Home loans and mortgages
With the growing interest in buying real estate and speculation, more and more lenders offering “nontraditional” types of mortgages. These include loan adjustable rate mortgage (ARM) of each shape and size, is the most popular interest mortgages, and very dangerous option ARM mortgages, which can lead to the amount you should increase in pace with time passing. The rapid growth in the loan market is the so-called “subprime” market, which caters to consumers poor credit records. The market for subprime loans is profitable because lenders offer loans to consumers with poor aim payment of customers at risk. Yes, customers are at risk, but lenders charge fees and interest rates that are high enough to offset the additional risk. People who are interested in buying a house should be cautioned, however, that many people to qualify for loans that are pushed to a higher price, instead of subprime loans.
Subprime loans is a lucrative market for lenders who can charge higher fees and interest rates because of increased risk posed by customers with poor credit history. A subprime borrower can pay an interest rate that is several percentage points higher than normal on a loan, and may include expenses plus “points” that administrative costs. A point is one percent of the loan amount. You can add several thousand dollars for closing costs and tens of thousands of dollars for the cost of the loan on the life of the typical 30-year mortgage.
Although it is understood that customers with poor credit history represent a greater risk to the lender, potential borrowers need to ensure they are not classified as a “subprime” because of Potential donors. Studies show that up to 15% of subprime borrowers have credit scores that are eligible for loans at lower, more traditional interest rates. What does this mean for potential borrowers is that you must buy for about the best price for a loan and not accept the fact that when a lender tells you that you are not eligible for the traditional price. Federal Trade Commission examines several donors that have dramatically increased their profits toward borrowers to qualify for loans with low interest rates in an increase in subprime loans, said he does not qualify for the lowest price low.
How can you avoid these problems? Get a copy of your credit report. You can get a credit of one of the three major credit bureaus - Experian, Equifax, Trans Union O. Normally, the rate subprime lenders to provide customers with credit scores below 620 if your score is higher than it should have better interest rates. If not, you can either accept the highest rates of donors, or take the time to improve his score to pay some bills in a timely manner.
