will not just help you out with finding the best options but the broker will also make dealing with the lender. So as soon as you choose the right option for you, the mortgage broker will be responsible in making deals with the lender.

In applying for a mortgage, you have to wait till your mortgage is pre-approved. As soon as your mortgage is pre-approved, you can go to the next step.

Having a pre-approved mortgage, you know the amount you can afford to buy a home. Pre-approved mortgage is an advantage in terms of the seller, since seller prefer buyer who have pre-approved mortgage.

Now, you can start looking for your dream home. You can work will a real estate agent. The agent will help you out in searching for your dream home; he or she will look for homes that fit your criteria and your budget. The agent will hand you limited lists of home that fits your criteria and budget. Visit the homes, until you find the one you want.

Make home inspection for you to find out if the home is in good shape. You and your agent can make an offer. You can let your attorney work with the paperwork needed and also your attorney will be the one who will deal with the lender for the money needed for your dream home.

Soon you will just be enjoying with your dream home. Now, you know how important settling your mortgage first in order for you to have a smooth process with your plan of having your dream home.

Eliza Maledevic

Article Author Eliza Maledevic from, a SEO Company.

Should you Work With a Mortgage Broker, a Mortgage Marketer, or a Bank Representative?

There are three kinds of mortgage consultants:

• The representative of the local bank branch: They only offer loans, and have many other duties besides mortgage loans, are salaried, with a possibility of an annual bonus.

Traditionally, it is the local bank branch representative who acts as the mortgage consultant. He is the only one who is able to make a mortgage application for clients – taux hypothecaire. The world of mortgage financing has changed and almost all lending institutions offer their mortgage products through mortgage brokers and, in some cases, through mortgage marketers. The bank representatives continue to offer mortgage loans (as well as other financial products) but only for the bank they work for.)

• The mortgage marketer: He only handles loans, with a specialty in mortgage loans. He is compensated by the bank that he originates the loans for.

A recent trend is for banks to hire local reps in order to give better service to the client. A mortgage marketer (taux hypothecaire) will go to the client, but he works for the bank that hires him. He is paid a commission on the amount of the loans he originates.

• The mortgage broker: The broker offers the loan products of many lenders. He specializes in mortgages and is paid a commission. This commission is paid by the lender that the loan is placed with.

Mortgage brokers have been dealing with mortgages for more than thirty years but have only become an import part of the mortgage market (taux hypothecaire) recently. A mortgage broker works with many lenders, usually 30 or more and can pick the best one for each client. Today, more than 12,000 mortgage brokers operate in Canada, with 27% of the mortgage market.)

(Please note that, although I try to be neutral on this topic, I am a mortgage broker – taux hypothecaire. I want to advise you that I believe working with a mortgage broker is the best way to go when you are shopping for a mortgage for your home.)

One thing is certain. It is the expertise and integrity of the consultant that will make the difference. There are excellent local bank branch representatives, excellent mortgage marketers and excellent mortgage brokers. However, the opposite is also true.

The service of the person with whom you will work is most critical.

Of this you can be sure: the expertise and integrity of whatever consultant – taux hypothecaire you work with will make a critical difference. Yes, there are expert local bank branch representatives, expert mortgage marketers and expert mortgage brokers. And then, there are those who do not fully understand this field.

It is the person in the position that is most important.

Mortgage brokering has become more popular

The CMHC did a survey that indicated that in 2004 more than 26% of the home loans in Canada were financed with the help of a mortgage broker. Even so, it is the individual and his integrity and expertise that will matter most (taux hypothecaire).

Gregory is an Accredited Mortgage Professional (AMP) with Mortgage Intelligence. If you need more information about Mortgage broker – courtier hypothecaire, visit: Hypotheque – Mortgage Intelligence

How Reverse Mortgages Work

Reverse mortgages were created in order to help ease the financial burden on aging seniors. A reverse mortgage is a type of financial instrument that permits home owners over the age of 62 to gain access to the money they have accumulated as home equity.

How a reverse mortgage works is that the lender makes payments to the borrower, rather than the other way around. The amount paid out is based on a percent of the equity remaining in the home (that’s the full property value minus the amount still owed).

Seniors can use money to fund:

* retirement;

* medical costs;

* a new car;

* home repairs;

* renovations;

* estate planning;

* a grandchild’s education;

* travel and leisure;

In order to get a reverse mortgage your current mortgage does not need to be completely paid off. The amount you can receive is based on the equity in your home. As a mandatory part of the process, however, your existing mortgages will be paid off. Some people simply use a reverse mortgage to get out of having to pay monthly mortgage payments, the money they receive just being a bonus.

When you receive a reverse mortgage, your home remains in your name, and your retain total control of the property. It is also still your responsibility to maintain the house and property and pay all taxes and insurance as usual. No lender can take your home away from you so long as you keep that home as your primary residence.

If, however, all owners of the home (all names on the title and mortgage), leave their home permanently for any reason (including illness) the loan is then due and payable. This does not apply to extended hospital stays or vacations. Any absence lasting longer than 1 year simply needs to discuss the situation with their lender.

With a reverse mortgage there are several ways you can receive your money:

* one lump sum;

* regular monthly payments;

* a line of credit;

* any combination of the above.

Reverse mortgages do not affect your Social Security, nor do they affect your Medicare. SSI, however, may be affected depending on the terms of the specific loan program in question.

To qualify for there are no:

* credit requirements;

* income requirements;

* loan repayment requirement provided you remain in the home as your primary residence.

There can, however, be significant expenses associated with getting a reverse mortgage, though the majority of these costs can be financed into the reverse mortgage.

With a reverse mortgage, after your death, your estate will not be responsible for owing anything remaining on the mortgage balance. Some programs even allow you to set aside a portion of the value in your home to be protected and passed along with your estate when you pass. As a holder of a reverse mortgage, you are permitted to sell your home, the proceeds simply going to pay off the reverse mortgage before any funds find their way into your pocket.

Somerset Mortgage Lenders has been in business since 1979. Whether you are looking to refinance your mortgage, consolidate your debt, improve your home, we can help. Call us toll-free at 1-800-675-9783 or visit us online.

Reverse Mortgages – What They Are And How They Work

Reverse mortgages are an option for borrowing money based on home equity. They were introduced in 1989 and are mainly used by senior citizens. Reverse mortgages pay the homeowner in monthly lump sums for their home equity. It is quite different than any other mortgage option.

Reverse mortgages are a great way to cash out on the equity on your home and to increase income. Under a reverse mortgage the homeowner is paid every month and when they decide to sell the house or pass away the lender then becomes the owner of the house unless their heirs pay off the mortgage. If they sell the house they can repay the mortgage that way, too.

Reverse mortgages do not pay out the entire amount of a homes worth. They usually pay between 30 and 80% of the homes value. They also must pay closing costs and service fess which are due monthly.

The details of a reverse mortgage are sometimes hard to understand. A reverse mortgage can be set up so a borrower gets a pay out every month or they can just get money whenever they need it. The government regulates these loans and requires that borrowers receive credit counselling to ensure they understand the reverse mortgage and everything it entails.

Reverse mortgages come with conditions that must be met in order to qualify. The conditions include that the person must be living in the house, they can not borrow more than the appraised value of the home and the older the homeowner, the more money they can get.

Additionally, with a reverse mortgage the borrower still maintains ownership of their home and are still responsible for the taxes and insurance, they will never be in debt because the loan is never worth more than their home is and the reverse mortgage must be paid as soon as the borrower no longer lives there.

Senior citizens often use reverse mortgages as a way to supplement their income. They may be facing rising living costs with a drop in income and suddenly need more money just to make it each month. This puts the senior citizen in desperate need for money. This is why reverse mortgages are regulated so much.

The government tries to protect older people from getting scammed b companies who are looking to use a reverse mortgage as a way to make money. These scams usually involve higher than average fees and conditions that are not typical.

A reverse mortgage can be a great way for a senior to supplement their income, but they need to make sure they completely understand any deal before signing it.

Reverse mortgages when done the correct way can be costly still, but they should never put the homeowner is serious debt as the loan will be repaid with the lender taking the house upon the person not living there anymore.

These loans are not a way to get into debt and if a reverse mortgage is set up so that is ever the case then it is likely a scam.

James Copper writes on all areas of finance and investment. He works for the Repossession Stopper who help homeowners stop repossession and avoid eviction.

Home Equity Lines of Credit and How They Work

You’ve certainly heard the ads on television that tell you to ‘tap the equity in your home’ when you need fast cash for home renovations, emergencies and even family vacations. There are two main types of home equity loans, a standard home equity loan, and a home equity line of credit. Before you decide to tap the equity in your home, you should understand what home equity debt is and how you can use it to finance the important things in your life.

Borrowing against your home equity

Most homes are purchased through mortgages, a loan taken from a bank or lender and then paid back over a course of ten to thirty years. As you pay back that money, a certain portion of what you pay goes to the bank as interest, and the rest is applied to the principal. The amount paid on the principal builds ‘equity’, which is, in simplified terms, the amount of your home that you own. The amount of equity you have in your home can be used as collateral for a loan to finance college, pay for a wedding or make home improvements, among other things.

A home equity line of credit is not exactly a loan. Rather, it’s a promise from a bank or lender that they will loan you money up to a specified amount when you need it at the interest rates agreed upon. Unlike a home equity loan, where the bank loans you a chunk of money and you pay it back, a home equity loan of credit allows you to borrow money as you need it, like a credit card.

Using a Home Equity Line of Credit

For example, if you take out a home equity loan for $10,000, you’ll get a check from the bank for $10,000 all at once. The interest clock starts clicking as soon as you sign the papers, and if you find that you need to borrow more money, you will need to apply again. If you really only need $2,000 of that money, you’ll still be paying interest on the entire $10,000 because you have the use of the entire $10,000.

With a home equity line of credit, the bank promises to lend you up to $10,000 over the next however many years. You haven’t actually borrowed any money when you sign a home equity line of credit agreement. It’s more like signing a credit card agreement. You won’t owe any interest until you actually use your home equity line of credit to borrow money. Once you’ve established a line of credit, if you find you need $2,000, you can draw that money from your home equity line of credit. At that point, you’ll owe the bank $2,000 and will start paying interest on a $2,000 loan.

There will still be $8,000 remaining on your line of credit. In other words, the bank has promised that it will loan you up to $10,000 during the term that the line is in effect, so you can still borrow up to another $8,000 as long as your loan remains in good standing. Even better, as you repay your loan, that money becomes available to borrow again, just like with a credit card.

So if you use $2,000 of your line of credit, you’ll have $8,000 remaining. If you then pay back $500 of it, you’ll be able to borrow up to $8,500 if you need it. You’ll only pay interest on the amount that you have actually borrowed, but you’ll have up to $20,000 available to you to use without having to apply for a loan every time you need one.

Why choose a home equity line of credit?

Establishing a home equity line of credit before you need one can be an excellent idea. Unlike a standard home equity loan, you won’t be paying any interest on the money that’s available to you unless you actually use it, and you’ll only be paying interest on the amount that you actually borrow rather than on the entire $10,000 amount.

There are a few circumstances where a home equity loan makes more sense than a line of credit. Since standard home equity loans generally carry lower interest rates than a home equity loan of credit, it makes sense to use a home equity loan if you will be paying out all or nearly the entire loan amount in a short period of time. In other words, if you need $10,000 to pay for something up front, then it makes more sense to take out a home equity loan for $10,000. You’ll pay less in interest that way.

If, on the other hand, you predict that you’ll need about $10,000 to complete a project over the next year, but won’t need all of it at once, a home equity line of credit makes more sense. While your interest rate on the line of credit may be slightly higher than on a standard loan, you’ll only be paying interest on the amount that you actually owe each month.

Brian Jenkins is a freelance writer who writes about topics pertaining to the mortgage industry such as a Mortgage Company

Can I Get A Refinanced Mortgage If I Start A Home Business With No Employees And Still Work My Regular Job?

I want to refinance my mortgage and I want to start a home business before doing so. It would have no employees and I would still keep my current job. My home business will not require any due balances or credit lines to increase my debt. Would mortgage companies see the worry that I would quit my regular job or would they trust that I would maturely handle the mortgage payments? In other words, would I have no problems getting refinanced under these conditions. My credit score is about 650 and I’ve been at my current job for 1 1/2 years but have had steady employment for a long time. I have also paid my mortgage on time for 12 months.