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Mortgage Loan Refinance Article
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Most of us find ourselves taking out a loan at one time or another in our lives, whether it's for a home, a car or personal reasons. At the time we take out the loan, it's usually set for some many months with monthly payments due on a certain day. The amount of the monthly payments is based on the current interest rate we're charged on the principal balance we borrow. Often, during the term of the loan, we find ourselves refinancing the loan for one reason or another. The main reason why people do refinancing is usually for a better interest rate, specifically if the loan is a home mortgage. With a home mortgage loan, refinancing for a lower interest rate can make a substantial difference in the total balance of our loan.
from:Lower interest rates are the most common reason for refinancing mortgage loans, but they are not the only reason for refinancing. When banks lend money for the purchase of a home, they will usually only borrow up to 80% of the value of the home (known as equity). For instance, if a home is valued at $100,000, the maximum amount the bank will borrow is $80,000. As time passes, the balance of the loan decreases while the equity of the home increases. Often home owners need extra cash for remodeling or other personal reasons so they choose refinancing by using the equity of their home as collateral.
An example of this method of refinancing would be that same $100,000 home. After a couple of years, the loan balance may be down to $70,000 while the value of the home may have increased to $120,000. In this scenario, the bank will borrow up to 80% of the home's value, which would be $96,000. This amount is $26,000 more than the borrower owes on his mortgage so they are eligible for $26,000 cash out. Refinancing of home mortgage loans is very popular for this reason.
While home mortgage loans are the loans that are most often refinanced, refinancing is not limited to just mortgages. Many borrowers take out loans when they purchase a car. A lot of people like trading their cars off in a couple of years to get a newer model. Many times the first car loan is not paid off, so they do refinancing of their first car loan and add it to the new car loan. Another reason is for additional cash for personal reasons. As long as the collateral of the loan (car, etc.) is worth more than the balance of the loan, banks are more than happy to help with refinancing, if the payments have been made on time, of course.
Mortgage Loan Refinance News
BofA Said to Put Off Refinancing Clients as U.S. Spurs Demand - Bloomberg
 Bloomberg | BofA Said to Put Off Refinancing Clients as U.S. Spurs Demand Bloomberg Bank of America Corp., struggling to handle mortgage refinancing after a US program boosted demand, is telling some customers to wait 90 days before starting an application, said two people with knowledge of the policy. The firm began a reservation ... MBS Prepayments Suggest Slow Uptake On Government's HARP Reducing Your Mortgage Interest Rate Obama's HARP Re-vamp – Some Homeowners Still Out of Luck |
Mortgage Refi Activity Ramps Up in U.S. as Rates Continue to Drop - World Property Channel
Mortgage Refi Activity Ramps Up in U.S. as Rates Continue to Drop World Property Channel According to the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey for the week ending February 3rd, mortgage applications increased 7.5 percent from one week earlier. The Market Composite Index, a measure of mortgage loan ... Mortgage Application Volume Up 7.5% Last Week - MBA Mortgage applications jump on refi demand: MBA MBA: U.S. Mortgage Applications Rose Last Week |
In Obama's Refinancing Plan, Homeowners to Pay a Premium - Fox Business
 USA TODAY | In Obama's Refinancing Plan, Homeowners to Pay a Premium Fox Business The insurance allows homebuyers to borrow at lower interest rates, but the FHA tacks a 1.15% charge on top of the interest rate of most new mortgages it guarantees for the life of the loan. While the administration has yet to decide how to structure ... President Comes to Area, Announces Homeowners Bill of Rights Editorial: Help underwater homeowners who are responsible Mortgage plan offers too little help for homeowners |
Mortgage Bonds in Eye of Storm as Refis Decline: Credit Markets - San Francisco Chronicle
 89.3 KPCC (blog) | Mortgage Bonds in Eye of Storm as Refis Decline: Credit Markets San Francisco Chronicle 8 (Bloomberg) -- Investors in US government-backed mortgage bonds who benefited from a decline in early payoffs by homeowners are bracing for the fallout from a loosening of refinancing rules at Fannie Mae and Freddie Mac. Prepayments for Fannie Mae's ... REAL ESTATE: Refinancing expanding for Fannie/Freddie borrowers 8 Steps for Boards to Stop Fannie Mae From Killing Your Co-op / Condo's Sales Time for New Leadership at Fannie and Freddie: Obama Should Side With ... |
Vail Daily column: More on the Making Home Affordable Act - Vail Daily News
 Housing Wire | Vail Daily column: More on the Making Home Affordable Act Vail Daily News In the first part of this series we identified the Making Home Affordable Act, the Obama Administration's initiative to help struggling homeowners get mortgage relief through mortgage modifications, interest rate reductions, refinancing, ... JP Morgan: Obama's housing program could help 500000 more homeowners Obama housing plan helps its one millionth homeowner HAMP Program To Undergo Some Tweaks |