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Posted on November 28, 2008 by Tom Brady | Posted under Loans
How to Slash Your Interest Rate While Converting Your Adjustable Rate to a Fixed Rate and Lower Your Payments
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But as we all know, things did not happen as expected. Today, interest rates are steadily rising. With the present financial crisis sweeping the globe, there are no signs of interest rates decreasing in the coming months or even years. Homeowners with adjustable-rate mortgages are now experiencing a steady rise in their monthly payments as well as a steady decrease in home value. What is even worse is when negative amortization occurs. The process of negative amortization takes place because adjustable-rate mortgages have caps that limit the mortgage amount within a specific time period. But when this limit is not sufficient to cover the increased interest, the unpaid balance is being added back onto the loan which in-turn gains more interest. So, even if the homeowner is paying on-time, his mortgage balance is increasing instead of decreasing. This could result in the homeowner owing his lender more than he originally borrowed. If you are one of these homeowners with an adjustable-rate mortgage, the only way you can survive your loan is to convert it into fixed rate mortgage. Once your debt is reduced to a fixed rate, your monthly payment remains constant until the end of your mortgage term and you will not have to worry about fluctuations and increases in your interest rate. Having a fixed payment allows you to be in control of your budget and have a solid financial plan, instead of being at the mercy of the market. But you could do even more than simply ask for a steady interest rate. You could actually slash a significant amount of money off of your monthly payment. A negotiation with your lender could result in a remarkably lower interest rate than you could possible imagine. This could be quite a daunting task for an individual homeowner like your self to take on so it would be in your best interest to seek the assistance of a reputable expert in loan servicing or loss mitigation to handle the process for you. All you have to do is carefully select a competent loan servicing or loss mitigation firm to handle the process of a loan modification so you can finally relax and sleep at night. © 2008, Tom Brady Reprint rights available for free About The Author: Tom Brady is a Loss Mitigation Specialist for LIG Loan Modification Services, a loss mitigation company that offers loss mitigation services such as loan modification, short refinance, forbearance, short sale, and deed in lieu of foreclosure. To see how your loan can be modified, visit http://www.LIGloanmods.com or call 1(888)220-9787. |
Tags: ADJUSTABLE RATE MORTGAGE, LOWER MORTGAGE, NEGATIVE AMORTIZATION
