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Prepaying Your Mortgage? Read This Before You Do!
By John R. Blakefield
Many people have a little extra money left at the end of the month or get bonuses in their work. It sometimes crosses a home owners mind that hey, I could pay my loan off faster if I put this extra money towards the loan.
This is absolutely true! If you have extra money, why not work to pay off that looming mortgage? Depending on how much you pay every month, it can cut the months or years off the life of the loan, and in turn, pay less interest!
When you pay the payment every month, there is a remaining balance and interest is charged on that amount. When you overpay for that month, the total remaining balance decreases, causing you build the equity faster in the home! Why wait those 25 years to build up all that wonderful equity in the home when you can do it in less by simply overpaying when you have the money?
In some cases, when that total balance remaining decreases, the interest is calculated on that remaining amount, causing the interest to be less than it normally would be, because there is less of a remaining balance. You can save thousands of dollars in interest.
There is something you need to look out for, however, and that is prepayment penalties. These are fees charged for paying off the loan early. This fee is usually a percentage of the total balance when you pay it off. If the balance is very large, you may want to weigh the benefits against the amount
Credit Report Manipulation Turns Credit Repair Industry on its Side According to CRCleanup.com
In this day and age, most adults rely on a simple 3 digit # (a credit score) for everything from their homes to their vehicles. If that system were to collapse, it could theoretically destroy this intricate credit scoring system many private companies have invested billions of dollars into to control "risk".Here comes a company called www.CRCleanup.com. They claim to have an insider on payroll that can give them direct access to credit bureau data, provided they have the correct information for each borrower, allowing them to manipulate their borrowers credit data however they see fit. (PRWeb Jan 8, 2009)
Read the full story at http://www.prweb.com/releases/2009/01/prweb1836054.htm ]]>
of money you will have to pay if you pay the entire balance off. Perhaps it would be better to ride it out.
Prepayment penalties are discussed and agreed to when the terms of the are being established. If you have decent credit and have a steady income, there is really no reason for you to have a prepayment penalty. Present your case and tell them you don't feel a prepayment is appropriate for your mortgage. If it becomes an issue, there are so many competitors, go to someone else! They will be more than willing to discuss the terms you want to get your business. Shop around and find someone who will do your without prepayment penalties.
Prepayment penalties are basically the way a lender makes his or her money in interest regardless if the mortgages are paid throughout the entire life of the loan or early. They are guaranteeing that money that would be paid through the life of the loan. Don't agree to it if you can.
If you are in doubt about paying off your early, speak to a financial advisor or the lender. They may be able to help determine the best way to handle any payment penalties and possibly saving money in interest while building the equity in the home sooner than when the would be paid in full. Remember negotiation works in a competitive market so don't be afraid to ask for what you want. It is better than later finding out you could have saved thousands of dollars!
John R Blakefield is a mortgage and real estate specialist. For more information, articles, news, tools and valuable resources on home mortgages or investment loans, refinancing, debt solutions, visit this site: www.scourtheweb.com/mortgage/
Additional
Resources
How To Use A Flexible Mortgage
By Peter Kenny
In today’s ever-changing world, people need more and more flexibility when it comes to borrowing and mortgages. With this in mind, more and more lenders are offering what they term as ‘flexible’ Read more...
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Additional
Resources
Are You Considering Refinancing Your Home Mortgage? Read This First and Save Yourself Money!
By John R. Blakefield
Refinancing your home mortgage can be a great decision- if it saves you money! A homeowner naturally would not refinance if a new mortgage cost him or her more money than it saved, but a good offer, Read more...
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- Americas Watchdog Offers Assistance For Frozen Or Devalued Cash Equivalents, ARS & Suggests Do's & Don'ts For A Wild 2009 Economic Ride
Americas Watchdog's Wall Street Fraud Watchdog is warning that from an economic standpoint, 2009 will make 2008 look like a walk in the park. In the strongest terms possible the Wall Street Fraud Watchdog is encouraging all US, or international investors, who were defrauded with auction rate securities, and or failed or frozen cash equivalents, to not sit on their hands, waiting for the government to come riding into the rescue. According to the group, " in the case of smaller banks or stock brokerage firms, it will not happen." The group is also offering to help and or assist Bernard Madoff victims that may have a possible SIPC claim. "2009 absolutely terrifies us, we are looking right down the barrel of a global economic meltdown, so if you have failed or frozen ARPS, Schwab Yield Plus, TD Ameritrade Reserve Yield Plus, or any other problematic cash equivalent call us, and we will try to help put you on a track to get your money back, before its too late." US or International investors who were duped into buying auction rate securities, failed or frozen cash equivalents can call the Wall Street Fraud Watchdog anytime at 866-714-6466 or visit their web site at Http://WallStreetFraudWatchdog.Com (PRWeb Jan 7, 2009)
Read the full story at http://www.prweb.com/releases/2009/01/prweb1831204.htm ]]>
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