Financing

During your venture you will probably hear this term used a lot. It stands for principal, interest, taxes and insurance. Every loan includes principal and interest payments and those labeled PITI also include taxes and insurance. Property taxes and homeowners insurance payments can be paid in an annual lump sum. PITI means that these payments are instead spread out over the year and included in each mortgage payment.

When a property owner agrees to payment of a portion of a home’s purchase price over time, with the debt to the seller registered on the title as a mortgage, it’s known as seller financing, a vendor take-back mortgage or a purchase-money mortgage. This is a home-financing strategy in which you the buyer borrow from the seller instead of or in addition to a bank or traditional lender.

The FTC or Federal Trade Commission requires each of the credit Bureaus Experian, Equifax and TransUnion to give consumers one free credit report per year for a total of three free reports each year. But you have to ask for them. You can get your free reports by going online to www.annualcreditreport.com. Don’t go directly to the credit report companies, they’re geared toward selling you reports.

Each online lender has different application requirements. For example, if you visit LendingTree.com which is one of the internet’s better known lenders, they have revealed a checklist of items to bring with you when you are ready to sign up.

Hybrid loans won’t save you quite as much money as pure ARM (Adjustable-Rate Mortgage) but they are cheaper than a 30-year fixed rate mortgage and they limit your risk. They are especially popular among buyers who don’t plan to be in their new home for more than ten years. Hybrids give you a fixed interest rate for the first three, five, seven or ten years of the mortgage.

Most mortgages do not limit prepayment of your principal, If you would like to pay twice the principal due each month, with the goal of paying off your loan early then you are free to do so without penalty. If rates fall and you’d like to refinance to a better loan after a year or two, you don’t owe anything extra. But some mortgages don’t treat borrowers so kindly.

Among all the paperwork involved with taking out a mortgage, it is very easy to let your mind wander and simply sign on the dotted line. But be careful, you should read through the loan documents. You have to ask about and also watch out for these hazards to your financial health in particular

Improving a credit score does not happen overnight. Why? It’s because most creditors only report to the bureaus once a month. But there are a few steps you can take right now to start cleaning up your credit blemishes and here they are.