The Home Equity Line of Credit or the HELOC, as it’s otherwise known, is a type of home loan. It essentially allows the loaner to open a line of credit with his house being the collateral. It’s a good option for people in need of a larger sum of money, but borrowers need to be […]
Types of Mortgage
How to Build Your Own Home with a Construction Loan
A construction loan is a widely used credit instrument that helps people build their own homes. Now, the process of building your own home can be highly rewarding—but also stressful and time-consuming. To boot, most people apply for home construction loans, which are, essentially, a special kind of mortgage. They’re a solution for people who don’t […]
All You Need to Know about Construction Loans, in a Nutshell
Believe it or not, construction loans are actually more complicated than mortgage loans—and this is because they come with higher risks for the lender, but also for the borrower. Most of the risks stem from the fact that repayment begins only once the project has been completed, but also from the over-budget costs, which can […]
Does an Interest Only Mortgage Really Work for the First-Time Home Buyer?
An interest-only mortgage is a type of home loan with a term during which the borrower, or mortgagor, only has to pay a generally constant amount that goes toward covering the interest. The principal of the loan remains untouched throughout the duration of the term. However, this term cannot last indefinitely—at the end, the mortgagor […]
What Changes to the Closing Process Will the TILA-RESPA Integrated Disclosure Bring?
As we’ve previously explained, on October 3, 2015, the HUD-1, GFE (Good Faith Estimate), and TILA (Truth in Lending Act) went away. They’re being replaced by the Closing Disclosure and the Loan Estimate. The latter, which has been alternatively dubbed a ‘know before you owe’ document changes what to expect when closing on a home […]
5 FAQs about the October 3, 2015 TILA-RESPA Changes
On October 3, 2015, new Real Estate Settlement Procedures Act (RESPA) rules will come in effect, with great impact on many realtor activities. The United States’ Consumer Financial Protection Bureau (CFPB) is aggressively enforcing RESPA and TILA (The Truth in Lending Act), both of which apply under the provisions of the Dodd-Frank Wall Street Reform […]
Fixed Mortgage Length: 15 or 30 Years?
When considering mortgage loans, most prospective borrowers know there are two basic types available on today’s market: fixed rate mortgages and ARMs (short for adjustable rate mortgages). Both types of mortgage loans come with specific subtypes, classified based on their length and other factors. It’s usually a good idea to have at least a basic […]
Minimum Down Payment for Conventional Loan versus FHA-Insured Loan
The MDPFCL (or ‘minimum down payment for conventional loan’, in full) is a major issue for potential home owners interested in applying for a loan. This especially applies to first-time home buyers, who are often still burdened by student debt, as well as to any household in the low- to moderate income earning tier. As […]