American Mortgage Resource, Inc.

Providing the Best Financial Resources for Boston and Massachusetts

Tag: Home Equity Conversion Loans

The Time to Buy a Home This Holiday Season is Now

In the United States as the winter months bring festive holidays like Thanksgiving and Christmas, many families are so busy and preoccupied that home sales will dip slightly. This makes now a good time to snag a great deal on a home this winter. Below are some factors to consider before biting the bullet on home ownership or moving to another home.

Less Competition as a Buyer

During this time of year it tends to get colder in many parts of the country. Not many people enjoy picking up their family and belongings and moving during these colder winter months, which creates less demand in the market for sellers. This increases the chances of getting a great deal as a buyer as less people are competing in the real estate market at this time.

Interest Rates Are at Record Lows

As the Coronavirus closed many businesses for extended periods of time, this year interest rates have seen record lows to spur the economy during this downturn. What that means for homes buyers is that borrowing money is nearly free thanks to these record low interest rates on mortgages. This is likely the lowest we will see rates for years to come and locking in a fixed rate mortgage is sure to save you thousands of dollars in interest in the future.

Buyers Want to Sell Quickly

Buyers in the market during this time are usually more likely to turn their property over as quickly as possible due to the time of year and other obligations this time of year brings. This means that you may have sellers that are more motivated to make a deal with you and help you secure your next home.

Final Thoughts

Though this year has brought many ups and downs, as we head into 2021 home buyers have unique opportunities to purchase and refinance homes at rates that are incredibly rare. Let American Mortgage Resource, Inc. be your one stop shop for all your mortgage and refinancing needs in the Waltham, MA community.

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

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.

Reverse Mortgages 101

The word “mortgage” usually brings to mind years of payments to a financial institution, until the full payment is accomplished. However, not all mortgages operate the same way. Hence, this blogpost welcomes the reader into the world of reverse mortgage.

Has to do with home equity

Also known as home equity conversion loans, reverse mortgages indeed are determined by the value of home equity. Reverse mortgages are available for homeowners 62 and older. To take out a reverse mortgage, a homeowner borrows against his or her home equity—i.e. based on the value of the home. Reverse mortgages are great in that they can allow homeowners to take advantage of a lump sum by borrowing against the equity (which can be a source of immediate income when times are tough or a steady stream of income). Although the homeowner is not required to make monthly mortgage payments, the full repayment is achieved at loan maturity.

A picture of home equity.

When is loan maturity achieved?

Loan maturity can occur when the homeowner sells the title of his or her home or moves out of the home (for example, to move into his or her child’s home). Unless the homeowner repays the mortgage by selling the home—the net amount from which would be used for repaying the mortgage loan—the homeowner’s heir(s) must repay the mortgage. Loan maturity can also occur when the homeowner dies. Creditors have the motivation to not collect monthly payments since the loan balance increases.

An elderly woman dabs.

Caveats

When one only has the facts above, a reverse mortgage could sound too good to be true. However, paying homeowner’s insurance and property taxes are still requirements for a reverse mortgage. (This is why wise financial planning is crucial for avoiding foreclosure.) Moreover, in certain instances, a widow or a widower can lose a home; therefore, reading the fine print is key for benefiting from a reverse mortgage. Another major caveat is that many scammers target the elderly in exchange for a fake reverse mortgage.

An elderly couple talks to a mortgage lender.

Conclusion

So there you have it. Reverse mortgages can be tricky to navigate, which is why you need a professional on your side. To benefit as much as you can from this “home equity conversion loan,” simply enlist the help of American Mortgage Resource, Inc. today.