Mortgages - Loan Origination Fees and Saving Your Money

Basics

A loan origination fee is a charge the lender makes for giving the loan to the borrower. This is an upfront charge, not like the interest rate which is the charge the lender makes over time.

A lender may charge an origination fee, but most usually do not charge more than 1%-2% of the loan amount.

Many lenders do not charge a loan origination fee, or only a very minor one. Fees that are a percentage of the loan amount can be quite large. A 2% origination fee is:

• $10,000 on a $500,000 loan
• $2,000 on a $100,000 loan

The origination fee in this case is based on the loan size. Reasons For Loan Origination Fees A loan origination fee may be charged by a mortgage lender as additional upfront compensation for lending to a risky borrower. This is a marginal borrower who has several factors working against their application, including:

• bad credit
• declining credit
• little assets
• little or no equity
• inability to document income
• inability to document employment

Better Deals People with good to great credit usually don't have to pay much on their loan origination fee. This fee may be dependent on the loan type or property type. There may be additional risk factors associated with the loan that the lender will want to be compensated up front.

What Are Different Loan Scenarios?

Your Loan Size

One of the most basic parts of your loan is the loan size.

The loan size is usually judged in relation to the value of a property.

If the property is worth $100,000 and the loan size is $90,000 the loan to value ratio is 90%.

This ratio is a critical factor lenders will look at to decide if a loan is approved, what type of loan is approved, and what total loan amount.

Loan Types

There are many different kinds of loan programs. You may choose between many different loan options, including interest only loans, 30 year fixed loans, 40 year loans, minimum payment option loans, and many others.

These different loans may need to be offered to you the customer in different ways.

For example, a 90% loan to value ratio may actually be broken up into different loans.

For one loan type you may be able to get one loan for the 90% value of the property.

For another loan type you may get an 80% loan for the first loan and a 10% second loan to get a total of 90%.

Another loan type may require that the loan be split up into 70% and 20% pieces.

Different Payments

You can end up with very different payments if your loan is structured differently.

Second loans are usually more expensive than first loans. They usually come with much higher interest rates.

A loan that is a 70/20 split may be more expensive than an 80/10 split. This is because the second loan is for 20% of the property’s value rather than just for 10%. The second loan, with its higher interest rate, is larger in one scenario than another.

30 Year Mortgages Or 50 Year Mortgages

Basics

The original loan offered by most lenders was a loan with a 30 year term. This loan was usually also fixed for 30 years.

Mortgage loan options now include:

loan term

loan type

These are two very different mortgage factors that you will need to understand.

Loan Terms

The term of a mortgage is the length of the loan. The longer a loan's term is the lower the monthly payment will be. Obviously it takes longer to pay off a loan with a longer term so you end up paying more interest over time than you would with a shorter term mortgage.

Loan terms can be for many years, including:

• 15 years
• 30 years
• 40 years
• 45 years
• 50 years

Some lenders also offer loan terms with other lengths.

So far the longest available mortgage loan term is for 50 years.

Loan Type

The loan type is the actual terms of the loan. These terms include:

• how long the interest rate on the loan is fixed
• whether it is interest only or not
• if the loan allows for a minimum payment option
• interest rate cap
• interest rate index
• interest rate adjustments

Which Loan Is Right For You?

If you are looking for a new way to lower your monthly payment then a 50 year loan is something you should consider.

If you want to pay off your property sooner than a 30 year loan may be better for you.

Another option to get a lower payment is an interest only payment option.

Bad Credit Mortgage Loan Rates

Even with bad credit mortgage loans interest rates at an all-time low and an increasing number of mortgage seekers getting several bad credit mortgage loans quotes, it is highly unfortunate that mortgage scams continue to approach an all time high.

Be Cautious Evaluating Bad Credit Mortgage Loan Quotes
It would seem that every time the economy is soft with a simultaneous hike in personal debt, as has been the case in the last few years, people are increasingly targeted for scams of every possible type. For mortgages, there is no exception to this trend. In fact due to borrowers seeking multiple bad credit mortgage loans quotes and preferring to settle for the lowest quote, it is made all the more easy for scamsters to take the innocent mortgage seekers for a ride.
The culprits behind mortgage scams let it be known that the lowest bad credit mortgage loans quote is being offered to lure unsuspecting businesses. Since there is no intention of keeping the promise, they don't bother about what their quote offers. Should they require their offer to be two percentage points lower than the others, they won't hesitate to do so.

Hidden Fees That Don't Show in Bad Credit Mortgage Loans Quote
Interest rates aren't the only comparisons that need to be made with bad credit mortgage loans quotes. It is up to you to ensure that when inviting bad credit mortgage loans quotes, all the fees that you will incur in dealing with that lender for your mortgage, should be included.
The law has made it mandatory for lenders to provide a good faith estimate. In this estimate, apart from the interest rate for bad credit mortgage loans being offered, all the mortgage terms and fees involved in the process of bad credit mortgage loans need to be mentioned. In addition you must also be given a Truth in Lending form, which compiles the complete financial evaluation of the mortgage. The law stipulates that these forms must be given to you less than 72 hours after you have filled out any initial forms with the lender for a mortgage.

On receiving the Truth in Lending form, you need to thoroughly examine it for inconsistencies based on all that you had been verbally told by the lender.

Unsolicited Mortgage Quotes = A Nightmare
Many people are at the receiving end of a few emails and phone calls almost on a daily basis with offers of bad credit mortgage loans quotes that have not been solicited. Most of the time whenever these quotes offer rates that appear too good to be true, they usually turn out to be so.

Here, the intentions behind the mortgage scam are to single out those in the lower income bracket for whom it is normally more difficult to secure traditional bad credit mortgage loans at good rates. This is done to lure the victims like a bait, after which there is a switch of technique. The unsuspecting victims are lured with unbelievable bad credit mortgage loans rate and then bad credit mortgage loans quote is later changed.
A common approach used by scamsters is to first offer bad credit mortgage loans quotes at ridiculously low rates and once they have their attention, they are told that their low income or outstanding debts make them ineligible for the rate originally quoted. Thus the victim is made to believe that the lender is actually doing them a favor by risking bad credit mortgage loans on them when nobody else would be willing to take the chance. Before long they are trapped into bad credit mortgage loans at high rates that they may not be able to afford, and subsequently compel them to file for bankruptcy or foreclosure.

A Fair Game for Bad Credit People: Bad Credit Mortgage Loans

If you have bad credit and want to buy a house, bad credit mortgage loans are waiting just for you. If you don't qualify for the other loans, you can always go for these bad credit mortgage loans and you will note the difference. Bad Credit Mortgage Loans.
Today, you don't really have to maintain a tremendous credit score with the option of bad credit mortgage loans. Borrowers with bad credit, little credit or even no credit are able to get bad credit mortgage loans. As a matter of fact, bad credit mortgage loans are one of the handiest tools that help you realize your dreams. Millions of Americans suffering from bad credit are going for bad credit mortgage loans. And most are happy with their decision too. Bad Credit Mortgage Loans.
Contrary to popular belief, bad credit mortgage loans are very easy to avail. You don't have to wait for days to get such a loan. Web sites, newspaper articles, mortgage books, consumer seminars and workshops, financial planners, real estate agents, mortgage brokers and lenders are all available to assist you along the way.
But before approaching a bank, credit union, or lending company for bad credit mortgage loans, be equipped with your answers to certain questions about your credit report and credit score. Lenders are likely to ask you questions on these topics before approving you for the loan. They may even want to see your statement of credit history, where all of your credit usages are recorded. That's why you need to be fully prepared; otherwise you might not get the loan.Bad Credit Mortgage Loans.
Financially speaking, your credit report is the most important thing that you produce in front of lenders of bad credit mortgage loans. You might be aware of the fact that your credit report is updated regularly and so reflects the latest information. Based on the information gathered in your credit report, a credit score is assigned. This credit score is necessary because it will determine how likely you are to be granted the bad credit mortgage loans.
If your mortgage loan is approved, the information gathered in your credit report, and your overall credit score, will be used to determine your interest rate. Several bad credit mortgage loan-lending companies insist on providing bad credit mortgage loans to people with bad credit scores. It's beneficial for borrowers with bad credit to find a lending company that specializes in non-standard mortgages. Lending companies that specialize in non-standard loans like bad credit mortgage loans, typically take low charges for the process of loan application, provide lower interest rates, and reduce the rates that are associated with mortgages. Bad Credit Mortgage Loans. Besides, if you go for such loans, you can raise finance by releasing the equity that you might have in your property. You would also have the option to consolidate all of your loans into one easily manageable monthly repayment system.
No doubt, there are many advantages of bad credit mortgage loans. To take advantage of these kinds of loans, you have to contact a bad credit mortgage loan lender who approves you for the loan. But there are several factors that lenders of bad credit mortgage loans consider while approving you for the loan. These factors are as follows:
- Your employment history. Try to give a picture of your employment history to lenders.
- Current monthly debt. Don't hesitate to mention your student loan, or car loan, if you have any.
- Stability of your income. It will attract lenders to give you the loan.
- Amount of money in your savings account.
- Type and value of the property you would like to purchase. It will help lenders to work according to your needs and requirements.
- The amount of your down payment and
- Whether or not you can pay your bills on time.
If you focus on these before you approach the lender for bad credit mortgage loans, you are very likely to get the loan. And once you avail the loan, it will take you a long way towards making your dreams come true.

Take Advantage of US Commercial Bad Credit Mortgage Loan

Commercial bad credit loan mortgage is used to purchase office buildings, apartment complexes, health care facilities and retail outlets. US Commercial Bad Credit Mortgage Loan. Whether it's a hi-rise building or a family-owned restaurant, buyers usually need additional funding to complete the construction or purchase. And, commercial bad credit loan mortgages provide exactly that additional funding. US Commercial Bad Credit Mortgage Loan
Commercial bad credit loan mortgages are similar in many ways to residential loans. However, they require far more paperwork than residential loans. But both types of loan require that the properties, being purchased, undergo a thorough appraisal. Also, both require collateral to secure the loan and protect the lender against any default. US Commercial Bad Credit Mortgage Loan
Another similarity between the two is that like residential mortgages, commercial bad credit loan mortgages can be refinanced to take advantage of more favorable terms. They can also be remortgaged to establish a line of credit, to be used for running a business. Like residential mortgages, the lender will hold the deed to the property until the loan is repaid in full.
Anyone who has ever applied for a loan will be familiar with the mountain of paperwork, required during the process. The lender takes the applicant's information, runs it through their guidelines and formulas. And after waiting many weeks, a decision is made, to either approve or deny. US Commercial Bad Credit Mortgage Loan

Bad Credit Mortgage Financing

If a person has ever missed a credit card payment or fallen behind on student loans purchasing a home can seem impossible. Securing a mortgage with a great interest rate depends largely on having a good credit score. For someone who has faced credit problems, they need to consider bad credit mortgage financing.

How To Find Mortgages For People With Bad Credit

We all know how important mortgage loans are when it comes to securing a home. How to find mortgages for people with bad credit. But not everyone is fortunate enough to get a very good deal on a mortgage loan. Find mortgages for people with bad credit is difficult. Many people have a bad credit history owing to their faulty spending habits at a young age. Mortgages for people with bad credit. Often the euphoria of landing the first job and getting a credit card of our own leads to a spending spree which results in debts. This however deters any chances of securing a good mortgage loan later on in life. But, now companies have come up with a loan that is designed specially for people with a bad credit rating. These loans are called as bad credit mortgage loans.
It's virtually impossible to believe that you have bad credit scores and yet you may get a mortgage loan with the lowest interest rates and scores. So bad credit mortgage loans may have higher interest rates than conventional mortgage loans. Let's accept this part and move ahead. The interest rates are something that is determined by the mortgage loan company. But you need to understand that everything is negotiable. You can get some really good rates even if you have bad credit scores. The reason behind this is that now there are so many companies that offer bad credit loans, that competition has forced them to reduce rates in order to get customers. So negotiation is the key to securing some good rates. So finding mortgages for people with bad credit is not easy.