Mortgage Modification - Long Term Effects - 5 Years and Beyond [mortgagecalculator-tips.blogspot.com]
www.peterkinch.com Feb 29, 2011 - Low rates continue to dominate the headlines as a Senior Economist from BMO indicates that the Canadian Housing market may be in a baloon but not a bubble. And speaking of rates, find out why you might want to have your mortgage renew in 2016 rather than 2017. And lastly, a reminder that I am returning to Ontario to do a live 5 Year Plan Workshop for the first time in almost 5 years. Ottawa Freb 18th.
mortgagecalculator-tips.blogspot.com The Mortgage Minute - Ongoing Low Rates means No Bubble
It's easy to find out all you ever wanted to know about how to apply for a mortgage modification on the web! Everywhere you look there are helpful tips and guidelines to get you through that initial qualifying process. But what happens in the long run? Once you are approved, then what? Maybe you don't want to even apply until you know that answer! I know I wouldn't! Being informed includes understanding how the entire process works not just the beginning!
Some of the benefits to a mortgage modification include:
1. Reduced interest rates, could be as low as 2%
2. Extended terms on your loan to as much as 40 years
3. Defer or forgive second loan balance
You have probably already read those benefits a thousand times online! So, ok you apply and are approved then what?
The first thing you should know is that you are given a 90 day trial period.
During this trial period you must make every payment on time! This is your new lower mortgage modification payment. It is only AFTER this 90 day period that your modified loan will be extended to the next 5 years.After the 5 years you will see a change again! Depending upon what the market interest rate was on the day your modification loan took effect, you new interest rate will change! For example, let's say your mortgage modification loan included a lower interest rate at 3%, and the market interest rate was 6% when your modified loan took effect. Beginning in year 6 of your mortgage modification your interest rate will increase 1% every year until you meet the 6% market rate. The goal being to get your loan back to the market rate as it was at the time of its inception. This is all documented in your mortgage modification agreement; you must read the fine print!
This makes sense, and is a good plan! But you need to know what is going to happen before you jump right into a mortgage modification! Basically the government is going to give you a break for 5 years, and then slowly bring your loan back up to the current market rate.
(Actually the market rate at the time of your initial modification)Knowing all the facts will make you a much more educated borrower! If you are overwhelmed by the whole process, or just want a bit more information, I can help you there too! Maybe you aren't even sure if you would qualify for a mortgage modification loan and want to find out before contacting your lender. These folks can help! Mortgage Modification experts! Click there and you will be well on your way to saving your home today! It is a scary time, a stressful time and should be entered with caution! Start here and find out would you qualify today!
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