Why Choose Contractor Mortgages?

Are you a contractor? If so, you may have already experienced your mortgage application being declined by several lenders and brokers. The lack of a fixed income makes it hard for contractors to secure a decent mortgage. It is really frustrating to dream of a home but unable to get the right finance for it. In contrast with other employees who receive a monthly fixed income, contractors usually don’t have a constant stream of money into their bank accounts, despite the fact that majority of contractors have a higher hourly rate compared to most office jobs. Therefore brokers and lenders see them as higher risk—and a chance they are unable to pay mortgage.
It is frustrating to be judged and financially discriminated. Most companies would hesitate lending someone who doesn’t work on a contract for company. Similarly lenders close their doors for people who consider themselves as self-employed. Contractors are usually paid on a hourly rate and usually have full control of their time. They have more freedom that someone in regular employment: but the lack of a monthly pay slip makes it really tough for them to secure any loan from the banks and lenders. No brokers would even consider them as qualified candidates for a mortgage.
There are however brokers that have seen a gap in the market for this rising group of processionals. The birth of contractor mortgages has opened a lot of opportunities for contractors, giving more opportunities to those in this market to own their own home with good interest rates. Although contractor mortgages are particularly designed to address the lack of fixed income of the contractors, it still requires them to submit proofs and documents upon application.
Certificate of contract is required from contractors if they plan to apply for a contractor mortgage. The contract should state the number of weeks or months it is effective, the amount of the agreed hourly payment and the name of the contractor. It is also important for a contractor or a freelancer to gather all the documents of his previous contract. Lenders want to know how long an applicant has been in this type of employment. Although it is not necessary to have a very long experience in contracting jobs, more experience entails a much higher offer from the lenders. Now with contractor mortgages you will be able to get the property you’ve been eyeing.

For mortgage rates and terms, you can visit www.contractormoney.com/mortgages today.

Can I Refinance My Home Without an Appraisal?

With mortgage rates hovering near all-time lows, you might want to consider refinancing your mortgage in order to free up some extra cash by lowering your monthly payments.

However, home prices are down from where they were at the housing market's peak, making it more difficult to accomplish this task. Appraisals can be one more hurdle in this process. However, there are some options if you are looking to refinance your mortgage without one, such as a VA streamline or an FHA streamline.


VA Streamline Refinance

In order to use a VA streamline, you must first be a military veteran or active duty personnel and have a current VA loan.

Some benefits of a VA streamline refinance include:

• It requires little or no out of pocket expenses, including most closing costs and other fees. Instead, you can roll these costs into the balance of the new loan to keep your savings intact.

• Interest rates are normally lower than the rates received by non-military borrowers.

• Rates that will not go up during the life of the loan.

If you are a veteran or an active duty member of the military, using the benefit you have earned could save you and your family a significant amount of money on mortgage payments every year.

FHA Streamline Refinance

Meanwhile, if you are not a current or former military servicemember, you might qualify for an appraisal-free refinance through the Federal Housing Administration.

In order to qualify for this program, there are a few basic requirements:

• Your mortgage must already by backed by the FHA.

• You must be current on the loan's payments.

• You must have shown good payment behavior during the past year.

• The refinance must allow you to drop your monthly principal and interest payments.

• You cannot withdraw cash from the mortgage.

Since the FHA already backs your loan, no further income or job verification is necessary to
qualify.

You can actually choose to complete an FHA refinance with or without an appraisal.

However, if you opt out, your new loan cannot be larger than the original one.

FHA refinances without an appraisal are required for rental houses or investment properties.

Take Advantage of the Market

Mortgage rates have dropped to record lows, making refinancing more attractive than ever. Refinancing your home loan without an appraisal through a VA or FHA streamline can significantly lower your monthly mortgage payments, and give you further financial safety.

The higher your current interest rate is, the more you can save. Contact a Freedom Mortgage representative, who can show how much your monthly payments could drop.