Interest Only Loans -- Interested or not?

With the increase in house prices, could a interest only loan be of any interest to you? Interest only loans are good for people who live in an area that is constantly increasing in value and plan to only live in a home for about 5 years or less. Interest only loans keep your payment small allowing those who couldn't normally afford to buy a house the chance at the American dream. If your area is predicted to increase in value or has a history of increasing in value then when you sell the house in a few years you could still see a decent amount from the equity built just in the property value increase. I.E. -- If you buy at 300k and 4 or 5 years from now you sell your house, no worth 450k, no matter how little you paid on the principle--you stand to make 150k. The difference in your payment with the interest only vs. the conventional loan could be noticeable smaller. However the interest rate on the interest only is usually adjustable after 5-7 years. So if you go with interest only either refinance before the rate adjusts or cash out and put the proceeds toward a new home. You can find more info on interest only loans at:
http://moneycentral.msn.com/content/Banking/Homefinancing/P73745.asp

Lendingtree customers voice your experience good or bad.

Have you dealt with lendingtree in the past? Despite lawsuits and bitter customers, some lendingtree customers are happy with their service. Let's hear about yours -- good or bad.

Lendingtree -- You might want to read this before you submit your info!

Lendingtree is quick to give you a list of 4 lenders who are ready to compete for your loan. You fill out the form online, hit submit and bam!...you are preapproved! -- Or are you? -- Try filling out the form with a 40K a year salary and a 2 million dollar loan...and guess what? Preapproved...humm. But, before you go filling out the form to test this theory here is the worst part. Lendingtree shops your loan to hundreds of lenders. Which is good because, "when banks compete you win", right? Maybe not in this case! Lendingtree shops your loan to all these lenders, but instead of furnishing each of them with a credit report-each of these lenders are pulling your credit report!! If you don't know much about credit having these multiple inquiries to your credit can drastically drop your credit score. There are Lendingtree customers out there claiming to drop 50-70 points on their credit score! But, don't just take my word for it. Visit this site to read complaints from actual Lendingtree customers:

http://ripoffreport.com/results.asp?q1=ALL&q4=&q6=&q3=&q2=&q7=&searchtype=0&submit2=Search%21&q5=lendingtree&Search=Search

Maybe it's better to find your local mortgage broker and let them get to work without totally damaging your credit. It's definately worth researching to find the broker who will treat you right.

50 Year Mortgage -- Would you do it?

Recently lenders have began to offer a 50 year mortgage. Would you consider a 50 year mortgage? Why or why not? Not sure? Read this:

May 10, 2006: 11:05 AM EDT
NEW YORK (CNNMoney.com) - As home prices and interest rates keep rising, lenders have figured out a way to keep the dream alive for millions of people who want to own their own home. It's called the 50-year mortgage.

According to a report Wednesday in USA Today, a handful of small lenders have begun offering 50-year adjustable-rate loans to buyers who need to keep payments low in the current economic environment.

Most banks already offer 40-year mortgages, which account for about 5 percent of all home loans, the report said.

"One of the biggest things in California is the high costs of homes. With rates going up, there's demand from customers (for) longer loans," Alex Diaz Jr., with Statewide Bancorp in Rancho Cucamonga, Calif., was quoted in the report as saying.

Statewide, which introduced its 50-year loan in March, has already received about 220 applications, Diaz said, according to the report.

The 50-year mortgage also signals that the cooling real estate market is heating up competition among lenders, the newspaper said.

"Mortgage lenders are getting craftier to get the attention of consumers," Anthony Hsieh, CEO of LendingTree, told the newspaper.

But he added that consumers first need to understand the product.

Two issues to keep in mind: A borrower with the 50-year mortgage builds equity very slowly. And because rates on the loans are adjustable, a borrower's monthly payments could rise, the report said.

Mortgage experts caution that the 50-year mortgage is best-suited for those who plan to stay in their home for about five years, while the loan's interest rate remains fixed, the report said.
"If you're going to be there for more than five years, you're gambling," Marc Savitt of the consumer protection committee for the National Association of Mortgage Brokers told the newspaper.

"You don't know what interest rates are going to be. I wouldn't do it."
The report of the new 50-year loan comes as the signs mount that the nation's real estate market is cooling.

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This blog is now open to discuss mortgages, lending and refinancing

Whatever questions you might have before, during or after the process of finding a mortgage or refinancing--put them here and get answers. If you're in the process of looking for a lender read more here: www.lendingfisher.com