I need an explanation of pros and cons about fixed and variable home loan rates.?
602154
3 years ago variable loans eg. 3/1 ARMs and 5/1 ARMS had a significantly lower rate than 30 year fixed rates. If you were going to stay in a home for 5 years or less, a 30 year mortgage was very expensive compared to a 5/1 ARM.\n\nWe are now in an interesting period where 30 year rates and adjustable rates are about the same, and in some cases, where the adjustable products are more expensive than the 30 year fixed.\n\nThe simple answer therefore (not knowing your credit situation and other factors), is go with a 30 year fixed. The rate is no higher than the adjustables and I personally believe mortgage rates are going to hit record highs in the next 4 years.\n\nThe only caveat to the above is if your credit score is below 620 and above 580. You will then qualify for a sub-prime loan. The rates on these loans are higher because of the lower credit score. In this case, the 2/28 ARM can be much cheaper than the 30 year fixed. This is a good loan if you don't have great credit, but want to buy a home.\n\nThe intent is that you will refinance it sometime in the next two years when your credit is better into a lower cost, 30 year mortgage.
548279
If a person ownes a mortgage which is fixed at 5% and assumable, the option to assume the loan becomes good for people who cannot get the same loan.  For instance, A 5% loan is good for someone with terrible credit or who doesnt qualify normally.  Thus, they get the benefit of a 5% loan AND the property.\n\nLoan now 5%\nLoan for Credit risk 8%\nBenefit 3% of property price.\n\nEmail me if you need more details.\n\nGood Luck
277163
It depends how long the rate stays fixed, and on the type of loan that you are talking, it is either differed interest, or an interest only and it could change in 1 month or 1 year.  It is pretty broad.\n\nCall me at (614) 825 1907 and we can talk more.\n\nTim Kazee
608479
As a branch manager for a direct lender/brokerage, I would stay away from the 2/28 at this time.  We may have more rate hikes, hindering you from refinancing in 2 years due to whats called payment shock!  It is a risky loan at this time as nobody knows if rates will decrease. You will be fine to refinance in 2 years; at the going rate at that time.. The 2 year fixed is a way for that loan officer to earn income off of you two times.  It may not be the best program for you after seeing your hesitance.  Email me at ryan.wood@truelend.com for other options.
223989
market determines the rate, look in the paper and find comparables.\n\nIf the neighborhood is not much of a rental area then you can charge a little bit higher rate but it will be harder to find a renter.\n\nYou don't want to have less money coming in that going out. You need to have a positive cash flow or you won't have the money to keep the house fixed up when it needs something and it will grow less and less valuable (might still go up but not as fast as the neighborhood) from deffered maintenance. You would be better off selling and buying a rental that has a positive cash flow.
498026
Pros\n-longer to pay it off\n-monthly payment is lower so it might be more managable for lower incomes\n\nCons\n-interest rate is higher than for shorter duration loans\n-paying more interest over time (this is a big negative)
35253
Saving money (i.e. paying less interest to a bank) is never a disadvantage.  If you can afford to pay bi-weekly I select this method you will save additional interest.  If you simply make one payment extra per year you will save interest and shorten your mortgage length but it will be slightly less empactful than a bi-weekly payment plan.
969403
There are many options available. The credi scores will diictate what rate you get...and these scores can be improved in less thn a week if they need to be.\n\nI write a blog on the subject of credit management, mortgages, real estate trends, etc. Check it out for more information that may be helpful.
389057
I agree with VATreasuries, whom I will say has a very appropriate user name.\n\nHigher interest rates affect the monthly amount of money that people need to debt service a property.  Essentially, if money costs more... their costs are higher accordingly.\n\nOther factors like taxes & hazard insurance have similar effects (we Floridians know this all to well) restricting value.  Herein Monthly Costs.\n\nWhen these Monthly Costs exceed pace of income growth to where they become a higher ratio of gross income needed to service monthly... property values tend to recede.\n\nThese past years have arguably been an anomoly... largely because of an influx of investment dollars into real estate holdings.
1013897
Open your mind set beyond the last 4 years when interest rates were super low.  They are STILL low to people who have had mortgages 10-15 years ago when rates were 10%, 15% and even 20%.\n\nOnly people getting mortgages within the last several years think rates are high now.  Explain to them the long term history of interest rates.\n\nFind people with HELOC's and convert them to Fixed rate loans.\n\nAs mentioned previously, there are many people with 2/28 and other ARMS that are going to want to convert to a fixed rate.\n\nAttend a few Real Estate Investing group meetings.  There are always people investing in Real Estate.  Be there when they need you.  Don't start out being pushy, just get to know them and be there often.
894710
The advantage of a negative am loan is that it keeps your payments low, and it sounds like you need low payments right now.  I think that your best course of action is to keep your current loan for the next two years until the prepayment penalty expires.  At that point, your wife will be working and you'll be in a position to handle a larger payment.  You will then be able to replace the negative am loan with a conventional loan that may have a higher payment but won't result in negative amortization.  In the meantime, you have 90K in equity so you're not in danger of running out of equity.  I think you may have made the right decision when you chose that negative am loan.\n\nThe only proviso to the above is this:  in the unlikely case that the rate on your negative am loan is very high, then you could to reduce your payments by refinancing.  But the current rate for a 30-year mortgage is around 6.4%, so your rate would have to be quite a bit higher than that to justify refinancing now.
118828
Well you should ask first of all for a good faith estimate from each lender, to see which one of the is giving you a better deal. You also need to know if they're giving you a pre-payment penalty, If so for how long. (average pre-pay is about 2 years, unless you have really bad credit) If you have Excellent credit you shouldn't get a pre-payment penalty. thae situation varies depending on your Fico Score. Also Find out how many points they're charging you up Front and if they're getting anything back form the lender after close of escrow. All this matters because. Also if you're financing 2 new loans make sure that they're Fixed, so that your monthly payment doesn't change every month. Also HELOC's loan interest rates change every month, and the rate is going up, which means that your payment will also go up.  So be very careful about this.
1141632
A couple of good places to look for this information.\n\n#1. I use www.bankrate.com\n#2. I also check my newspaper business section. They usually have a list of all the best rates that they know of.\n\nI hope that helps!
781709
For the sake of your cash flow go for the lowest possible monthly payment.  You can always pay more, but if you have a vacancy you might need the extra wiggle room made possible by a lower minimum payment.  A fixed rate would be better than an adjustable for this just because it makes you annual planning easier.  I used to own a couple of apartment buildings and know that being able to fix as many or your payments as possible can make life easier in a crunch.
500285
Go to www.realtor.com \n\nthey have a mortgage calculator. you can change the price of the house, the down payment, and the interest rate.
949086
The interest rate is horrible, but keep building the score so if and when you borrow in the future the rate is more reasonable, like in the single digits. You have to repair the score somehow so its a good start.
1143806
Probably better to get a different kind of loan, like a small business loan.  Putting your house up for a risky venture could be disastrous.