0
What else can I help you with?
Can you explain what recasting a mortgage means?
Recasting a mortgage is when the borrower makes a large payment towards the principal balance of the loan, which then reduces the monthly payments and potentially the overall interest paid over the life of the loan.
What is the meaning of a recast mortgage and how does it differ from a traditional mortgage?
A recast mortgage is when the borrower makes a large payment towards the principal balance of the loan, which then reduces the monthly payments. This differs from a traditional mortgage because it allows the borrower to lower their monthly payments without refinancing the entire loan.
Is it beneficial to calculate a mortgage payment for the future?
It is always beneficial to calculate a mortgage payment for the future. Being aware of financial obligations, especially one as large a a mortgage payment, whether in the present or future, is a good step toward financial security.
Does a large down payment offset low income when applying for a mortgage?
Yes, a large down payment can help offset low income when applying for a mortgage by reducing the amount of money you need to borrow and potentially improving your chances of approval.
What is a balloon payment?
A balloon payment is a large, lump sum payment made either at specific intervals, or more commonly, at the end of a long-term balloon loan
Can you explain what recasting a mortgage means?
Recasting a mortgage is when the borrower makes a large payment towards the principal balance of the loan, which then reduces the monthly payments and potentially the overall interest paid over the life of the loan.
What is the meaning of a recast mortgage and how does it differ from a traditional mortgage?
A recast mortgage is when the borrower makes a large payment towards the principal balance of the loan, which then reduces the monthly payments. This differs from a traditional mortgage because it allows the borrower to lower their monthly payments without refinancing the entire loan.
When mortgage payments are made in what way does the interest portion change each month and why?
Each month, the interest portion of the payment decreases and the principal portion of the payment increases. The interest decreases because the outstanding principal balance decreases each month as payments arev made. At the beginning of a loan, the interest portion of a payment is large and the principal is small. Towards the end of the loan, the interest portion is small and the principal portion is larger.
How does a reverse mortgage purchase work?
Similar to a purchase with a regular mortgage. The difference is that you need a large enough down payment to qualify, and you won't ever have to make a mortgage payment on the new home.
Is it beneficial to calculate a mortgage payment for the future?
It is always beneficial to calculate a mortgage payment for the future. Being aware of financial obligations, especially one as large a a mortgage payment, whether in the present or future, is a good step toward financial security.
What is meant by balloon mortgage in Anchorage, AK?
Regardless of location a balloon mortgage is when you have a large final payment at the end of the loan period.
Does a large down payment offset low income when applying for a mortgage?
Yes, a large down payment can help offset low income when applying for a mortgage by reducing the amount of money you need to borrow and potentially improving your chances of approval.
What is a balloon payment?
A balloon payment is a large, lump sum payment made either at specific intervals, or more commonly, at the end of a long-term balloon loan
Do large principal payments reduce monthly payments?
Large principal payments do not reduce monthly payments. Monthly payments are typically fixed based on the loan amount and interest rate, so making a large principal payment will not change the monthly payment amount. However, paying off a large portion of the principal can help reduce the total interest paid over the life of the loan and shorten the loan term.
How much of mortgage payments goes to principal?
Amortized mortgages follow a sliding scale of interest versus principal. During the early years of a loan, a large percentage of your payment goes to paying down the interest amount, and a very small amount, sometimes only a few dollars, goes to lowering the principal. As the loan ages, the proportion changes the other direction, so in the last few years, virtually every dollar you pay goes to pay off the principal balance. Of course, by then, you've paid many thousands of dollars more in interest. For example, if you get a $200,000 mortgage for thirty years, at five or six percent, by the end of thirty years, you'll have paid over $450,000 in interest alone, if you make every payment on a regular basis. This is one reason why it is sometimes a good idea to pay extra dollars against your principal, if you can, especially early on. For example, if you add a the next month's principal amount to your regular monthly payment, in 15 years you'll be able to pay off a 30 year mortgage. Most mortgage companies will send you an "amortization schedule", which details exactly how much of each monthly payment goes towards principal, and how much goes towards interest. The quicker you pay off the principal, the less interest you have to pay, and that can add up to a hundred thousand dollars or more. _______________________________________________________________ You need to keep track of your Amortization schedule the mortgage companies post and updates after each payment. Make sure your payments states "PRINCIPAL PAYMENT ONLY", then have an attorney ready to file suit of damages. I have been paying $500.00 on the 1st and $500.00 on the 15th of each month from military pay while my wife sends in the normal current payment every month. When the Income tax return came in, I added it to the $500.00 PRINCIPAL PAYMENT ONLY that was sent to the mortgage company. The Mortgage Company ignored PRINCIPAL PAYMENT ONLY, and posted it to current payment. After a total of 72 phone calls from Germany to the Mortgage Company in the United States which is not cheap, and all they say is "YEAH, YEAH, TOO BAD" and don't intend to fix it where now my next due payment is May 2010 and this is February, then it is time for attorney to take the records from the Mortgage Companies own website and take it to court. So since talking does not good, maybe a law suit to 1) Clear the mortgage debts completely and 2) Punitive Damages for several million dollars, the mortgage companies will then start treating people right.
How does the down payment affect a mortgage?
A down payment will reduce the principal borrowed which lowers your monthly payments. A large down payment may also help lower your interest rate and may help you avoid paying PMI. If, for example you were buying a $200,000, at 5% for 30 years, the payment would be $1073.64 per month. If you put 10% down, or $20,000, your monthly payment would be $966.28 and you would save about $20,000 in interest.
What are the potential risks and benefits associated with a mortgage balloon payment?
A mortgage balloon payment can offer lower monthly payments initially but carries the risk of a large lump sum payment at the end. Benefits include lower initial costs, but risks include potential financial strain if unable to make the final payment.
