With Mortgage Lenders “jumping ship”, tighter lending guidelines and increased government regulation, many consumers are left with a sinking feeling.
Consumer’s who sit today with an Adjustable Rate Mortgage (ARM) soon to adjust will be forced to pay substantially more per month, sell their homes or in the worst of cases foreclosure may be the result.
As the media continues to cover the growing situation, consumers across America may be relating news stories to their personal situation. It is important to know each situation is different and there are home financing options still available.
It is impossible to predict what is going to happen 3 months from now and even more difficult to predict 6 months to a year from now
Non-traditional mortgage options have all but disappeared, making it difficult for many to refinance out of volatile loans. Simply put, what you qualified for 2 years ago may not even be available today. Going forward, it is likely credit worthy consumers will be impacted by these changes and possibly unable to obtain the mortgages they need and deserve.
If you have an adjustable rate there is no time to waste, today is the best time to contact a local mortgage professional and weigh all available options.
Take stock of your current situation and determine if now is the right time for you to investigate other loan options, by answering the questions below. If you don’t know the answer you can use the Adjustable Rate Rider which was included in your loan documents at the time of closing.
Do you know:
- The maximum interest rate you can be charged?
- The maximum percentage your interest rate could increase at one time?
- How often your interest rate can adjust?
- Your initial (introductory) interest rate?
- The index your interest rate is tied to?
- How each adjustment will affect your payment over the long run?
- After answering the above questions you determine it is time to look at current loan offerings make sure you take control by using the pointers provided below.
- Work with a professional you trust, ask for referrals from friends and family if needed
- Ask the professional questions and make sure you get the answers
- Work with a professional that belong to the local and/or national mortgage association
- Listen to the professional, but make sure you are heard in return
- Understand future changes to your proposed loan – prepayments, adjusting rates, etc.
- Find the benefit to accepting the new loan – monthly savings, secure rate, etc.
- Get a second opinion or input from others if you are unsure
Remember to work with a professional that offers a no obligation, risk free evaluation and will provide you with an estimate of the fees associated with the proposed loan.