If you're like many seniors, your home is your largest asset, and although you are concerned about the thought of borrowing against it, your house may be the only way to increase your income. Rising real-estate prices have caused many seniors' homes to significantly increase in value. But unless they are willing to sell, it may be an inaccessible gain during a time in their lives when extra income...

Mortgage Soup

J.Stewart

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Mortgage Soup

Looking for home mortgage loans can get confusing with the alphabet soup of mortgage loans programs available today.
Most of these programs are just variations of fixed rate and adjustable rate mortgage loans. These loans can be structured to meet your financial needs, and most are available in 15 or 30-year terms. Your long-term plans play an important part in selecting the right type of loan, use
these general guidelines to help you as you shop for home mortgage loans.

Fixed Rate Mortgage - If you’re going to be staying in your home for at least 7 years, consider a fixed rate. This
loan’s interest rate is fixed for the life of the loan or term – 15, 20 or 30 years. Usually the shorter the term,
the lower the interest rate. This type of loan is amortized – both the principle and the interest are paid off at the end of the loan term.

Adjustable Rate Mortgage - If your only planning on living in your home for a short period of time you may want to
consider an adjustable rate. Your interest rate can adjust – up or down. The rate is tied to an index like treasury bills or prime rates. The initial rate usually starts out
low, but can adjust after a set period of time. If you choose this type of loan and then decide to stay in your
home, you may want to refinance after two years to avoid any upward rate adjustments.

Combination Fixed and Adjustable - Going to be in your house for just a few years? This type of home mortgage loan can start out as a fixed rate for a set number of years, keeping
your rate and payments low, and then the loan adjusts. Like the adjustable rate, the amount of the adjustment is tied to an index that can go up or down. This loan is sometimes
called a two-step or convertible ARM. Just remember, these loans usually go up after a set period of time, or if you have to convert after a few years it can cost you money. Be sure you understand your loan and when your payments could go up to avoid paying more than you have to.

Balloon - An interest only loan. You would only want to use this loan if you were only staying for a short time in your home. Because you’re only paying interest, and nothing towards the principle, you don’t build any equity. At the end of the loan term, you have to pay the balance off all at once, but few people ever keep these loans for the entire term.

Having an understanding of these basic types of loans and combinations of them is the key to finding the mortgage loan
that is right for you.

About the Author

J.S.Stewart is the author of "Mortgage Soup." Visit his
site to shop for mortgage loans at
http://www.2applyforloan.com

The latest information and news on Mortgages:

Yahoo! News Search Results for mortgage

Mortgage rates remain below 5 percent (AP via Yahoo! News)
Mortgage rates held below the 5 percent threshold for the second straight week, a report said Thursday, weeks before a government program that has been keeping rates low is scheduled to expire.
Mortgage Rates on 30-Year U.S. Loans Fall to 4.95% (Update2) (Bloomberg)
March 11 (Bloomberg) -- Mortgage rates in the U.S. declined for a second consecutive week as the number of home-loan applications rose. The rate for 30-year fixed mortgages fell to 4.95 percent for the week ended today from 4.97 percent, Freddie Mac said in a statement.
Mortgages: 30-year fixed-rate mortgage averages 4.95% (Market Watch)
30-year fixed-rate mortgage averages 4.95%, Freddie Mac reports.
Freddie Mac: 30-yr Fixed-rate Mortgage Rate Slips (Fox News)
Freddie Mac: 30-yr Fixed-rate Mortgage Rate Slips
Mortgage rates fall to 4.95% (The Arizona Republic)
Mortgage applications rose 0.5 percent.
Yahoo! News Search Results for refinance

Pernod Ricard Plans to Issue Bonds to Refinance Absolut Buyout (Bloomberg)
March 10 (Bloomberg) -- Pernod Ricard SA , the world?s second-biggest liquor maker, is planning to sell six-year bonds to help refinance loans used to buy the Absolut vodka brand in March 2008.
New Article on Fannie Mae, Freddie Mac HARP Mortgage Refinance Program Availa...
In a new article, AimLoan.com explains why Fannie Mae and Freddie Mac?s program to refinance underwater homeowners should be expanded, as lowered mortgage rates are key to economic recovery. (PRWeb Mar 9, 2010) Read the full story at http://www.prweb.com/releases/2010/03/prweb3690424.htm
New Article on Fannie Mae, Freddie Mac HARP Mortgage Refinance Program Availa...
In a new article, AimLoan.com explains why Fannie Mae and Freddie Mac?s program to refinance underwater homeowners should be expanded, as lowered mortgage rates are key to economic recovery.
Coal producer ICG prices stock, debt offerings (WVVA Bluefield)
Associated Press - March 11, 2010 9:05 AM ET SCOTT DEPOT, W.Va. (AP) - International Coal Group says it's priced stock and note offerings it's using to refinance debt.
Golf course refinancing approved (The Oak Ridger)
With little discussion Monday, City Council agreed to essentially refinance the debt on the Centennial Golf Course, potentially saving close to $900,000 and allowing the debt to be paid off two years early.