August 7th, 2014
Should I refinance my mortgage? This is a question many people ask. Luckily, there are a number of reasons why refinancing may be a smart financial move.
Refinancing a mortgage means paying off an existing loan and replacing it with a new one. The most common reason a person may look to refinance is to get a lower mortgage rate. It is important to pay attention to the current average rates in order to get the lowest rate possible. A homeowner may also refinance in order to shorten the term of their mortgage or convert from an adjustable-rate mortgage to a fixed-rate mortgage, or vice-versa. It is wise to consider refinancing a mortgage now, while the interest rates are near record lows.
A refinance is also a way to get cash in your pocket. This can be done by getting a mortgage on a paid-off house. Although this isn’t technically a refinance, it’s a similar idea. This is a great option for individuals who are mortgage-free and have thought about purchasing a second home, an investment property, or starting a business. This way, they can cash out their first home and use the money to fund a larger purchase.
When used carefully, a refi can be a valuable tool to consolidate debt. Cash-out refis have dwindled since the housing bust began, however there are still a few. Many use these funds to pay off credit cards, lower overall debt service, and save money.
Some homeowners also decide to refinance in order to consolidate two mortgages. The most common situation is to combine the first mortgage with the home equity line of credit. Although some home equity lines of credit often have low rates, many people want to refinance to get rid of them in fear the rate may jump to a greater percentage a few years down the road.
Lastly, refinancing may be a viable option for an individual attempting to address family matters. Divorces tend to lead to refis often as a means of removing the absent spouse from the note; thus, the other party is no longer legally responsible for the loan payments. Using a full service law firm like HoganWillig is a benefit in such a situation where a marital case and a real estate transaction are taking place simultaneously, because they can both be handled under one roof.
November 18th, 2011
Our real estate department handles all types of real estate related matters, including foreclosures. This might be an unpleasant task, however the local lenders we represent are very understanding and sympathetic to their borrowers’ plights. I have had our banks agree to postpone actions and sales, and to work out payment plans, or allow a home to be sold for less than the loan amount very often.
October 13th, 2010
Congratulations! You’ve signed a contract to purchase a new home and now you are waiting for your mortgage to be approved and for closing to take place. You are excited to move into your new home and usually preparation and economizing is a responsible thing.
February 8th, 2010
If you are refinancing or borrowing to purchase a home, loan cost is not the only issue to consider.
There has been a lot of publicity lately regarding the changes to the Real Estate Settlements Procedure Act which are designed to make it easier for borrowers to “shop” among lenders in order to obtain the very lowest cost loans. I would like to point out that cost should not be your only concern. Clients who have come to me after their loan closing with problems all seem to have their loans with huge national banks. These banks, perhaps understandably given the volume they face, have problems tracking payments, loan assignments, and other matters. One client, who had never been late or missed a mortgage payment, was accused by his national lender of missing one month’s payment. They told him that if he did not pay it immediately or provide proof that it had been paid, they would begin foreclosure proceedings. He had to do all of the legwork to prove that they received and cashed the payment, and he still had to wait “up to 45 days” for the bank to agree. He was told that there were other borrowers in the same position regarding the same month, and that the problem may have arisen from the bank’s purchase of a loan portfolio, but nonetheless, the burden was on him to prove that the lender received the payment. Similar problems arise when there is a need to prove that a mortgage with the national lender has been paid in full. Again, it is usually up to the borrower to prove to the lender that he made all of the payments, even if it has been years since his final payment.
I have also seen that national banks (by the way, I do not include HSBC or M&T in this category for the purposes of this entry) have not treated our clients, who are experiencing financial difficulties, in an understanding or humane manner. Most of our clients are content with the way they have been treated by their small, local lender. It has been my experience that local lenders are very understanding and willing to help resolve foreclosure and payment issues. I have not spoken with any big bank client who feels they have been well or fairly treated.
So, if you are refinancing or borrowing to purchase a home, give some additional consideration to your smaller local bank.
January 21st, 2009
The current economic chaos and uncertain future has negatively impacted many industries and people. Some businesses are filing for bankruptcy and others are seeking relief through bailout plans. The average person has probably suffered significant investment losses especially relative to their 401k or other retirement plan. Even worse,