Applying for Mortgage Loans Online

Internet nowadays has eased out several processes and procedures of real estate industry and mortgages. Through online one can complete nearly three-fourth of the process involved with property transactions and loans applications in less time. The internet provides several benefits such as property listings, virtual tours of homes and online application of mortgages.

Taking a smart step ahead is good but you need to know the key essentials before you venture into the loan process online. Get yourself prepared by making a proper research before you proceed with it.

How to apply for a mortgage loan online

The process for mortgage application online may differ from one borrower to another. But the basic process remains the same which you need to carry out in order to get the best mortgage loans.

1) Analyze your credit report

The prime thing that is needed for the purchase of a mortgage loan is the credit report. Make sure you have a good credit history that helps you to get the best mortgage loan. Your credit report should never have errors or any other discrepancies that affects your credit score and keeps you from getting a mortgage.

2) Fix your budget

You should be able to determine your mortgage budget before you apply for a home loan and never wait for the lender to do that for you. You can plan your budget based on your income, credit score, risk factors and affordability that can keep you safe till the end period of your home loan. If you need an aid in this case, then go for online mortgage calculators that evaluate your monthly repayments and interest rates for the mortgage.

3) Get a list of online mortgage lenders

In this case you need to find the best and trustworthy lenders who are expertise in offering online mortgage loans. Since the process take place online and due to the anonymity of the web, there are chances for many dishonest lenders to harness the information and other such things of a consumer using several application tools. Hence before you apply online, look for the standards and the trust logo of the company which gives you comfort over other processes.

4) Never disclose all information

The online mortgage process carried out by mortgage lenders involves very few inquiries from the borrowers that help to screen them for the loans. Hence it benefits you too from filling several credit inquiries that may or may not be successful with an online lender. Also too many of these inquires can sometimes flag you red that can be sent to other lenders thus minimizing your chances of getting a home loan.

Once you ensure with the above aspects, it is time for you to evaluate and compare the interest rates and several other features of mortgages online. This helps you to choose an ideal mortgage loan that suits you the best.

Bridging Loans – Taking You to Prosperity

Before I start writing the article I would like to make your mind clear about the precise definition of bridging loans, what it is actually and how it will take you to prosperity.

“Bridging loans are a short-term loan used as a way to endow with funding for the purchase of a new property while the borrower expects the sale of an on hand property”.

Off-course it seems risky and it is said that unless all the stars are not in perfect alignment, it can turn a bad luck. But very frankly saying selling of property is not a big deal and if you have property than taking loan on its part is not a big deal. The only thing demanded by bridging loans is that you need to be tricky in co-ordination and purchase and sell of new property and if transaction occurs simultaneously than no words to describe your stars.

A Bridging Loans also known as commercial bridging finance makes these types of transaction easy and possible. It not only helps you with instant money but also helps you keeping away from getting stuck by financial crisis. By taking this loan borrower need not to pay for two mortgages and the best part of these loans is that you can take it for commercial purpose and also for personal purposes.

Features of these loans

These loans are short term in nature

The application process for borrowing these loans are more or less similar as of the other loans.

When you are planning to have bridging commercial loans it is preferred that you should opt for private lender than commercial banks. The reasons are many, bridging loans are short term loans so it is better to have someone who charges least interest, secondly lender can easily give you loans with minimal paper work. The need for commercial bridging loans start or can be guessed little early so it is suggested that you should go for pre approval of these loans.

Bridging Loans get paid back in the form of only interest. This means you get the entire amount from the lender, keep on paying the monthly interest until your backed property is not sold out. Once the transaction is complete, give away the handy principal amount back to the lender. So, in the case of repayment option in bridging loans principal payment is one time lump sum payment.

These loans are good for both the parties as in the case lenders also need not to worry about defaulter because the money seeker is obligatory to put up security or guarantee to secure the loan. This is normally in the form of an additional part of property.

But on the part of borrower, I want to make the point clear that the lender will still systematically evaluate your credit history. And I think it is genuine on its part also because any one will undergo the same procedure because of the level of risk he/she is taking. But not to worry poor credit is not an obstacle.

Mortgage Rates Are Going Up – Dos and Don’ts to Save Money

One of the options available to the consumer in mortgages is the variable rate mortgage. In variable mortgage, the interest rate is geared to the prime rate. When the prime rate is low, your mortgage interest rate is also low. However, when the interest rates start going up, the mortgage interest rate also goes up. Quite often, even when the mortgage rate has gone up, the monthly payment remains the same, but the bank may adjust the payment once or twice a year to take into account the rising interest rates. How often this adjustment will take place is stated in the mortgage documents.

For those who are nervous about the changes, the security of five-year, or longer, fixed loans are the best option; however, there is a cost for this comfort. Long term fixed rate mortgages are relatively expensive and can not be prepaid without hefty penalties which are usually 3 month interest or the interest rate differential between your mortgage rate and the current mortgage rate, whichever is higher. I have seen these penalties running into tens of thousands of dollars when outstanding mortgage balances were large.

It is important to note that the posted rates by the banks are negotiable to some extent. If you have a good credit score and 25% down payment, you may be able to get a discount from the posted interest rates. But just because the bank manager says hello to you when you walk into the bank or the girl behind the counter smiles, does not mean that they will give you the best or the lower rate.

The time to lock in to fixed rates is when the rates change direction and begin going up. Before locking in the rate, you should consider your own personal situation. as well, If you are thinking to sell the property and move, you should not lock into a fixed rate mortgage as at the time of selling, you may be asked to retire the mortgage and it may cost you interest penalties.

In the economic period of rising interest rates, you should also not borrow to the limit. Either go for a fixed rate mortgage or if you are going to opt for a variable rate mortgage, allow your self some room so that even when the rates go up, it will not strain you financially. Twenty percent cushion may be what you should consider, e.g. if your regular payment is $1,200 dollars a month, you should be able to handle payment of up to $1,440 without too much strain. That increase of $240 dollar is equivalent to a 20% cushion.

If you have a variable rate mortgage, and it is within 2% of the current rates, it may not help you to lock in the mortgage at fixed rates. There may not be any real benefit, as changing the mortgage will involve expenses such as legal, appraisal and processing fees if any.

Based on the study done of the last 40 years period, the people who opted for variable rate mortgages, (except for a short span of 18 months back in 80’s when the interest rates went through the roof.14-15% per annum) came out ahead of those who opted for fixed rate mortgages. It is very likely that this pattern will hold good, going forward as well.