Are you so desperate for a home loan that you are stretching your finances too far?

Written by Syd Johnson


Once you get a quote for a home loan don’t be tempted to takerepparttar entire amount if it looks like you overqualified. Most consumers fill out an application for a home loan and hope they can get enough money to buy their dream house.

A nice chunk of those consumers also overqualify for their home loans. If go to your local bank, credit union or mortgage broker and you are approved for a $500,000 home loan, they payments might be a bit more than you realistically afford.

Use a mortgage calculator to see your real monthly expenses If you are not good with your money or would prefer to not stretch your finances torepparttar 112117 limit to get a home, get your hands on a good mortgage calculator as soon as you getrepparttar 112118 figures on your home loan. You might think all will be fine as long as you can own your own property.

However, you must take into account all ofrepparttar 112119 things that come along with owning a home. Sometimes you can get so caught up withrepparttar 112120 actual dollar amount of your home loan that you forgetrepparttar 112121 other pieces of your budget.

Do you still have cash for entertainment and personal use? Check your budget to see if you still have money to enjoy things like going out, purchasing new furniture, a family vacation once per year and regular manicures and pedicures. Then add in your student loans, car payments, credit card bills, lunches at work and tickets to take your family to baseball games a couple of times every season.

Why should I get a second mortgage? It's a good way to pay off high interest debt.

Written by Syd Johnson


Second mortgages are basically any type of home loan that you take out while still making payment onrepparttar primary mortgage. This is not an arrangement to be entered lightly because you will end up paying a lot of fees and can rack up a huge debt that negates some ofrepparttar 112116 progress you have made in paying off your original mortgage.

Keep loan below Fannie Mae guidelines One ofrepparttar 112117 most common reasons to get a second mortgage is to keep your home loan amount belowrepparttar 112118 Fannie Mae guidelines. Fannie Mae purchase home loans from lenders all overrepparttar 112119 country, but only ifrepparttar 112120 loans are in accordance with some very strict rules.

If a lender wants to make sure that your loan does not go overrepparttar 112121 Fannie Mae limits, they can give you a primary loan for one amount and add a second mortgage forrepparttar 112122 remaining balance. It’s creative, and there are many alternatives to this arrangement, but it works.

Home equity loans Another way to get a second mortgage is when you sign up for a home equity loan. The loan is basically secured byrepparttar 112123 amount of equity you have earned in your home. However, if you dorepparttar 112124 math, you are reducing your equity.

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