Greenwich CT Mortgage Rates Articles and Tips

When is a Second Greenwich, Connecticut Mortgage a Bad Idea

Sat, 14 Nov 2009 14:54:29 -0600

If you are considering a second mortgage, there are certain things you should know. Greenwich banks view a second mortgage as a secured loan, because the applicant is putting their home up as collateral for the loan. For this reason, second mortgages are usually easy to get. Not everyone, however, should pursue a second mortgage.

Failing to Make Payments
What happens to Greenwich, Connecticut borrowers who cannot afford to pay back their second mortgage? In this case, it is quite possible that you will lose your home. The bank will sell your home to repay the loan.

Because losing your home is a possible result of taking out a second Greenwich, Connecticut mortgage, borrowers should closely assess all of their options before applying.

A Second Greenwich Mortgage is a Good Option for…
Prior to applying for a loan against your home, banks require that you have a sufficient amount of income and a certain level of home equity. Different lenders have different standards, so it may be wise to shop around.

If you qualify, a second Greenwich mortgage may be right for you if:

You need extra cash for only a few years, maximum;
Interest rates are likely to decrease;
You plan to sell your home within two years, but need extra cash now;
You need money to improve your home;
You want to consolidate other debts to a lower interest rate.

Don’t Apply for a Second Mortgage If…
Though a second mortgage is a great way to get fast cash, it is not a good option for everyone. You should avoid getting a second Greenwich mortgage if you:

Have a history of falling behind on monthly payments;
Do not have a steady income;
Just purchased your Greenwich home and want to use a second mortgage to pay for the down payment. Substituting a down payment with an additional home loan is the easiest way to become underwater on your mortgage. If you need a loan with a small down payment requirement, consider an FHA loan. With this loan, you can put as little as three percent down.

A Good Option for Responsible Borrowers
A second Greenwich, Connecticut mortgage can often resolve current financial problems, but be sure to get all of your questions answered before signing the dotted line. In taking out a second mortgage, realize that you are leveraging what is most likely your most valuable asset: your house.

If you are a responsible homeowner with a good credit history, a second Greenwich mortgage is a good option. It’s a simple way to borrow cash at a moderately low interest rate. And better yet, the interest you pay on your second mortgage is usually tax deductible!

A Resource Guide to Greenwich, Connecticut Homeowners Insurance

Sat, 14 Nov 2009 14:18:51 -0600

A person's home is usually their most valuable asset; therefore, a homeowner should take the necessary steps to protect it. Buying Greenwich homeowners insurance can be a lengthy process, so it's important to start researching various policies as soon as you buy the house. Most importantly, you'll need to know which coverage options are necessary, and which options are extraneous. Here are a few secrets about purchasing Greenwich homeowners insurance that are designed to save you time and money.

Familiarize Yourself with Policy Options
If you already have a Greenwich, Connecticut homeowners insurance policy, or you're looking to buy home insurance, you must understand your coverage. Most Greenwich homeowners believe their insurance policy will fully cover all damaged or destroyed property, despite the amount of damage present. Keep in mind that, homeowners insurance generally does not cover your home's present market value, but rather the replacement cost. Home additions and major remodeling projects can boost your home's value, but your policy may not cover the additions. It is important that your coverage is sufficient, based on your home's replacement cost.

It's also important that you recognize other risks, such as floods or earthquakes. These risks often require their own, separate policy. If you live in a city susceptible to floods or earthquakes, you may want to purchase this extra coverage.

Find the Best Home Insurer in Greenwich
Working with an experienced Greenwich homeowners insurance carrier is also very important. There are many ways to go about this. You can ask family or neighbors for referrals, you can do your own research online, or you can examine the overall ratings of various insurers through Standard & Poor's.

When you have a list of a few possibilities, call them to receive policy quotes. Be sure to compare the same coverage options among different insurers, so you know that a lower quote does not equal less coverage.

Ask About Possible Discounts
Most Greenwich home insurers offer a wide variety of discounts for homeowners. Here are three popular discounts to ask about.

Multi-Policy: This discount is awarded to people who insure their home and vehicle with the same carrier. You are generally given a discount on both policies.
Home Security Devices: If your Greenwich home has carbon monoxide detectors, alarm systems, or other safety devices, you can save up to 10% per year!
Senior Discount: Many Greenwich home insurers offer discounts to policyholders over 50-years-old.

Set an Affordable Deductible
To reduce your annual insurance premium, you can raise your policy's deductible. A deductible is what you must pay before your insurer will cover any remaining damages. The more you increase your deductible, the more money you'll save on your premium. Many Greenwich home insurers offer deductibles up to $10,000. This will save you a lot, but you must ask your mortgage lender before selecting such a high deductible, and also make sure you have that much cash available to pay for it, if needed.

Review Your Policy Each Year
With time, a homeowner's needs change, an insurer's coverage options change, and the economy changes. Given this, you review your policy every year to account for such changes.

Applying for a Greenwich Bad Credit Mortgage

Sat, 14 Nov 2009 14:10:31 -0600

If you have poor credit, it's not the end of the world; you can still get a Greenwich, Connecticut mortgage. A credit score lower than 600 is termed sub-prime. Though is becomes more difficult to receive a Greenwich home loan if you have a low credit score, there are still plenty of options available to you.

Where Do I Start?
If you take the time to look around or locate a trustworthy Greenwich, Connecticut mortgage broker, you will discover that there are numerous bad credit mortgage options. Online mortgage lenders also have many bad credit mortgage options to.

Don't be embarrassed by your bad credit score - many people are in your shoes! Instead, take the necessary steps to fix your credit. A mortgage can help you quickly improve your credit score if you make payments on time.

Boost Your Credit Score
Though bad credit mortgages are not the best option, they can benefit applicants in many ways. Before applying for a bad credit mortgage, you'll need to make sure your credit report and score are correct. Look for any outdated or incorrect information in your report. Remove closed accounts, and make sure you aren't a victim of identity theft.

Fixing any errors on your credit report can immediately improve your score, so it is definitely worth the time. The more you can increase your credit score, the lower your loan's interest rate and monthly payment.

Verify Your Income
Then, you'll need to provide proof of income. This includes pay checks, bank transactions, and income tax returns. Greenwich bad credit mortgage lenders look closely at your proof of stable income, so they know you'll be able to repay the loan.

Beware of Fees
Greenwich lenders assume that applicants with low credit scores have a greater chance of missing their mortgage payments. To offset the risk of sub-prime loans, lenders often charge a higher interest rate and limit the amount that can be borrowed. They may also incorporate higher late fees. Also keep an eye out for prepayment penalties, which punish the applicant for paying off their mortgage too quickly.

Finally, go over the payment guidelines with your Greenwich lender. Make sure you can make the payments on time and in full. Failing to do so would make your financial situation worse.

Ask a Loved One to Co-Sign Your Loan
You can sometimes get a lower rate by asking someone with better credit to co-sign your loan. The co-signer is responsible for repaying the loan if you cannot make payments.

Lenders Reward Punctuality
Some Greenwich mortgage companies reward borrowers who demonstrate improved money management. For instance, they may reduce your interest rate if you make several mortgage payments on time.

Ask About an FHA Loan
The Federal Housing Administration helps Greenwich home loan applicants get affordable home loans. FHA loans offer low rates, low down payment requirements, and less credit requirements. If you have less than perfect credit, you may qualify an FHA loan. Speak with your Greenwich lender about FHA loans today.

Choosing to Pay Off Your Greenwich Mortgage Early

Sat, 14 Nov 2009 13:40:16 -0600

Should you pay off your Greenwich mortgage early, or to invest the extra cash? Greenwich lenders hear this question every day.

Some lenders argue that it makes more financial sense to invest additional savings in the stock market than to pre-pay your Greenwich home loan. In our current economy, however, investing in the DOW might not increase your nest egg. Unless you know of a guaranteed DOW pay-off, you could be better off putting your money towards a more certain investment - your home.

While investing in the stock market might create longer-term liquidity because your money is not trapped in your home, pre-paying your Greenwich mortgage can be extremely beneficial. Here’s why.

Remove Your Most Costly Monthly Expense
For a majority of Greenwich homeowners, a home loan is their largest monthly expense. By eliminating your largest monthly expense, you’ll dramatically increase monthly cash flow and have more money to invest in future years.

Save Thousands in Interest
If you have a Greenwich, Connecticut home loan with a high interest rate, it’s smart to pay it off early. Otherwise, you’re just spending your well-deserved savings on mile-high interest payments. Studies show that most Americans pay over $10,000 in mortgage interest payments each year. Think of the long-term savings you could enjoy if you paid off your Greenwich mortgage early and became free of that smothering interest payment.

Costs and Benefits
Let’s assume you have a 30-year Greenwich home loan worth $250,000 at 6 percent interest. If you remained on the 30-year track, your monthly payment would be $1,500 for 30 years. Total interest payments, however, would be more than $260,000 over the life of the loan. That transforms a $250,000 home loan into a $510,000 mortgage!

To lower accrued interest, spend an extra $100 each month on your Greenwich mortgage. This minor addition takes a 30-year mortgage down to 25 years, and will save you thousands of dollars. If you have the financial resources to pay even more, say $500 extra each month, this would transform that 30-year loan to a 15-year loan, saving over $130,000 in total interest!

Important Rules You Should Know
If you hope to pay off your Greenwich mortgage early, note the following important home loan secrets.
#1: Indicate that your additional mortgage payments apply to the principal balance.

#2: If you plan to pre-pay your Greenwich home loan, first pay off any debt having higher interest rates, e.g. credit cards.

#3: Avoid putting all of your additional money into your early mortgage payment. You’ll need to keep some additional cash in a money market fund.

#4: Never apply for a long-term Greenwich mortgage if you expect to pay it off in a few years. Keep in mind that interest rates are lower on short-term mortgages, so if you think you’ll pay off your mortgage ahead of schedule, apply for a shorter-term loan and save time and money.

#5: Before making additional mortgage payments, confirm with your Greenwich lender that your mortgage doesn’t have a pre-payment penalty.

How to Select a Dependable Greenwich Mortgage Lender

Fri, 07 Aug 2009 21:24:21 -0500

If you want to find a reputable Greenwich Connecticut home mortgage lender, there are several important qualities to keep in mind. You probably see lots of ads in the newspaper about Greenwich lenders offering to solve your mortgage needs. Weeding out a reliable lender from an unreliable lender is the most important step to take when selecting your Greenwich mortgage lender. Below are a few useful tips that will help you choose the best Greenwich home mortgage lender.

Look At More Than Just Interest Rates
Don’t just choose the Greenwich mortgage company with the best interest rate. Rates are important, but you also need to find a mortgage company with high-rated customer service. Failing to choose a Greenwich mortgage lender with good customer service could prolong the application process, or result in an unapproved loan or unnecessary fees. To make the New Canaan, Fairfield, Stamford, Darien, Norwalk home buying experience as uncomplicated as possible, research Greenwich mortgage lenders with both low rates and great customer service.

Request Referrals
Perhaps the easiest way to find a reliable Greenwich Connecticut mortgage company is to ask your family and friends which lender they trust. You may also want to ask a real estate agent, as he or she knows the field. Finally, look up the ratings and reviews of your top Greenwich lender choices on the Better Business Bureau’s website.

Ask For an Experienced Greenwich Loan Originator
Within a large or small Darien, New Canaan, Norwalk, Stamford, or Fairfield mortgage company, there are individual Connecticut loan originators. This is the individual who draws up your mortgage. Though it is necessary to choose a dependable lender, you also want to find a trustworthy loan originator within the company.

Your Greenwich loan originator should have no fewer than five years of experience in the mortgage industry. Make sure he or she fully answers any questions you have, and that they are honest. Above all, make sure they find the best mortgage and rates for your budget. The top Greenwich loan originators work towards your needs and provide their expert opinion.

Your Connecticut loan originator should lay out the various Greenwich mortgage programs available. After you’ve chosen the right mortgage for your situation, your loan originator should eliminate any fees that they can and lock in the lowest interest rate possible.

Using a Greenwich, CT Commercial Equity Loan to Finance Renovations

Tue, 14 Jul 2009 09:54:18 -0500

A commercial equity loan (a.k.a. commercial equity line of credit) is a line of credit that allows borrowers to unlock the equity in their commercial property without the added expense of traditional loans (which involve multiple fees, including appraisal, title, and environmental). Since a commercial equity loan is actually a line of credit, the borrower must only pay interest on the amount that they use. And like other lines of credit, the borrower has access to the money at any time, up to the maximum amount.

Commercial equity loans help borrowers create liquidity, as there are fewer fees and relatively lower interest rates as compared to traditional loans. Many individuals now use a commercial equity loan to finance building renovation.

Low Rates = A Good Time to Renovate

If you own a Greenwich, CT commercial property in need of additions or renovation, you may want to consider taking out a commercial equity loan to finance building renovation. With interest rates currently so low, borrowers can use this line of credit to remodel, renovate, and improve commercial property at a relatively low cost.

Let’s suppose you own a slightly run-down Greenwich, Connecticut commercial property. Despite being a fixer-upper, the building is perfectly located; it’s convenient for both employees and customers. Certain renovations, however, would make it more presentable and attractive to your customers. You’d also like to make the property fit the style and purpose of your business. Taking out a Greenwich, CT commercial equity loan would help you to convert and renovate your property so that it is right for your particular business and for your customers.

SBA 504 Program

If you plan to renovate your Greenwich, CT commercial property into a green, energy-saving building, you can save even more through a commercial equity line of credit. The Small Business Administration’s 504 program offers incentives for a building and/or renovation that reduces energy costs at least 10%, is an energy producing facility, and/or is a green or non-green manufacturing facility.

The SBA 504 program also allows energy-efficient Greenwich, CT businesses the ability to finance up to 90% of the purchase or renovation cost at a lower rate than traditional loans. Additionally, if your Greenwich, Connecticut commercial property renovation incorporates the use of alternative or renewable energy, you’ll receive considerable tax incentives for "going green," helping the environment, and setting a positive example for other Greenwich business owners.

Am I Eligible?

A Greenwich, CT commercial equity loan can be difficult to obtain if the borrower does not have a high credit score. This is because commercial equity loans are often for large sums of money. In order to qualify for a Greenwich, CT commercial equity loan, borrowers must prove that, after renovations, the finished product is worth more than construction costs. This is called a Profit Test.

Pros and Cons of a 15-Year Greenwich Connecticut Mortgage

Fri, 03 Jul 2009 18:49:49 -0500

If you missed out on last year’s super-low rates, don’t worry: there’s still a chance to get a very low interest rate on your Greenwich CT mortgage. How? Consider a 15-year mortgage. There are many pros and cons of 15-year Connecticut mortgages, and they aren’t for everyone. Read below to learn more about this type of mortgage and if it could benefit you.

The Pros

Save Time - A great benefit of 15-year mortgages is that you can pay off your Greenwich CT mortgage in a shorter period of time, which accelerates equity in your home. It also allows you to invest your money in a hard asset that is not as risky as other types of investments (e.g. stocks). Paying off your mortgage in a shorter period of time will also help if, in 15 years, you expect other major expenses (e.g. child’s college tuition) or financial changes (e.g. retirement).

Save Money - With a shorter term 15-year CT mortgage, you will save thousands (and maybe even hundreds of thousands) of dollars in interest payments. Let’s suppose you have a $250,000 mortgage. Based on the current interest rates, you would pay about $245,000 in interest if it were a 30-year mortgage. If it were a 15-year mortgage, on the other hand, you would pay about $100,000 in interest. Choosing a 15-year mortgage could save you over $145,000 in interest payments!

Lower Interest Rate - A 15-year mortgage also helps to save you money by offering a lower interest rate (generally between .25 and .50 percent lower) than a 30-year mortgage.

Short-Term Living - A 15-year mortgage is optimal for Greenwich CT homebuyers who do not expect to live in their home for the rest of the lives. With a 30-year mortgage, your monthly payments do not even begin to dent the principal balance for several years. With a 15-year mortgage, however, homebuyers quickly build equity in their home and pay down the principal balance. So if you only plan to stay in the home for 10 or so years, you will be able to build equity much faster and resell the property in a shorter period of time than if you had a 30-year mortgage.

The Cons

Higher Monthly Payment - Since a 15-year mortgage offers a significantly shorter repayment term, this means that your monthly mortgage payment will be higher than with a longer term, 30-year mortgage. You will have less cash flow and budget flexibility with a 15-year mortgage.

Locks Up Your Money - Building upon the point above, a 15-year mortgage will eat up a lot more of your monthly earnings, thus taking away from other possible investments. You may pay $500 a month more for a 15-year mortgage than a 30-year mortgage. It is up to the homebuyer whether or not he or she has the financial resources to make that sort of commitment.

Risky - A 15-year mortgage is riskier than 30-year mortgage, because you must pay it off quickly. If you lose your job or acquire unexpected financial setbacks, you’ll still have to make high monthly Greenwich CT mortgage payments. If you are comfortable with relinquishing the extra cash each month to pay off your mortgage early, however, then it may be a risk worth taking.

Less Purchasing Power - A 15-year mortgage offers less purchasing power. This means that you may not qualify for the "home of your dreams" because the shorter term makes the monthly mortgage payments simply too expensive. With a 30-year mortgage, however, you will have smaller monthly mortgage payments and therefore may qualify for a more expensive home.