Mortgages


	*Preparing for your* future...**

Mortgages

Maybe your just beginning to plan for the "American Dream" of owning your own home or perhaps you currently own and are trying to figure out if now is the time to refinance. No matter at what point you are at with your real estate investments, you realize one thing, it takes a lot of money and requires some good planning.

Use the worksheets to help you make some of your decisions.

Worksheets

Monthly Payment Amount

How Much Can You Afford

Compare Loans

Equity Line Payments

Mortgage Basics
A mortgage is the loan that a borrower gets from a bank, thrift, independent mortgage broker, online lender or even the property seller.

The house and the land it sits on serve as collateral for the loan. The borrower signs documents at closing time giving the lender a lien against the property. If that borrower doesn't make payments as agreed, the lender can take the home through foreclosure.

Because mortgages are such large loans, consumers pay them off over long periods -- usually 15 to 30 years. Their monthly payments gradually whittle away the principal balance, slowly at first then rapidly toward the end of the loan.

Current Rates

What's in a payment?
When escrow is used, a monthly mortgage payment is called a PITI payment. That's because each one covers a portion of the following four costs:

Principal -- the loan balance

Interest -- interest owed on that balance

Real estate Taxes -- taxes assessed by different government agencies to pay for school construction, fire department service, etc.

Property Insurance -- insurance coverage against theft, fire, hurricanes and other disasters

Borrowers can choose to pay their real estate taxes and insurance in lump sums when they come due, rather than in monthly installments to their escrow accounts.

Depending on the kind of mortgage a borrower has, the monthly payment may also include a separate levy for private mortgage insurance (PMI) or government-backed mortgage insurance premiums.

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