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Sally Said:

where to find 105% mortgage loan to purchase a home?

We Answered:

DON'T DO IT!!!!!

Roberto Said:

What happens to the mortgage on our existing house if we use a bridge loan to purchase a new house?

We Answered:

1. On the Bridge loan, you can take out up to 85 percent of the value, and put it into a new home - payment is deferred for 6 months. That will enable you to #1 buy the new home, or build the new home #2 gives you time to sell your other home.

2. You are still responsible for all mortgages.

3. Lenders will take a hard look at your credit, your middle credit score needs to be in the 600's for the Bridge loan. The middle score varies from lender to lender rom 620 - 680 and higher. Other factors come into play.


BRIDGE LOAN:
It is a short-term bank loan of the equity in the home you are selling. You may take out a bridge loan, or interim financing, to help with a knotty situation: closing on the home you are buying before you close on the property you are selling. This loan basically enables you to have a place to live after the closing on the old home.

The key to a bridge loan is having a qualified buyer and a signed contract. Usually, the lender issuing the mortgage loan on the new home will write the interim financing as a personal note due at settlement on the property being sold.
If, however, there is no buyer for the property you have up for sale, most lenders will place a lien on the property, thereby making that bridge loan a kind of second mortgage.

Things to consider: interest rates are high, points are high, and there are costs and fees involved on bridge loans. It may be cheaper to borrow from your 401(K). Actually, any secured loan is acceptable to lenders for the down payment. So if you have stocks or bonds or an insurance policy, you can borrow against them as well.

So basiclly it is this: A "bridge loan" is financing secured by your current home, a home typically listed for sale. The bridge loan is used to finance the purchase of the second home and is paid off when the first home sells.

In addition to other questions, when considering a bridge loan seller/borrowers should ask about interest costs, up-front fees (because bridge loans are short-term financing, it's better to pay a higher interest rate than points for a loan which will generally last just a few weeks or months), and what happens if house #1 takes longer to sell than anticipated.

Jack Said:

2nd Home is it better to get an equity Loan to purchase or a 1st mortgage?

We Answered:

I am a mtg broker. I would do a fixed HELOC and combine all your debt into it. If you pay all your debt separate, you are paying interest on the cars, credit cards, etc which are NOT tax deductible. Your mtg debt is.

Congrats on having your home free and clear!

Eric Said:

Can I add a family friend on title at closing even if they are not on the mortgage loan or purchase contract?

We Answered:

You don't have to hide it, and you can't anyway. It will be on the final title policy that they send back to the lender.

I think it is a MISTAKE to put your family friend on title, because then you won't be able to do anything with the property, including refinancing it or selling it, without his signature, and that can give him other legal entitlements to which he should not receive.

Have him "gift" you the down payment, and then post closing, have him do a private mortgage for the amount of the down payment.

Yes, that will put him in second lien position, but it's better than him being part-owner.

No way in heck would I put his name on as an owner.

PS: The above poster is incorrect. There is no law anywhere in any state that says who you can receive financial assistance from. That is a LENDER policy, not a law. Mortgage company's do not get 'automatically' notified of subsequent liens..ever...it doesn't matter if they are in first lien position. No county has such a system in place. Also, adding a name doesn't delay the closing as it can be done in 5 minutes. Who comes up with these made-up idea?

Constance Said:

Where can I get a great new purchase mortgage loan without PMI?

We Answered:

If you put down enough money you can get a mortgage without PMI just about anywhere. One thing some people do is to take out a home equity line at the same time and use the home equity credit to increase the total downpayment to a sufficient amount so you won't need PMI. It means you will have two mortagages, the main one and the smaller home equity one, but you will be free of PMI related debt once the home equity line is paid off.