Todays Mortgage Rates

Keeping up with your credit rating

Fri, 25 Sep 2009 01:17:05 +0000

Checking Credit
The Annual Credit Report Request Service is the most reliable way to check one’s credit scores. Other options exist, such as using a credit monitoring service. Credit monitoring is beneficial as it allows people to catch identify theft and errors earlier as well as correct mistakes regarding account information. With either option, people should check their credit ratings to avoid any potential surprises when needing to purchase an item that depends on good credit. Should there be an error within a credit report, the person must contact the credit bureau of the inaccuracy by writing a certified mail that is supported by relevant documents. Should the claim change his credit status, he may receive another free credit that is accurate to his credit rating.

US Federal law allows everyone to request a free credit file disclosure once a year, and such requests can be made electronically; however, the person should be cognizant over the potential for scams. Emails and pop-up ads on the internet are generally scams; additionally, one should never give his credit card number when requesting a free report.

Bond Credit Rating
Just as individuals have credit ratings, corporations have bond credit ratings that assess their credit worthiness. Reviewing the respective bond credit ratings is essential for those who are considering investing into debt securities from companies or foreign companies; these ratings help investors decide the investment’s level of risk. Bond credit ratings, also known as corporate credit ratings, can be assigned to long and short-term obligations in addition to insurance companies, securities, preferred stock, and loans. Generally, the long-term credit ratings indicate whether or not a country will pay its debt obligations.

Fitch IBCA, Moody’s, and Standard and Poor’s all provide rating systems to help investors determine the amount of risk associated with their investments. Ratings range from high credit quality to junk or default quality. A AAA rating is the highest credit quality; C or D is the lowest/junk quality. For Fitch ICBA, AA would represent a high credit quality; BBB would represent very good credit quality; and AAA is the highest quality. Anything under BBB would be considered speculative or junk, and the Standard and Poor rating system states a D rating denotes default junk status.

Sovereign credit ratings refer to a country’s capability to provide a stable investment atmosphere for potential investors. Numerous factors – political stability, foreign currency reserves, economic status, public and private investment – are reflected with such sovereign credit ratings, which are often the first thing institution investors look at when deciding if they should invest abroad.

Not only do investors use credit ratings but also entities looking for investors. Investment grade ratings can generate interest for a company or country and make it desired by foreign investors. Emerging market economies benefit from having high credit ratings to show how safe their foreign investors’ moneys are. As credit ratings facilitate investments, companies and nations attempt to improve their ratings, which in turn ensures an open capital market.

To see more on credit ratings and CD rates go to www.cdrates.org

An Introduction to Mortgages

Sun, 16 Aug 2009 19:56:32 +0000

Home buyers generally do not have the capital to purchase a home outright. As such, they seek to receive a loan, which is secured by a lien on the real estate, and they will reimburse the lender over a period of time. The home buyer will also owe the mortgage interest fees. The lender holds the deed of the property until the home buyer pays off the mortgage; thus, the deed is the collateral of the payment. As such, a mortgage in itself is not a debt, but instead it is the lender’s security for a debt.

Despite the lender owning the deed, the home buyer still occupies the property and has legal responsibilities of the property as though he owned it outright. Generally, home buyers acquire a mortgage by paying a down payment up front and then paying monthly rent. If the home buyer fails to pay the debt, the lender can take back the property and sell it to cover the debt.

The Mortgage Process
The homeowner has to borrow the principal to buy the home. Before the principal is financed, the homeowner must give a down payment, which is usually a small percentage of the home’s then market value, which in turn will be deduced from the total principal debt.

The lender charges the homeowner interest on the principal money. He can charge the homeowner points and other loans costs in addition to the given mortgage interest rate. The interest is financed along with the principal and every interest point is one percent of the total financed amount.

Amortization is the process of the monthly payments. Generally, a homeowner’s monthly payments are mostly interest in the early years under the amortization, which reduces debt over a number of years.

Homeowners have to pay various taxes on their property. Taxes help finance the cost of running communities and they fund schools, infrastructure, and roads. Property taxes are to be paid even after a mortgage is paid off as well, as in many communities, they are the biggest source of tax revenue for local public schools.

Insurance
Most lenders require homeowners to have home insurance, which covers home and personal property from damages stemming from natural disasters, crimes, weather, fire, and so on. Having homeowner’s insurance is essential even if a homeowner does not pay with a mortgage, as the homes could require future repair should it be damaged or destroyed. Some insurance is required as well. For example, homeowners who purchase property that is located in federally designated high flood risk zone within a flood plain must have insurance should the homeowner sign for a federally insured loan to acquire the property.

When homeowners put less than 20 percent down on a purchase, most lenders also charge private mortgage insurance, which protects the lender, not owner, from the owner’s defaulting on the mortgage. After July 29, 1999, lenders must cancel this insurance after the mortgage balance shrinks to 78% of the home’s purchase price.

Rates Still Hovering At All Time Lows

Sat, 11 Jul 2009 11:18:34 +0000

Today’s mortgage rates continue to hover at all time record lows and this along with government incentives has made a refinance mortgage more financially attractive than any other time in history. Currently the interest rate on a 30 yr fixed mortgage is 5.12%. Generally, anywhere around the 5% interest mark is a great deal. Not every one should be refinancing for this reason alone however there are several factors that make refinancing at today’s mortgage rates a prudent financial decision for many homeowners.

How do you know if now’s the time to pull the trigger on a refinance mortgage? Start by finding out what your current loan balance is, relative to the value of your home. If it’s 80 percent or less, you have lots of options. If it’s between 80 percent and 105 percent, you’ll have to see if you qualify for a Home Affordable Refinance Program which was recently passed by our government in an attempt to help people better manage their loans. If it’s more than 105 percent, you’d have to pay down your mortgage balance with cash to refinance. That may not be a bad idea, depending on your financial situation-but talk with a mortgage loan advisor before proceeding.

The next thing to determine is how long you plan on staying in your existing home. Because refinance mortgages come with closing costs, you don’t start saving money on that lower payment until you’ve repaid the upfront costs of the loan. Also, when estimating closing costs, remember to account for any prepayment penalties on your existing mortgage. A mortgage loan officer will analyze your current mortgage and give you a cost benefit analysis so you are able to fully evaluate whether a refinance mortgage is a wise financial decision.

If you want to take advantage of the lowest mortgage rates in history and refinance your mortgage then it would behoove you to get several quotes from various lenders so you are able to compare lenders and go with the one you feel most comfortable with. The most efficient way to receive multiple quotes is to fill out an online application through a website that is affiliated with several top lenders. This requires filling out only one application and you are then matched with 3-4 lenders who are licensed in your area. The mortgage professionals will then help you further explore whether or not refinancing at today’s mortgage rates is a wise financial decision for your situation.