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Types of Home Loans and Which is The Best?

Are you looking to get a home loan? Want to know the different options, and get the best? There are options, and the best option can be found. Read this article, and discover the information you need, to be able to get the best home loan.

There are all different lenders out there, that offer loans. You can find the best, and it can save you a lot of money, but you need to know what to look for. Take the time to research, and you can find the best options. The first key is to know the options.

The main 2 options of loan that you will discover, is the secured versions, and the second is the unsecured versions. And they both have benefits. For loans under $10,000, a home loan, which is often advertised as being of benefit for home improvements is best. And you can find some amazing findings.

The difference is simple to understand, and depending on circumstances, may be available to you or not. The key to remember, is that you can get a secured loan, if you have a home that you have purchased or is still on mortgage. The secured aspect means that it is secured on your home. Take the time to research, and you will find that this is the cheapest option, and can save a lot of money.

The other is the unsecured option, which is best, if you don’t want to put something up for security for the loan or if you can’t. Remember that this type of home loan will work out the most expensive, so consider strongly. If you want to save, getting secured loans, is the best option. So, see through research what you can find.

Wells Fargo Home Loan Modification – Important Debt Ratio Qualification Information

When the Obama administration launched its Home Affordable Modification Program in 2009, the government’s goal was a simple, but important, one: It wanted to slow the number of housing foreclosures sweeping the country. This is still an important goal: According to foreclosure information Web site RealtyTrac, U.S. property owners received 2.8 million foreclosure filings in 2009. That’s an all-time record.

If you hold a mortgage loan serviced by Wells Fargo Home Loans, you might qualify for a loan modification through the federal program. The government is offering financial incentives to companies such as Wells Fargo to encourage them to modify the loans of homeowners who are struggling to pay their mortgage bills each month. Lenders can do this in several ways: They can reduce the principal balance of homeowners’ loans, lower the interest rates attached to them or restructure the loans’ terms. Each of these steps will lower the mortgage payment of homeowners and, hopefully, allow them to avoid defaulting on their home loans. This will, in turn, keep them from losing their residences to foreclosure.

There are certain qualifications, though, that homeowners must meet to qualify for a loan modification. The most important might be debt ratio. According to the Home Affordable Modification Program regulations, the total mortgage loan payment — including interest, property taxes and other fees — of homeowners must be more than 31 percent of these owners’ gross monthly incomes.

The theory is that homeowners who aren’t spending this much on their mortgage loans do not require a modification.

There are other requirements that homeowners must meet, too. They must be seeking a modification of a loan attached to a primary residence. Second or vacation homes are not eligible for modifications under the federal program. Homeowners must have a mortgage loan of $729,750 or less, and they must be struggling to pay their monthly mortgage loan. Finally, they must have taken out their mortgage loan on or before Jan. 1, 2009, to take part in the federal loan modification program.

The federal program has a goal of preventing 3 million to 4 million housing foreclosures. So far, it is not reached this goal. However, homeowners who are struggling to make their loan payments, and who have the necessary debt ratios to qualify for it, should call their mortgage lender immediately. It might mean the difference between losing their homes to foreclosure and keeping them.

Bankruptcy and Equity Home Loans

If your bankruptcy discharge date is over twelve months ago, and you have been in the same employment for at least two years, then you are on a relatively good footing when it comes to potential lenders. In most cases it takes two years following your bankruptcy discharge date for you to get back into the ranks of a good credit rating.

It can be difficult to secure good credit after bankruptcy, however home equity loans can provide a relatively easy source of finance if you should require it. Because the loan will be secured on your home, it makes you a lower lending risk. This is because you are using your home as security, so the lender knows that you are much less likely to default on your loan repayments, and if you do they have the ability to repossess your home. This is why it is vital you are sure that you can make the repayments on your equity home loan before you apply for it, as the last thing you want to do is put yourself in the position of potentially losing your home.

While the fact that your loan will be secured on your property can be very detrimental if you are unable to keep up with your repayments, there is a plus side to using your home as security. Because you are able to offer substantial security to the lender, in the form of your home, you are much more likely to be able to get low interest rates on any amount you wish to borrow. You will find that there is a marked difference between secured loans, such as equity home loans, and unsecured loans. This is purely because of the fact you are offering the lender something tangible that has more value than the loan you are taking out, that they can call against should you default on your loan.

You will have to be prepared to do a fair bit of research into loan providers, and see what kind of deals are available from lenders who offer finance to people who may be considered high risk by mainstream and high street financial institutions. Be sure to get a few quotes before making a decision, and not just jump at the first offer that is made, the more information you get the greater your understanding of the rates and terms that are available to you will be. This way you will be able to make some comparisons and make sure you are taking out a loan that suits your needs. After bankruptcy, equity home loans can be slightly more difficult to find than if you didn’t have a bankruptcy on your file, however if you are prepared to put the time and effort in then you will be able to find what you need.