www.miamimortgagehome.com

As with any other type of mortgage, there are some benefits and some drawbacks to having an interest-only mortgage. It’s in your best interest to know about them and make an educated decision based on this information.

Interest-only have some disadvantages that you want to consider. Listed below are the most common ones:

1.    It’s riskier loan than a fixed rate loan because the payments may change every month depending on the overall economic conditions. Even though you have the flexibility to choose between one of four payments, the rates may go up or down without you being able to control them.

2.    If interest rates go up significantly, you may find it difficult to make your monthly payments.

3.    It is a more expensive loan than a regular loan over the life of the loan.

4.    It’s is harder to understand because of its characteristics.

5.    The initial low rate will adjust to a rate higher than that one of a fixed rate mortgage to make up for the artificially set initial low rate.

On the other side, there are several benefits that may help you decide on getting this type of loan. It’s important for you to know them before making a final decision. These are some of them:

1.    You can afford more of a house because the lower initial payments allow you to take out a larger loan.

2.    You can use the money you save on making investments, paying bills or making improvements to your house.

3.    You can take advantage of lower rates without having to refinance.

4.    You can more easily qualify for this type of loan.

Interest-only home loans are usually a good choice if you think you’re going to stay in the house for many years, if the interest rates are expected to go down or if you think you will be earning a lot more money in the future.

As with every mortgage, it is your responsibility to learn about the different types of loans available to you. Of course, you are not alone. You can always contact a local mortgage broker who will guide you through the process of choosing the right type of loan for your specific economic situation.

In the slow real estate market we are going through, you want to make your home look as good as possible to potential buyers. Always remember that as buyers walk around you home, they are thinking whether they could see themselves living in a house like yours.

For example, if your home has a strong odor, many buyers will think that it is a sign that your house is in bad shape. If the bathrooms are dirty, homebuyers won’t be able to see themselves living in your house; particularly, if they visit six other houses after yours.

In the following paragraphs, you’ll read about different things you can do to make your house look like a home your buyers could make their own. These strategies can be done quickly and for very little money. Make a budget of how much money you can spend and prioritize where you are going to spend that money. Of course, it is important that you start making the changes right away.

First, show your home during the day whenever possible so that there is as much light as possible. Even if the buyers see the house during the day, make sure to turn all the lights on. Replace regular light bulbs with the more powerful 100 watts light bulbs.

If your house has a front lawn, make sure to cut it and trim it as it’s another indication of how well you maintain your home. Clear the lawn of any objects tat should not be there. If the paint in the outside is old, replace it if you can afford it. If you can’t afford new paint, paint the trims on the door and windows.

Change the old mailbox and doormat with new ones. Buy quality street numbers that can be clearly be seen from the outside. Work hard in preparing your house so that the buyer’s first impression is a good one.

Inside the house, clean the carpet and the floors. If the carpet is very old, rent a carpet cleaning machine or hire a professional. In most cases, it’s not worthwhile to change the carpet because it may not much the taste of the future buyers. If you choose to change the carpet, do it with a neutral-colored carpet.

Also, if you see that some rooms need to be painted, please paint them with neutral colors. In some cases, you may just need to wash the stains off the walls.

Next, clean and tidy every room. Take out anything that makes your rooms look clogged. Spend some extra time cleaning every corner in your bathroom. Also, place a few scented candles around your home and light them up an hour before your first appointment.

You can also improve your house with little money by changing light switches, electrical outlets and doorknobs. These upgrades are really inexpensive and make the house look a lot better.

After you are done preparing your home, ask yourself whether it is a house that you would choose to make your home. This is an important question because it is the question that potential buyers will be asking themselves. If you can’t answer yes, ask yourself why and keep making changes until the answer is positive.

The MTA (monthly treasure average) loans have become a very common type of loan in the mortgage industry. It has become very popular because it provides people the chance to afford a more expensive house. At the same time, it gives the home owner the flexibility to choose among four payment options every month.

In this article, we’ll take a look at what this type of loan is all about, AND the main risks associated with it.

The MTA loans are based on the monthly treasuries average index; one of the most stable indexes in the market. By using this index, your payments won’t change much during the first five years. Payment rates usually range from 1% to 2.95% for the MTA ARMS.

Please keep in mind that since the rates are so low, your monthly payment may not cover the interest charges causing the loan to create deferred interests (also called negative amortization.)

All MTA mortgage loans have a 5 year payment recast. A payment recast is a recalculation that is performed to figure out the payment necessary to repay the loan over the remaining 25 years. This is done by adding any deferred interest to the remaining loan balance and amortizing the payment over the remaining 25 years.

For example, A MTA loan of $400,000. After 5 years there has been $30,000 in deferred interest, your new loan will be $430,000 at the then current rate, amortized over the remaining 25 years. So, if your payment started at 1% or $1,286, in year one and rates were at 6.75% or higher, after year five, your new payment would be $2,970, or higher.

When you choose an MTA loan, you have four choices for your monthly payments each and every month:

1. Minimum payment option – The minimum payment accepted by the bank. Most of the time, it will cause deferred interests to be accumulated.

2. Interest only payment option – With this option, you only pay interests and you don’t reduce the balance of the loan.

3. Full principle and interest – The same payment you would pay in a 30 year fully amortized loan.

4. 15 year amortization payment option – This is the highest of all payments but it’s the one that reduces the balance of the loan the fastest.

Keep in mind that the MTA loan has several drawbacks:

1. It’s an adjustable rate loan – No matter which one of the MTA’s available you choose, these loans still have an adjustable rate. If you plan to live in your house for the next 30 years, you may be better off with a 30 year fixed mortgage.

2. MTAs usually require a minimum of a 5% - If you require 100% financing and wish for a low payment, you should consider 1, 3, 5 year interest only ARMS.

3. If you are tight with money, you may have to refinance the loan every five years (just before the loan is recasted and the monthly payments jump up.)

4. Also, if you choose this type of loan to afford a more expensive house, you may be in trouble when the payment goes up.

Please, take some time before deciding on choosing this type of loan. The most important advice I could give you is to talk to a certified mortgage broker who can study your financial situation and goals, and choose a mortgage that is suited to your needs.

In the next article, we’ll take a look at how you can use MTA’s in creative ways to fund your retirement, your children’s education or the purchase of additional assets.

Mortgages can be divided into two main categories: fixed and adjustable.

In fixed rate mortgages, the interest rate stays the same during the whole duration of the loan. They are available for 10, 15, 20, 30 and even 40 years. There are also “bi-weekly” mortgages, which shorten the loan by calling for half the monthly payment every two weeks. (Since there are 52 weeks in a year, you make 26 payments, or 13 “months” worth, every year.)

In adjustable rate mortgages, the interest rate may vary at given intervals. These loans generally begin with an interest rate that is 2-3 percent below a comparable fixed rate mortgage, and could allow you to bu^y a more expensive home.

However, if interest rates go up, your monthly mortgage payment will go up, too. On the same token, if rates go down, your mortgage payment will drop also.

 Within those categories, there are many other types of loans.

For example, you can choose from loans with a balloon payment after a given amount of years, interest-only mortgages, negative appreciation loans, etc.

 There are also mortgages that combine aspects of fixed and adjustable rate mortgages - starting at a low fixed-rate for seven to ten years, for example, then adjusting to market conditions.

 During the first meeting with your mortgage broker, you should study your personal situation and decide on a type of loan that will adjust to your needs.

I wish you the best of luck in your future endeavors.

Sincerely,

Igor Buces

www.miamimortgagehome.com

ibuces@globalbankerstrust.com

305-710-5183

Once we have completed the application, we’ll give it to one of our processors who will organize your paperwork and verify your employment, bank balances, and other information.

   The best way to guarante^e that the loan is closed in the shortest amount of time is to respond promptly to requests for information while processing is taking place.

 Some items that you may need to show that weren’t necessary during the application include:

 • The final purchase contract for the house (if applicable).

• If you’re self-employed, the mortgage company may require your personal and business tax returns for the previous two years and your company’s year-to-date Profit and Loss statement.

• Divorce settlement papers, if applicable

• Updated account statements for listed assets in the application that may have changed in value.

• Information about debts or credit report items that may have been delinquent or not accurate.

• Evidence of your mortgage or rental payments, such as canceled checks.

• An irrevocable gift letter if you are receiving a monetary gift from a relative.

 The processor in our company needs to collect this information before presenting it to an underwriter. An underwriter is the person who reviews all the information in your loan file to determine if the application meets the lender guidelines. With approval, a lender should give you a letter of commitment, which is a promise from the lender to make a loan based on specific terms and condition^s.

 In the next lesson, you’ll learn the types of mortgages you can choose from.

 Until then, I wish you the best of luck in your endeavors.

 Sincerely,

Igor Buces

www.miamimortgagehome.com

ibuces@globalbankerstrust.com

305-710-5183

Once you have been pre-approved and have chosen your dream house, you need to start the loan approval process. This process generally begins with an initial interview where you and a mortgage broker discuss the different types of loans you can choose from.

 In that meeting, the mortgage broker will fill out a 1003 mortgage application form. To speed up the loan approval process, you’ll need to take with you several documents that need to be sent to the lender:

 - A purchase contract for the house (if you have one)

- Your bank account numbers and the address of your bank branch, along with checking and savings account statements for the previous 2-3 months

- Pay stubs, W2 withholding forms, tax returns for two years, or other proof of employment and income verification

- Credit card bills for the past few billing periods, or canceled checks for rent or utility bill payments, to show payment history and amount of revolving debt

- Information on other consumer debt such as car loans, furniture loans, student loans and retail credit cards

- Balance sheets and tax returns, if you are self-employed

- Any gift letters, if you are using a gift from a parent or relative or other organization to help pay the down payment and/or closing costs. This letter simply states that the money is in fact a gift and will not have to be repaid.

 Having these items on hand when you visit the mortgage company will help speed up the application process. Usually, an appraisal fee will have to be paid when you submit the mortgage application. After the mortgage application, we will let you know if you qualify for the loan within a couple of days.

In the next lesson, you’ll learn ways to speed up the processing of the loan.

 Until then, I wish you the best of luck in your endeavors.

 Sincerely,

Igor Buces

www.miamimortgagehome.com

ibuces@globalbankerstrust.com

305-710-5183

This is one of the most frequently asked questions by interested buyers. The basic answer is that it depends on each individual’s situation. Generally, though, your down payment can be anywhere from three to twenty percent of the home’s value. Down payments can be lower for first-time buyer loans, veterans or those on active military service can obtain loans with no down payment at all. In some situations, you may be considered for 100% financing.

 To be considered for a low down payment loan, you generally need to have:

 • Sufficient income to support the monthly mortgage payment

• Enough cash to cover the down payment

• Sufficient cash to cover normal closing costs and related expenses (explained below)

• A good credit background that indicates your payment history or “willingness to pay”

• Sufficient appraisal value, which shows the house is at least equal to the purchase price

• In some instances, a cash reserve equivalent to two monthly mortgage payments

Closing costs, or settlement costs, are additional expenses at the time of closing. They are paid when the home buyer and the seller meet to exchange the necessary papers for the house to be legally transferred. On the average, closing costs run approximately 2% to 3% of the house price. This percentage may vary, depending on where you live.

 Closing costs include the loan origination fee (if not already paid), points, prepaid homeowner’s insurance, appraisal fee, lawyer’s fee, recording fee, title search and insurance, tax adjustments, agent commissions, mortgage insurance (if you are putting less than 20% down) and other expenses. Your mortgage professional will give you a more exact estimate of your closing costs.

 Points are finance charges that are calculated at closing. Each point equals 1% of the loan amount. For example, 2 points on a $100,000 loan equals $2,000. Companies may charge 1, 2 or 3 points in up-front costs in addition to the down payment. The more points you pay, the lower your interest rate will be. In some cases, you may be able to finance the points.

  
In the next lesson, you’ll learn the kind of paperwork that is needed to apply for a loan.

 Until then, I wish you the best of luck in your endeavors.

 Sincerely,

Igor Buces

www.miamimortgagehome.com

ibuces@globalbankerstrust.com

305-710-5183

Before you start looking at homes, you need to have an idea of what you can afford.

 The best way to know how much you can afford is by getting pre-approved. Being pre-approved for a loan has two main advantages. First, you’ll know exactly what you can afford. Second, you can negotiate with the seller of the property from a position of strength; the seller will take you a lot more seriously if you can show them that you are able to find financing for the house.

 Besides, being pre-approved is FREE, fast, and there is not obligation on your part. If a mortgage tells you that he/she will charge you for a pre-approval, it’s time for you to look  for a new mortgage broker.

 As a general rule, you’ll be able to buy a house with a price 2-3 times your annual income.

 A more common way to determine how much house you can afford is by looking at your monthly income and expenses. You’ll usually qualify for a monthly payment (including mortgage payment,taxes, insurance and other fixed expenses) equal to 28 percent of your total monthly income. Also, your monthly housing costs plus other long-term debt (expenses extending more than 10 months into the future such as car payments or credit card debt)should not represent more than 36 percent of your gross (before taxes) monthly income.

 However, keep in mind that there are many programs specially designed to allow you to afford “more of a house.”

In lesson 4,we’ll take a closer look at the different types of programs and how they can help you to bu^y the house you want.

 Also, keep in mind that when deciding whether to approve you for the loan, the lender will look at three main factors:

 1- It will look at your incom^e and debt to determine your ability to repay the loan

 2- It will look to your debt and credit history to determine how likely it is that you’ll repay your loan on time (If your credit rating is not good, let me know and I’ll help you improve it so you can afford more of a house with a lower interest rate)

 3- It will look at an appraisal of the house to make sure that property offers sufficient guarantee for the loan

In the next lesson, you’ll learn what type of down payment and closing costs you can expect to pay. But don’t worry, it’s not as much as you may think. 

Until then, I wish you the best of luck in your endeavors.

Sincerely,

Igor Buces

www.miamimortgagehome.com

ibuces@globalbankerstrust.com

305-710-5183

As you well know, your credit score can make the difference between obtaining a loan with good terms and not getting a loan at all.

Even though it’s true that there are all types of programs for almost all kinds of credit scores, you may want to take a closer look at your credit rating.

A difference of 100 points in a credit score can mean having to pay a few extra hundred of dollars in your monthly payments. After 360 payments (your typical 30 year mortgage,) the extra money can amount to tens o thousands of dollars.

And that’s just part of it. By having a better credit score, you will also be able to afford more of a house.

About now you may be wondering how to improve your credit. Well, about a few months ago, I found a site that offers a FRE*E credit repair system. After reading it carefully, I realize that it could help many of the people that come to me looking for good terms on their mortgage.

The good thing about it is that is easy to follow and it can help repair your credit in about 30 days. That means that you can be fixing your credit WHILE you look for your dream home.

The website that you need to visit to download the system is www.repaircreditforfree.com

Please understand that I am here for you and that I will try to help you no matter the type of credit you have. I don’t get any kind of financial benefit from recommending this product. I have just included this resource as an aid in case you want to improve your credit.

In the next lesson, we’ll take a look at how much of a house you can afford.

Igor Buces

www.miamimortgagehome.com

ibuces@globalbankerstrust.com

305-710-5183