finance - Blog - REO Pro Network

What Kind of Mortgage Fits Your Needs?

Posted by Michael Collins, CDPE, SFR on January 22, 2014 at 9:12am

What Kind of Mortgage Fits Your Needs?

No matter the state of the economy, each year the number of new mortgages underwritten reaches millions of homeowners. Some are buying for the first time while others are downsizing or upsizing. When rates drop, like they did over the past 2 years, many people seize the opportunity to refinance their home loan. However, how do people decide on which mortgage to use for their specific need? An online survey conducted by HSH.com points to some of the factors that influence consumer decisions.

Most Important Factor

It should come as no shock that the most important factor is the interest rate. Regardless of the type of loan, the size of the loan or the customers home state, everybody is trying to get the best rate for their home loan. In the survey mentioned above over 45% stated that the rate was the top factor for choosing a loan.

Other items, such as the length of the term and the fees also ranked high in the survey, but none was as vital as the rate.

Deciding How Much to Use for Down Payment

The ability to make a down payment equal to 10%-20% of the home’s price will give the borrower a range of products to choose from. A large down payment and a solid credit score will usually allow a borrower to qualify for a conventional loan which has the best interest rates.

For borrowers that have a smaller down payment, their options will be limited to FHA, USDA or VA for qualifying veterans.

Choosing the Right Term

With rates at an all-time low many borrowers are actually paying more attention to the term of the mortgage loan as part of the decision process. While the traditional fixed rate of a 30 year loan remains quite dominant more and more people are looking at different adjustable rate products. Those borrowers that have refinanced in the past 2 years have often chosen to go down to a 15 or 10 year term in order to drastically cut down on their total interest pay back while also paying off the home sooner.

Brokers Still the Top Choice

When looking for the right mortgage loan a number of people still prefer to use the services of a mortgage broker over a local bank or credit union. In the survey mentioned earlier over 30% of respondents claimed that they sought the services of a broker rather than another type of lender. Since brokers typically have access to multiple lenders they can offer any type of mortgage loan and get the best rate too.

Obviously, none of these factors discussed the two biggest items facing a borrower; are they happy with the home and can they afford the mortgage payment? Beyond those two items, the guidelines mentioned above should help any new borrower pick a loan that is right for their situation.

Additional Mortgage Info:
Home Mortgage Loans

FHA Reforms Shift The Game

Posted by Howard Bell on September 19, 2010 at 12:10pm

The coming FHA reforms will help stabilize FHA's financial viability. FHA will be allowed to raise premiums. The cap on the maximum annual FHA insurance premium increases from 0.5% to 1.5% and for loans with high loan To Value ratios, 0.55% to 1.55%. But the real importance is how the reforms will shift liquidity to rental property.

Multi Family
The bill also increases FHA's multifamily loan limits for elevator buildings and buildings in high cost areas, helping lenders finance the construction and rehab of rental housing.

Sales volume is up, debt and equity financing are more available and indexes for both sales volume and equity financing registered all-time highs. Apartment market conditions continue to improve across the spectrum said NMHC Chief Economist Mark Obrinsky.

The Politics Of Housing Shifts
Multi Family is a winner

Liquidity provided by Fannie and Freddie has enabled the apartment industry to build and maintain millions of units, including an overwhelming number of market-rate apartment properties needing no federal subsidies. With the Govt needing to repair its balance sheet, this is the better asset to back.

Rental Markets
Mark Zandi, chief economist at Moody's Analytics adds not everyone can or should have a single-family home. After the single family home market collapsed, many began looking at a major distortion in the markets...government support in the housing market is disproportionately larger for homeownership than rental units.

The Congressional Budget Office reported, the government in 2009, devoted nearly four times as much to support homeownership.$230 billion for homes and about $60 billion for multi family property.

Money always finds a home and opportunity follows. Given limited Government dollars, it stands to reason, going forward that liquidity and sales will shift to the rental property arena at the expense of single family homes.

REsourced from www.yourpropertypath.com
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Staying in Business

Posted by Brian Roth on September 3, 2010 at 4:09pm

These five steps have and can help you assess your current situation and point you in the right direction.

1: Develop an emergency fund to help get you throughout the unexpected occurrences that are bound to happen in a slow economical time. Work on setting aside $1000.00. This should be used for the worst case scenario.

2: Do not take on any new debt for the next 18 months.

3: Begin collecting all past due accounts. If you do not have personal to do this, look to a factoring company to collect those debts. If a factoring company says the debts are to old or cannot be collected, hire a collection firm. Getting 20 cents on the dollar is better than getting nothing. It is better to have a factoring company or a collection company doing this than for you to waste your time. Besides they have the skill and tools to get money.

4: Start making those sales calls to the companies that have turned you down in the past.

5: And the most important of them all is always have an exit plan. Many people in business for them selves never have a exit plan. Do you plan on retiring from your business, leave it to the kids, or the wife if something happens. What does your profit and loss look like?

Most people looking to purchase a business want it to have high profits and little loss. Are your going to sale the assets to get your retirement set up?

Reposition your business. The best course for action is to start at the basics. Know how much revenue you produce against your costs. Know your accounts receivables and the quality and diversity of the clients you have. NEVER PUT ALL OF YOU EGGS IN ONE BASKET. Manage all of your assets with a plan.

Be prepared for those lean times, they will come when you least expect them.

Be willing to listen. Look for innovative ways of doing business and cost saving revenue producing streams. Look for information outside of your standard business areas.

Another big one is know the risk your customers represent to your revenue producing capacities. Whats there credit rating? How is there payment history? What are there projections for growth? What are there weaknesses?

Do not let a single company represent any more than 25% of your total revenue or accounts receivable.

Continually farm and look for new business and means of creating business.

Do not divert cash from your company for personal use. You draw a salary or a wage and it needs to be paid as such. It should not be paid from the profits or whats left at the end of the month for the company to grow.

finance (3)

What Kind of Mortgage Fits Your Needs?

FHA Reforms Shift The Game

Staying in Business

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