The majority of people that buy a house do so with the thought that they will pay off their existing mortgage (or if they don’t, they think they will by the time they get to the closing stage of the sale). The reality is that the majority of the time, people are paying off their existing mortgage by renting, refinancing, or refinancing and renting. This is more and more the norm.
The problem is that many people think that they can just buy a house free and clear and immediately pay off their existing mortgage. But that isn’t how it works. It takes a long time for the banks and finance companies to reduce payments on your mortgage. So people end up paying more in interest and penalties than they would have if they had just bought a house.
The good news is that there is another way. If you have a credit score of 600 and a mortgage of $500, you can borrow up to $700 at no interest (or $700 for a $700 mortgage). Once you have this loan in place, the interest is reduced to no additional interest. This is called a “negative amortization.
If you have a current loan of 1.5 million dollars you can refinance the current loan to a new loan of 700. But to do this, you must also be current in your mortgage and have a credit score of 600. This means you have to live in your current home for six months in order to refinance the loan. This is a bit of an inconvenience, but it’s also very doable.
As it turns out, the loan comes with an interest rate of 6.25% which is really nice. But then again, the interest on this loan is pretty low. So if you are in a hurry to get the loan, you can refinance from a mortgage broker, but it certainly isn’t cheap.
We’ve seen many auto finance loans that are even lower than this and we have also seen very high interest rates that are higher than this. A major reason that these loans are so cheap is because there is very little paperwork that must go along with the loan. Instead, the only paper that you’re given to sign is the standard “I declare myself current in my mortgage” and “I declare myself current on my credit score.” Other than that, the loan is really hard to get.
In fact, getting a house loan is a nightmare. You sign the paperwork, but you dont really know if you actually own the house. Because if you sign, it doesnt mean that you own it, because you can still buy it back with that money. Plus, you dont actually own the house until it is appraised. The problem is that the paperwork isnt always clear and the loan gets to go through the usual approval process, which can take a year or more.
The good news is that there are several loan companies that are not only willing to give you a loan, but will pay for it. These companies are called “second home” companies. The bad news is that due to the large amount of paperwork involved with this type of loan, you may not get the best rate.
So it is a good idea to compare rates and find the one that is right for you. There are many loan companies out there. The best one is the one that has a history of servicing customers. The second best is the one that has a good reputation. The third best is the one that has a good reputation for the amount of paperwork it takes to get approved.
The point is to find the best rates. However, I would recommend contacting your mortgage broker and getting a few quotes to get you started. As a general rule, if you are interested in a second home, you should always get the best interest rate, and you should always do your own due diligence to avoid being ripped off by a company that doesn’t have a history of servicing customers.
