Monthly Archives: October 2013

The ABC of Mortgage Switch

What is a mortgage switch?

Under mortgage switch, a borrower can shift from an existing mortgage to another. It is also called as remortgage or refinancing. Using mortgage switch, you can pay off the debts of one mortgage through the proceeds of a new mortgage, utilizing the same property as collateral.

Who opts for mortgage switch?

Some people opt for remortgages in dire circumstances, for e.g., to prevent an impending foreclosure or because their current mortgage deal term has almost expired and they have a significant sum outstanding.  Meanwhile, there may be others who are stuck in a bad deal carrying high monthly payments and have found another mortgage to bail them out of the current financially bleeding mortgage.

Is it worth to make the switch?

There is no clear-cut, straight answer to this question. Before making the switch, there are several issues that need to be sorted, starting from whether your current lender will charge you any prepayment fees or early-redemption fees. These are fees charged by a lender if the borrower leaves the mortgage earlier than the originally agreed period. This is naturally a compensation to make up for the remaining monthly interest payments the lender will be missing out on.  

Check the points and other fees chargeable by the new lender in case of a remortgage. This will help you in calculating whether the new refinanced loan is actually cheaper for you or not.

When to make the switch?

The cost efficiency of most mortgage switch deals is dependent on market interest rates. Borrowers, who currently have a variable-rate mortgage and vice-versa, face a major dilemma in deciding the right time to execute a mortgage switch. The best time to make a switch would be at a time when it results in savings. The trick lies in getting the timing right. You can take the help of professionals for this purpose.
Since, variable-rate mortgages have repayments that fluctuate on the basis of prevailing market conditions, they will be beneficial when interest rates are falling or are at a low level. In such cases, payments will also fall. Similarly, variable-rate mortgages become expensive when the interest rates rise.  

In case of fixed-rate mortgages, the borrower is given a fixed repayment amortization schedule for a period of time, irrespective of the market conditions. Thus, if the interest rates rise, then the mortgage holder will be potentially saving money. However, in case of falling rates the opposite holds true.

For more information, you may contact:
Allegro Mortgages Corp. – Best Broker for All Your Financing Requirements
(416) 987-0008

Check out amortgages.ca/ for information on different refinancing options.

What is a mortgage switch?

Under mortgage switch, a borrower can shift from an existing mortgage to another. It is also called as remortgage or refinancing. Using mortgage switch, you can pay off the debts of one mortgage through the proceeds of a new mortgage, utilizing the same property as collateral.

Who opts for mortgage switch?

Some people opt for remortgages in dire circumstances, for e.g., to prevent an impending foreclosure or because their current mortgage deal term has almost expired and they have a significant sum outstanding.  Meanwhile, there may be others who are stuck in a bad deal carrying high monthly payments and have found another mortgage to bail them out of the current financially bleeding mortgage.

Is it worth to make the switch?

There is no clear-cut, straight answer to this question. Before making the switch, there are several issues that need to be sorted, starting from whether your current lender will charge you any prepayment fees or early-redemption fees. These are fees charged by a lender if the borrower leaves the mortgage earlier than the originally agreed period. This is naturally a compensation to make up for the remaining monthly interest payments the lender will be missing out on.  

Check the points and other fees chargeable by the new lender in case of a remortgage. This will help you in calculating whether the new refinanced loan is actually cheaper for you or not.

When to make the switch?
The cost efficiency of most mortgage switch deals is dependent on market interest rates. Borrowers, who currently have a variable-rate mortgage and vice-versa, face a major dilemma in deciding the right time to execute a mortgage switch. The best time to make a switch would be at a time when it results in savings. The trick lies in getting the timing right. You can take the help of professionals for this purpose.
Since, variable-rate mortgages have repayments that fluctuate on the basis of prevailing market conditions, they will be beneficial when interest rates are falling or are at a low level. In such cases, payments will also fall. Similarly, variable-rate mortgages become expensive when the interest rates rise.  

In case of fixed-rate mortgages, the borrower is given a fixed repayment amortization schedule for a period of time, irrespective of the market conditions. Thus, if the interest rates rise, then the mortgage holder will be potentially saving money. However, in case of falling rates the opposite holds true.

For more information, you may contact:
Allegro Mortgages Corp. – Best Broker for All Your Financing Requirements
(416) 987-0008

Check out amortgages.ca/ for information on different refinancing options.

Making Your Annual Bonus Count With A Mortgage Calculator

An annual bonus can be a wonderful windfall at the end of the year to do with as you please. It could go into savings, a special purchase, paying down your credit cards or into your house as a prepayment on your loan. When your mortgage is calculated, either fixed or adjusted, you are told how much to pay on a monthly basis.

However, a mortgage calculator that specializes in additional payments will show it can be very much in your favor to consider this using your bonus as an additional annual payment

And you thought you were through with a mortgage calculator after you signed the papers on your house.

The monthly payment your mortgage lender requires is the least amount you must pay in order to keep current on your mortgage. It doesn’t mean that you can’t pay more! If you have an annual bonus which comes in every year, then it is definitely worth investing this by paying an additional annual payment against the principal outstanding on your mortgage.

Use a mortgage calculator to work out how much difference your annual bonus makes to your mortgage. Depending on the size of the annual bonus, and how much of it you want to use against your mortgage principal, you can save money in terms of interest you won’t need to pay. This reduction shows up because you are paying the loan off faster that your mortgage. The less time you owe, the less interest you pay.

This is the “miracle of compound interest” your bank loves working against him. When you pay ahead on the principal, you reduce the amount of interest you pay on the interest. Poor him, lucky you. Your mortgage calculator reveals the way to make it work for, not against you.

Another option you need to consider, however, is whether or not investing the money in another way would be more beneficial. It might work to your advantage to build up a larger amount and pay in that lump sum, say every 5 years, for example.

Using the current rate of interest offered for an investment account that can be opened with the amount of your annual bonus, work out how much in total you would have at the end of 5 years. Then pull up the additional payment mortgage calculator to work out what difference it would make to your loan.

The investment account pays you interest, and so you will have extra money to pay against your principal. In the second part of this scenario: use the mortgage calculator to calculate the mortgage if you paid the bonus directly against the principal balance on your mortgage each year for 5 years.

Which of the two totals works best for you financially? If it looks too good to be true, change mortgage calculators and double check. Which of them gives you a lower balance and lower mortgage term? This is the option that most effectively puts your money to work.

An additional payment against your mortgage principal is an ideal way of investing your extra capital in your home. Use the mortgage calculator first however to determine whether this, or an investment account, is the most efficient use of your money.

Accessible Loan is Instant Payday Loans

There are people who initially depend only on their salary. They are often under the pressure of fixing financial status for meeting some expenses. Thus, they are on hunt for some loans. In this case, instant payday loans can be highly useful.

Instant payday loans are offered instantly to the applicants 24 hours and 7 days. This kind of loan has been made possible because lending institutions of this loan do not ask or request the loaner or borrower to submit loan related documents immediately.

This is simply means that the borrowers are free of worries from fixing the necessary documents. Thus, this loan is simply convenient.

Usually, these loans are provided for a very short repayment duration. The duration will not less than a week and not more than 2 weeks. This rule of the duration of repayment will and should be made clear to the borrowers in order to avoid default payment.

In addition, the loan is paid back when the borrower has received his / her salary the next payday. Now, with this condition on short repayment duration, instant payday loans are generally costly. The interest on this loan goes higher and there is also high finance fee.

However, considering that the loan are at high cost, one should only avail this kind of loan when it is very necessary. In short, when it is very badly needed to fix some very important financial problem, there you can avail the loan.

On the other hand, high cost of the loan is but not a big problem for anyone who may avail this loan for the loan is not carried for long. It means the loan you have applied for will not take any longer than one to two weeks. Now, by the time the next payday comes, the loan will be paid back.

These loans are secured loans. There are no collateral required. Thus, the amount of money can be borrowed without any risks.

However, there is another way of assuring the safe return of instant payday loans. It is through looking into repayment capability. Though some lenders will not ask for any documents at the time you apply for the loan but they will have to verify your details at times, asking your employment documents which includes monthly income and employment status.

Since, most of us, if happens to go through financial burden are on hunt of some trusted loans must be very careful in the selection of loan companies we ought to apply with our loans. Prior to our application for any loans, most important thing to do is to compare diverse loans with the interest rates and fees they have.

It is but necessary to choose the lender who has suitable offers  for your needs. What is good in instant payday loans is that, though you are having bad credit, you are still welcome to avail it without doubt, provided that you show your repayment capacity and make sure that you paid back the loan on the time it should be paid or else you will suffer from high interest rates added to your loan.

It would also be better to avail the said loan via online application for instant and convenient approval of your loan.

Instant payday loans are greatly useful for getting an instant loan just when it is needed and necessary for financial support purposes.

Loaners or borrowers should always remember that there is higher interest rate and fee involved in availing this loan, so it is good to pay off the loan on time.

Thus, with this way, you can improve your credit score as well and have the loan availed for the second time, but this time, very convenient, easy and fast.