Welcome to Mortgage Guide
Mortgage Crisis Article
. For a permanent link to this article, or to bookmark it for further reading, click here.
Use an Online Mortgage Calculator to Understand ARMs
from: Mortage & Debt FactsAdjustable rate mortgages still exist, even with the bad rap they’ve received from the mortgage crisis. They are a specialty product that were not meant to be used by everyone, just by a few people who might benefit from the adjustable rate. People who weren’t planning on spending more than five year’s in their home or people who had income that was rising were the traditional buyers of ARM loans. The reasons for this are that the loans adjustable terms are difficult to assess unless you have done your research with an online mortgage calculator. If you don’t know what you are signing with an ARM loan, you shouldn’t get this type of loan.
Get the Facts
There isn’t just one type of adjustable rate mortgage, so you will need to understand the product you are investigating before you plug any numbers into a mortgage calculator. You will need to know how long the initial payment is fixed and when and how often the rate is adjusted. For instance, in a 3/1 adjustable rate mortgage, you might have a period of three years and then it adjusts every year thereafter. There are also 5/1, 7/1, and 10/1 ARMs. There are also hybrid mortgages and ARMs that are tied to different indexes. This can make understanding the product you have a bit more complex. Try to get a good idea whether you are dealing with a classic ARM or whether this is a hybrid product. Also, make sure you know how long the initial rate lasts as some offer teaser interest rates that quickly fly by, some in less than a year.
You will also want to know if the adjustments are capped, so that they cannot go past a certain amount. This is very important to be able to see your best and worst case scenarios with a mortgage calculator. The caps are usually set as a percentage of the previous payment amount or sometimes as an interest rate hike cap. The thing to understand is that even though the interest rate increase may be capped the first year, and nothing happens to adjust the rate the following year, you may still be charged an increase from the previous year’s cap. It’s because the lender assumes you owe and they cut you a break on the previous year. This means that you won’t really be able to figure out exactly what you owe each year on the mortgage calculator, but you can get a best case and worst case scenario from the mortgage calculator.
Mortgage Crisis Specific links
Mortgage Crisis News
Kenny says mortgage crisis biggest issue facing Ireland - Irish Times
 Irish Times | Kenny says mortgage crisis biggest issue facing Ireland Irish Times Taoiseach Enda Kenny: said the Government had taken a number of steps to deal with the mortgage crisis. Photograph: Aidan Crawley/Bloomberg Mortgage arrears is the single biggest issue currently facing Irish people, Taoiseach Enda Kenny has said. 'More urgency' demanded over mortgages crisis Govt failed to deal with mortgage crisis - Micheál Martin Taoiseach: Mortgage arrears biggest issue facing country |
Wall Street CMBS Allure Fades as Volatility Surges: Mortgages - San Francisco Chronicle
 Bloomberg | Wall Street CMBS Allure Fades as Volatility Surges: Mortgages San Francisco Chronicle May 24 (Bloomberg) -- Wall Street's on-again, off-again love affair with commercial-mortgage-backed securities is on the rocks as markets get whipsawed by Europe's debt crisis. Goldman Sachs Group Inc., Deutsche Bank AG and other banks sold $2.4 ... Increased global market volatility spells trouble for commercial property ... |
Credit Suisse report plays down risk of mortgage crisis - Sydney Morning Herald
 Financial News | Credit Suisse report plays down risk of mortgage crisis Sydney Morning Herald AUSTRALIA'S high house prices look more likely to slow lending growth than cause a mortgage crisis in the medium term, a Credit Suisse report suggests. Falling demand for overvalued houses would affect the big four banks' ability to expand their ... Bank lending standards variable |
Obama Administration Looks For Mortgage Misconduct Tipsters - Wall Street Journal
Obama Administration Looks For Mortgage Misconduct Tipsters Wall Street Journal The Justice Department on Thursday announced the launch of a website (www.stopfraud.gov/rmbs.html) that seeks information from people who worked in the mortgage-backed securities industry before the foreclosure crisis and saw wrongdoing. |
Calif. homeowners with foreclosed second mortgages targeted by firm - News10.net
 News10.net | Calif. homeowners with foreclosed second mortgages targeted by firm News10.net By Rick Jurgens Adding new uncertainty in the state's ongoing mortgage crisis, a Texas company is aggressively pursuing hundreds of Californians to collect second-mortgage debt - on homes they've already lost through foreclosure. Firm targets CA homeowners with foreclosed 2nd mortgages |