Q. We have to relocate because of my husband’s job. Our home value has fallen nearly $100,000. We would like to get rid of it, but we don’t want to go into foreclosure. Someone mentioned a short sale. What impact would that have on our credit rating?

A. A short sale, in which you negotiate with the bank to sell your home for less than you owe on your mortgage, will have a dramatically negative affect on your credit.

A consumer who has been through a short sale could see a drop in her credit score of up to 200 points, essentially the same decrease as if the homeowner had gone into foreclosure. And like a foreclosure, the negative mark will pull down the score for seven years.

That said, if you’re underwater on your mortgage and you need to move, a short sale is a better option than foreclosure. Going through foreclosure will make it very difficult for you to get a loan for at least three to five years; if you’ve done a short sale, you may be able to qualify for a new mortgage within two years.

Sen. Charles Schumer is warning homeowners who are taking advantage of low mortgage rates by home mortgage refinancing that they should beware of predators.The senator says they’re the same predators who pushed subprime loans that contributed to the economic crisis.With mortgage rates at historic lows, hundreds of thousands of homeowners are eligible for refinancing in New York state alone.

The senator says misleading offers include lures such as no down payments or closing costs, limited documentation or low credit scores. But such offers, Schumer says, can come with hidden fees and clauses and floating interest rates that can wipe out any savings from the refinancing and even cost the homeowner more.

Question:

I have a 100000 career as a Registered Nurse and have a foreclosure on my record from 2 1/2 years ago. My credit score is about 640. My boyfriend is self employed but has the option of getting a VA loan. He is in construction and has had to claim a loss on his taxes the last two years just to make it through. He has a credit score over 780. Is there anyone that will give us a mortgage loan under these circumstances?

Answer:

Several options comes to mind:

• FHA guidelines are two years after a foreclosure, which means you could qualify for as little as 3.5% down.
• Hard-money lenders will often make loans six months after filing bankruptcy or a foreclosure, but will a require 20 to 35% down payment. The interest rate will be very high and the loan terms are not as favorable; many will contain prepayment penalties and be adjustable.
• Subprime lenders (not to be confused with hard-money lenders) are no longer making 100% financed loans.

Reverse mortgages as its name indicates operates in a manner opposite to that of the typical mortgage such as a home loan. In a typical mortgage, you borrow money in lump-sum right at the beginning and then pay it back over a period of time.

Reverse Mortgage

In your payback — the EMI — a portion goes towards paying the interest and the remaining goes towards paying back principal. All along, you pledge the asset — namely the home you have bought with the loan — to the bank. This asset is the security against which the bank is lending to you. In reverse mortgage, you pledge a property you already own (with no existing loan outstanding against it). The bank in turn gives you a series of cash-flows for a fixed tenure. These can be thought of as reverse EMIs.

NHA Housing Loan

There are various forms of reverse mortgage available in the developed countries. The specific format National Housing Board (the facilitator for housing finance in India) is promoting is one in which the tenure is 15 years and the owner of the house and his/her spouse continue to live in the house till their death — which can occur later than the tenure of the reverse mortgage. Should I Refinance Home

The IMPORTANT POINT is — how much of an annuity income can my house generate using reverse mortgage? The banks have so far not indicated which interest rates they will use to determine the EMI — however, we can safely assume that it will not exceed the interest rates used for loan against property — which is currently in the region of 12-14%.REVERSE MORTGAGE: Reverse mortgage as its na…

Refinancing is when you get a loan (secured) to pay down an old loan. In this case, “mortgage refinancing” thus meaning to pay off your old mortgage.
This most often happens to get a lower rate of interest or to get some cash out to do other things with from the equity your home provides. There are a few steps that one goes through during the mortgage refinancing process.

1. You obtain and then complete the loan application that is in front of you.
   
2. You then are presented with loan offers from the loan consultant.
   
3. Once you choose what one you will go for, there will be some documentation that will be needed to start it.
   
4. After a brief period of time you will receive the various disclosures (legal information, terms etc) to which if your in agreement, you sign and return them to your loan consultant.
   
5. Upon the loan consultant receiving this information he or she will set up an appraisal company to contact you about appraising the value of your home. This must be done so that the loan is secured against the predetermined value of your home.
   
6. You sit back a little, as your loan consultant does the work to order the payoff of your old loan with the new one and a title search and processes the loan file.
   
7. The underwriters then obtain the information from the loan consultant and either approve it or request any additional information they may need. If they need more information, they will get a hold of your loan consultant to get in contact with you. Then if all goes well, the final approval is given and a closing date is scheduled.
   
8. The final document is sent off to the title company, notary public, or lawyer who is closing it. You then sign any final documents, provide id, etc.
   
9. During the next three days, you have the right to cancel your new loan agreement.
   
10. The mortgage refinance process is completed and you have successfully refinanced your mortgage.HOW TO REFINANCE UR MORTGAGE : Refinancing…