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Differences Between Commercial and Residential Lending

December 3, 2020 / / 0 Comments

Residential and commercial lending are not created equal for many reasons. Commercial lenders will often take a much lower risk then residential lenders are willing to take. Below we discuss some of the major differences to expect between commercial and residential lending.

Commercial

Income Qualification: In order to qualify for a commercial loan the lender is going to mostly take into account how much income your company generates versus the cost of the property.

Down Payment: Commercial loans typically require a much larger down payment than residential loans require. This is mostly because the commercial real estate market is much riskier so most commercial lenders will require at least 20% down.

Length of Loan: Again because commercial loans typically involve a much higher risk, the length of commercial loans are typically significantly shorter than those of residential loans. Most commercial loans will need to be paid within ten years.

Residential

Income Qualification: When applying for a residential loan lenders will mostly only take into consideration an individual’s income versus their current outstanding debts.

Down Payment: Those with good credit scores can typically negotiate a lower down payment on a residential loan. Lower down payments are often offered as long as a private mortgage insurance is also paid.


Length of Loan: Typical conventional residential home loans will have a 30 year term. Sometimes these loans can allow for a length negotiation depending on the borrowers financial standing.

Final Thoughts

After a while, commercial and residential property owners will have options when it comes to refinancing their current loans. Refinancing can not only help reduce monthly payments and interest rates, but make it possible to reinvest into your property too. Call American Mortgage Resource, Inc. to learn more about our quick and easy refinancing options.

The Best Ways to Use a Home Equity Loan

November 27, 2020 / / 0 Comments

What are you envisioning for your home? Are you looking to renovate the kitchen? Perhaps replace the garage door? To fund your house projects, you can find financial support through a home equity loan. Bankrate comments, “Tapping your home equity can be a convenient, low-cost way to borrow large sums at favorable interest rates in order to pay for home repairs or debt consolidation.” Continue reading to learn about more ways you can use your home equity loan.

Home Improvements

Financing large projects is feasible with a home equity loan. With fixed monthly payments and a large sum of cash up front, you can pay for projects like a kitchen remodel, bathroom renovation, deck installation, and more. Once these projects are finished, they can raise your home value over time and give you a good return on your investment. Are you planning to sell your home in the future? Prospective buyers will take an interest in your new improvements.

College Debt

While student loans are more conventional, another route you can take is by using home equity. You may find that a home equity loan gives you more of an advantage due to the lower interest rates. Additionally, you can extend the term of the loan and therefore reduce your payments. However, you want to be careful not to default payments, otherwise, you could lose your house. Before using home equity for student debt, calculate the monthly costs and see if you can make the payments.

Debt Consolidation

Are you paying high-interest debt on a credit card or car loan? Consider consolidating your debt with your home’s equity. This way, you can pay off personal debt at a lower interest rate and set a longer term. You will be able to make monthly payments quicker and easier. Note: using home equity makes this secured debt – meaning the collateral is your home. Bankrate states, “If you have a solid debt payoff plan, using home equity to refinance high-interest debt can help you get out of debt faster.”

Conclusion

When you need a home equity loan, contact the team at American Mortgage Resource, Inc. Our professional lenders have the answers to your loan questions and are friendly when helping you with your loan needs. Get started on the loan application process today!

What Questions Can a Mortgage Calculator Answer for Me?

October 29, 2020 / / 0 Comments

When you are in the market to buy a new home or decide you want to refinance, it is best to prepared and informed before making any big decisions. Your funds are going to be an important part of the buying process, so by using a financial tool such as a mortgage calculator, you can plan ahead. Similarly, managing your monthly payments for the mortgage can also be accurately shown on a calculator. Learn more about how a mortgage calculator answer your financial questions!

How Long Until I Pay Off My Loan?

In order to strategize your payment plan, you need to look closely at the loan term. With a short term, there are typically higher payments in a shorter amount of time. However, you won’t be paying as high of an interest. On the other side, a long term allows you to have lower payments, but you will be paying more interest over time. Finding a balance of affordability and less interest can help you make the most of your payments towards a home loan.

Can I Afford This House?

One of the main questions to ask yourself is “Am I able to afford this house?” Before settling on that beautiful house you’ve been dreaming of, first determine how much you can afford. A mortgage calculator can give you an accurate estimate of the amount you will need for monthly payments, as well as a down payment. The goal is not to overspend on your house and set realistic goals while considering your financial situation.

How Much Should I Put On The Down Payment?

The higher the down payment, the lower your monthly payments will be. However, you should only put in what you can manage to pay for. Do not put all of your savings and emergency funds into your down payment. Instead, you can use a calculator to figure out a practical down payment. First-time buyers can especially benefit from a calculation, as they will not have extra funds from a previous property.

Conclusion

If you need to calculate your mortgage payments, American Mortgage Resource, Inc. has a free calculator online. You can navigate our website and click on “calculator” to enter your information. For help with the loan process or other mortgage services, contact our team today!

Home Equity Loans: The Answer You’ve Been Looking For

September 30, 2020 / / 0 Comments

Qualifying for certain loans and credit cards can be a difficult and confusing process for many of us. Homeowners have a unique advantage when it comes to borrowing money in a pinch as they may be able to qualify for a home equity loan. Follow along below as we discuss home equity loans and their pros and cons.

What’s a Home Equity Loan?

A home equity loan is a fixed or adjustable form of credit secured by how much equity you have in your home and enables you to borrow against that equity. Essentially this type of loan is a second mortgage as you will have to continue paying your primary mortgage while simultaneously making payments on your new home equity loan.

Pros

Home equity loans can save the day when you need help repaying higher interest debt elsewhere or funding home renovations. A distinctive benefit these loans offer is that while their interest rates may be slightly higher, any interest paid on them is tax deductible.

Cons

Undoubtedly the biggest risk in taking out a home equity loan is that your lender may be able to force you to sell your home to resolve the loan if you are ever unable to make your payments. Additionally, your home will have to be appraised to establish its value and you will have to provide proof of sufficient credit and income.

Final Thoughts

When considering applying for a home equity loan or any other type of loan, be sure to shop around to compare the varying plans offered by banks, credit unions, and mortgage companies in your area. At American Mortgage Resource, Inc. we have relationships with over 20 different lenders and strive to make the process as simple and smooth as possible. Contact us here to learn more about our affordable services.

How Reverse Mortgages Benefit Seniors

August 28, 2020 / / 0 Comments

If you are 62 and older and own a home, you may be able to opt for a reverse mortgage. When you use a reverse mortgage, home equity is withdrawn as cash to pay for expenses like home improvements or debt consolidation.  You do not have to pay taxes on the proceeds or make monthly mortgage payments. Of course, there are requirements you have to meet in order to qualify. Read more about the benefits of a reverse mortgage.

Pros

After you retire, there are still monthly expenses to be paid. These expenses can begin to add up, leading you to find more options to supplement your income. Luckily, a reverse mortgage can help. Bankrate states, “A reverse mortgage can be a solution for consumers ages 62 and older who own their homes outright — or at least have a considerable amount of equity to draw from.” Some seniors use this loan to pay for living expenses, repaying debt, covering healthcare expenses, and more. It is also a way for seniors to enjoy retirement, giving them the freedom to purchase a vacation home or another property.

Cons

There aren’t too many drawbacks for a reverse mortgage, but you must keep some things in mind. According to Bankrate, “the borrower must maintain the house and pay property taxes and homeowners insurance.” Furthermore, you have to be living in your home as a primary residence, as well as keep your property in good condition. It is also good to note that closing costs can be expensive too.  

Conclusion

If you are interested in a reverse mortgage, contact the team at American Mortgage Resource Inc. We have a variety of loan options available and can help you make the right decision. For more information on our reverse mortgage services, call us at (617)-972-8588. We look forward to talking with you!

Most Affordable Communities to Buy a Home in Waltham, MA

August 28, 2020 / / 0 Comments

Just west of Boston lies Waltham, MA, a quaint and scenic small town centrally located in between 3 major highways. Through its southern end flows the Charles River and as you head north you’ll find that it’s also home to several colleges, parks, and even a music theatre.

Piety Corner Historic District

Piety Corner Historic District is a quiet area in town adorned with red brick buildings and parks. Most homes in this area are bungalow, colonial, and ranch style homes in addition to the common condo. This community is great for local hiking and outdoor recreation at parks like Prospect Hill Park. Piety Corner is also very kid-friendly, with schools for kids of all grade levels nearby.

The South Side

The South Side is a large yet quiet suburb style community filled with many single family homes and gorgeous condos. This part of town is separated from the rest of town by the Charles River, giving the South Side and its surrounding communities a private and secluded feel.

Banks Square

A popular and affordable neighborhood in Waltham is Banks Square. This community is known for its charming neighborhoods filled with condos, townhomes, and single family homes. Though this area is set back slightly further away from most schools, it is only blocks away from the town’s main street, which is a popular hub for shopping and dining.

Final Thoughts

Waltham, MA is a fantastic place for new and growing families due to its affordability and number of parks and private/ public schools. Just outside the desirable Piety Corner community lies your one stop shop for home loans, mortgages, and refinancing in Waltham. At American Mortgage Resource, Inc. you will receive personalized home buying support from highly skilled experts that are also members of the local community.

Private Mortgage Insurance (PMI)

July 30, 2020 / / 0 Comments

When it comes to a mortgage, considering all of your options is crucial in finding the arrangement that best meets the continued needs of you and your family. Many private insurance companies will offer home buyers PMI, which is a deal typically established by the lender and paid for by the borrower, but can benefit both parties. Continue along with this month’s blog for more information about PMI and to find out if it’s right for you.

The Purpose of PMI

PMI is sometimes required of home buyers who have put down a deposit that’s less than twenty percent of their loans total value or who have taken out a conventional loan rather than a government assisted loan. Essentially PMI is insurance coverage for the lender to ensure they will be repaid the amount of the loan in full.

Pros of Having PMI

Agreeing to PMI can help home buyers who are struggling to qualify for a loan large enough to afford a home. It can also help them qualify for their desired loan much more quickly. As the prices of homes continue to soar every year, a prolonged plan to save for a larger deposit may not be the best option for some potential home buyers.

Cons of Having PMI

The biggest downside of PMI is that it’s an additional monthly expense or upfront cost that new home buyers are responsible for paying in addition to their mortgage. It’s also an expense for a service that doesn’t directly benefit those funding it. PMI will usually have to be paid until the borrower has compensated a predetermined minimum on their principle.

Conclusion

Private mortgage insurance can help countless families finally catch the break they need to afford a home. For more information on how to get approved for a loan, visit this article. For expert help through the loan and mortgage processes, contact our professionals here for guidance you can trust.

Why Your Credit Score is Important for the Loan Process

June 23, 2020 / / 0 Comments

In order to get the best deals and rates on a home loan, you need to have a good credit score. Mortgage lenders are going to look to see if you are a responsible borrower and making your payments on time. Additionally, your credit score can provide the information a lender needs to determine your eligibility, including which rates they are going to offer and what type of loan you qualify for. Continue reading to understand how your credit score is important for the loan process!

Are You Credit Worthy?

Before you begin shopping for loans, have your credit score ready to go. Check online with an accredited website for the most accurate results. It’s important to mention that most lenders are going off of a FICO credit score, which ranges from 300-850. If your credit score falls under the category of “fair” or better, you’re in the average range for an American borrower.

Is Your Credit Enough for a Home Loan?

According to Meridian Banker, “the credit score needed to buy a house greatly depends on the type of home loan you apply for.” Some of the most common loans you are going to come across are conventional loans, FHA loans, and VA loans. These loans start at a minimum of 500-620 or higher. FHA loans are beneficial for borrowers with low credit scores, while conventional and VA loans are better if you’re in the “good” or “very good” range.

What about Rates?

The higher your credit score, the lower your rates are going to be. The amount you’re paying back on the loan is greatly affected by the rate at which it’s set. Essentially, a lower rate is going to save you more money over time. This is why having a good credit score can expand your loan options, while also giving you better rates in the long run.

Conclusion

For more information about the loan process and what it involves, the professionals at American Mortgage Resource, Inc. are here to answer your questions. We want you to be confident in your financial decisions, so call us at (617)-972-8588 or visit our website to send a message. We look forward to hearing from you!

3 General Refinance Loans

May 7, 2020 / / 0 Comments

Are you planning to refinance your mortgage? Do you want to take advantage of lower interest rates or perhaps lower your monthly payments? When you start to shop around for the best offers, it’s important to understand which loans you can get approved for. There are some refinance loans that may be better suited for your financial needs. Follow along in our blog to learn more about the general refinance loans you can apply for.

Rate-and-Term Refinance Loan

If you’re looking to save money on monthly payments or switch your loan from an adjustable rate to a fixed rate, then this loan can help with that financial goal. It can change the interest rate, loan term, or even both, without changing the actual amount of the loan. Experian comments that “if your original mortgage has an adjustable rate, moving to a loan with a fixed rate can help you avoid market fluctuations.”

Cash-Out Refinance Loan

Need quick cash for a home improvement project? Then a cash-out refinance loan may be right for you. When you apply for this type of loan, you are essentially taking out a portion of your home’s equity in order to get a large amount of cash. However, be cautious that this will most likely increase your loan amount, as well as result in higher monthly payments.

Cash-In Refinance Loan

While not as common as other loan alternatives, cash-in refinance loans are still an option for homeowners. Instead of taking out cash, you’re putting money into the loan to reduce the new mortgage balance. Consider this loan if you’re interested in qualifying for a lower interest rates, underwater on your mortgage or want to get rid of private mortgage insurance

Conclusion

Have any questions about the loan process? Get in contact with a representative from American Mortgage Resource, Inc. We can help guide you to make the right financial decision. Call or visit our website for more information. We look forward to speaking with you soon!

What is a Jumbo Loan?

April 29, 2020 / / 0 Comments

If you are new to the world of loans and home buying/owning, we are here to help you better understand! In this months blog we will be going over what exactly you need to know about a jumbo loan. Continue reading if you’re ready to learn!

Basically…

A jumbo loan is essentially just what it sounds like. When it comes to buying the home of your dreams, sometime the price is just too high. A simply loan wont cut it and you don’t have enough in your bank account. A jumbo loan is here to help! When the price of your dream home is high, so is a jumbo loan. What makes a jumbo loan so special is that it goes outside of the normal restrictions of what size a loan you can get from the bank. They are classified as non-conforming loans since they don’t follow the typical guidelines. They will differ per area you are looking to buy in, so it’s important to properly research jumbo loans in each area. You wouldn’t want to find your dream home in a spot that has limitations that will restrict your loan. 

Another concept you need to keep in mind when considering jumbo loans is that you might see it’s difficult the find someone willing to give you a loan of that size. Jumbo loans, which can be incredibly beneficial in the end, are also extremely risky. As mentioned before, they don’t work within the typical loan guidelines, which make the risk large should you not be able to pay everything off in the end. With all that being said, the specific qualifiers are often hard to hit. After a thorough analysis, it must be provable that you have high income and a great credit score. Those are the two main qualifiers that you need to focus on. 

Conclusion

Ultimately, jumbo loans are a great way to get the home of your dreams. If you believe you will qualify and are looking for an expert to walk you through all the necessary steps, be sure to check out American Mortgage Resource, Inc.

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