Manage Your Mortgage Well (Part 3)

Mortgage means you are activating the capital blocked in your assets to have more productivity by deploying the finance you get. Earlier, I made some submissions on mortgage how to get. Some more submissions are in the same direction. These submissions be taken as tips only and should be taken as advisories – you may take action accordingly or not, it depends upon your own circumstances and choice. There is no intention to influence your decisions either way

Before putting up your property for mortgage, you must learn the property tax laws.
Usually, the residents pay their property taxes in arrears. What this means is that come tax time, the money you take out to settle your property taxes is meant to cover for the previous years’ payment. If it’s your first time buy, you probably won’t have to worry about the amount of money you’ll have to shell out, considering that your seller will give you credit in order to cover for their pro-rated tax share.
If you refinance, however, this is another story. The lower refinance mortgage rate you get may not be enough to make you happy about the kind of money you have to produce. On top of that, you might even have to contend with lenders that require you 12 to 15 months’ worth of tax payments in escrow.
However, you could get around this provided your lender has paid taxes due for the year. Once that’s done, you can then be assured that your lender will not be asking you a hefty sum for escrows. That means you won’t have to worry about producing cash come closing time.
Make sure your credit report is acceptable.
A lot of things ride on your credit report – foremost, of course, is your ability to get a refinance mortgage loan. If you have good credit standing, have never had a late payment on any of your loans, can boast of no defaults, you will be considered as a trustworthy borrower. As a result, you get better treatment – and better refinance mortgage rates.
Furthermore, you don’t have to go around begging for loan companies to accept your loan application. If your credit standing is good, you can expect lenders to give you a better deal.
How Soon Can a Mortgage Be Refinanced?
There are many advantages to having your mortgage refinanced. Of course, the most important and obvious reason is the lower rate you’ll enjoy. When applied at the right time and opportunity, having a mortgage refinanced can save you thousands of dollars in the long run. However, since timing plays a crucial role in refinancing, it’s important that you understand the factors that can affect how successfully you can take advantage of it. So how soon can a mortgage be refinanced and should you?
The right time
Getting a mortgage is not for sissies. This type of loan, whether you’re taking it out to purchase a car or a house, is easily one of the biggest financial decisions you’ll ever make in your life.
If you’re taking out a home mortgage loan and are considering getting it refinanced later, you’ll be glad to know that you could probably do it at any time you want. But once you have a mortgage and interest rates begin behaving in a manner that is favourable to you, you shouldn’t automatically apply for refinancing.
First, the difference in the new interest rate and the current interest rate should be enough to actually give you some advantages. Second, most lenders will probably advise you to refinance only after your loan has matured for a minimum of 12 months or so.
However, it’s good to consider this only if interest rates have remained more or less the same. If, at any time after you have taken out a mortgage loan the market trend begins tipping to your advantage, you should consider refinancing your loan. Remember that interest rates are rather volatile and if you wait too long for them to dip further, you could miss out on a very good opportunity to get a good deal.
Consider the 2 percent rule.
Just because interest rates have fallen a tiny bit does not automatically justify your decision to refinance. Consider refinancing only if the new interest rate is at least 2% lower compared to the rate you’re currently paying. A 1% difference in interest is not sufficient reason to make the switch.
Remember that there are costs associated with a new loan. When you consider refinancing for your mortgage, remember that you will have to pay extra for closing fees. An interest rate as low as 1% will not cover the expense.
You have no late payments.
You could go ahead and refinance a mortgage provided you have paid your loan faithfully for the last 12 months. If you have never had a late payment during the last year, you could make the shift and have your mortgage refinanced.
You have already built up equity.
If you want to refinance a mortgage soon, try to examine if you have already built up equity. You should have a minimum of about 5% or 10% equity (depending on the lender) before you could consider refinancing as a feasible option. So is refinancing an option for you?
Of course, you can always consider refinancing your mortgage at any time you feel most comfortable. The key is to consider the time factor, along with the type of opportunity being presented by the market. After all, refinancing is really getting a new loan. Just be prepared for the procedures and costs that you will have to go through all over again.
Will your home be seized?

Believe it or not, most creditors are not interested in seizing your home. If they place a lien on your property, they might have to pay a good amount of money just to take your property.
If it gets sold, the lender may not always get a sufficient return on their investment. Homes that get seized through a judgment do not sell at market value, which means that your creditor will not get a lot out of it. This is why most creditors are not really interested in seizing your home just to enforce a judgment on a debt.
Furthermore, a lien does not automatically mandate you to sell your property – you are not forced to do so. However, should you voluntarily sell the property or in this case, refinance it, you will have to pay your debt to your creditor out of the payment you received as a result of the transaction.
Second of all, seizure of property isn’t something that most creditors will do because it is, quite simply, bad PR. They want to enforce their right to collect but at the same time, they don’t want to be seen in a bad light. If you’re still unsure about the whole thing, your lawyer can shed light on certain things, particularly about laws in your state.
What you should do.
First, it’s important that you see a lawyer regarding your situation. They can help guide you on what you can do regarding your credit and give you information on the steps your creditor could take should they choose to enforce your judgment. This should help you protect your property and whatever income you may be receiving at this time.
Second, you might want to discuss the steps you have to take regarding your application for a mortgage refinance. Your goal here is to negotiate as best as you can fair terms – the kind that will help you keep your home and set you back on your feet again.
Be Happy – Manage Your Mortgage Well.

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