If you make a prepayment, or if you payoff the loan early, the lender loses the money it would have made in the future. With that in mind, many lenders protect themselves from early prepayments on loans by forcing the homeowner to pay a penalty if he or she decides to pay off the loan before the end of the loan term. These penalties are known as prepayment penalties. Learn more here about prepayment and prepayment penalties.
Fannie Mae Restricts Refinancing
To reduce the number of mortgage loan refinancings, Fannie Mae instituted a fee. Fannie Mae's refinancing fee should offset the cost of people defaulting on their mortgage loans. In addition, Fannie Mae is limiting home owners to refinancing no more than once per year. Learn more about Fannie Mae's new refinancing policies.
Mortgage Lenders Share News
Some home owners had trouble making mortgage payments after 9-11. Experts from the Mortgage Bankers Association put their delinquency rates into perspective. Learn also how mortgage lenders and secondary market players such as Freddie Mac work to combat mortgage fraud.
Ask Mortgage Lenders About Prepayment Penalty
When you're researching your mortgage loan options you should find out whether your mortgage loan has a prepayment penalty. A mortgage lender charges you a prepayment penalty if you pay off your mortgage early. State laws vary as to whether mortgage lenders can legally charge prepayment penalties.
Error In Contract Prepayment Penalty
A mortgage is sold with a mistake regarding the prepayment penalty. It is the homeowner's responsibility when signing a contract and to be aware of the danger of predatory lenders. If you signed the disclosure statements without reading them, it's a little bit hard to make a case that you were in some way defrauded, unless you do not read and understand English. Every borrower has some responsibility to make sure the loan documents say what they think they say.
Home Buyers And Homeowners: Mortgage Questions To Ask Your Lender
There are several mortgage questions that home buyers and homeowners should ask their lenders before filling out their applications. Most home buyers and homeowners don't know what they're getting into when they finance or refinance their homes with a mortgage, and handing that application in to your mortgage lender without knowing what you're signing could get you into trouble. One important question home buyers and homeowners should ask their mortgage lender is how their credit will affect the mortgage loan's interest rates and terms.
Consider Interest Rates and More When Refinancing
It's important to look at interest rates when you're thinking about refinancing your home mortgage loan. But there's more to deciding whether to refinance than just interest rates. When you're trying to decide whether to refinance your mortgage you need to think about how long you will stay in the home and whether you can recover closing costs. You should also look at whether there's a prepayment penalty for your old mortgage loan.