No Closing Cost Refinancing, Is It Right For You

In most refinances situtations you can elect to have the refinancing lender pay for all of the Non-Recurring Closing Costs.
This is often referred to as a No Points No Fees (NPNF) Refinance, or no closing cost refinance.

In order to get a No Closing Cost Refinance you will need to accept a slightly higher rate than a normal No Points mortgage. Usually about .250% to .500% higher.
Non-Recurring Closing Costs include the following: Appraisal Fee, Credit Report, Lenders Fees, Broker Fees, Title Insurance, Escrow Fees and Recording Fees.
 

Is a No Cost Loan Right for You?

If you are planning to own the property less than five years, or if you are short on cash to close on a purchase, then a no cost loan could be right for you.  It is easy to calculate your break-even point by simply looking at the difference in your payment for a no cost loan vs. a loan with costs and then dividing that difference into the amount of non-recurring closing costs that you would have to pay at closing.  The result of this calculation will tell you how many months it would take to re-coup the expense of the closing costs so you can then compare that time frame to the length of time you anticipate living in the property.

No Cost Loan Comparisons

Let’s look a scenario outlined above comparing a no cost loan with a zero point loan.  You are considering two options offered on a $300,000 loan. Option A is a no cost loan with a rate of 6.25% and a payment of $1,847 compared to option B, a zero point loan with base non-recurring closing costs of $2,800 and a rate of 6.00% and a monthly payment of $1,799. The difference in payment would be $49 per month and if you divide this difference into the base closing costs of $2,800, the months to required to break-even (BE) or re-coup the costs is 57.73 months. Divide the number of months by 12 to annualize the equation and it would take 4.81 years to re-coup the costs of the zero point loan vs. the no cost loan. Taking the no cost loan here seems to make the most sense.

Now let’s compare the no cost loan to a loan with base closing costs as well as points. Option A again has a 6.25% rate and is at no cost. Option C has a rate of 5.75% at 1 point plus base closing costs of $2,800. The payment under option C would be $1,751 and the total non-recurring closing costs (NRCCs) with the point would be $5,800. The payment under option A is $1,847 with the non-recurring closing costs (NRCCs) being paid by the lender (or already included in the rate). The difference in payment would be $96 per month and divided into the $5,800 in closing costs would equal 60.15 months, which divided by 12 to annualize, would then take 5.01 years to break-even.  Given the time value of money and the fact that a homeowner will likely refinance

Debt Counsellors will help people with debt problems who need to refinance

Cash Out Refinance

If you are in need of some cash for your present living expenses and have a large equity position built up in your home and are wondering should refinance or take out a home equity loan then our experts are waiting for you to contact them to answer your home loan questions.

Refinance V Home Equity Loan

Let’s say you need some extra cash. Should you refinance or get a home equity loan?

With a cash-out refinance or home equity loan, you can get money from your home equity. Whether it’s home improvements, college tuition or paying of debt, you have two options. Learn how each works, and which works for you.

Let’s say you have a home that’s worth $150,000 and you owe $100,000 on the mortgage. That means you have $50,000 of equity in your home, which is like having $50,000 in a savings account. A cash-out refinance allows you to access that equity. For instance, if you need $10,000, you can refinance your mortgage so that you owe $110,000 and the lender then gives you $10,000 in cash at closing.

Since every homeowner’s situation is different, your best option will depend on your specific circumstances. Quicken Loans has several mortgage options to choose from. When you compare cash-out refinance loans further, there are a few things you should consider in order to determine what’s best for you:

Speed

Need cash fast? Cash-out refinances can be done as quickly as two weeks.

Rate

A cash-out refinance loan typically has a lower rate than a home equity loan and can be done without taking out a second mortgage.

Term

Cash-out refinances lump all your payments into one low payment instead of having multiple payments due each month.

An experienced mortgage expert can help you learn more about a cash-out refinance loan. With your own personal mortgage expert to guide you, you’ll have no trouble determining if this loan is right for you.

If you still have questions, please feel free to contact one of our affiliate lenders to talk to a home mortgage loan refinance expert today. We can help you determine which refinancing option is best for your situation.

Refinancing for Poor Credit

Like most other people in this troubled economy you too need to pay for your living expenses and plan for future needs not to mention college and retirement. Perhaps you have a business venture in mind or an exceptional investment opportunity. The problem is that cash is tight but you have big equity in your home.

The obvious remedy is a home mortgage refinance but your credit is poor and lenders are not lining up to refinance your home. You need to look for a home loan company that specializes in home refinancing for poor credit

Refinance to Lower Rate

If you have poor credit, you might be limited in your options as to what you can achieve. This can be especially annoying to homeowners who want to refinance their mortgages to take advantage of low interest rates but have had a few debt defaults in recent years. The story is always the same: you see these low 5% interest rates advertised on TV and you know that you deserve to refinance your home loan with this low interest rate. However, once you call, you find out that in fact you can refinance your mortgage, but it will cost you a lot more than you think. The reason is simple: poor credit. Refinancing with poor credit can be difficult. You might have filed for bankruptcy or racked up a whole bunch of debt which you just couldn’t pay off. Debt defaults take a long time to get off your credit report and they can affect every lender to whom you owe money.

This is because these days, lenders are very clued in to borrower’s credit scores and credit history. All your credit information is stored in a giant database somewhere and if your credit is poor for some reason, it’s going to show up on a mortgage refinancing report. And banks probably don’t mind seeing a few defaults and poor credit accounts here and there. More fees for them! Your bank might like to see one of their client’s earmarked as ‘poor credit’…they can raise your interest rate and you can’t do anything about it.

Poor Credit Lenders

These days, having poor credit isn’t necessarily as poor as it should be. This is because banks are business entities too. Banks borrow money just like people do. In times of relatively low interest rates, banks need to make money by originating loans. And, a lot of new ‘subprime’ lenders have opened up shop in recent years and are specifically in the business of lending to people with poor credit. They are looking to refinance poor credit accounts like yours and collect massive fees on the backend.

Many people with poor credit history look to take out loans from friends and family. While this may be a fairly good short term solution, it might not be the smartest of long term business moves. What you need to do is refinance your mortgage and lower your payment. The best thing you can do for yourself is to shop around. I’d be willing to bet that some banks will give you a better deal on a mortgage refinancing than you think they would. Find out who’s got the best rate to get the best deal on your loan. This might take a little legwork, but it could pay off. Finding that right bank to give you the right deal on your refinancing will be worth the effort.

Refinance Interest Rates

Mortgage can last a lifetime and that extra 1% can add up to literally thousands of dollars over the years. I have friends that are in their 70s and still paying off their home loans. It’ll pay off in the long run to make sure you find the best deal possible. Don’t let poor credit stop you from refinancing your home.

Bad Credit Equity Loans

Regardless of your credit score if you have equity in your home then we have a lender who will give you a bad credit equity loan.  The beauty of a bad credit equity loan is that you can use the cash equity you have built in your home for any purpose you want. Pay off your high interest rate credit cards, buy a car or pay for college, it’s your money do what you want with it.

Bad Credit Home Equity Loan

After you have been approved for a bad credit equity loan the funds will be made available to you in a checking account. The beauty of this arrangement is that unless you make a draw down in the form of writing a check you will not have to pay any increased monthly mortgage payment.

How Bad Credit Equity Loans Work

As previously mentioned the home equity loan amount that you have been approved for is made available as an available balance in a checking account linked to your current mortgage account. When you draw from the available checking balance the amount drawn is applied to your current mortgage balance and your monthly mortgage payment will increase to include the new mortgage balance. This increase will insure that your mortgage is paid off in full within the period of the mortgage be that 20 years, 25 years or 30 years.

If you do not draw down from the available checking balance created by the bad credit equity loan then your mortgage payment will remain the same as will your mortgage balance.

Bad Credit Equity Loan Security

With a bad credit equity loan you are using the equity you have built up in your home as security for extra money being made available to you by the bad credit equity loan lender. It is very important to remember that your home is being used as security and if you use the equity loan funds and don’t keep up with the repayments your home will be at risk of foreclosure.

However if you use the bad credit equity loan wisely you will actually be getting a nice security blanket for yourself. The fact that you will have substantial funds available to you in a checking account will give you security in the event of unforeseen circumstances and the fact that you will not be charges a penny if you don’t use the funds made available by the bad credit equity loan means that you have insurance against any life crises for no cost to you other than the application costs.

Apply for a Bad Credit Equity Loan

Contact one of our premier bad credit home equity lenders today and get the cash you need today with a bad credit equity loan.