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Save With a Home Loan Mortgage Company

The average home loan mortgage company will charge interest

Interest on the average home mortgage will cost the homeowner nearly TWO TIMES the cost of the home.

If you were to purchase a $150,000 home with a $120,000 mortgage (80%), and you paid an interest rate of 9% for 30 years, you will have paid over $227,500 just in interest (in addition to the original $120,000). That's nearly two times the cost of the home!

A credit card debt of $7000 (now the average) at 18% being paid at the rate of $20 principal plus interest each month will take over 29 YEARS to pay off, almost as long as a home mortgage. Interest charged on this credit card debt will top $18,400, more than 2.6 TIMES the original debt!

If you work for a living, you know that when you are not working, you are not getting paid. But interest never gets sick, never takes a vacation and never sleeps. It is working against you 24 hours a day, seven days a week, each and every day of the year.

There are some other interest tips and tricks.

- One trick your mortgage company may have played on you is to include a prepayment penalty in your mortgage. If you try to pay off your mortgage early they may actually charge you for doing so. Or they may only apply part of your payment to the principal and take the rest as a "service charge."

- Make sure when you make an additional payment that you send a check separate from your monthly mortgage payment with instructions that the amount is to be applied toward the principal of your loan. Otherwise they may just apply it towards next month's payment and still charge you the interest.

- Generally you will not have this problem with credit card companies. But watch out for late payments or going over your credit limit. They may then use these "rule infractions" as cause to raise your rate to over 25%!

- If you are looking to refinance your mortgage, look for a mortgage that lets you pay on a bi-weekly basis. Since many people receive a bi-weekly paycheck this also makes it easier to budget your money. If you are paying every two weeks you will make an additional monthly payment each year (26 bi-weekly payments vs. 12 monthly payments). Also, because you are paying the principal down every two weeks rather than every month your interest charges will be reduced.

Home Loan Mortgage Companies

Home loan mortgage companies are adept at leading home buyers through the complex maze of real estate legalities, liens, and liabilities---all the way to home ownership. A broker in a home loan mortgage company is paid to bring together lenders and borrowers, like a talent scout, often evaluating a buyer's credit situation and matching him to the right lender. Brokers in home loan mortgage companies bid a home buyer's application to more than one lender. Once the lender has been chosen, the home loan mortgage company broker stays through the process until the loan closes.

Home loan mortgage companies are working for the best deal for the lender, so it pays for a potential home buyer to watch to see what terms are offered and shop around for the best reasonable option. You may want to work with more than one home loan mortgage company. Even though a broker in a home loan mortgage company might have multiple loan options to choose from, he is not obligated to find the best deal for you unless he is acting also as your agent.

Home loan mortgage companies are not banks or credit unions. Loan officers in a bank sell and process home loans, but only for the loans that their employer originates. Many of the choices might sound the same as those offered by home loan mortgage companies, but the choice of rates is reduced. Here is the difference. A home loan mortgage company might be local or online, finding you a lender that could be anywhere in the country. A lender outside of your community may process your loan more slowly than those who know your real estate area best, but it is also true that distant lenders may accept a wider range of credit risks. Specialized sales can be found in many home loan mortgage companies. It pays to question issues like loan terms and processing time when negotiating with any home loan mortgage company.

Sometimes it isn't clear whether you are dealing with a home loan mortgage company broker or an actual lender. You have to ask; it isn't always mentioned and the information you receive will give you a clue who is being paid a fee, on top of a fee, on top of another fee. When you pay "points" during the loan closing or in combination with your interest rate, you may be compensating a home loan mortgage company employee for their services. This is why it is important to shop around for different home loan mortgage companies. Fees are generally estimates that can be negotiated but your familiarity with terms such as title examination fees, abstract of title fees, property survey fees, document fees, recording fees will help you discuss options on an even playing field with the home loan mortgage company representative. Your expectation, backed by the Real Estate Settlement Procedures Act, that your home loan mortgage company will give you a good faith estimate of charges to be incurred, is your right as a potential home buyer.