Refinance Mortgage

go default on mortgage? We are going thru short sale/foreclosure situation and stopped paying mortgage for a month now. Would a car loan lender raise rates based on our mortgage default? Or is the loan rate fixed for the terms of the loan?

Only credit cards have universal default clauses. If you are late paying the mortgage or car loan, the credit card company might just kick in the universal default. But your mortgage and car loans are installment loans with set interest (or at least rules for adjustable rate increase) that don’t include universal default clauses.

It wont affect it, sometimes it can make it worse. Mortgages are sold like Oil, or Corn ect. They are sold on the open market. If China, Japan ect decide they dont want to buy mortgages anymore the rates go up.

The Fed doesnt control mortgage rates. The people that buy mortgage backed securities do.

People that think the Fed controls mortgage rates are wrong. Its like thinking the feds lowered mortgage rates and now the price of corn should go down. Its the same thing.

Its purely a market decision not a fed decision.

I have a mortgage with a rate of 4.99% which i am allowed to take payment breaks from. Three per year. I have a loan at a rate of 5.2%. Would it be wise to take the payment breaks and use the money to clear my loan? My mortgage is £115k and the loan is £14k

Also, is it worth putting the loan onto a credit card with 0% interest until the 0% interest period is up and then sourcing another 0% interest credit card offer and shifting the balance continually like this until the debt has gone?
I think the loan may actually be more % than i said. I will check
Just checked and the apr is 6.9% on the loan with £13k left

Refiance your mortgage and incorporate your other loan into it. In other words let the mortgage co. pay off the other loan aand add it to your mortgage. You can also wrap up your auto loan in your mortgage to free up that higher interest rate.

how many points do i have to buy to bring my rate to 5% an how much would it cost me for those points thank you

It shouldn’t be any more than one point if you have good credit and don’t get cash back at closing. If your loan amount is less than $200,000, there could be a low loan amount surcharge.

I am planning to purchase a house for $519 000.

Down payment – 25 000 to 50 000 dollars

Is it possible to get 0% mortgage rate? How do you make this kind of deal with the bankers? What are the chances of getting this deal?

My goal is to only pay $1320 or so per month. No immensely higher than that.

This would be very difficult. Bank are in the business of making money, offering a 0% loan without some kind of benefit to the bank is not possible. Especially, given the fact that you are looking at putting down a payment of less than 10%, I would say your chances are nil. you’re best chance at getting a 0% mortgage is if you are purchasing a multi-million dollar home and using the bank that you currently have your millions in savings/investments with….get the point? (If you aren’t giving the bank a good profitable reason for them to give you completely free money, they won’t do it)

Techincally, the closest way to get a 0% mortgage is to pay cash for the home then borrow out the equity you have and use that money for investment purposes. This would mean your debt interest is fully tax deductible. You wouldn’t get all of it back on your income tax (meaning it wouldn’t be a truly 0% loan), but it should create some nice tax deductions for you that would greatly subsidize any interest incurred on the debt.

Wish there was a more favourable answer for you.

With the same information given between several different lenders (fico, salary, down payment, etc) there seems to be a slight difference in rates. How flexible are these rates? Can the lender actually give me a better rate to win my business without me having to pay points or are the rates non negotiable based on their system of determining rates?

Yes, they can.

Me & my bf are in the process of buying a condo & we decided to switch banks b/c one offered to knock off a percentage of a point, so it would be lower. (they actually asked what the other bank was going to give us & said that they would take off a certain % of a point)

Banks can do what they want & offer what-ever intrest rates they want. They are generally close to one another, but, you almost never find 2 banks that will offer you the exact same rate (they may offer the same "starting rate" , but, once they run your figures, then they all come up with something different, b/c they have different criteria)

I say no. Rates have NEVER been below 5% and with inflation a worry, I wouldn’t bet on it.

I do not understand why the Treasury Department has to step in to negotiate the freezing of mortgages rates.

Why cant the banks/mortgage companies use their own discretion by doing it themselves?

You would think it would make good business sense to freeze the rate and having a mortgagee continuing paying the mortgage than having the loan forclosed altogether…

An explanation to why these companies are not already doing this would be helpful. Thanks.

Actually, none of the above are correct. The problem is a problem of timing, duty and risk.

Imagine that there is a real estate market in equilibrium, but facing a block of foreclosures in addition to normal supply and demand relationships. The foreclosures will add supply but will not alter demand for purchased homes. The foreclosed may look for rental housing or move, but they will not look to purchase since they will not be eligible.

Since this is a serial process dependent upon liquidity available and the public does not know the magnitude nor timing of the foreclosures, so prices will fall month after month. Therefore there is an incentive to be the first to foreclose since you will realize higher prices and lower losses on your loans.

This has a potential to create a rush to foreclose causing everyone to lose who is holding debt, raising homelessness beyond the ability of communities to manage, and triggering losses for the FDIC and PBGC. Further, it is bad for elected officials in an election year. Also, ordinary homeowners could find their homes non-marketable or marketable at very low prices. This will cause people to be inflexible in looking for employment making the entire economy less efficient, making profits lower, making wages lower, putting more strain on the credit markets.

Banks can use discretion, but each one individually must foreclose as quickly as possible unless an agreement can limit how much any one of them forecloses. A run to foreclose would be much like a run on the bank, everyone gets burned and no one gets what they want. If they can agree on a mechanism, they can go to shareholders with a good citizen stance, be able to fight the internal politics and if it is enforceable protect themselves from one another. Cheating is in everyone’s interest so protection from cheating is very important.

Rate freezes only make sense if the Treasury can promise low rates, which would be the same as promising high inflation. This will cause the mortgages to be worth less in a real sense, but profitable in the nominal sense. Bondholders will get hurt, potentially alot, but the banks will be fine, the homeowners will be hurt less than otherwise and the politicians will get re-elected.

when allen greenspan changed the interest rates to rise on home loans to stop inflation he was obviously wrong..when he was replaced, the interest rates based on prime started to decline to prevent stagflation.as of now, where do think the prime rate will go…higher to stop inflation or lower to create stagflation?

I don’t know. I’m justing hoping that it stays low for another few months, so we can sel our house, and buy a new one with a good interest rate.

For at least the last couple days? is there chance home equity loan rate goes down?

The two are not the same and have nothing to do with each other. The prime rate has gone up many times lately so all loan rates will follow.

When you borrow money to buy a home the bank is not the one that loans you the money. Companies bid for these mortgages and when they have a lot of money that needs to be earning something then the rate will go down. When the money is tight then the rate will go up. They will tell the bank they will buy so many millions of dollars worth of mortgages at a given rate. There are several so the rates may not be all the same. Depending on your history the bank and holding co. will decide what company will take the risk.