Mortgage Payments Archives | Lerette Lending

What’s The Difference Between Interest Rate and Annual Percentage Rate (APR)?

The difference between APR and the actual note rate is very confusing, especially for First-Time Home Buyers who haven’t been through the entire closing process before. When shopping for a new mortgage loan, you may notice an Annual Percentage Rate (APR) advertised next to the note rate. The inclusion of an APR is actually mandated …

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Calculating The Net Benefit Of A Refinance Transaction

Refinancing / By Joshua Lerette

Calculating the net benefit of refinancing can be a challenging task if you do not understand what to calculate. We are going to focus on the net benefits of refinancing from the standpoint of lowering your interest rate. Although there are several reasons to refinance, lowering your mortgage rate to save on interest payments over …

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How Do Mortgage Rates Move When The Fed Lowers Rates?

Home Loan Basics / By Joshua Lerette

Lower mortgage rates is a common misconception that is perpetuated by the mainstream media when the Fed makes an announcement of lowering rates. However, when the Fed cuts interest rates, mortgage rates can actually increase. Fed 101: According to Wikipedia: The Federal Reserve System (also known as the Federal Reserve, and informally as the Fed) …

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Why Do I Need To Pay A VA Funding Fee?

Home Loan Programs / By Joshua Lerette

The VA Funding Fee is an essential component of VA loans and is a requirement of any Veteran taking advantage of this zero down payment government loan program unless deemed disabled by the military. This fee ranges from 1.25% to 3.3% of the loan amount, depending upon the circumstances. On a $150,000 loan that’s an additional …

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Why Do I Need Mortgage Insurance?

Home Loan Basics / By Joshua Lerette

Mortgage Insurance, sometimes referred to as Private Mortgage Insurance, is required by lenders on conventional home loans if the borrower is financing more than 80% Loan-To-Value. According to Wikipedia: Private Mortgage Insurance (PMI) is insurance payable to a lender or trustee for a pool of securities that may be required when taking out a mortgage …

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Understanding An Amortization Schedule

Home Loan Basics / By Joshua Lerette

By committing to a mortgage loan, the borrower is entering into a financial agreement with a lender to pay back the mortgage money, with interest, over a set period of time. The borrower’s monthly mortgage payment may change over time depending on the type of loan program, however, we’re going to address the typical 30 …

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How Do I Calculate My Mortgage Payment Without Using A Mortgage Calculator?

Home Loan Basics / By Joshua Lerette

Calculating an exact mortgage payment without a calculator on a loan is no small task, but there are some simple rules-of-thumb you can use to get a close estimate. With the exception of the MIT Blackjack Team, performing this type of complex math in your head often leads to frustrating rants. When coming up with …

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Do I Have To Continue Making My Mortgage Payment If My Lender Goes Bankrupt?

Home Loan Basics / By Joshua Lerette

When mortgage lenders go out of business and are essentially taken over by the FDIC, homeowners are left wondering if they still need to make a monthly payment. Great thought, and a very common question for many borrowers in the 2006-2010 timeframe. The short answer is YES, you still have to continue making mortgage payments …

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Shopping For A Hazard Insurance Policy

Home Loan Basics / By Joshua Lerette

When shopping for a hazard insurance policy, something called “bundling” can actually save you quite a bit of money that most people aren’t aware of. Many of the big insurance companies price their insurance rates to attract a particular segment of the market. They usually price their hazard insurance policies to attract homeowners who need …

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Who Owns My Home If I Have A Mortgage?

Home Loan Basics / By Joshua Lerette

Many borrowers believe that when they purchase a property by obtaining mortgage financing, they also own their home. Technically speaking, full ownership on a property only happens once the mortgage loan amount has been paid in full. To break this down in more detail, there are a few components of a mortgage: A Promissory Note is …

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