Welcome to Mortgage Guide
Mortgage Underwriter 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 Underwriter Specific links
Mortgage Underwriter News
Understanding Your Operation is Critical to Profits; Recent Lender... - Mortgage News Daily
Understanding Your Operation is Critical to Profits; Recent Lender... Mortgage News Daily These home additions will be reviewed by the underwriter for health and safety issues. Wells has issued a reminder that all Freddie Relief Refinance Mortgage transactions under HARP 1.0 guidelines (that is, with loan submission dates before February 6, ... |
David Voth Assumes Senior VP of Technology Role at Dimont & Associates - MarketWatch (press release)
David Voth Assumes Senior VP of Technology Role at Dimont & Associates MarketWatch (press release) At Fannie Mae, David led the design, development and implementation of Desktop Underwriter, the mortgage industry's most widely-used underwriting system. He also created and led a cross-functional team to design, develop, and market an innovative, ... |
Freddie Mac Repurchase Policy Is MBS Investors' Latest Worry - Fox Business
 Bloomberg | Freddie Mac Repurchase Policy Is MBS Investors' Latest Worry Fox Business Freddie Mac said late Tuesday that repurchases of the 2010 and 2011 loans would mean stripping the loans from its mortgage-backed securities, boosting the principal prepayments that have been increasingly damaging to investors in the $5 trillion MBS ... Bank Of America Buys Back $330 Million In Loans From Freddie Mac BofA Repurchases $330M from Freddie; Delinquencies Down, Sales... BofA Will Buy Back $330 Million of Mortgages From Freddie |
ICBA Mortgage Solutions Names Ron Bricker Regional Account Manager - MarketWatch (press release)
ICBA Mortgage Solutions Names Ron Bricker Regional Account Manager MarketWatch (press release) Bricker brings nearly 25 years of experience in the mortgage banking industry to the position. Most recently he was regional underwriting manager of GMAC's correspondent division. Previously, he was an account manager with Mortgage Guaranty Insurance ... |
Why 20% Down Won't Help the Housing Mess - The Fiscal Times
 The Fiscal Times | Why 20% Down Won't Help the Housing Mess The Fiscal Times Focusing on the size of the down payment distracts from the real source of sound loans—better underwriting and eliminating alternative borrowing methods like interest-only and adjustable-rate mortgages, says former mortgage lender Colin Robertson, ... |