Seven Smart Ways To Reduce Your Mortgage Rate | Wilmington NC real estate

After you get a comfort zone about shopping for a mortgage, start looking for Wilmington NC real estate online ~ http://www.WilmingtonNC-realestate.com
1. Compare Mortgage Companies
2. Float Down
Financial products introduced recently will lower your rate if market rates fall, but won’t raise it if rates creep up again.
3. Quick Close
If you can settle on your loan quickly (say, 30 days or less), some lenders will agree to shave percentage points off your rate.
4. Lock In
If you fear rates are going to rise, lock in early before they do. Some lenders allow a float-down option, but with an up-front fee.
5. Pay Points
If you’re willing to pay some interest up front (known as points), you can get a fixed-rate mortgage with a lower interest rate.
6. Stay Awhile
If you agree to keep the same loan for five years or longer, some lenders will cut their interest rate. If you do move or refinance before the agreed-upon deadline, you may have to pay a penalty of about 1% of your loan.
7. Use Good Credit To Negotiate
Do you have A-1 credit? If so, you’re a hot commodity for lenders. They may even be willing to reduce closing costs to get your business. If interest rates are firm, ask for a reduction in fees for document preparation, processing, courier services, copying, underwriting, appraisal or application. Other reductions might include: fewer or no points, lender’s attorney’s fee, commission rate (for mortgage brokers) and the credit check fee. On an adjustable rate mortgage, ask for a lower starting rate.

With so many options available, you may need a professional to help you choose the best program for your situation. Call us today to see what’s available in your area.  910-202-3607 or bakerwayneassociates@ec.rr.com.

Ten Savvy Ways To Pay For A House Today | Wilmington NC real estate

Different buyers have different mortgage needs. Fortunately, lenders today offer many mortgage options to choose from. Chances are you’ll find a mortgage plan that works for you.

Because points, fees and interest rates vary, check with us or your lender for specific information on the type of loan you are considering. The “snapshot” interest rate examples shown here are for illustrative purposes only and may not reflect current rates. For simplicity, all examples here use a $100,000 sales price. Monthly payments are for principal and interest only (taxes, insurance and condo/homeowner fees would increase your payment).

Adjustable-Rate Mortgage.

The interest rate is adjusted up or down periodically based on a financial market index (such as Treasury bills). Monthly payments start lower than for fixed-rate mortgages. The initial rate is set for a specified period — 1, 3, 5, 7, or 10 years — and then rates adjust on a schedule, say, annually. The adjustments generally are limited by annual caps and a life-of-the-loan cap.

Down Payment: $10,000
Mortgage Amount: $90,000
Term of Loan: 30 years
Interest Rate: 7% (until first rate adjustment)
Monthly Payment: $599 (until first rate adjustment)

Fixed-Rate 30-Year Conventional Mortgage.

A fixed-rate conventional loan is made by a commercial lender for 30 years. Monthly payments (excluding taxes) remain unchanged for the life of the loan. Some lenders allow mortgages with as little as 5% down, but require private mortgage insurance for loans with less than 20% down.

Down Payment: $10,000
Mortgage Amount: $90,000
Term of Loan: 30 years
Interest Rate: 8 1/2%
Monthly Payment: $692

Fixed-Rate 15-Year Conventional Mortgage.

This is similar to the 30-year conventional mortgage, except the loan is repaid in half the time. Interest rates are typically lower than for a 30-year loan, and interest paid over the life of the loan is less, but the monthly payments are usually slightly higher. Government-backed loans — VA and FHA — are also available in 15-year terms.

Down Payment: $10,000
Mortgage Amount: $90,000
Term of Loan: 15 years
Interest Rate: 8 1/4%
Monthly Payment: $873

Two-Step Loan.

This 30-year loan is a cross between the ARM and a conventional loan. The mortgage carries a fixed rate for 5, 7 or 10 years and then adjusts to market interest rates once for the remainder of the loan. The initial rate is generally lower than a fixed-rate conventional mortgage, but the second step of the two-step mortgage is often conditional on the lender’s approval.

Down Payment: $10,000
Mortgage Amount: $90,000
Term of Loan: 30 years
Interest Rate: 8 1/8% (for first 2 steps)
Monthly Payment: $668 (until adjustment)

Federal Housing Authority (FHA) Loan.

These are government-insured loans so homeowners can make a smaller down payment than on conventional loans. The limits on FHA loans are high enough to handle moderately priced homes in many parts of the country. FHA loans are assumable for future buyers who qualify.

Down Payment: $10,000
Mortgage Amount: $90,000
Term of Loan: 30 years
Interest Rate: 8 1/4%
Monthly Payment: $676

VA Loan.

These are loans for qualified veterans backed by the Department of Veterans Affairs with low or no down payment required. These mortgages are subject to the VA mortgage funding fee, depending on the size of the down payment. VA loans can be combined with second mortgages and are assumable to qualified buyers.

Down Payment: $10,000
Mortgage Amount: $100,000
Term of Loan: 30 years
Interest Rate: 8 1/4%
Monthly Payment: $751

Seller Financing.

Sellers may take back a loan against their equity in the property in the form of a first or second mortgage. One approach to owner financing is to use a balloon mortgage calculated and repaid for 5 or 7 years as a 30-year mortgage, but then the balance of the loan is due in a lump sum.

Down Payment: $15,000
Mortgage Amount: $85,000
Term of Loan: 5 years
Interest Rate: Negotiable
Monthly Payment: Depends on rate

Assumable Mortgage.

A buyer takes over the existing mortgage — usually FHA, VA or ARM — at its current interest rate, with the concurrence of the lender. An assumption may have a lower rate than those currently available, and taking over the mortgage may save on closing costs. The down payment makes up the difference between the sales price and the balance on the loan.

Down Payment: $30,000
Mortgage Amount: $70,000
Term of Loan: Time remaining on loan
Interest Rate: Same as seller had
Monthly Payment: Same as seller was paying

Wrap-Around Mortgage.

Here a new mortgage incorporates an older, assumable loan to help bridge the gap between the loan balance and home sales price. The interest rate is often below market, but higher than the rate the old mortgage carries. Payments are made to the new lender or the seller, who forwards part of the payment to the first lender. The term of the mortgage is the time remaining on the original loan.

Down Payment: $10,000
Mortgage Amount: $90,000
Term of Loan: Time remaining on original loan
Interest Rate: 9%
Monthly Payment: $724

Buy-Down Mortgage Plan.

The seller or a third party provides additional cash to the lender in exchange for a lower interest rate for the buyer. Approaches vary among permanent buy-downs, multi-year and graduated plans.

Down Payment: $10,000
Mortgage Amount: $90,000
Term of Loan: 30 years
Interest Rate: 6 1/2% (initial)
Monthly Payment: $568 (until subsidy diminishes or expires)

In addition to these loan scenarios, Wilmington NC has USDA 100% financing loans on certain areas in New Hanover, Pender and Brunswick counties.  For a map of  New Hanover County click here.  The areas outside the orange sections are in the USDA loan eligibility zone.  Let us know what area you would like to search for homes in and we will supply you a list of 100% financing USDA homes.

Six Tips For Getting The Best Loan | Wilmington NC real estate

For most of us, shopping for a new home also means shopping for a home mortgage. In both exercises, you’ll want to be a smart shopper. Working together, we can find a house you’ll love. And while it’s not likely you’ll actually “love” your new mortgage, here are six secrets to make sure your financing needs and the lender you’re considering are a good match.

1. Mortgage pre-approval.

{short description of image}A no-cost, no-obligation pre-approval before you start house hunting can save you big time. The seller knows you’re a “cash buyer” and may favor your purchase offer over another. Find a lender who offers pre-approval. That’s not the same as “instant approval,” which is often an approval loaded with qualifications. Nor is it a how-much-can-I-afford “pre-qualification” estimate, which doesn’t give you the same bargaining clout.

2. Quick loan processing.

Some lenders offer actual mortgage approval in just 5 to 7 days, and electronic underwriting is sometimes even faster. Ask about it. This quick turn-around could get you to settlement sooner, which may make you the most attractive potential buyer to your seller and may mean less time in temporary housing.

3. Flexible underwriting guidelines.

Some lenders count the earnings of a spouse who doesn’t yet have a job in the new location but has at least a two-year work history. That kind of flexibility may make you eligible to purchase the home you want.

4. Variety of mortgage products.

Perhaps you’ll do best with a short-term mortgage or an adjustable-rate loan or two-step plan. Find a lender who offers a selection of mortgages and even unique mortgage products that suit your situation best.

5. Rate-lock options.

Find out what rate-lock options are available from the lender. The shorter the lock time — that is, the less time between when you agree on a mortgage rate and when you actually go to settlement — the lower the interest rate you’ll have to pay.

6. Negotiable lender fees.

Go to a lender whose fees are reasonable. Question extra charges, such as a “commitment fee” or “underwriting fee” or “processing fee.” Mortgage lending is competitive and lenders often will negotiate fees to get your business.

We can work together to find the house that’s right. And we can talk about how to make sure the loan is right, too. Please give us a call or send an e-mail.