Mortgage Lending Solutions

by Louie Latour

If you are in the process of shopping for a mortgage you may wonder about paying points. Many people will tell you to avoid paying points at all costs. Are there any advantages to paying points? Here is all you need to know about paying points on your mortgage loan.

Points, often referred to as discount points, are a fee you pay the lender upfront in exchange for a lower interest rate. One point is equal to one percent of the total loan value. Lenders require people to pay points based on their application status. Mortgage lenders all have different criteria for evaluating your application; however, your loan to value ratio, credit score, and down payment all affect whether or not the lender will require points for your loan.

There are situations where paying points can benefit you. If you have good credit and money in the bank, you can use points to negotiate for better terms on your loan. Most mortgage lenders discount your interest rate in exchange for points. By paying this fee upfront you will pay less in interest over the life of the loan. If you plan on staying in your home you can recoup this expense over the long run.

When you are shopping for mortgages carefully examine how the points you pay reduce the interest rate, and how much it lowers your monthly payment amount. By plugging this information into a mortgage calculator you can see how much you will save in interest over the life of your loan.

Using points to your advantage is a smart way to buy down the interest rate your lender charges you. This will save you interest payments over the life of the loan and has a side benefit of being a tax deductible.

To get your free mortgage guidebook visit RefiAdvisor.com using the link below. St Louis Mortgage Refinance Louie Latour is a mortgage professional and the owner of RefiAdvisor.com, a mortgage resource site offering a free gift for homeowners: “Mortgage Refinance - What You Need to Know.” This guidebook helps homeowners avoid common mortgage mistakes and predatory lending practices.

by Louie Latour

If you would like to save money on your mortgage you need to shop for the best deal. In order to avoid common mistakes homeowners make when shopping for a mortgage, you need to do your homework before you shop. Here are the basics you need to know before getting started.

Finding a new mortgage with a lower interest rate and better terms can save you a great deal of money. Most homeowners do know enough about the mortgage industry to recognize a good mortgage when the find one.

Before you do anything else you need to make sure your credit is in order. To get the best interest rate for your new mortgage you must not skip this step. Request a copy of your credit report from each of the three credit agencies. Once you have these reports go over each one with a fine tooth comb for errors. If you find problems you will need to dispute the error.

Once your credit reports are in order, focus on making all of your payments on time for at least six months. Mortgage lenders need to see you have a reliable payment history. By making these payments on time you will improve your credit score and qualify for a better interest rate.

If you have multiple credit cards the amount of outstanding credit you carry can also affect your credit score. Open accounts are potential debts; these accounts add additional risk for the lender. Close accounts you don’t need, especially the department store charge accounts.

Shop from a wide variety of mortgage brokers and lenders; using the internet makes it easy to compare offers. When you do this make sure you are get quotes without the lenders accessing your credit history. Too many lenders accessing your credit can damage your credit score.

Once you have selected a mortgage lender and an interest rate make sure the lender locks the rate for you. Get this lock in writing and make sure the lender grants you enough time to close on the mortgage. If you take longer to close than the lender has guaranteed you could lose your interest rate.

To learn more about common mortgage mistakes you need to avoid sign up for a free mortgage guidebook.

To get your free mortgage guidebook visit RefiAdvisor.com using the link below. Louie Latour is a mortgage professional and the owner of RefiAdvisor.com, a mortgage resource site offering a free gift for homeowners: “Mortgage Refinance - What You Need to Know.” This guidebook helps homeowners avoid common mortgage mistakes and predatory lending practices. Claim your free guidebook today at: http://www.refiadvisor.com/