The monthly mortgage payment on a 400,000 loan for 30 years amortization period for 5 year fixed mortgage 3.7% rate is $1,834.76. It will cost you 260,000 in mortgage interest if will take that long for you to pay the mortgage. Remember that most of the interest paid in the first 5 years of your mortgage. In order to speed up the payent process you can do double payments or biweekly. If you take the same mortgage with biweekly payments your biweekly payment will be $ 846.11 which is $142 less per month.

If you have a commitment from the lender, then they cannot just change their mind unless they found something wrong with your application (i.e. undisclosed credits, wrong information on income source, different source of down payment as what was presented initially) . If you do not have a written commitment from the lender and you only have a verbal commitment, it may be difficult to bring them to court. The way we do pre-approval is like getting a real mortgage - submit all relevant documents up front and get the lender give us a mortgage commitment good for x-days. This assumes that your financial condition would be the same or better when the mortgage application with a property is submitted.

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I went to local bank. i got the above mortgage. my credit is excellent. i have money to back the house. is this a good rate? could i have done better without resorting to an internet or unreputable mortgage? please advice. i don't think it is too late to change my mind.

As a Mortgage Banker based on what you said I would say its a fair deal. If you really hunted and searched, you could I am sure find a slightly better rate but there would most likely be fees. You see this is how pricing on loans work. The higher the rate generally the lower the fees because the lender is compensated by what is called a service release premium. Its great if you are strapped for cash to close. However, there is also an adjustment to the pricing when the loan about is below 100K. You know, you can always ask the bank if they can give you a better rate with no increase in fees . All they can do is say yes or no (then risk loosing your business). Make not mistake, they want your business, especially if you have excellent credit. Banks as you know, are in Business to do loans. Hope this helps.

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Let say, i still have 25 years left to pay off my 30 years at 6% mortgage,should i change 30 years mortgage to 15 years when interest rate at very low (like 4.5% for 15 years loan), i know some will say don't do it, use different amout money to invest some where,but i don't have good idea to invest some where so that i rather pay off my loan the early the best?

First off there's no way you can get a 4.5% fixed rate for 15 years today. I doubt you could get 6% fixed for 15 years. But as a hypothetical question you have to run the numbers. Assuming your balance is $100,000 if you continue as is your monthly payment (principal and interest only) would be $644.30 and you would pay $93,290 interest over the next 25 years. If you pay $199.56 extra each month on your existing mortgage the mortage will be paid off in 15 years and you will save $41,396 in interest. Plus that's 10 years of your life that you won't have a mortgage payment. If you refinance at 4.5% for 15 years your payment will be $764.99 or $78.86 less than paying off the existing mortgage in 15 years. That will save you an additional $14,195.44 in interest over 15 years. That's the real value of the lower interest rate. As you can see shortening the duration has a lot more impact than lowering the rate in this example. You can shorten the duration on your own. You cannot lower the rate without refinancing. One way to make the decision is to find out what the cost of refinancing at the lower rate would be then calculate your payback period (i.e. divide the financing costs by the $78.86 it saves you each month). If your refinancing costs were $500 your payback period would be less than 7 months, for $1,000 the payback period would be almost 13 months. Those would seem reasonable. If your payback period was say 5 years that might not be a good idea as you might not even be in the house by then. Another thing to consider is if you refinance you have no choice but to pay the higher payment each month. If you shorten your mortage voluntary by paying extra each month and you find yourself unable to do that you are not obligated to. You can convert my calculations to work for you by multiplying by your balance's ratio to $100,000. If your balance is $80,000 multiply by 0.8. If your balance is $150,000 multiply by 1.5. Remember that financing costs means any money you have to bring to closing plus any increase in the balance after you have refinanced. If you pay $500 and after the closing your balance is $101,000 it cost you $1,500 to refinance, not $500. You've just financed $1,000 of your cost of refinancing. You might also consider the tax consequence. That $14,000+ dollars in iterest may be deductible for you so in effect the federal government will be paying some of that for you. And of course you only save the $14,000 if you actually stay in the house the full 15 years. Good luck to you. p.s. Check to see if you are paying PMI on your loan. If so you can likely drop that now.

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2009.i want to lend another 5,000 now and change my term to 30 years does anyone know if i will have to wait untill my fixed rate agreement is finished in june 2009.and if i do get it do you think the payments would remain the same as i am increasing my mortgage to over 30 years instead of 25 years.thanks

What does the agreement say the rate will be after the fixed rate period ? It could be anything and mean your monthly payments can go through the roof.Another 5000 under those terms is very risky.

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Question details:it's been 6 years to have 30 year mortgage. fed is considering another interest rate cut. is 1.25-1.5% change (and 30 to 15) worthwhile to consider (adding all closing fees)? thank you for your inputs in advance.

You did not say how much the loan is for, so that makes a difference. So I will use $100,000 for an example, and you can adjust from there: $100,000 for 15 yrs at 4.5% = 768.00/month payment. Interest paid = $37,702 If you just increase your payment: $100,000 for 15 yrs at 5.75% interest = $830.000/month. Interest paid = 49,478 Staying at 30 years: $100,000 for 30 years at 5.75% = $583/month Interest paid will be: $110,091 Just increasing your payment to a 15 year schedule will save you $60,000 in interest. (over 30 years.) Refinancing to a 15 year loan will force you to stay on the 15 year plan, and save an additional $11,000. If you refinance and move, then you lose out on the refinance option. You can do some of your own calculations using the mortgage calculator: http://www.daveramsey.com/etc/realestatecenter/?FuseAction=dspMortgageCalculator&strMode=dspMortgageCalculator

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Im just wonder, say i lock into a 25 or 30 year mortgage. is that ever possible to change? im looking to buy a home and im looking to pay the least i can right now. i wonder if in a few years, if that can be changed to pay the mortage off faster. any advice?

You can never change the amortization period specified in your mortgage contract. If you take a thirty year mortgage, your amortization period remains a thirty years, according to contract. That being said, any payment amounts in excess of your required monthly mortgage payment will be automatically applied against principal reduction. Accordingly, if you make payment amounts monthly in amounts roughly equivalent to those of a fifteen year mortgage, your mortgage WILL be paid off in roughly fifteen years. The only difference is the interest rate charged. Thusly, with a slightly higher interest rate on a thirty year, you might make two or three more payments to finish off that mortgage.

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I have a 30 year interest only mortgage of 230,000 - at a fixed rate of 6.25% for the 1st two years - we currently pay £1,245 per month. next month we drop to a variable rate of 2% above bank of england rate (currently 0.5%) meaning our new rate would be 2.5%. how much will our new monthly repayments be?

http://www.moneymadeclear.fsa.gov.uk/tools.aspx?Tool=mortgage_calculator Or you could ask your lender.

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So i go to my bank to see if refinancing my mortgage is worth it. i've got about 10 years left. here's what the rates are: fixed-rate mortgages loans to $417,000 30-year5.0001.0005.151 15-year5.2501.0255.533 loans over $417,000 now how can a 30-year loan be a higher rate than a 15-year? that makes absolutely no sense. i mean there is absolutely nothing stopping me from using a 15 year payment schedule on the 30 year mortgage, and enjoy the lower rate and still have the benefit of if i get into financial trouble, changing my payment to a 30 year: $240,000 5.00% 360 ========== $1,288.37 $240,000 5.00% 180 ========== $1,897.90 all i have to do is pay the $1897.90 every month instead of the $1288, and i'm effectively turned my 30 year into a 15 year with an automatic "dont pay $603 a month if you don't want to " option? this instead of: $240,000 5.25% 180 ========== $1,929.30 i'm totally confused. edit: ok good we are in agreement, this makes no sense. no 15 year should ever be at a higher rate than a 30 year. as a followup, isn't it illegal to have a prepayment penalty on a mortgage? maybe just in ny? i'm at 5.5% right now, so i'm sure it doesn't make sense to do it for 1 point reduction in rates, but i'm just trying to figure out how a bank could possibly make such a blatant error, then again, we are talking about the current state of our banking industry...

I'm also a bit confused. You show: Fixed-Rate Mortgages Loans to $417,000 30-year 5.000 1.000 5.151 15-year 5.250 1.025 5.533 Loans over $417,000 This says that the 30 year rate is lower than the 15 year rate by 1/4 %. Most 15 year mortgages are at a lower rate than the 30 year mortgages since the 15 year mortgages are less risky to the mortgage lender than the 30 year mortgage because the loan term is half the time. As far as the other part of your question, I agree that it is smarter to take the 30 year mortgage, even at the higher rate, just for the flexibility that you describe. As long as there is no prepayment penalty in the contract, anyone can turn their 30 year mortgage into a 15 year mortgage, or a 10 year, or a 5 year mortgage.

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I understand, but don't see the point about the federal reserve lowering interest rates and making a big deal over it, when the 30 or 15 year interest rate on mortgages are still not going down. mine is at 6.25 for 30 years but would like to have a 4.75 for 15 years. the cost is not worth it for much less change than that. what do you think? i know it doesn't make a difference on mortgage but then why is the news acting like its going to save home owners?

The Fed Funds Rate is for overnight transaction between banks and the federal reseve bank. It does not have a darn thing to do with mortgage rate. The best inicator there is the T bill and the London Inter Bank Offer rates. They have the most impact.

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I received a foreclosure notice in sept. of 2007 from abn-amro as i hadn't been making payments and i could no longer afford to do so. i walked away from the property (in michigan) and moved to california. i figured i would get a notice saying they sold the property and i still owe an amount and that would be that. so just over a year later i started receiving notices from citimortgage showing that i was delinquent on the mortgage by 16 or so months. i contacted them and they said they had no record of the house ever being foreclosed on. apparently abn-amro had deceptively packaged it for them. so i was busy with school and just decided to not stress over something i didn't have time to deal with. after a couple years of barely acknowledging any of their communications i've just got a notice from citi stating that they have begun foreclosure proceedings. wow! twice on the same property! well i think that abn-amro must have not liked their chances of breaking even so they stuck it to citi. so i'm wondering if there is anything i can do to protect myself against a deficiency judgment. i've also got a form from citi's workable solutions department i'm wondering if i should fill out and return. i'm concerned about giving them any info i shouldn't and the only thing i would want from them is a deed in lieu of foreclosure. i think this is the form i need to fill out to have a chance (probably a fat chance!). so what do you think? should i fill out this form with standard info about me, plus income (very little), expenses (almost equal to income), and assets (almost none besides the house that's getting foreclosed again), and hope for a deed in lieu of foreclosure? or should i not give them any info? any other advise that would help protect me would be appreciated to! the house is in michigan and it has been torn up in preparation for remodeling. i think you could call its state uninhabitable or in disrepair. i have no desire to return to michigan. the only debt on the property is the original mortgage, which changed hands twice. mortgage balance =$30,000. amount in default =$25,000. total about $55,000.

here's what i'd do [i think] -- prepare an offer to Citi to turn over the deed if they forgive the rest. Sign the deed in lieu and have it notarized. Mail it in to Citi with the offer. Give them the personal info, too. Then wait. *** my guess is they'll ponder and stew for a few months and then accept it. it may take several years for them to fix and sell the place. what you want is to escape the possible future albatross of this thing coming back to haunt you in 3 years when they finally sell the property and determine how much they lost on it. *** btw, i think the math on the debt is wrong. 3.5 years of interest and taxes on top of a 30k debt does not result in 25k in added charges. that's about 24% simple interest, which is too high. ask them to waive the penalties included in the 25k and any other unearned fees involved. this goes in your offer.

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I've heard that mortgage companies are trying to get new laws passed regarding 30 yr fixed mortgages. i've heard that they are trying to make it so that if any new company buys your mortgage the new company will be able to change your rate even though you signed papers for a fixed rate over the life of the loan. i currently carry an extremely low conventional mortgage with the rate of 5.25% fixed for 30yrs and i recieved this mortgage through a very ligitament bank. my contract states that no matter who purchase my mortgage they cannot change my rate throught the life of the loan no matter what. obviously most banks don't hold onto the loans and my loan was sold to countrywide about 4 months or so after the closing and i have been paying them for 5 years. but i've heard that they are trying to make it so they can change rates of fixed loans with new legislation. is this true? if so can anyone point me to some info regarding it?

No truth at all. I've heard that rumor on and off since the 1960s.