Obviously, you will not have this equity or the additional expenses if you decide to live in an apartment. And if you particularly dislike mowing and shoveling and such, an apartment gives you more relaxation time. Also, depending on your outside interests, you might find an apartment with pool facilities or a workout gym or tennis courts. Needless to say, if you are single, you will find more eligible bachelors and bachelorettes in an apartment complex then you will in a family neighborhood.
What this boils down to is that you must base your decision on whether to buy a house or rent an apartment on what you will feel comfortable with while fully realizing what the future might bring. However, this decision is not only for people starting out in life. It is important to read this section because we will be discussing the possibility of selling your present house and moving into an apartment in our section on saving money.
2nd Mortgage
Second mortgages can be a very bad trap for you. That is, you have been paying on your home mortgage for awhile and can now use the part of the house you have already paid for (your equity in it) as collateral on another mortgage. Therefore, you are right back where you started from. Unfortunately, it is the person who is deeply in debt already who is encouraged to get a 2nd mortgage. The idea is that this additional loan can be used for whatever you want and it is very tempting.
We continually see TV commercials for 2nd mortgages to pay off your huge debts. Does it really make sense to you to take on even more debt in order to pay off old debts? No, you know it does not.
By: Nate Perrott
Posts Tagged ‘Debts’
Home Mortgage – Part 4
February 6th, 2010Educate Yourself Before You Refinance a 2nd Mortgage
January 24th, 2010
There is no arguing that your home is your greatest asset. As the cost of living goes higher and higher, you may decide you want to get a second mortgage on your home. The money that you receive can be used to pay off those nagging bills and debts, do much needed maintenance or remodeling projects you’ve been putting off, or even pay for a child’s education. But you must be careful when applying for a second mortgage. You have got to be sure that you can afford the additional payment. If you are unable to make this payment you are facing the prospect of losing your home.
Maybe you have already taken out a second mortgage on your home. But as the interest rates fall, you realize that you are paying a higher interest rate than what the norm is. Consider refinancing your mortgage to obtain a better interest rate.
Even if your credit is less than perfect, you can obtain a lower payment through a better interest rate. But there are a few things that you must take into consideration before you sign those loan papers.
First of all, you should probably get the advice of a financial advisor or tax professional before you say yes to any mortgage refinance. Your mortgage lender is an expert on home mortgages, but he is not an expert on your financial situation. Therefore, it is better to get the opinion of a financial adviser before you decide to pursue refinancing.
Next, make sure that you get all finance terms and conditions in writing. Read the contract carefully and be aware of what it really says. If you are not sure of something in the mortgage contract, do not sign it. Take it to someone who can interpret it for you such as your financial advisor or your attorney. You must know what is in the contract to avoid nasty surprises later.
Before you go shopping for a second mortgage refinance, study up on the lingo. Know what the terminology and abbreviations mean. Mortgage lenders love to talk in their own language. Don’t let them take the upper hand by not knowing what they are talking about. Knowledge will give you power.
Shop around extensively. Don’t make the mistake of going with the first second mortgage lender that you come across. There is always a better deal to be found out there. Shop around until you find one that you are satisfied with. The Internet is a great source for researching lenders and various loans. You will find a goldmine online if you simply spend 30 minutes or so looking around.
There you have some great advice on a refinance 2nd mortgage. Be cautious and know what you are getting into before you sign. If you do it right, it can pay off for you in the long term.
By: Terry Edwards
Refinancing High Rate Debts with a Second Mortgage
January 11th, 2010
There are many ways to refinance a debt from debt consolidation, to credit card consolidation to bill consolidation to loan consolidation, however one of the best ways to do it could be refinancing your debt with a second mortgage. If you are a homeowner then it is likely that you might be eligible for refinancing and in many cases refinancing with a second mortgage.
At 123finance they believe that, “If taken properly, a homeowner will not find a more effective option than to take a second mortgage on their property, most American consumers have become aware of revolving debt and the bad effect it can have on them…”
Second mortgages can be taken out for a number of different reasons from paying for a college education for your children, to home improvement, to paying off outstanding credit cards to consolidation of all of your unpaid loans. If you end up with an interest rate from a second mortgage that is much lower than your other bills combined then you end coming out on top in the long run.
The best candidate for a second mortgage is the home owner who needs a large amount of money and has plenty of equity built up in his home. A second mortgage is basically a lien taken against the value of your existing home and you pay it back in monthly payments as you would any other loan. The good news is that second mortgages are tax deductible and you can certainly get rid of high interest rates from your other loans.
One thing to remember is that a person must go through the same process to get a second mortgage as he did to get his first one. This can be compensated by going through the same lending company that gave you the first loan, but that is not mandatory. In fact, the lending company you initially used might not be the best choice so do your homework accordingly.
Important items to consider when obtaining a second mortgage to pay off your debts include exactly how much debt you owe, how much money you will need to borrow and how much you can afford. There will be costs in obtaining a second mortgage so ask questions – perhaps there will be a down payment. How long will you want the loan term to be for and what is the interest rate are also important questions? Finally, what is the type of loan involved since you can be sure that different lenders will offer different options.
By: Rita Cook