Unorthodox Way to Pay Off Loan Early


In order to save some cash over the life of your mortgage, you may consider taking out a bigger loan than you need and making one large, lump-sum payment toward the principal immediately after closing.

By doing this, you will shorten the term of your loan and lower your interest payments.

Borrowing $300,000, for example, as opposed to the $280,000 you really need means you will have a higher required monthly payment. With the combination of the large chunk paid toward principal off the bat ($20,000 in this case), and the higher monthly payments, you will pay off the loan in less time.

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Mortgage Pre-Approvals May Help Home Buyers


In areas where you’re likely to be up against other buyers when bidding on a home, a pre-approval letter can be what sets you apart.

The letter, which should be signed by your lender’s underwriter, assures the seller that you have the financial means to purchase the house. In other words, it is evidence that you should be take seriously as a prospective buyer.

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Low Interest Rates Not Good for Selling


When mortgage rates fell below 4 percent in 2011 and dropped to a record low of 3.3 percent in 2012, many people purchased new homes or refinanced their existing homes. Good news at the time, but bad news for the future of selling.

Current rates – while still historically low – are back up over 4 percent and are expected to rise again later this year. Anyone with a sub-4 percent interest rate currently would end up paying more for a house of the same price if they ended up moving this year.

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Budgeting for your Mortgage



When budgeting for your mortgage, consider spending no more than 30 percent of your monthly income on your housing costs. Spending more than that makes for a cost-burdened household, making it difficult to afford other everyday living expenses. According to the Harvard Joint Center for Housing Studies, approximately 40.9 billion households in the United States were cost-burdened in 2012, the most recent year covered in The State of the Nation’s Housing report.

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Lessen the Strain of Student Loans




The average American household owes nearly $33,600 in student loan debt, which breaks down to about $387 per month with a 6.8% interest rate under a standard 10-year payment plan.

But it doesn’t have to be as bad as it sounds. To lessen your monthly payments, consider joining a pay-as-you-earn program; sign up for an income-based repayment program; extend the timeframe for your loan repayment (though this will increase the amount of interest you pay over time); refinance and lower your interest rate; or defer your payments for up to three years. Also, if you’re a teacher or a public sector employee, you may be eligible for special financing programs.


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How Much First-Time Buyers Should Save

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“Singles, couples, families — at some point almost everyone turns their financial attention to buying a home. But how much do we really need to save the first time out? How much is enough to handle the typically steep curve of down payments and closing costs?

When it comes to saving for a home, there are some helpful rules of thumb. But then, there are also alternatives for buyers who need a leg up.Let’s look at the basics and some workarounds when considering approaches that first-time buyers can take to getting through the front door of their first house…”

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Considerations For Renting Property

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“Many beginner or speculator-type real estate investors think that the crux of real estate investing is finding a distressed property, fixing it up, and selling for top profit. Keeping it as a rental ends up being a mistake, a backup plan, or a last resort for many people. But is keeping a property as a rental always a bad thing?

Regardless of how you come about owning a piece of property, there are a few things to keep in mind when considering whether you should keep it as a rental or not…”

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Image by Teemu008 from Palatine, Illinois via Wikimedia Commons.

The Current State Of The Housing Market

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“The Dow Jones Industrial Average was down 19 basis points in early afternoon trading on Friday. The movement came at the end of a tough week for investors as the market retreated from all-time highs just in time to kick off earnings season.

Wells Fargo was the highlight of the earnings calendar this morning, releasing second-quarter results before the opening bell…”

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Using Your Home To Avoid Debt

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“I have plenty of experience going into debt. I’ve spent over half my life paying down a mortgage. I’ve taken out more than one home equity loan and have made more than my share of car payments. Have I ever been debt-free? Yes, for the first 18 years of my life. But now that I’m approaching retirement, I am nearing that state of equanimity once again. So I know how to get in and also how to get out.

There are plenty of ways to dig yourself deeper into the hole. For most of us, these are the top five debt traps…”

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Image by Catherine Scott via Wikimedia Commons.