Latest Inflation Numbers A Threat To Adjustable Rate Mortgages
Washington, DC (ContentDesk) April 21, 2006 -- The US Bureau of Labor Statistics announced that the Consumer Price Index for
All Urban Consumers (CPI-U) increased 0.6 percent in March, before seasonal adjustment, an annualized rate of 7.4%.Oil prices also closed at a record $72.17 on the New York Mercantile Exchange. With supply constraints in the Gulf of Mexico, Iraq, and Nigeria, analysts are expecting oil prices to continue trending higher throughout the summer.Oil futures contracts for the next 3 years are all trading above $70 per barrel. "In effect, the market is saying this is going to be with us for a while," said A.G. Edwards & Sons commodity analyst Bill O'Grady.With oil prices heading higher, most experts expect inflation rates to remain at current levels, or trend slightly higher, putting more upward pressure on home mortgage rates.
In the most recent decade, because of an environment of falling interest rates and inflation, many people who refinanced their homes opted for an adjustable rate mortgage.
This provided the best of both worlds: an initial interest rate that was lower than a comparable fixed-rate loan at the time, and, in an environment of falling interest rates, the monthly payment on their mortgage kept going down with each passing year. However, the environment of falling inflation and interest rates no longer exists. That said, there is a growing concern that both inflation and interest rates will continue to trend higher for the foreseeable future. "Get the inflation call right, hedge your housing decisions and you may well be able to moderate what looks like an even more inflationary time to come." said Goerge Ure of Urbansurvival.com.There is no getting around the fact that both higher oil prices and inflation will put upward pressure on home mortgage rates. "I am suggesting to every client of mine to lock in low fixed rate 30 year mortgages now, while they are still available," said Christine Carter of www.E-Z-Mortgage-Refinancing.com."It just simply doesn't make any sense for new mortgage applicants to opt for an adjustable rate mortgage in an environment of rising interest rates, especially while 30-year fixed rates are still near historic lows," she said.Some
analysts caution that the mortgage lending industry could see a significant spike in foreclosures as rising interest rates effect the roughly one-third of all mortgages originated in the US last year.
Some fear that many borrowers who stretched their budgets to buy the most house they could afford using a lower-rate ARM will be forced into default by significantly higher payments due to rising interest rates.However, in recent months economists at the Federal Reserve Board have downplayed the threat of a spike in foreclosures due to rising interest rates..
California Mortgages
A Mortgage is a long-term loan for a large amount, commonly taken for a property or a house. It is a kind of home loan except that it is termed for longer. Mortgages are available through banks, private lenders, or property sellers. Unlike personal and home loans provided by banks and financial institutions, long term Mortgages stretch for even 50 years at a time while the usual Mortgages last for as long as 30 years. The minimum duration for a Mortgage is 15 years.
A Mortgage is given on the property that is kept as a collateral security. This is the reason why short-term Mortgages are more popular than long-term Mortgages with money- lenders. As the property value decreases with age, so does the value of the security. 15- 30 years is the best tenure when land is being kept as a security for a Mortgage, unless the land is in its prime at the time of mortgaging. Although Mortgages can be extended at the sole discretion of the lender, the borrower might have to pay...
Mortgages > California Mortgages
How to Compare Fixed Rate Mortgages and Adjustable Rate Mortgages
There are many types of mortgages, and the more you know about them before you start, the better. To compare one Adjustable Rate Mortgage with another or with a fixed-rate mortgage, you need to know about indexes, margins, discounts, caps, negative amortization, and convertibility. You need to consider the maximum amount your monthly payment could increase. Most important, you need to compare what might happen to your mortgage costs with your future ability to pay.FIXED RATE MORTGAGESIn a fixed-rate mortgage, your interest rate stays the same for the term of the mortgage. The main advantage of a fixed-rate mortgage is that you always know exactly how much your mortgage payment will be, and you can plan for it.Benefits and Advantages:- Low rates for the full term of your mortgage- Security of a fixed monthly payment for the life of you loan, regardless of fluctuations in interest rates- More stability may give you peace-of-mindDisadvantages- Higher initial monthly payments compared to...
How to Compare Fixed Rate Mortgages and Adjustable Rate Mortgages
Mortgages > How to Compare Fixed Rate Mortgages and Adjustable Rate Mortgages
Florida Interest Only Mortgages
An interest-only mortgage is one in which you only pay back interest with no principal for a certain period of time.
After this time period, which is usually five to ten years, the payment increases to include repayment of both interest and principal.
Most lenders in Florida offer interest-only mortgages.
As with any other mortgage, this option works best if you understand its advantages and disadvantages.
If you need a lower payment initially and anticipate you will be able to make larger payments later, an interest-only mortgage may be the right choice for you.
Alternatively, if you want a larger mortgage to buy a more expensive house, an interest only mortgage may help because the initial payment you are required to make is smaller so you can borrow more.
Interest-only mortgages may also be convenient for people who have an irregular income.
If your cash flow is irregular and you still want to buy a house, an interest...
Mortgages > Florida Interest Only Mortgages
FHA VA Home Loan Mortgages is strategically aligned with Most Major Banks throughout the United States as well as a large number of mortgage lenders.
(ContentDesk) May 22, 2004 -- Whether you are a Veteran searching for a Veterans Affairs VA Loan or you're searching for a fixed rate on an FHA Loan, we can help you get on your way. Our experienced financial accountants will help you understand the entire process of borrowing with a loan of this type and will be there to answer any additional questions or concerns you may have. More than 29 million veterans and service personnel are eligible for VA financing. Even though many veterans have already used their loan benefits, it may be possible for them to buy homes again with VA financing using remaining or restored loan entitlement.Section 203(k) insurance enables homebuyers and homeowners to finance both the purchase (or refinancing) of a house and the cost of its rehabilitation through a single mortgage?or to finance the rehabilitation of their existing home. Section 203(k) is one of many FHA programs that insure mortgage loans, and thus encourage mortgage companies to make mortgage...
FHA VA Home Loan Mortgages is strategically aligned with Most Major Banks throughout the United States as well as a large number of mortgage lenders.
Mortgages > FHA VA Home Loan Mortgages is strategically aligned with Most Major Banks throughout the United States as well as a large number of mortgage lenders.
FHA VA Home Loan Mortgages is strategically aligned with Most Major Banks throughout the United States as well as a large number of mortgage lenders.
(ContentDesk) May 22, 2004 -- Whether you are a Veteran searching for a Veterans Affairs VA Loan or you're searching for a fixed rate on an FHA Loan, we can help you get on your way. Our experienced financial accountants will help you understand the entire process of borrowing with a loan of this type and will be there to answer any additional questions or concerns you may have. More than 29 million veterans and service personnel are eligible for VA financing. Even though many veterans have already used their loan benefits, it may be possible for them to buy homes again with VA financing using remaining or restored loan entitlement.Section 203(k) insurance enables homebuyers and homeowners to finance both the purchase (or refinancing) of a house and the cost of its rehabilitation through a single mortgage?or to finance the rehabilitation of their existing home. Section 203(k) is one of many FHA programs that insure mortgage loans, and thus encourage mortgage companies to make mortgage...
FHA VA Home Loan Mortgages is strategically aligned with Most Major Banks throughout the United States as well as a large number of mortgage lenders.
Mortgages > FHA VA Home Loan Mortgages is strategically aligned with Most Major Banks throughout the United States as well as a large number of mortgage lenders.
Arizona Mortgage Company Launches Site Specific to 3/1 ARM Mortgages
American Mortgage Specialists is proud to announce the purchase of http://www.3yearARMs.com, a website devoted entirely to 3-year Adjustable Rate Mortgages (ARM loans).
Michael George, branch manager of American Mortgage Specialists purchased the domain name from a Nevada corporation that specializes in internet marketing for mortgage companies: KOG Enterprises, Inc."KOG has helped us bring in a great deal of new business over the past several months.
We have seen a remarkable return on investment thus far," Mr. George explained.3yearARMS.com will be devoted entirely to the 3/1 ARM product.
Different types of 3-year Adjustable Rate Mortgages will be discussed, but only ARMS and only ARMS that are fixed for 3 years."This is so that our visitors, who are shopping for a 3/1 ARM will find exactly what they are looking for," Mr.
George explained.
"It is frustrating to search for something and...
Mortgages > Arizona Mortgage Company Launches Site Specific to 3/1 ARM Mortgages
Mortgages
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