Should You Bet The House?

December 6, 2011

Entrepreneurs are often tempted to bet the house on their businesses.  This means that they get a loan against their home equity, rather than trying to get a business loan.  This practice has risen a great deal in recent years, with home owners who own businesses either putting their homes up as collateral or borrowing against the home equity.  The percentage of people tapping into their home equity for a business, according to Barlow Research Associates, rose from 18.4% to 27.5% from 2001 to 2006.

However, with the less secure economic times and the drop in home prices, less owners have the option to draw on a home equity. As George Cloutier, the founder of American Management Services in Orlando, Florida explained, “In normal times, there would be a movement to use home equity to shore up losses and sagging sales. The problem that has occurred is that no one’s doing home equity loans, especially on marginal cases where the owner’s business is in trouble.”

Obviously, betting the house can be quite risky – and can be quite nerve-racking for spouses and families of the entrepreneur. It’s important to look at all of your options and to talk to a company like Intercontinental Capital Group with Dustin DiMisa before making any decisions of this sort.


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Dealing with an Underwater Property

November 30, 2011

Just in the New York region, according to Zillow.com, about 17% of single-family homes are considered underwater. This means that the owners owe more on the mortgage for their homes than the homes have been appraised as being worth.

Many people don’t realize that one way out of this situation might be to refinance.  As Cari Sweet-Kostoplis explained, there are many ways to qualify to refinance the loan with programs that aim at avoiding late or partial payments or foreclosure.

Jef Kinney, the vice president for innovation and development of Fannie Mae said, “I don’t think a lot of people are aware that they have this option.” By refinancing, it may bring people’s payments “to a level that is sustainable to them and put money in their pockets.”

Certainly, many companies like Intercontinental Capital Group with Dustin DiMisa can offer advice for refinancing in situations of this sort.


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The Ramifications of Inheriting a Home

November 26, 2011

If you’ve recently inherited a home, you might feel like you’ve won the lottery.  Many estate planners, however, will say that the situation is far more complicated than this.  Many people will choose to simply sell the house and take the proceeds.

For those, however, who want to keep the house, the laws and regulations become less clear.  Who is responsible for paying the mortgage until the estate is settled?  The will might say, as Deirdre R. Wheatley-Liss, a tax lawyer, explains, that the heir is to receive the home free and clear. This would mean that the executor needs to sell stocks and do other things to pay off the mortgage.

If there isn’t a will, or these things aren’t stipulated, then state law will come into play.  Learn more about these issues and make sure you know your rights before deciding what to do with such a “windfall.”


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Keep the Mortgage or Get Rid of It at Retirement?

November 22, 2011

It’s a big question that people have as they get to retirement age. Of course, if your loan is up and you’ve managed to retire without a mortgage, you’ll be much more comfortable. For the rest of us homeowners, however, we have to make a decision if it’s worth it to put down a large chunk to pay off the mortgage or not.

DaRayl Davis, a money manager, suggests that it might be worth it, instead, to buy a vacation or retirement home cheaply with that money.

It’s important to look into the current mortgage rate that you have, as well, and to think about the tax implications for losing your mortgage deduction.

These are all issues that should be addressed before anyone runs out and gets rid of their mortgage. Certainly, a qualified residential lender company like Intercontinental Capital Group with Dustin DiMisa can lead future retirees through the process.

 


Posted, by in Mortgage Refinancing Tags: , , ,

Checks in the Mortgage Application Process

November 17, 2011

When you’re in the process of applying for a mortgage, it’s important to know about  checks that can often be part of a mortgage application.  Mortgage banks are nervous about people exaggerating information to obtain a loan that they might otherwise have not been able to qualify to receive.

You may, therefore, be scrutinized more than you are used to during the loan process and you may wonder why so much effort is being put into checking your every detail. They may look at your bank account to see if an out-of-character deposit has been made and they will want to know its source.  Any new debt will also be looked at.  As Carolyn Mitchell, a senior vice president of Aklero Risk Analytics explains,  “Sometimes borrowers don’t think buying a new car prior to closing a loan is a problem, but it is.”

Similarly, if you disclose that you earn much more than people typically earn in your field, you may find yourself under extra scrutiny.  As Intercontinental Capital Group with Dustin DiMisa explains, lenders will often check with the IRS and other sources for verification.


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Getting a Mortgage Loan as a Retiree

November 12, 2011

If you’re a retiree looking for a mortgage, you shouldn’t feel that you’re up against a brick wall. More and more retirees are coming to companies like the Intercontinental Capital Group with Dustin DiMisa looking for loans.  Lenders will tell you that the process is the same at any age, as long as you qualify based on income and credit scores.

As David Boone, a first vice president of Provident Bank in Jersey City, N. J. said, ”We just had someone who came in at 85 and got a loan — a 30-year loan.”

You should start by gathering your documents together. You should know that you’ll need to show a pension award letter or a Social Security award letter if you’re retired, along with income tax returns and statements showing what you have in any retirement accounts.

You should, of course, be careful when deciding how much money to borrow and make sure that you look at available cash flow now – and 5 to 10 years from now.


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Considerations Before Co-Signing for a Mortgage Loan

November 8, 2011

There are certainly times when someone might ask you to co-sign their mortgage loan.  They may not have enough money to get the loan on their own from a company like Intercontinental Capital Group with Dustin DiMisa.

While you want to be a good person and help them out, you should think about many factors before saying yes.  The mortgage will show up on your credit rating as will any late payments by the principal buyer.  This could hurt your credit score and your chances to purchase another home or car in the future.

Certainly, if they default on the loan, you will also have responsibilities that you may not be ready to take on.

There are circumstances where it might be fine to sign on as a co-signer for a loan, but you should make sure to know all the facts before you do so.


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Getting a Mortgage as a Freelance Worker

November 5, 2011

If you’re a freelancer, you may enjoy making your own hours and being your own boss. Or, you may be a freelancer because you lost your last job and couldn’t find employment with someone else. Either way, unfortunately, it’s going to be more complicated for you to get a home mortgage than it is for those who are employees.

Many freelancers are shocked to learn about this when they show up for a loan with Intercontinental Capital Group with Dustin DiMisa or with another company.  As Christopher J. Mayer, the Milstein professor of real estate at the Columbia Business School, recently explained, “People who don’t fit into the regular check-all-the-normal-boxes these days are disproportionately challenged.”

Learn more about getting a loan as a freelancer and make sure you know how to protect yourself.


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Refinancing: Asking the Right Questions

October 24, 2011

Before refinancing with Intercontinental Capital Group with Dustin DiMisa or any other residential mortgage company, it’s very important to understand refinancing.  David Boone, a first vice president for residential lending at Provident Bank in Jersey City said that he asks potential refinancers what their long-term plans are for the house.

It generally takes about a year to recoup the closing costs of a refinance, and if you don’t plan to remain in the house long, then refinancing is probably not worthwhile.  Boone also said that, if the difference between the current rate and the new loan rate is less than a quarter of a percentage, it’s probably also not worthwhile to refinance.

Phillip Loria, the president of Amerimutual Mortgage warns people not to become fixated on finding the lowest rate.  They often end up doing nothing, when they could have saved a good deal of money with a pretty good rate.

Learn more about refinancing and the questions to consider with this article.


Posted, by in Mortgage Refinancing Tags: , , ,

All Time Lows in Mortgage Industry

October 12, 2011

Good news in the mortgage industry.  Freddie Mac recently released results of its Primary Mortgage Market Survey (PMMS) which showed that the conventional 30 year fixed has hit an all-time record low at 4.01%.  In addition, the 15 year fixed averaged a low at 3.28% for the week.

There were five main regions surveyed in Freddie Mac’s survey.  The West region had the lowest average rate for the 30 year fixed and it dipped below 4% to 3.95%.

As Frank Nothaft, vice president and chief economist at Freddie Mac reported, “Fixed mortgage rates fell to all-time record lows this week following the Federal Reserve’s announcement of its Maturity Extension Program and additional purchases of mortgage-backed securities. Interest rates for ARMs, however, were nearly unchanged as the Federal Reserve plans to sell $400 billion in short-term Treasury securities, which serve as benchmarks for many ARMs.”


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