Maintain your old Siemens Hipath system

Poor Credit? Get a Sub-Prime Mortgage Now, and Refinance to a Conventional Mortgage Later

There are great mortgage loans for people with poor credit, and yes, you can still save thousands of dollars. In order to receive preferential treatment for mortgage professionals, you'll need a credit score of 680 or better (this is considered A credit). If you have a score that is less than 600, you'll fall into a sub-prime loan category. Now, you'll need to get creative, in order to get your mortgage and not lose a fortune.

A sub prime lender will offer you virtually any type of loan that a conventional lender will offer, but you'll pay a much higher interest rate, as a risk premium. In other words, these lenders consider people with low credit scores risky borrowers, because they may have some poor payment history. Lenders like people who pay all their bills on time, even though it is not at all uncommon for people to occasionally miss a payment for one reason or another. So, the sub prime, or non-conforming, or niche, lender says, "We'll take the risk, but we want to make a lot more money, in order to do it." Don't worry. You can get it done, and improve your situation to refinance at a better rate later.

Let's assume you have poor credit, and you want to purchase a house for $100,000. You also have only five percent to put toward a down payment. You bring a twofold problem to the lender ? poor credit and a very high loan-to-value, or LTV. You need to borrow $95,000 on a $100,000 home, so your LTV is 95%. As a general rule, lenders like purchasers to bring 10 to 20 percent of their own money to the table, again lowering the risk for the lender; they feel that the more money a borrower has in a deal, the less likely she is to default. So, your mortgage professional will find his best sub-prime lender, and take your application to him.

Now, if your debt-to-income ratio (amount you owe monthly vs. gross income monthly) is 50% or less, and your credit score is above 500, you'll likely get your $95,000 loan. Your interest rate, however, will be between 10% and 12%, creating a very large monthly mortgage payment. So, how are you going to win the mortgage game, in this case? You have two options.

First, you can improve the loan by reducing the LTV. In other words, instead of taking a loan at 95% loan-to-value, you apply for a first mortgage of $80,000 (80% LTV) and a second mortgage of $15,000 (15% LTV). Here's how you save money. Instead of borrowing $95,000 at, let's say, 12%, with a payment of $977, not including taxes and insurance, you have a loan for $80,000 at 8.75%, for a payment of $629. Your second mortgage is at 13%, with a monthly payment of $166. Now, your combined monthly mortgage payments with two loans are $795, saving you $182 monthly over the first mortgage at 12% and $2,184 each year.

The second option is to take an adjustable rate mortgage, which offers great savings, just like conventional loans. If you take a 2-year ARM, which sub prime lenders offer, you might be able to get a rate of 7% or 8%, instead of the 10% you'd likely get on a 30-year fixed loan. You might also talk to your mortgage professional about combining option one and two, and taking an ARM on your first mortgage at 80% LTV and still taking a second mortgage for $15,000. This could save you even more.

Get a free mortgage course to learn more.

Mark Barnes is an investment real estate and real estate finance expert. Get his free mortgage finance course at http://www.winningthemortgagegame.com. Mark is also the author of the new novel, The League, a shocking, sports-related conspiracy. Learn more about his suspense thriller at http://www.sportsnovels.com.

In The News:

Cyclone survivors clinging onto trees as they await rescue
Thu, 21 Mar 2019 05:07:00 +0000
Aid workers are scrambling to get food and water to desperate survivors of the devastating cyclone that hit Mozambique, Malawi and Zimbabwe, as thousands remain trapped by floods.

Four men arrested for 'secretly filming 1,600 hotel guests'
Thu, 21 Mar 2019 09:38:00 +0000
South Korean police have arrested four people on suspicion of secretly filming around 1,600 hotel guests and live-streaming or posting the footage online.

Trump under fire over 'bizarre' John McCain funeral comments
Thu, 21 Mar 2019 07:19:00 +0000
Donald Trump has come under fire from his own party after unleashing a bizarre tirade against the late Republican Senator John McCain.

New tech could thwart crime gangs making millions off fake olive oil
Thu, 21 Mar 2019 09:37:00 +0000
Scientists in the US have devised a way of testing to see if olive oil is real without the use of hi-tech scientific equipment.

New Zealand bans semi-automatic weapons after terror attack
Thu, 21 Mar 2019 03:07:00 +0000
Military-style semi-automatic weapons and assault rifles will be banned in New Zealand, the country's prime minister has said.



tikatoshop.it

Erfahrungen mit Pallhuber Wein
Agen Bola SBOBET Terpercaya

Travel in comfort and at your leisure with CT Airlink Limousine & Car Service for top quality private transportation and exceptional customer service. We operate Sedans, SUVs & Vans for CT Car Services to covering all Connecticut airports including Car Service from CT to Newark Airport , Mohegan Casino Uncasville CT, Foxwoods Casino Mashantucket CT, Manhattan Cruise Terminal NYC, Brooklyn Cruise Terminal NYC and Bayonne Cruise Terminal NJ. CT Airlink hire licensed and friendly chauffeurs who have in-depth knowledge of the Areas.

How to Find the Lowest Rate Possible!

The quest is on! You're in the market for a... Read More

New Home Loan - Understand The Various Types Of Mortgage Lenders

So, you've decided to buy a house, and you're ready... Read More

Buying A Home? Reasons to Consider Financing Your New Home Loan Online

Financing your new home loan online can save you time... Read More

Why Refinance Back into a 30-Year Loan?

One of the biggest reasons homeowners refinance their mortgage is... Read More

Thinking About Refinancing Your Loan?

Refinancing your home or property is a big decision that... Read More

Refinancing Your Home - How and Why?

Chances are you may need a little extra money to... Read More

Advantages Of Mortgage Pre-Approval

There are several advantages to getting mortgage pre-approval before looking... Read More

Home Equity Can Create a Never-ending Money Cycle

What could you do with $10,000? Well, you can have... Read More

Home Loans and Mortgages ? Beware of Deed Theft Scam

The average home in the United States has a value... Read More

Mortgage Info You Can Actually Understand!

This is a great time to Refinance Your Home or... Read More

6 Helpful Mortgage Tips

Here are some mortgage tips that can help you obtain... Read More

How To Choose Your Mortgage Loan

Are you excited about purchasing your first home? Or maybe... Read More

Remortgage Serves To Rewind The Reimbursements Of Mortgage

It takes a mighty big effort to secure a home... Read More

Mortgage Debt Elimination

The prospect of mortgage debt elimination is something that many... Read More

Home Equity ? Let the Market Eliminate Your Private Mortgage Insurance

In decades past, most people who were interested in obtaining... Read More

Flexible Mortgage Tips

Outlined below are some useful flexible mortgage tips. The most... Read More

What Is The Best Deal For A Mortgage?

Few of us invest the time and effort into researching... Read More

What is the PayOption ARM?

Imagine an adjustable rate mortgage that allows you to pick... Read More

Mortgage Terms Explained

When you are hunting for a mortgage, you will find... Read More

The Top 5 Reasons to Buy a Home

1. Save on your income tax.Yes, something good can come... Read More

Online Mortgages in 5 Easy Steps!

We're all entitled to the opportunities and benefits of home... Read More

Self Employed Mortgage Loan ? Getting a Mortgage When You?re Self Employed

Being self employed has many benefits. When you are self-employed,... Read More

Bad Credit Home Financing - Get The Mortgage Loan You Want Even With Poor Credit

Having poor credit alone cannot hold you back from getting... Read More

Shopping for A Mortgage? Do Your Homework First

If you happen to be shopping around for a mortgage,... Read More

Looking for a Bad Credit Home Improvement Loan

To make needed repairs to your home without the advantage... Read More