Welcome to Home Mortgage
Home Mortgage Refinancing Rates In Britain Article
. For a permanent link to this article, or to bookmark it for further reading, click here.
You may also listen to this article by using the following controls.
Part V: Learn About your Home Mortgage Options
from: Mark Mathis
Here are some things to consider with an ARM or a Hybrid ARM:
- Is my income likely to increase enough to cover higher mortgage payments if interest rates go up?
- How long do I plan to own this home? (If you plan to sell soon, rising interest rates may not present the risk they do if you plan to own the house for a long time.)
- Can my payments increase even if interest rates generally do not increase?
- What index will be used to adjust the mortgage rate? Ask the lender for a table showing movements in the index over the previous 10 years to see how your mortgage payments would have changed.
- How often will the interest rate be adjusted? Every year? Three years? Five years? The longer the adjustment period, the better you will be able to plan your future loan cost.
- What is the initial mortgage interest rate? Does it include a special discount or “teaser?” If so, you could face a large increase in your monthly payments when the interest rate is adjusted for the first time.
- What is the margin on the interest rate? The margin is the amount that the lender adds to the index rate to calculate your mortgage rate. For instance, if the index rate is 7 percent and the margin is 2 percent, your overall interest rate would be 9 percent.
- What limits or caps have been placed on the adjustments? One of the most important items to discuss with your lender is the maximum amount that your mortgage rate can increase in any single adjustment period and over the life of the loan. Find out the "worst case" situation in the event of a sharp increase in your index rate.
- Is the loan convertible? If so, is there a cost to convert? Convertibility allows you to change your ARM to a fixed-rate loan at some designated time in the future.
- Is there a prepayment penalty? If you refinance your loan with a new loan, you may be assessed a fee.
Finding the correct mortgage for your family's particular needs is a very important step in the home building process. Be sure to thoroughly research all available options, and speak to several home finance professionals prior to making a decision. Selecting the wrong initial financing option can turn out to be a costly one.
=============================================
Print entire article at:
http://www.houseplancentral.com/articles.php?id=18
=============================================
About the author:
Mark Mathis is a building designer and publisher of several stock house plan websites and informational resources including http://www.HousePlanCentral.com,
http://www.HousePlanGallery.com, and http://www.moneytalks-bswalks.com. Be sure to visit each site and subscribe to our eNewsletters to receive special offers, promotions, and subscriber-only features.
Home Mortgage Refinancing Rates In Britain News
FTSE posts biggest daily gain in almost 2 months
M&A talk among the travel telecoms and mining sectors helped Britain's top shares to their biggest daily gain in almost two months on Wednesday as strong manufacturing data from the U.S. and China boosted sentiment.
Read more...Santa Barbara home sales down
Santa Barbara home sales in July were down compared to the same time last year, but are still better than the national average, which fell by more than a third compared to July 2009.
Read more...Obama mosque opinion turns lite
US President Barack Obama has once again weighed into the mosque for Ground Zero argument, saying Muslims have the right to build their house of worship near the site of the 9/11 terrorist event.
Read more...Business & Finance
Market overview - European shares close higher - AFP European stock markets closed higher yesterday, supported by strong German trade figures and speculation that the US Federal Reserve may take...
Read more...