 del.icio.us | | |  Digg | | |  Reddit | | |  StumbleUpon |
Don't Let Your Lender Sell You a Bad Credit Mortgage
By Sheryl LandrumMortgage Credit Problems Columnist
If you're looking to refinance your current mortgage, purchase a new home, or are just looking for a home equity line of credit or a home equity loan, you need to make sure the home loan you get is the best one you can qualify for. By following these few steps you can insure that you are getting the best loan possible and not settling for a bad credit mortgage.
The ABCs of a Bad Credit Mortgage
A bad credit mortgage, or a sub-prime mortgage, usually differentiates from a prime or good credit mortgage in a couple of ways. Bad credit loans usually have a higher interest rate than prime mortgages and they usually come equipped with pre-payment penalties as well. To ensure you are getting the best deal, always ask the loan officer who is working with you to give you these two items:- Good Faith Estimate--a Good Faith Estimate is the cost of your new mortgage loan. It includes any origination points you are paying or discount fees to buy-down the interest rate. Your GFE also includes the cost of lender fees, title and escrow fees, and any pre-paid taxes and insurance. If you want impounds for taxes and insurance, those costs will be estimated as well. Often there will be a difference in origination and/or discount points between a bad credit loan and a prime loan.
- Truth-In-Lending Disclosure--this document should always be given to the borrower as well. The TIL shows the loan parameters including the loan terms, the interest rate, and the pre-payment penalty if there is one.
About the Author
Sheryl Landrum is a Senior Loan Officer with Charter Funding in Carlsbad, California and a freelance writer specializing in the mortgage issues.
| Share This Article: | del.icio.us | | | Digg | | | Reddit | | | StumbleUpon |
Other Recommended Refinance Articles
© 1999 - 2008 MortgageCreditProblems.Com. All rights reserved.