How To Get a Home Mortgage If You’re Self-Employed

As the self-employed community grows, so does the need for lenders who tailor their services to the market. If you’re self employed, it’s very hard to get the loan you deserve unless you go to a specialist. This excellent article by David Miles sheds some light on the subject.

How To Get a Mortgage If You’re Self-Employed

If you are self-employed, work on a contract basis, or have an income that is irregular or comes from multiple sources, it will generally be harder for you to get a mortgage than it is for someone who is an employee and can easily prove their income.

With over three million self-employed individuals in the UK, the attitude of many mortgage lenders towards the self-employed population is a problem that can affect a large number of people, even though many self-employed people often earn more than a lot of salaried workers.

The problem stems from the fact that the majority of mainstream mortgage lenders require proof of income when assessing a mortgage or remortgage application. Employed people can use their payslips and P60 as proof of salary, but there is no such straightforward equivalent if you are self-employed.

In place of payslips, self-employed workers may be asked to provide audited accounts that show their income over the last three years. However, in many cases, these accounts will not give an accurate reflection of how much money a self-employed person is making. This is because if the accountant who prepared the accounts is doing his job properly, he will have offset as many allowable expenses as possible against tax. This has the effect of reducing the self-employed person’s net profit, upon which the lender will base the size of mortgage or remortgage they are prepared to offer.

The situation is even worse for the newly self-employed, as they may not yet have been trading long enough to have had three years’ worth of accounts prepared.

This is where mortgage lenders who specialise in self-certification mortgages and self-employed mortgages come into their own. These types of lenders appreciate the different and complex working patterns of the self-employed, contract workers, and people whose jobs are seasonal. They are prepared to look at each case individually and assess each mortgage application on its own merits, rather than just applying a series of one-size-fits-all income tests. In many cases, self-certification means that you do not need to supply any proof of income - you just declare what your income is without having to provide any supporting documentation.

In addition, specialist self-employed and self-certification lenders are more likely to offer flexible mortgage products that allow overpayments and underpayments. This is ideal for people whose income can fluctuate throughout the year, as it means you can overpay when times are good and underpay if you’re business is going through a quiet period.

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Copyright 2004 David Miles. David Miles is the editor of a number of mortgage websites including UK Mortgages & Remortgages where you can find further advice on mortgages or request a personalised mortgage quote or illustration.

Excellent write-up, David! I personally learned a lot and I know our readers did too!

If you enjoyed this article but want to know more about getting a home mortgage in your current situation, just drop us a line today and we’d be happy to provide you with a free consultation to get you headed in the right direction.

How To Save Thousands in Interest on Your Home Mortgage!

No matter if this is your first or 30th home mortgage, you can always learn new ways to save more money on your mortgage. In this article, Sameer goes over the basics of restructuring your payments to save you lots of money in interest.

How To Save Thousands in Interest on Your Home Mortgage!

So you have a mortgage on your home or planning to get one? Here’s something to consider if you want to reduce your interest payment and save on thousands of dollars. Consider going in for a bi-weekly mortgage payment plan.

So, what is a bi-weekly mortgage payment plan? The difference in this type of mortgage plan lies in the frequency of payments. Out here you make your payments every two weeks instead of every month. By going in with such a payment plan, you end up paying for the 52 weeks in a year, i.e. 1 month more than the otherwise 12 payments you would make with the monthly plan (52 / 4 = 13 payments in a year). You may think why pay extra? But the benefits are there for all to see. By going in for such a mortgage plan, you are reducing the tenure of your loan as well as continuously reducing the principal and interest which has to be repaid.

An illustration to show what we mean - Suppose you were to go in for a mortgage of $150,000 for a term of 360 months at an interest rate of 6%, your monthly payment would work out to $899.93 and your total interest through out the tenure of the loan would work out to $173,757. Now consider the same mortgage taken on a bi-weekly payment plan. Your bi-weekly payments would be of $449.67 while your total interest for the entire tenure would work out to only $135,294 + you end up completing the loan in 24 years instead of 30. Huge difference!

The savings from such a payment plan are huge and are worth considering if you can afford to make the payments every two weeks. At least, keep it as an option!

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Sameer S Panjwani is the CEO and Founder of ChoiceOfHomes.com - Find real estate listings of homes on sale and rent.

Thanks for writing that excellent article, Sameer! This is a great tip for making more effective payments and stretching our dollars further.

To find out more information about restructuring your mortgage payments or other home mortgage topics, we’ll provide a free consultation to get you headed on the right track - just contact us today to get started.

Live in Sacramento, but Want to Refinance Online? Not a Problem…

If you have a lot of pride in your city, it can be difficult to make the decision to look outside of local brokers to get your home refinanced. Fear not! The best resource for information and price shopping is the Internet, but your can take the information back to your local broker and they can be even more helpful since you’re educated about the market. So without further adieu…

Doing a California Refinance Online

Californians are passionate people. I know. I have lived in California my whole life: From the smoggy basins of Los Angeles, to, well, the smoggy basins of Sacramento. I’ve traveled highway 101, I’ve smelled the glory of the Redwoods, and I’ve experienced the confusion of the Terminator becoming governor. Without turning into a pop-song, I’ve done it all California-style, and that even includes, moving through the exciting process of doing a California Refinance Online!

Okay, so it’s not exactly as poetic or as exciting as I’m making it out to be, but a Sacramento Refinance conducted online does not make you a bad Californian. It makes you a smart consumer, and if it’s important for you to keep your business local, then there’s no need to shy away from your monitor. You can still do it all in your pajamas.

In the next few moments, I’m going to cover some basics to ease your worries and calm your nerves about using the internet to gain access to local money.

1. You are in Total Control.
2. Important Online Mortgage Resources
3. Keeping it Local!
4. Start Broad, And then Narrow Your Search.

You are in Total Control

Chances are, you will be filling out a short 30 second form online in the very near future, and in return, you will be receiving 3 to 4 immediate offers from brokers and lenders vying for your business. But that doesn’t mean that you must receive offers from banks located at the top of the Space Needle or beneath the catacombs of the Grand Canyon.

The majority of the loan search services available online provide you with the option to request loan offers from several brokers specific to your area. You don’t need to reach far and wide to get a good deal. This means that you can rest easy. When it’s time to complete the online short-form application, just make sure the query asks you if you’d like to narrow your search.

Important Online Mortgage Resources

a) Ask if your prospective mortgage broker and/or lender are licensed under the CMLA, the California Mortgage Lending Act of 1994. http://www.corp.ca.gov/pub/mb.htm

b) Check out their complaint history with the Better Business Bureau online. http://www.bbb.org/

c) Ask if they are a member of the CMBA, the California Mortgage Bankers Association http://www.cmba.com/

d) Do you qualify for Affordable Housing? If so, make sure your lender can broker a loan that will meet your needs. Here is the current Interest Rate Schedule: http://www.calhfa.ca.gov/homeownership/rates/index.htm

e) Research the current California Mortgage Refinance Rates online. We offer a free, daily rate-watch at our site, but interest rate information is everywhere.

Keeping It Local

Doing a California Refinance from your neighborhood bank or local broker, is probably a very good idea. One important reason is that they know the terrain, and they know what things are like in your home town or State. Every region has a different set of variables and demographics that determine its respective health or struggles, as it pertains to mortgage rates. If your preference is to do your refinance with local information and personable service, then I say go with your instincts.

Start Broad, Then Narrow Your Search

Start with a broad query using the Internet, and then narrow your search. There are too many banks and brokers in your area, for you to call on the phone, or take a day to drive by each office for a personal visit. Use the internet as a resource. Start wisely. Conduct a broad Sacramento Refinance loan search, via the methods discussed above, and then zero-in on the folks down the street.

If you are not making decisions based on wise, savvy shopping tactics, then in the end, you could wind up spending more money through higher rates, or higher fees, all in the good name of convenience. You can still go local in the end. Those are the parameters that you get to choose when conducting a search. But don’t start there. The internet is a powerful tool, for your Sacramento Refinance needs. Don’t ignore it. Use it, and use it to your full financial advantage.

We’ve enjoyed providing this information to you, and we wish you the best of luck in your pursuits. Remember to always seek out good advice from those you trust, and never turn your back on your own common sense.

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Copyright 2005, by Loans-Resource.Com

What a great read! I know our readers love to hear about new ways to make their time go further for them, and this is just the ticket.

If you’re a reader who’s ready to take action towards getting your home refinanced, drop us a line today to make sure you’re on the right track. All of our consultation services are free - we’re all about helping the Sacramento community, so drop us a line today!

Want to do a Home Loan Modification? Not Without These Tips!

I don’t know of anyone that wouldn’t want to take advantage of a loan modification to save money, but there is a good way and a bad way to go about it. Before you begin your loan modification quest, here is what you need to know?

Loan Modification Choices - Things You Need to Know

A Home Loan Modification is an offer to make a permanent change in the borrowers mortgage terms which is normally involves a rate modification. To find out if you qualify or how to get help on a mortgage loan modification there are plenty of attorneys and loan modification companies to help consumers.

To determine if you are eligible the legal representative will request certain documentation and ask you income and expense questions. One will need to be in a hardship situation such as job loss, dramatic reduction in income, divorce, death, etc. many individuals opt to try and do the loan modification themselves without the assistance of an attorney who knows the laws, knows how to stop a foreclosure, knows what errors to look for in the closing documents, and what is needed to qualify.

There are other companies out there who claim they can do a loan modification and then actually can’t help the homeowner and find themselves even more underwater since they had to pay that particular company a processing fee. A loan modification, also called debt restructuring, with an attorney can significantly make headway for clients at a faster rate and faster responses. I have personally witnessed people trying to save a buck here and there and do it themselves. Yet, they discover six months later they are still no closer to a modification agreement and are still chasing down different office staff in the lenders office.

Some homeowners that are struggling to make their mortgage payments or close to foreclosure may choose to employ a real estate attorney or a loan modification company rather than doing it ion their own due to the fact that an attorney has a significantly more positive impact and results, when ordinary individuals have failed. The lender has to respond to attorney in a timely fashion otherwise there are penalties, possible loan rescission, and expensive legal fees. They don’t want this in addition to a foreclosed property. Once an individual fails to negotiate with the loan servicing company, it is much harder to use an attorney later on to stop a foreclosure due to time constraints and the lender having your current information. Getting to the right person or persons within the mortgage lenders’ loss mitigation department can be difficult to impossible at times. Some have stories that their documents simply disappeared like the loss mitigation has a magical genie on staff. Mail and faxes may suddenly become misplaced, agreements moved to different departments, etc. Their objective is to collect for their investors. You are not the client to them. The investors are.

Remember the lender is mainly trying to collect delinquent payments, not give you a break. The loan loss mitigation area is not in the business of offering each person that requests 3.00% fixed rate for 5 or 10 years or reduce the principal loan balance down by $100,000. Although, the odds increase when using qualified loan modification companies with an attorney. If they are done at all, it is based on the individual file and must be properly negotiated to achieve positive results. When one uses the loan modification services from a company that has an attorney on staff, they are usually going to have a better outcome.

A loan modification is a long term solution, modified forbearance agreements are designed by the lenders to just get paid. Of coarse they will negotiate with you to get caught up, requiring a portion of the late payments to be paid up front to reinstate the loan or to stop foreclosure.

Be Careful of Loan Modification Company without an Attorney

There are many loan modification companies also known as loss mitigation companies marketing their success stories, refunds, and principal reductions. If they guarantee a principal reduction, then you need to do business elsewhere because that simply cannot be guaranteed period. It may be a strategy within the loan modification company’s marketing but there is no guarantee!
If they say refunds, make sure they disclose the refund amount if their processing department deems it not to be a favorable file for a loan modification.

I will agree that not every company out there is untruthful however most of the salesman are working just to make a sales commission. You should work a loan modification company that has attorneys, paralegals and experienced bank negotiators to personally handle files that come in.

What is a Typical Loan Modification?

A standard loan modification puts the borrower into a comfortable and long term ability to make their new payment. Modifying the mortgage terms of the current loan can involve a very low rate that is fixed for a period of 3 to 7 years then systematically rise to the current market fixed rates. In certain situations, the lender may also choose to decrease the principal loan balance or wipe out part or all of the second lien if it is introduce properly with documentation. In summary, a loan modification should be favorable solution to both the homeowner and the investor.

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Homeowners interested in a loan modification program who are behind on their payments or have a financial hardship can apply with a Real Estate Lawyer or visit http://www.OCRealEstateLawyer.net website to have experienced paralegals, debt negotiators supervised by Attorneys who know this business.

What an excellent perspective!

To get professional advice for your mortgage situation at absolutely no cost, get in touch with us today.

Like Free Money? Take Advantage of the FHA for your Next Home Purchase!

Today, we have the pleasure of hearing from Greg Shuey, a loan originator from Utah, on the topic of the FHA. Since he’s walked clients through FHA-type loans before, he’s in a great position to offer his expertise for us today. Let’s take a look at what he has to say.

FHA Loans Make Buying a Home Easy During Hard Times

The Federal Housing Administration or FHA is a federal agency established as part of the National Housing Act of 1934. Its goal is to improve the housing standards and conditions of every Americans. FHA provides a sufficient home financing system. The agency does this by insuring mortgage loans to help stabilize the mortgage market.

In short, the FHA is your key to homeownership. You can get different types of mortgage loans offered by the Federal Housing Administration. They are the following:

• Fixed-Rate mortgages
• Adjustable-Rate mortgages
• Energy Efficient mortgages
• Graduated Payment mortgages
• Growing Equity mortgages

You need to meet certain requirements such as employment and credit scores to qualify for any of these mortgages. There are limits imposed on FHA loans offered to homebuyers. These limits will help you purchase a home during tough economic times and strict lending standards prevent you from qualifying for conventional loans.

Last year, the Housing and Economic Recovery Act of 2008 signed by President Bush made some changes to FHA loan limits to help more homebuyers qualify. For example, FHA loan limits on single-family home mortgages will be raised to $271,050 in low-cost areas and $625,500 in high-cost areas. The previous FHA loan limit was $362,790.

The new limits, according to the Housing and Urban Development secretary, is targeted at assisting neophyte homebuyers and those struggling with money to refinance to government-backed loans such as FHA loans. One of the most beneficial things FHA does is that it allows you to refinance or buy a home with a low down payment. This spells great for first-time homebuyers and those who dont have much money for initial payment. Other than that, FHA-insured loans have more benefits than the conventional loan. They have lower down payment, which is at 3 percent. In addition, it can come anybody”family members or organizations as a gift.

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Greg Shuey originates loans for Utah Financial, a mortgage company in utah. Together with Chase Gunderson, we specialize in FHA home loans and Utah FHA Streamline loans. We are here to educate and help you along the way when researching streamline refinance in utah.

Thanks for sharing those excellent insights, Greg! I know our readers have picked up some valuable tips!

If you’re a reader and considering making a move in the mortgage industry, talk to our experts first. We’ll get you pointed in the right direction after a no cost consultation.

Buying a New Home? Use These Essential Tips to Do It Right!

If you’re looking to buy a new home, we’ve got a great article for you. Robin Smith has a great article for those new to the mortgage world. Without further adieu…

Getting a Home Mortgage Loan To Buy Your New Home

Most people find it difficult to buy their home as they are not in a financial condition to afford it. If you are looking for a new home and if you dont have enough money to make your purchase then you can apply for a home mortgage loan with which you could buy your dream home.

Home mortgages are a typical kind of home loan in which you are required to keep your home as collateral against your home mortgage loan amount. All home mortgage loans are secured kind of loan and they require security against the loan amount. Other than putting your home on mortgage, some financial lenders may also require you to provide some down payment in order to get approval for your home mortgage loan. The amount of your home mortgage loan finance is also determined by the current equity value of your home and also the amount that you provide as down payment.

Moreover, your credit history plays a vital role in determining the interest rate and the terms and conditions of your home mortgage loan. However, because of your collateral and your down payment, you will receive a larger home loan amount with a favorable interest rate.

Home mortgages may be again divided into fixed rate home mortgage loans and adjustable rate home mortgage loans. If you take a fixed rate home mortgage loan then you will have to make a fixed monthly installment until the end of your repayment. A large number of homeowners prefer this kind of mortgage loan as they get the knowledge of the amount that they are required to pay throughout the entire loan period. Moreover, it relieves them from surprises like a sudden rise in monthly installment. On the other hand, an adjustable rate home mortgage loan allows the borrower to adjust their monthly repayment according to their repaying ability. The interest rate of an adjustable rate mortgage loan keep on changing with the market trends.

Normally, an adjustable rate mortgage loan allows you to start your repayment with easy monthly installment as you can adjust the interest rate according to your convenience. However, the principal mortgage loan amount and the interest rate usually become much bigger with the completion of the loan period. This is the main reason for the rapid increase of foreclosures over the past few years.

Another type of home mortgages that you can apply is the bad credit home mortgage loans. Even if you have a poor credit record, you can still get a bad credit home mortgage loan if you own the clear title of your present home. Like other home mortgage loans, you are required to put your home as security against your bad credit home mortgage loan amount. Your bad credit mortgage loan amount depends up on the market value of your home and your repaying capacity. Before applying any of the home mortgage loans, you should fist figure out the type of home mortgage loan that will suit for financial condition. Moreover, you should consider various factors like the amount of your down payment and the means of financing the closing payments of your mortgage loan amount. You should also feel comfortable with the monthly repayment that you are going to make in order to avoid defaults on your home mortgage loan.

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The above article has been written by Robin Smith, a professional having keen knowledge of home mortgage loans. Find out more on types of financing and mortgages as listed in real estate directory.

Thanks for your contribution, Robin! We loved your article!

To learn more about how these tips and others can apply to your personal home search, just drop us a line today.