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Mortgage Refinancing - Beware the Vultures
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Buying a Home With Bad Credit
Many people assume applying for bad credit mortgage loan is an almost impossible task so they defeat themselves before even starting. When in fact it is not near as difficult as you first may think. The process can be slow, or at least seem like it's taking forever and for many the waiting period for approval is the toughest part. The lending institution looks over your credit rating and makes cer... Read mortgage refinance article
My Home Is Not Selling
If you own a property that has been sitting on the real estate market for a long time with no prospective buyers in sight, the first thing you'll need to do is modify your listing price. Get completely updated information on any recent local sales in the area of the property. If your price is already current, usually a price reduction of about 5 to 10 percent of the total listing price is needed t... Read mortgage refinance article
Mortgage Refinancing - Beware the Vultures
If you are in the process of mortgage refinancing you need to be wary of overpaying for your loan. Mortgage vultures overcharge you and even structure their loans to promote foreclosure so they can take your home. Predatory lending practices are common in the United States; however, if you take the time to do your homework and research mortgage offers, abusive lenders are easy to spot. Here are several tips to help you avoid the vultures when mortgage refinancing.
Mortgage vultures are any company or broker that takes advantage of you when mortgage refinancing. This describes the industry as a whole, because wholesale lenders encourage retailers to mark up you interest rate unnecessarily. Mortgage companies and brokers have a subtle way of disguising the way they overcharge you. What happens when you apply for mortgage refinancing is the wholesale lender qualifies you for an interest rate and provides your mortgage company or broker with a written guarantee of the interest rate.
Your mortgage company marks up the interest rate and gives you a separate written guarantee. If you agree to the terms and take out the loan, you are paying more than you should for that mortgage. Mortgage companies and brokers mark up your interest rate because the wholesale lender pays them one point, or one percent of your loan amount, for each .25% they get you to overpay for mortgage refinancing. The mortgage company will never tell you they've done this, and if you do not know what to look for you'll never see it in the Good Faith Estimate or HUD-1 statement.
This unnecessary markup of your mortgage interest rate is called Yield Spread Premium and results in homeowners in the United States overpaying $16 billion dollars in unnecessary interest every year. Because you are already paying origination fees for mortgage refinancing, any retail markup you pay is money wasted on junk fees. How can you avoid paying retail markup of your interest rate when mortgage refinancing? Homeowners that learn to recognize Yield Spread Premium can avoid paying it.
You can learn more about mortgage refinancing including costly mistakes to avoid by registering for a free mortgage tutorial.
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What Real Estate Agents Dont Want You To Know
Buying or selling a home is the single largest investment of a lifetime for most people. It is a BIG business deal composed or people, emotions, contracts and cash and those are all the ingredients for legal and financial pain if you don't know what you are doing and most people don't.
Real estate agents are trained in real estate principals, practices, law and some finance before they get their license to sell real estate. As licensed salespeople they have access to inside information you don't have whether you are a home buyer or seller. And, their training gives them a strategic advantage over you.
For example, have you been to school to learn real estate principals and practices? How much do you know about real estate law? How much do you know about mortgage financing? Who is representing your best legal and financial interests?
The truth is that you will be representing your own best interests and that puts you on an unleveled playing field when dealing with commissioned real estate sales agents. So before you run out and sign contracts and get involved in a financial transaction you may not fully understand, you should have access to a source of information that shows you how to protect your basic legal and financial interests, right?
Agents aren't going to give you information that will show you how to be on a level playing field with them because whoever has the knowledge, rules. They are not going show you how to take control of the home buying and selling process so that you can represent yourself in a more professional manner. They want to get listing contracts and make sales to get commissions! They want you to do a deal with blinders on.
Take contract law, for example. Agents like to get home buyers and sellers to sign on the dotted line because it locks people up on a contract to perform. Do you think they are going to show you how to write a contract you can get out of if it's not be in your best economic interest?
A SMART WAY TO SIGN A CONTRACT
Whether you are buying or selling a home you can put these 5-magic words right above your signature before you sign the dotted line: "subject to buyer's (or seller's) attorney's approval". Then, sign the purchase (or listing) contract. In this way, you can get out of the deal if you have second thoughts and/or your attorney does not approve of the contract within a reasonable period of time (24-48 hours). Real estate agents call this a "weasel clause" because it allows people, like you; to weasel out of a deal after you cool down or realize you made a mistake in judgement. Trust me, agents don't want you to know this kind of information.
This is just one powerful tip from our premiere real estate e-book that we are giving away free this month. If you are interested in learning how to get your copy, you can get more information on our home page.
Thanks for reading!
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