Find your way through the Financial Maze

Advantages of Disadvantages of Second Mortages and Home Equity Line of Credit

A home-equity loan is, in reality, a mortgage on your home, and usually is viewed as a second mortgage. It is important to keep that in mind if you plan on selling the home in the foreseeable future.

If the home is sold, the original mortgage and the second mortgage will have to be paid-off. This would then impact the amount of money available for purchasing the next home.

If you are still paying the original mortgage, taking a home-equity line of credit is the same as taking a second mortgage. The main difference is that with a line-of-credit loan, you only pay interest on the amount you here to read Factors to Consider When Going for Home Loan

If you take a traditional second mortgage, you will have a set amount that you are borrowing, for a specific term and payment, assuming, you get a fixed-interest loan.

Advantages of Disadvantages of Second Mortages and Home Equity Line of Credit

Getting a second mortgage, be it a traditional loan or line of credit, is much like getting the first mortgage. There will have to be an appraisal of the value of the home, which is an expense the owner incurs.

Usually, an inspection is required, and some institutions may ask for a broad outline of what improvements you are making. They may want to know if you are adding a room, or just remodeling parts of the existing structure.

Repaying a line of credit loan is tricky in that the monthly payment will increase as you withdraw the money. Thus, budgeting how much you are going to have to pay each month becomes more difficult.

If you have prepared a reasonable budget for what you want to do, taking out a traditional second mortgage may be the better alternative. The application process is the same. The monthly repayment amount will be constant for the term of the more info for on how to apply line of Credit at

Thus, if you take $20,000 as a line of credit, your monthly payment will increase as you spend the money.

However, the funds would be quickly available if you want to take the loan and start the improvements at a later date.

With a traditional second mortgage, you start paying it back within the first 30 to 60 days depending on the policies of the lending institution. However, the payment will remain static or fixed for the duration of the loan. This will help in budgeting how the money will be used, and how much you have to repay each month.

Both approaches are viable and depend largely on whether you have a set plan and a good estimate of the cost, or have several projects, you want to undertake. In the multi-project scenario, the nature of the improvements could be subject to unanticipated price changes.

There are other factors to consider such as the existing value of your home as it compares to the amount you are seeking to borrow and your overall credit rating. Furthermore, if you increase the square footage of your home through by adding a room or an attached-garage, the premium for your homeowner’s insurance will increase.

The final factor to consider is what do you want to do. If you have a specific project in mind and a good estimate of the cost, the second mortgage approach may be better. If you want to update kitchen appliances and bathrooms or install new carpet, the line of credit may work best.

You need to have a priority list and realize that a line of credit is not unlimited. There will be a cap on the amount you will be able to borrow. This will be based upon the value of your home, your income and credit history.

Factors to Consider When Going for a Home Loan

A mortgage is a long term commitment. Therefore, you need to settle for the right one. Many people end up choosing financial institutions that approach them first for a mortgage. Although this could work at times, lack of proper knowledge in finance can really work against you leaving you with a very expensive mortgage to service. Luckily this guide will help you understand what to look for before committing yourself.

Know the Different Types

Adjustable and fixed rate are the two main types of mortgages available today. A fixed rate one as the name suggests maintains the same interest rates until it is cleared. This mortgage can be right when interest rates go up. However, if you want to take advantage of low-interest rates at times then an adjustable rate home loan is your best choice. Both of these mortgages have their setbacks and benefits, and if you have a great banking partner, you will find it easy to settle for the right one.

Factors to Consider When Going for a Home Loan


When going for a home loan, interest rates should not be your only worry. Almost all lenders have additional costs that come with these mortgages with the common ones being processing and administration charges. Although avoiding them altogether may be a tall order, you can lower them by talking to as many lenders as possible to know their more info about refinancing mortgage loans at

Get the Right Lender

Buying a house is a major investment, and you should never settle for the first company you come across. You will miss out on a grand offer if you make this mistake. In addition, interest rates and fees vary from one lender to another. As good practice, start with your bank then compare their rates with a few other lenders before making up your mind. Keep in mind that your financial status also plays a crucial role in determining your interest rates. Therefore, it is advisable to try and have a steady job before applying for one so that financial institutions do not see you as a high-risk borrower.

Know the Lock Period

Many lenders also come up with offers to entice potential home buyers. These offers usually have an expiry date attached to them. This means that if you are not able to complete your payments within this period, the interest rates that you had on offer are subject to change. In case this happens during a financial crunch, your interest rates will skyrocket making the mortgage quite expensive. Knowing the lock period can help you avoid such situations and also encourage you to complete your payments on time.

Getting a mortgage is a process that you need to think carefully through and carry out extensive research to settle for the best. If you are armed with these guidelines, you will not only be able to get a manageable mortgage but also get that home that you have been looking for.

Spend Wisely to Invest in Your Future

Spending too much money on shopping can quickly deplete a savings account, and screw up a family budget. Sure there are things around the house we need to buy, so I leave that task to my wife. She is great at maintaining our budget, and ensuring that we never go over.

Recently she purchased a nice “wooden shoe storage bench” (similar to this one) for our bedroom. Just by looking at it you would think that it cost a bundle, but it didn’t. My wife found a bargain, she saved money, and she purchased an item that the entire family can use.

Making smart investment decisions are important for the future safety of our finances. If you were to purchase a shoe storage bench like this from a reputable wood furniture dealer, you would expect to pay several hundred dollars. There are other alternatives to getting quality household items, without spending tons of cash.

Ways to Save Money While Shopping for Quality Items

Anyone can find a great deal in their local stores. All you need to do is search the newspaper ads. Many stores have their end- of- the- year clearance sale. This is when you are likely to find the items you have been wanting, but could not afford.

Look in the Classified Ads

Garage sales are the perfect place to find new and slightly new items including shoe storage benches :) .  Dozens of people clear out their basements, and garages, to make room for new items. This is your time to invest in the items you need, at the prices you can afford. Chances are you will find a lot of things you and your family can use.

Be Thrifty with Your Money

Spend your money wisely. You don’t have to buy a $300 shoe bench, if you can find one for $50. It might not be new, but you can stain it, put on a fresh coat of paint, and make it look like you brought it from a furniture store. Nevertheless, my wife is great at saving us money, and keeping up with our budget. Without her quick thinking, and thrifty spending, we would probably be in debt right about now.

Hopefully you can be like my wife, shopping can be at the same time both entertaining and budget friendly. Just take the time to find bargains and you’ll definitely suffer from less buyers remorse afterwards.

How to refinance your current mortgage loan

The meaning of refinancing

Refinancing is when you replace one debt obligation with another that has its own set of conditions. Inherent and projected risk can affect the terms and conditions of a refinancing plan in a given state, province or country, as can the stability of a national government or currency unit, banking regulations, the credit history of the individual applying for refinancing and the credit rating of the nation itself. read more about Refinancing at article is specifically about refinancing one’s current mortgage loan. The existing mortgage is paid off and a new one is created.

Questions to ask

When considering the option of mortgage loan refinancing, there are certain questions that you must ask, such as the following:

  • Are interest rates going down, or do I expect them to go up?
  • Has my credit score improved in any way? If so, you might be able to qualify for a lower- rate mortgage loan that your current one.
  • Do I want to switch over to a different type of mortgage loan?

More important, since your house is often the most valuable financial asset in your possession, choosing the right lender or broker and making sure that the terms of the mortgage are the right kind for you are both crucial.Click here to read some important tips before going for home loan.

How to refinance your current mortgage loan

The refinancing process

The mortgage refinancing process is often much the same as it was when you made your original mortgage. You will usually have to pay a refinancing fee — three to six percent of the outstanding principle is not uncommon — as well as points, or one percent of the amount of the loan. learn more about the cost of refinancing at There are loan discount points that you pay to cut down the interest on your loan. Other expenses associated with refinancing include those for:

  • appraisal
  • inspection
  • attorney review
  • FHA or other federal expenses
  • house and title insurance
  • surveying

To avoid getting yourself into a financial maze, have all your finance records with you when you apply for mortgage refinancing, including your great banking statements, investment accounts W2s and pay stubs for the past two months. Interview prospective lenders, choosing the one with whom you feel comfortable. Once that person has confirmed all your information, pay off your old mortgage via the closing process.

Home loans

A home loan is also an important element of mortgage refinancing. The particular plan you choose depends on whether you desire:

  • fixed monthly payments
  • flexible payment with lower down payment requirements
  • refinancing for eligible service members
  • lower opening monthly payments

Each of these plans is ideal for people in certain financial conditions. For instance, the fixed monthly payment option is appropriate if you intend to live in your current residence for a long time. Detailed information on each plan can be found at, along with various subtypes and their rates.

Top 5 Tips to Cut shopping Costs

save on shopping

Shopping is usually a chance to refill some of the household items that may have run out. Although this process is necessary, sometimes people go overboard and end up spending a lot of money. There are copious ways to cut down on your shopping costs.

Use Coupons

Use CouponsCoupons are what every shopper needs to save money. You will be surprised at the thousands of dollars that you can save by using these coupons. In fact, this option is so effective that people come out of supermarkets and shopping malls without spending a dime. There are very many places to find them. Newspapers, manufacturer’s websites and the internet in general can offer you enough coupons to cater for a huge portion of your monthly shopping. You can find Bed bath and beyond coupons at different coupon websites like this one, I never shop at that place without getting a coupon for 20% off, they send those things out like crazy.

Do Not Shop When Hungry

Do Not Shop When HungryPeople usually purchase a lot of stuff when hungry. Therefore, do not make that trip to the mall when you are hungry otherwise you will come back home with nothing left in your wallet.

Compare Prices Online

Compare Prices OnlineBuying things online in itself is cheaper than the traditional shopping model that many people are used to. You just need to sit down, take your computer and check out a few stores on the internet. This gives you an opportunity of finding the cheapest of them all, and the beauty of this is that your products will be delivered at your door stop. Who would not love this?

Do Not Shop from One Place

Do Not Shop from One PlaceThis can be quite a hassle, but you also get a chance to walk around and see new places. There are certain products that are likely to be cheaper in your local store than in a supermarket. Steak, groceries and baked foods are cheaper bought locally. Even when going to a supermarket, consider discount supermarkets over chain ones since they are always cheaper.Click here for some more buying tips

Know When to Shop

Many supermarkets usually take morning hours to establishing the day’s shopping trends before posting discounts in the afternoons. This means that you will get more discounts when you shop in the afternoon than early in the morning. You could also talk to the friendly looking gentlemen in the store to know the best time for such deals.
Shopping may not be fun for men but at least these tips can help them save as much money as possible from this activity. Remember, you are likely to get even more savings by doing this alone. Kids and your wife will probably bring in unplanned expenses.

You can read a good post about things to consider when buying a home loan that you might also prove useful to you.

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