Monday, November 19, 2012


Two general categories of mortgages:

1. FRM - Fixed Rate Mortgage (Locked-in)

- interest rate and payments won't change during the term you select

2. ARM - Adjustable Rate Mortgage (Variable)

- interest rate changes


Closed Mortgage

- payments have to be made according to the term. After the term ends, payments can be made as much as you want

- recommended if you're planning to pay off your mortgage in the long run

- interest rates for closed term mortgages are generally lower than for open term mortgages

- ability to save on interest costs

- prepayment charge applies if you wish to renegotiate your interest rate

- prepayment charge applies if you want to pay off your mortgage balance prior to the end of its term

Convertible Closed Mortgage

- provides the same benefits as a closed mortgage, but can be converted to a longer, closed term at any time

- no prepayment charges when you convert to another term

Six-Month Convertible Mortgage

- you can take advantage of interest rate fluctuations

- lower interest rate for six months

- option of converting to a longer closed term at any time during the six months at no cost

Open Mortgage

- the mortgage loan can be repaid either in part or in full at any time without prepayment charges

- recommended if you want to pay your mortgage loan as soon as posssible in the short term

- can be converted to any other term, at any time, without a prepayment charge

- interest rates for open mortgages are generally higher than for closed mortgages because of the added pre-payment flexibility

One-Year Open Mortgage

- you can prepay any amount of your mortgage, at any time, with no administration costs and no prepayment charges

- interest rate is fixed over the one year term

- flexibility to convert your mortgage at any time, to a longer term without a fee


Convertible Adjustable Rate Mortgages (ARM)

- excellent for situations like rising income expectations, high interest rates, and short-term home ownership

- can be turned into a fixed rate mortgage after a set period (usually 2nd-5th yr)

- allows the homeowner to convert to a fixed rate mortgage for a fee (may prove reasonable versus the costs of Refinancing)

Five-year Closed Variable Interest Rate Mortgage

- pay an interest rate that will change with Mortgage Prime Rate for the full 5-year term of your mortgage

Five-year Open Variable Interest Rate Mortgage

- flexibility of increasing your payments to any amount at any time

- you can pay off all or part of your mortgage without paying compensation (administration fee)

- you can make lump sum payments of any amount at any time


Typical costs, fees, charges, expenses in BUYING A HOME, HOUSE, CONDOMINIUM, PROPERTY, REAL STATE:

- Mortgage application and processing fee

- Mortgage insurance

- Mortgage life insurance

- Property insurance

- Home inspection fee

- Appraisal fee

- Lawyer fee [Offer to Purchase, Title search from registry, Mortgage documents, Closing]

- Registration of deed and mortgage fee

- Land survey fee

- Land title insurance

- Land transfer tax

- GST (General Sales Tax)

- Property tax

- Estoppel Certificate on the condo corporation's financial and legal state

- Monthly fees for common elements maintenance

- Connection charges for utilities (electricity, water, telephone, gas), or transfer thereof

- Appliances, Furnitures, Drapes, Decorations, etc.

- Repairs

- Moving expenses


- Real Estate Broker Commission/Fees

- Loan Fees (Direct Loan Costs)

- Items Required by the Lender to be paid in advance (Prepaids)

- Escrows/Impounds/Reserves

- Title and Closing Charges

- Recording/Government Filing Fees

- Miscellaneous Charges


- discharging a mortgage with the proceeds from a new mortgage obtained at a lower interest rate

- replacing an older loan with a new loan offering better terms

When to refinance a home?

- Interest rates are lower than the mortgage rate

- Effects or outcome of refinancing will offset the transaction costs involved


Mortgage term: 30-year mortgage

Mortgage rate: 6%

Mortgage loan: $400,000.00

Current interest rate: fell down to 4%

Is refinancing your house worthwhile?

- the homeowner should consider the long term savings against the transactions costs, fees, charges, and expenses involved in refinancing the house

- consider also the length of time the homeowner intends to stay at the home

Typical costs, fees, charges, expenses in a home refinance:

- Points (to secure the loan)

- Document preparation fees

- Appraisal fees

- Loan Application Fee

- Origination Fee

- Processing Fee

- Licensed Appraisal Fee

- Land Survey Fees

- Attorneys Fees

- House Inspector fees

- Underwriting Fee

- Discount Fee/Discount Points

- Funding Fee

- Loan Set-up Fee

- Administrative Fee:

- Transfer Fee

- Wiring Fee

- Flood Certification Fee

- Tax Service Fee

- Credit report cost

- Title search

- Title insurance

- Early Payoff Penalties & Fines

- Remaining Balance Costs

- Homeowners Insurance


- application fees

- mortgage insurance

- points

- lawyer fees (Attorney's fees)

- loan origin fee

- survey cost

- homeowner and title insurance

- home inspection fee

- title search

- Prepayment penalty


Typical costs, fees, charges, expenses in SELLING A HOME:

- Inspection Report

- Competitive market analysis(CMA)

- Automated valuation model(AVM)

- Appraisal

- Advertising Expenses

- Multiple Listing Service(MLS) Providers

- Website Expenses

- Print Ads (Local Newspaper, Flyers, Brochures, Magazines)

- Signage (For Sale sign, Open house signs)


- insurance

- loan fees

- taxes

- transfer and assumption taxes

- escrow fees

- inspection fees

- homeowner's insurance

- recording fees

- appraisal fee



- Mortgage

- Insurance

- Property Tax

- Home equity loan

- Interest costs

- Utilities

- Gas

- Oil

- Electricity

- Cable

- Telephone (regular & long distance)

- Cellphone (wireless)

- Satellite

- Internet service

- Garbage removal

- Water

- Sewer


- Kitchen (countertop, cabinets, sink, faucet, exhaust fan, refrigerator, freezer, stove, microwave, dishwasher, etc.)

- Bathroom (bath tub, shower, sink, toilet, exhaust fan, etc.)

- Appliances (clothes washer, laundry dryer, TV, Radio, Home Theatre and Sound system, Electric Fans, DVD players, Amplifiers, Computers, etc.)

- Dining room sets (tables, chairs, glass, etc.)

- Living room sets (sofa, couch, glass, etc.)

- Decorations, curtains, drapes, etc.

- Fixtures (electrical, mechanical, structural)

- Bulbs, tubes, lights and lighting

- Electrical wire, wiring, panel, breaker, etc.

- fire extinguishers

- batteries

- smoke detectors/smoke alarms

- carbon monoxide alarms

- filters

- furnace

- Boiler

- hot water heater

- air-conditioning

- blowers, exhausters

- Humidifiers

- air cleaner

- air duct cleaning

- basement

- crawl space

- tiles

- floor boards

- carpets

- attic

- roof

- chimney

- termites protection and treatment

- ants spray and infestation

- bugs, cockroaches, mice control

- gutters & downspouts

- eaves

- Interior and Exterior sidings, walls

- painting

- windows

- doors (latches, locks, hinges, etc.)

- screens

- plumbing, pipes, hoses

- insulations (thermal, electrical)

- septic system

- Garage

- Driveways and Sidewalks

- Landscaping

- Grading (slope)

- Retaining Walls and Fences

- Weatherproofing, waterproofing

- Gardening (soil, compost, fertilizer, plants, flowers, pots, tools, etc.)

- Garden tractor

- Trees, Shrubs and Vines

- Lawn mowers

- Patios, Porches and Decks

- snow throwers, snow removal machines

- snow salts

- seal coatings

1 comment:

  1. Easily Boost Your ClickBank Traffic And Commissions

    Bannerizer made it easy for you to promote ClickBank products using banners, simply visit Bannerizer, and grab the banner codes for your chosen ClickBank products or use the Universal ClickBank Banner Rotator to promote all of the ClickBank products.