A Purchase loan is acquiring financing for a purchase of a property. The difference of the purchase price and the down payment is the amount required to be financed. This is also called the Loan To Value Ration (LTV). It is always a wise idea to make sure to put down 20% for down payment to ensure that you will not be forced to get Mortgage Insurance. However, it is possible to get a conventional loan with only a 5% down payment. Only catch is, the lenders will require Mortgage Insurance.
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There are two reasons to refinance, cash out and rate and term. Cash out Refinance is when there is enough equity in the property to refinance at a higher loan amount than your existing loan. A Rate and Term Refinance is simply refinancing your existing loan into a new loan without receiving any cash out. This would be done solely to lower the interest rate and in turn, lower the payment. In today’s market, most lenders and investors are staying away from interest only loans and any other type of non traditional mortgages. However, the rates on the conventional mortgages are lower than they have been in decades.
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Real Estate Purchase/Sale
Purchasing a property is a very important decision. It is very important to have an idea of your future goals with regards to the property to be able to make a more calculated decision.
A short Sale is when the amount owed on the property is higher than the value. In this case, your lender will have to agree to a lower price and pending the approval of the short sale, you will be able to sell your property. Keep in mind, this process is not intended for you to keep your home, it is simply because you can’t afford your payments and the property is not manageable anymore. In this case, the short sale will help avoid foreclosure which is the worse case scenario. Some lenders, through their assistance programs, are offering a relocation fee to the seller/borrower.
Real Estate Investments
This is a great market for investing in properties. With the amount of foreclosures the lenders are releasing on a regular basis, there are many great deals out there for purchase. Typically, it is possible to make a 10%-20% percent spread on your investment if done wisely. There are many myths with regards to property flipping and double escrows and all kinds of other crazy stories. However, most are not true and/or practical. It is very simple, you would have to find the property or properties at enough of a discounted price, where if you would be able to re-sale almost immediately, with enough of a profit to pay closing costs and still have a net return. This is where we can help finding those properties.