Eliminating Your Subprime Mortgage [mortgageuseful.blogspot.com]
Follow us on TWITTER: twitter.com Like us on FACEBOOK: www.facebook.com The Global Financial Crisis (GFC) started three years ago, but China seems to be immune to it. Under the tightening monetary policy, many of enterprises are turning into shadow banks. With the due date of loan sharking approaching, the economic claps occur continuously. Foreign media warned that the Chinese version of the Subprime Mortgage Crash is approaching. After the start of the GFC in 2008, China began changing its monetary policy. For small and medium size firms its difficult to access the formal banking sector. Instead, they loan money from shadow lenders who are actually state companies. The official sector can obtain money from state-owned banks and issue loans to other borrowers with higher interest rates. In addition, non state-owned shadow banks are expanding, and more problems are being exposed. Economists are worried that China is s tarting to follow the pattern of the US' Subprime Mortgage Crash. During the World Economic Forum held in Dalian last week, a former vice chairman of NPC, Cheng Siwei said: "China's Subprime Mortgage Crash is the lending of money to local governments which have no ability to repay them." It is estimated that 80% of the loans from the top four banks in China go to state-owned firms. But now China has different shadow banks, from state-owned to individuals' firm, most of them with officials' background. Local governments use state funds to invest in businesses ...
mortgageuseful.blogspot.com China's Subprime Mortgage Crash
A subprime mortgage seemed like a good idea for many aspiring homeowners just a few short years ago. It was the most touted real estate loan by most lenders. Unfortunately, after taking out the loans, many borrowers realized just a bit too late, that they were not able to meet their loan's requirements. Thankfully, there are ways to get out of the predicament now.
Subprime Mortgages - What Are They?
To give you a brief background, subprime mortgages are usually offered to people with a poor or bad credit history. Since low credit scores did not prevent folks from getting approved, these mortgages were often the last resort. Of course, the terms often included high interest rate, loan application fees as well as balloon payments and prepayment penalties.
Refinancing A Mortgage
Here are five quick steps to help you refinance your subprime mortgage.
Step 1: Timing is important when refinancing a mortgage.
It is vital that you take action when the timing is just right, especially if your existing mortgage comes with an adjustable interest rate.
Just before the interest rate adjusts to a higher rate, Before your pre-payment penalty is activated and Before the required balloon payment is called. If you don't have those key pieces of information about your mortgage, you can always contact your lender and ask for it.
Step 2: Re-evaluate and assess your credit rating.
Have you made any improvements to your credit score since it was last reviewed? There are several things you can work on right now, to repair your credit.
You are entitled to one free annual credit report from each of the three major credit bureaus, Equifax, Experian, and TransUnion, so take advantage of that opportunity.
Step 3: Have a steady source of income.
Creditors always want to be reassured that their borrowers have a steady sources of income. That steady job ensures that you will always have enough money to at least cover the interest payments of the loan.
To qualify for a second mortgage or eliminate your existing loan, you must prove that you have a stable job and steady paycheck. If your income is strictly cash, provide documentation certifying that your cash income is constant and steady.
Step 4: Evaluate the equity in your home.
How much home equity do you have left? If the equity is 10% or less of the value of the property, chances are you might not be eligible for the best refinancing rates at the moment. Start reducing the size of your existing mortgage before applying for a second mortgage.
Step 5: Shop, Compare, and Apply
Once you have lined up all the details and are ready, the only thing left to do is shop for best mortgage rates, make comparisons, and submit your application.
