Title
a document that gives evidence of an individual's ownership of property.
Title Insurance
a policy, usually issued by a title insurance company, which insures a home buyer against errors in the title search. The cost of the policy is usually a function of the value of the property, and is often borne by the purchaser and/or seller. Policies are also available to protect the lender's interests.
Title Search
an examination of municipal records to determine the legal ownership of property. Usually is performed by a title company.
Truth-In-Lending
a federal law requiring disclosure of the Annual Percentage Rate to home buyers shortly after they apply for the loan. Also known as Regulation Z.
Two-Step Mortgage
a mortgage in which the borrower receives a below-market interest rate for a specified number of years (most often seven or 10), and then receives a new interest rate adjusted (within certain limits) to market conditions at that time. the lender sometimes has the option to call the loan due with 30 days notice at the end of seven or 10 years. also called "Super Seven" or "Premier" mortgage.
Underwriting
the decision whether to make a loan to a potential home buyer based on credit, employment, assets, and other factors and the matching of this risk to an appropriate rate and term or loan amount.
Usury
Interest charged in excess of the legal rate established by law
Saturday, March 18, 2006
V - W VA - Wrap Around Mortgage
VA Loan
a long-term, low-or no-down payment loan guaranteed by the Department of Veterans Affairs. Restricted to individuals qualified by military service or other entitlements.
VA Mortgage Funding Fee
a premium of up to 1-7/8 percent (depending on the size of the down payment) paid on a VA-backed loan. On a $75,000 fixed-rate mortgage with no down payment, this would amount to $1,406 either paid at closing or added to the amount financed.
Variable Rate Mortgage (VRM)
see adjustable rate mortgage
Verification of Deposit (VOD)
a document signed by the borrower's financial institution verifying the status and balance of his/her financial accounts.
Verification of Employment (VOE)
a document signed by the borrower's employer verifying his/her position and salary.
Warehouse Fee
Many mortgage firms must borrow funds on a short term basis in order to originate loans which are to be sold later in the secondary mortgage market (or to investors). When the prime rate of interest is higher on short term loans than on mortgage loans, the mortgage firm has an economic loss which is offset by charging a warehouse fee.
Wraparound Mortgage
results when an existing assumable loan is combined with a new loan, resulting in an interest rate somewhere between the old rate and the current market rate. The payments are made to a second lender or the previous homeowner, who then forwards the payments to the first lender after taking the additional amount off the top.
a long-term, low-or no-down payment loan guaranteed by the Department of Veterans Affairs. Restricted to individuals qualified by military service or other entitlements.
VA Mortgage Funding Fee
a premium of up to 1-7/8 percent (depending on the size of the down payment) paid on a VA-backed loan. On a $75,000 fixed-rate mortgage with no down payment, this would amount to $1,406 either paid at closing or added to the amount financed.
Variable Rate Mortgage (VRM)
see adjustable rate mortgage
Verification of Deposit (VOD)
a document signed by the borrower's financial institution verifying the status and balance of his/her financial accounts.
Verification of Employment (VOE)
a document signed by the borrower's employer verifying his/her position and salary.
Warehouse Fee
Many mortgage firms must borrow funds on a short term basis in order to originate loans which are to be sold later in the secondary mortgage market (or to investors). When the prime rate of interest is higher on short term loans than on mortgage loans, the mortgage firm has an economic loss which is offset by charging a warehouse fee.
Wraparound Mortgage
results when an existing assumable loan is combined with a new loan, resulting in an interest rate somewhere between the old rate and the current market rate. The payments are made to a second lender or the previous homeowner, who then forwards the payments to the first lender after taking the additional amount off the top.
Thursday, March 16, 2006
What should you look at when deciding where interest rates are headed?
What should you look at when deciding where interest rates are headed? There are hundreds of different reports, charts and news items released every quarter help economists determine where interest rates are headed. The following are particularly useful for mortgage shoppers:
The core Consumer Price Index -- The federal Bureau of Labor Statistics releases this data every month. The core index measures what consumers are paying for goods and services at malls, grocery stores and other retail locations. Unlike the overall CPI, it excludes food and energy prices, which can bounce around enough each month to distort the overall price trend picture. Buyers should pay attention to the report because it's one of the most important indicators of inflation. High inflation equals high interest rates. Low inflation allows interest rates to fall.
Employment Cost Index/Average Hourly Earnings -- These two data sets are also put together by the BLS. The ECI comes out quarterly while the Employment Situation report containing the earnings figures comes out monthly. The ECI measures changes in employee wages, salaries and benefits, while the AHE number shows how worker wages are changing month to month. Both are important because rapidly rising labor costs can force businesses to raise prices to compensate, spurring inflation. For the most recent ECI data, click here. For the most recent AHE data, click here.
Gross Domestic Product -- This report comes from the Bureau of Economic Analysis, which releases an advance, preliminary and final estimate of each quarter's GDP. GDP is the nation's total economic output for a given 3-month period. When growth is too strong, it can cause demand for goods and services to outstrip supply. That, in turn, allows businesses to charge more, fueling inflation. For the most recent GDP data, click here.
Advance Retail Sales -- This monthly report, which comes from the Bureau of the Census, tallies sales at retail stores. It's important because the Federal Reserve Board doesn't want people spending too much too quickly for fear that could cause the economy to overheat, driving inflation. For the most recent Advance Retail Sales data, click here.
New Home Sales/Existing Home Sales -- These two reports come out monthly. New home data comes from the Census Bureau while existing home sales data comes from the National Association of Realtors. Both reports are important because they measure consumer demand for homes, mortgages and mortgage refinancing loans. They also contain information about home prices.
The core Consumer Price Index -- The federal Bureau of Labor Statistics releases this data every month. The core index measures what consumers are paying for goods and services at malls, grocery stores and other retail locations. Unlike the overall CPI, it excludes food and energy prices, which can bounce around enough each month to distort the overall price trend picture. Buyers should pay attention to the report because it's one of the most important indicators of inflation. High inflation equals high interest rates. Low inflation allows interest rates to fall.
Employment Cost Index/Average Hourly Earnings -- These two data sets are also put together by the BLS. The ECI comes out quarterly while the Employment Situation report containing the earnings figures comes out monthly. The ECI measures changes in employee wages, salaries and benefits, while the AHE number shows how worker wages are changing month to month. Both are important because rapidly rising labor costs can force businesses to raise prices to compensate, spurring inflation. For the most recent ECI data, click here. For the most recent AHE data, click here.
Gross Domestic Product -- This report comes from the Bureau of Economic Analysis, which releases an advance, preliminary and final estimate of each quarter's GDP. GDP is the nation's total economic output for a given 3-month period. When growth is too strong, it can cause demand for goods and services to outstrip supply. That, in turn, allows businesses to charge more, fueling inflation. For the most recent GDP data, click here.
Advance Retail Sales -- This monthly report, which comes from the Bureau of the Census, tallies sales at retail stores. It's important because the Federal Reserve Board doesn't want people spending too much too quickly for fear that could cause the economy to overheat, driving inflation. For the most recent Advance Retail Sales data, click here.
New Home Sales/Existing Home Sales -- These two reports come out monthly. New home data comes from the Census Bureau while existing home sales data comes from the National Association of Realtors. Both reports are important because they measure consumer demand for homes, mortgages and mortgage refinancing loans. They also contain information about home prices.
Tuesday, March 14, 2006
Best Time To Refinance
Todays Topic: Best Time To Refinance
Today's National Averages:
30-yr Fixed 5.81% 6.01% 15-yr Fixed 5.46% 5.79% 5/1 ARM 5.54% 6.8%
Best Time To Refinance Your Home Loan
You bought your home during the housing boom and now after a year or two into your new home you're considering refinancing. The question is, "Is now a good time to refinance your home loan?"
Any lender or broker will likely say sure let's look into it and see how much loan you can afford! But before you even consider talking to a lender you'll want to get some questions answered for yourself.
1. Are you seeking to lower your monthly payments?
2. Do you want to consolidate debt?
3. Do You need cash for large purchases?
4. Are you seeking to adjust your interest deduction expense for tax purposes?
Whether to refinance your home loan depends largely on your immediate and long range financial goals. Once you've answered these questions you'll have a better idea of the actual need you have to refinance. If your needs prove practical you'll then want to start shopping the lowest rates possible. Check local mortgage rates and get three competitive rate quotes. Compare the saving using a mortgage payment calculator. Choose the rate and loan program that's right for you.
Match rates with the more desirable loan program. Many incline toward a 15-year Fixed Cash Out Refinance program. This gives them cash they can pocket to grow their income with a view to refinancing again upon reaching desired income level and the option of choosing a longer or shorter-term loan.
Today's National Averages:
30-yr Fixed 5.81% 6.01% 15-yr Fixed 5.46% 5.79% 5/1 ARM 5.54% 6.8%
Best Time To Refinance Your Home Loan
You bought your home during the housing boom and now after a year or two into your new home you're considering refinancing. The question is, "Is now a good time to refinance your home loan?"
Any lender or broker will likely say sure let's look into it and see how much loan you can afford! But before you even consider talking to a lender you'll want to get some questions answered for yourself.
1. Are you seeking to lower your monthly payments?
2. Do you want to consolidate debt?
3. Do You need cash for large purchases?
4. Are you seeking to adjust your interest deduction expense for tax purposes?
Whether to refinance your home loan depends largely on your immediate and long range financial goals. Once you've answered these questions you'll have a better idea of the actual need you have to refinance. If your needs prove practical you'll then want to start shopping the lowest rates possible. Check local mortgage rates and get three competitive rate quotes. Compare the saving using a mortgage payment calculator. Choose the rate and loan program that's right for you.
Match rates with the more desirable loan program. Many incline toward a 15-year Fixed Cash Out Refinance program. This gives them cash they can pocket to grow their income with a view to refinancing again upon reaching desired income level and the option of choosing a longer or shorter-term loan.
Friday, March 10, 2006
Beating The Energy Crisis
While British families deal with rising oil prices and bankruptcy reaches a new peak, American families gasp at high-energy bills and cringe over foreign security at American ports. The Bush administration promises a new energy resource as China makes oil deals with Iran. Where is the world heading? For the moment, nowhere it hasn’t already been.
What does this spell for the future? Andrew McKillop author of "ENERGY TRANSITION AND FINAL ENERGY CRISIS" predicted a continued rise in energy prices saying that after the 2004 short-term ‘price crisis’, which can only intensify in the 2005-2008 period, and within at most 10 years, both oil supply and natural gas supply will enter into constant and terminal decline, due to physical depletion.
Policy makers in late 2004 now admit that ‘oil prices will remain high’ because of fast demand growth and slow growth of supply. Solution? Mckillop explains, "Participation in faster development and construction of non-oil, non-gas renewable energy alternatives to fossil fuels, and especially substitutes for oil, will therefore reduce invasion risks for oil and gas exporter countries. The same effort will also reduce ‘threats to economic security’ of the large oil importer nations and groups of nations."
Conserve Energy
Until then each household should take it upon itself to conserve energy in the form of oil and gas while sparing our electric power supply as well. In addition home weatherization and the use of bikes and scooters for short transport will go a long way in staving off the energy crises and extended price wars.
Spend Thrift
With energy bill doubling this spring homeowners would do well to consider ways to reduce spending costs and save money. Home refinancing can cut over 50% off monthly mortgage payments. These funds can then be used to offset high-energy bills.
Save Hard Earned Dollars
Keep your hard earned dollars from going out the window literally. During cold winter months and hot summer days Americans spend more on air conditioning than anything else accept the mortgage and food. That said, investing in weatherization and keeping the temperature at a modest 68 degrees in the winter and 75 in the summer can save hundreds of dollars per month.
What does this spell for the future? Andrew McKillop author of "ENERGY TRANSITION AND FINAL ENERGY CRISIS" predicted a continued rise in energy prices saying that after the 2004 short-term ‘price crisis’, which can only intensify in the 2005-2008 period, and within at most 10 years, both oil supply and natural gas supply will enter into constant and terminal decline, due to physical depletion.
Policy makers in late 2004 now admit that ‘oil prices will remain high’ because of fast demand growth and slow growth of supply. Solution? Mckillop explains, "Participation in faster development and construction of non-oil, non-gas renewable energy alternatives to fossil fuels, and especially substitutes for oil, will therefore reduce invasion risks for oil and gas exporter countries. The same effort will also reduce ‘threats to economic security’ of the large oil importer nations and groups of nations."
Conserve Energy
Until then each household should take it upon itself to conserve energy in the form of oil and gas while sparing our electric power supply as well. In addition home weatherization and the use of bikes and scooters for short transport will go a long way in staving off the energy crises and extended price wars.
Spend Thrift
With energy bill doubling this spring homeowners would do well to consider ways to reduce spending costs and save money. Home refinancing can cut over 50% off monthly mortgage payments. These funds can then be used to offset high-energy bills.
Save Hard Earned Dollars
Keep your hard earned dollars from going out the window literally. During cold winter months and hot summer days Americans spend more on air conditioning than anything else accept the mortgage and food. That said, investing in weatherization and keeping the temperature at a modest 68 degrees in the winter and 75 in the summer can save hundreds of dollars per month.
Tuesday, November 29, 2005
Financing Your Gift? Beware Of Hidden Fees
Financing Your Gift? Beware Of Hidden Fees
The average American couple will spend $1,476 this year in holiday gifts, food and decor, according to a recent survey by the National Retail Federation. Many spend three to four times that amount from November to January. That said, during the nations busiest shopping season of the year many consumers will be seeking to finance gifts via credit cards, mortgage refinancing and equity lines of credit...
Today's Low Rates
Avg. Rate Points APR
30 Yr Fixed 5.76% 0.64 5.93%
15 Yr Fixed 5.33% 0.65 5.61%
1 Yr ARM 4.47% 0.55 6.81%
...Some shopper will be completely unaware of the hidden fees andoverall costs of financing extravagant gifts. That said we've put together a list of fees associated with loans used to cover debtacquired from gift giving. Compare and save.
Gifts purchased using... Added fees and charges
Credit Card 10-20% more
Refinancing 6.50-8% more
Home Equity Loans 7-9% more
From the above those who have already refinanced their home mortgages and held funds for gifts may do better in the long run. Still the best approach is not to finance gifts at all.
An alternative is prepaid gift cards. These average $25 per card without fees.
The average American couple will spend $1,476 this year in holiday gifts, food and decor, according to a recent survey by the National Retail Federation. Many spend three to four times that amount from November to January. That said, during the nations busiest shopping season of the year many consumers will be seeking to finance gifts via credit cards, mortgage refinancing and equity lines of credit...
Today's Low Rates
Avg. Rate Points APR
30 Yr Fixed 5.76% 0.64 5.93%
15 Yr Fixed 5.33% 0.65 5.61%
1 Yr ARM 4.47% 0.55 6.81%
...Some shopper will be completely unaware of the hidden fees andoverall costs of financing extravagant gifts. That said we've put together a list of fees associated with loans used to cover debtacquired from gift giving. Compare and save.
Gifts purchased using... Added fees and charges
Credit Card 10-20% more
Refinancing 6.50-8% more
Home Equity Loans 7-9% more
From the above those who have already refinanced their home mortgages and held funds for gifts may do better in the long run. Still the best approach is not to finance gifts at all.
An alternative is prepaid gift cards. These average $25 per card without fees.
Monday, November 14, 2005
Today the Philadelphia Fed released the findings of its fourth quarter survey of professional forecasters. The contours of the report show that the consensus expects growth to slow markedly in the fourth quarter of 2005, but then accelerate to much stronger growth during the first half of 2006.
Fed fund futures were generally unchanged last week. A light data calendar and a holiday-shortened schedule helped keep most near-term contract prices stable.
Fed fund futures were generally unchanged last week. A light data calendar and a holiday-shortened schedule helped keep most near-term contract prices stable.
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