I-RefinanceToday.com

How to Lower Your Interest Rate Mortgage

If you have a home loan, are about to get a home loan, or if your are considering a refinance, then this article will introduce you to
some financial strategies, that can dramatically change your financial future.

This is to help you learn about insider industry strategies and secrets that the banks don’t want you to know about. By keeping you in the dark and allowing you to cling to flawed financial concepts, is big money for the banks.

Now here is an important financial question for you, your financial future is riding on your answer. If what you thought to be true about a specific financial strategy wasn’t true after all, when would you want to know ? Now or later ? We’ll assume that it is now.

mortgage application

The strategy that we are talking about is how we view and treat our home loans. You may also want to ask yourself ‘who taught you everything you need to know and understand about the most effective and efficient way to handle a home loan ? The sad reality is that the majority of Americans have a fatal misconception of how a home loan works, and how much of their hard earned money is actually given away to their lenders. Americans are so focused on interest rates and payments, that they fail to recognize that they are trapped in a mortgage cycle of debt.

How would you feel if you found out that the mortgage system is actually set up to keep you trapped in that mortgage cycle ? And that cycle reaps huge profits for the banks, and in doing so, your lender is literally stealing your financial future. Now that may seem like a harsh alligation, but it’s vital that you know just exactly how true it really is.  By paying your home loan as agreed, or regularly refinancing, you are securing your banks financial future while denying you and your family potentially hundreds of thousands of dollars that could be going towards your financial nest egg.

It is imperative that you and your lender do not have the same goals. Whats good for you is paying your loan as inexpensively and rapidly as possible. What’s good for the lender is the exact opposite, they want to earn as much interst as possible for s long as possible.

However you have a choice as to whether you want to play their game or not.

Lets take a look a 1 misconception that many people have in regards to mortgages. This is in regards to the “Federal Truth in Lending Disclosure Statement.” Now if you have ever purchased a home you have certainly received one of these documents.

The first important thing to look at would be the amount financed.This is typically called the principal balance.  Let’s assume that it is $ 350,000.. It is important to understand that if we just had that amount our selves, we could have gone and paid cash and not have to worry about any mortage payments. Understandably most of us don’t have that kind of money, so we go shopping around at banks and lenders to find our loan.

Lets’ assume the loan is $ 350,000 at 6.25 % . Now in order for the lender to give us that money, the borrower is going to have to agree to the finance charge and pay that back over the term of the mortgage, lets say it is for 30 years. In this case we would be looking at over $425,000 that the borrower would have to repay. In the end that comes out to over 120% of the original principal balance. However most of us just shrug that right off, because you might be thinking that you are not going to be living in that house long enough or may be you think that you will just refinance later on.

Well if you ever really want to own a home this will be the minimum that you will ever pay. Don’t tell people you bought a home for $ 350,000, tell them you bought a home for $775,000 because that’s going to be the total of all payments that you are going to have to make if you ever want to own a home. This is the minimum, if you got an interest only loan, or a 40 year mortgage you are never going to own your own home.

So it very important that you start taking a look at ways to reduce this interest charge. Stay tuned for part 2 on strategies on how to actually reduce your mortgage payments.

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