Why Lenders Want You To Keep Your Mortgage
Why Lenders Want You to Keep Your Mortgage
Have you ever wondered what you would do if you held the winning lottery ticket in your hand? If you work hard like I do you would probably want to take a vacation, but many dream of new cars and new homes. If you love the home you have, you would probably want to pay it off. The American Dream is not only to have a home, but own it outright. With a number of successful people who have that buying power to pay their mortgage off today, why dont they?
Believe it or not, the answer is simple; what we have learned from our parents and those who have gone before us is wrong. As the economy changes, so do the rules. Many of us have not kept the same jobs for 10 years, let alone 30 years like many of our grandparents did. In addition, many of us are not going to be in the same home for 30 years like our grandparents did. Statistics prove that homeowners keep their mortgage for only 4.2 years, and that is because homeowners are typically wanting to get a lower rate, do some home improvements, and even restructure their debt by the time they hit that 4.2 year timeframe. As you can see, there isnt any reason to throw more money at the loan when you are going to turn it over this frequently. So, the wealthy dont want to pay their loans off so fast, they just want their mortgages to work for them.
The flip side to this is that the banks would love for you to stay in debt forever with your mortgage. They dont tell you that now is the time to refinance. Let me say it again; banks dont want you to refinance right now, and now is the time. The reason it is a good time, is because rates are now at a 50 year low. You can get a 30 year mortgage loan for as low as 4.75%, and a 15 year mortgage loan for as low as 4.5%. Refinancing now, means you wont have to refinance again, so you can cut down on your monthly payments and get out debt. A lower monthly mortgage payment means you have less going to the lender, so you can put more back for yourself and invest it, or pay down other debts too. Banks are not going to advertise this to you to try to draw you in, because they want you to pay more in interest. Banks will rarely tell you about something that will benefit you because they are in the business of making money off interest, and its not your best interest.
The smart choice for your mortgage loan is an FHA loan. They take many factors into consideration such as down payment, assets, disposable income, credit score, and pay history. With conventional loans, you have to fit into a box that gives no room for exceptions. Your credit will have to be near perfect, and a perfect pay history on everything over the past 24 months or better. The lower the score, the higher the risk in the lenders eyes, and conventional loans arent willing to look much further. In addition, if you are buying a home, you will need to put down at least 10% minimum, and not many first-time buyers are prepared for this.
Whatever the case may be, whether you are looking for a new home purchase, or you are looking to refinance, I am the expert in FHA and I can help you. I am partnered with a lender that is a federally chartered bank , allowing me to operate in all 50 states. For more information on FHA, and what you need to do to qualify, you can go to www.fhaloansnow.net and use my FHA calculator , and submit your application which takes only two minutes to complete. You can also reach me directly by calling 310-498-2700. I look forward to helping you live out your American Dream.
by: Mayer Dallal
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