San Diego Home Mortgage Rates Articles and Tips

Choosing to Pay Off Your San Diego Mortgage Early

Sat, 14 Nov 2009 14:05:05 -0600

Is it better to pay off your San Diego, California mortgage early, or to save and invest the extra money? This is a common question posed to San Diego mortgage lenders.

Some people argue that it makes more financial sense to invest extra savings in the stock market than to pay off your mortgage early. In our current economy, however, investing in the stock market is a risky proposition. Unless you are aware of a guaranteed DOW pay-off, you could be better off putting your money in a less risky investment - your home.

Though investing in the stock market can create longer-term liquidity because your savings are not tied up in your home, pre-paying your San Diego mortgage can be extremely beneficial. Here's why.

Remove Your Most Costly Monthly Expense
For most San Diego homeowners, a mortgage payment is their largest monthly expense. By paying off your largest monthly expense, you'll have a larger chunk of change when you retire.

Drastically Reduce Interest Payments
If you have a San Diego home loan with a high interest rate, it's best to pay it off early. Otherwise, you're just spending your hard-earned savings on accrued interest payments. Studies show that most Americans pay over $10,000 in home loan interest payments every year. Think of how much you could save in the long-term if you paid off your San Diego mortgage early and became free of that smothering interest payment.

A Breakdown of the Figures
Suppose you have a 30-year San Diego mortgage worth $250,000 at 6 percent interest. If you made payments on schedule for 30-years, your monthly payment would be $1,500 for 30 years. Total interest payments, however, would be more than $260,000 over the loan term. That transforms a $250,000 home loan into a $510,000 mortgage!

To reduce accumulated interest, spend an extra $100 per month on your San Diego mortgage. This minor addition reduces a 30-year mortgage down to 25 years, and will save you a lot of money in interest. If you have the financial resources to pay even more, say $500 extra each month, this would convert that 30-year loan to a 15-year loan, saving over $130,000 in total interest!

Noteworthy Guidelines to be Aware of
If you plan to pay off your San Diego mortgage early, be aware of the following important home loan secrets.
#1: Indicate that your extra mortgage payments apply to the principal balance.

#2: If you plan to pre-pay your San Diego home loan, first pay off any debt having higher interest rates, e.g. loans.

#3: Avoid putting all of your additional money into your early mortgage payment. Be sure to keep some emergency cash in a money market fund.

#4: Do not apply for a 30-year San Diego mortgage if you expect to pay it off in a few years. Keep in mind that interest rates are lower on short-term mortgages, so if you think you'll pay off your mortgage ahead of time, apply for a 15-year loan and save time and money.

#5: Before making additional mortgage payments, confirm with your San Diego lender that your mortgage doesn't have a pre-payment fee.

Tax Breaks for Environmentally-Friendly San Diego Home Renovations

Sat, 14 Nov 2009 14:00:35 -0600

Going “green” is advertised everywhere you turn. And why not? Green living not only helps our planet, but it can also save you tons of money!

From eco-friendly automobiles, to green equipment, to green homes, there are several ways to be green. Read below to learn how turning your home green can save you lots of green, too!

Tax Breaks for Your Green San Diego Property
Green home renovations can result in dozens of tax deduction credits. Read below to learn about possible eco-friendly home renovations that often result in tax credits.

Rooftop solar units
Energy Star appliances
Energy-efficient skylights
Eco-friendly external doors
Swimming pool or hot tub warmed by solar power
Geothermal heat pumps
Environmentally-friendly AC unit
Energy-efficient stove

Such government incentives make buying new products for your home more affordable and fun!

It’s Never Been So Cheap to Go Green
The amount you’re eligible to save on a green home depends on your state. More than half of the states in our nation give eco-friendly incentives that reduce the homeowner’s costs over 40 percent!

For instance, in NJ, liberal state incentives can pay for more than 90 percent of a home’s solar unit. A rooftop solar unit priced at $38,000 would drop to about $3,000 after applying the federal tax credit, the state discount, and the power company’s renewable energy program.

Solar power is becoming less and less expensive each year. Reduced installation costs, combined with local subsidies, have made solar panel prices decrease by 31 percent in the last decade.

Don’t Wait, Go Green Today
For San Diego, California homeowners who must make roof repairs in the near future, they might as well buy solar panels. By doing so, they will get a generous tax deduction, and they’ll also save thousands in energy bills. Studies show that eco-renovators using solar power will regain the cost in roughly three years, perhaps sooner.

Turning your San Diego home “green” will not only drastically reduce your power bill, but you’ll also do your part to help the environment. Investing in your San Diego home has never been so efficient!

Interviewing San Diego Mortgage Lenders

Sat, 14 Nov 2009 13:51:56 -0600

San Diego mortgage lenders give prospective homeowners money to purchase a home. It is important that borrowers find a reliable San Diego mortgage lender so that the mortgage approval process is quick and easy. To ensure that your needs and goals are met, ask various San Diego mortgage lenders the following questions. This will help you weed out the strong from the weak, and help you select the San Diego mortgage lender that’s right for you.

What are the Pros and Cons of Each Type of San Diego Mortgage?
When researching potential San Diego, California mortgage lenders, you need to be knowledgeable of various mortgage types. Do your own research first. The more knowledgeable you are going into the lender interview, the smoother the entire process will be. You will also need to create a comprehensive monthly expense report so that you can determine the type of mortgage you can afford.

Popular mortgages include fixed rate, adjustable rate, and interest only. Most people choose a Fixed Rate Mortgage, because it has a simple and predictable payment. If you are planning to sell the property within five years, though, you may want to go with an Adjustable Rate Mortgage. If you choose this type of San Diego mortgage, ask the lender about a rate cap.

In any case, make sure that the lender goes through all of your options. Watch out for the lender who is overly-eager to sell you on a particular loan type. They may be promoting a mortgage that’s not in your best interest.

Can You Provide Me with Referrals?
Don’t pick a San Diego mortgage lender solely based on the interest rate they offer. Though interest rates are important, you also need a lender with helpful customer service. Go online to the Better Business Bureau to check San Diego mortgage lenders’ customer service ratings. Failing to choose a San Diego mortgage company with top-quality customer service could result in a long loan approval process, unnecessary fees, and overall dissatisfaction.

What Fees Do You Charge?
Next, consult with your lender and list all of the closing costs. Be aware of costs for the appraisal, credit report, title, and taxes. Then, compare these fees with other San Diego lenders. Many times, a broker gives you a lower rate, but they charge you a hefty fee in return. Good San Diego mortgage lenders should not only offer low rates, but also eliminate as many fees as possible.

Is my Loan Originator Experienced?
Finding a San Diego mortgage lender is step one. But you’ll also need to be paired with a knowledgeable loan originator. This is the person within the San Diego mortgage company who drafts your mortgage. Only deal with a loan originator who has more than five years of experience in the mortgage industry, understands the housing market, and has your best interest in mind.

These are great introductory questions to ask during the mortgage interview process. Also be sure to ask about Annual Percentage Rates, prepayment penalties, and applicable tax breaks. The more you know, the better off you’ll be.

First Time Homebuyers Excited about San Diego Market

Tue, 18 Aug 2009 10:56:18 -0500

It has not been easy for first-time homebuyers to purchase a property in the state of California over the course of the past few decades. A majority of California residents simply haven’t been able to afford the exorbitant home prices that are commonplace in major cities such as San Francisco, Los Angeles or San Diego. Even with financial assistance from jumbo mortgages and other help for first time homebuyers, a lot of California residents have continued to rent in these cities because the cost of living makes buying a home prohibitive. That’s starting to change now that the market has shifted. First time homebuyers are now in an excellent position to purchase California homes. One of the most popular markets for doing so is the San Diego real estate market.

Housing prices throughout the San Diego area have declined over the past several years. This has been caused by the mortgage crisis and the high number of foreclosed homes throughout the area. This means that homes which were formerly out of the price range of the average resident are suddenly becoming affordable. People in the state who have managed to maintain their employment (as well as those who have a little bit of the savings in the bank) are excited about the opportunity to finally purchase a home of their own as a result of this shifting market.

This is great news for people who have always wanted to buy a San Diego home. And the news gets even better. Despite the drop in housing prices, it is believed that the California real estate market is eventually going to return to its glory days. This means that those residents who are able to buy their first home in the area today are people who are making a really smart financial investment. Home prices will eventually climb again. The house will be worth a lot more than it was purchased for today. Residents can choose to resell and upgrade again at that time or to simply hang on to the San Diego house that they are finally calling home. Either way, it’s a good time for first time homebuyers in this region.

How to Pick a Trustworthy San Diego Mortgage Company

Fri, 07 Aug 2009 21:26:54 -0500

If you need a reputable San Diego California home mortgage company, there are many important qualities that you should know. You probably see lots of ads on television about San Diego companies offering to solve your mortgage needs. Discerning a good lender from a bad lender is an essential step to take when selecting your San Diego mortgage lender. Below are a few helpful tips that will help you select a top San Diego home mortgage company.

Consider More Than Just Interest Rates
Don’t just select the San Diego mortgage lender offering the best interest rate. Interest rates are important, but you also need to find a mortgage company with excellent customer service. Failing to choose a San Diego mortgage lender with top-quality customer service could lengthen the application process, or result in an unapproved loan or high fees. To make the Lemon Grove, Pacific Beach, Coronado, Ocean Beach, and La Mesa home buying experience as simple as possible, analyze San Diego mortgage lenders with both low interest rates and good customer service.

Request Referrals
Perhaps the best way to find a trustworthy San Diego California mortgage lender is to ask your neighbors and friends which lender they had a good experience with. You may also want to ask your real estate agent, since he or she knows the field. Lastly, check out the ratings and reviews of your top San Diego lender choices on the Better Business Bureau’s website.

Select a Reliable San Diego Loan Originator
Within a large or small La Mesa, Pacific Beach, Ocean Beach, Lemon Grove, and Coronado mortgage company, there are individual California loan originators. This is the person who draws up your mortgage. While it is necessary to choose a trustworthy lender, you also want to find a dependable loan originator within the company.

Work with a loan originator who has no fewer than five years of experience in the home loan industry. Make sure he or she thoroughly answers any questions you have, and that they are trustworthy. Above all, make sure they have your best interests in mind. The best San Diego loan originators listen to your goals and provide their informed opinion.

Your California loan originator should lay out the various San Diego mortgage programs available. After you’ve chosen the right mortgage for your situation, your loan originator should lower any fees that they can and secure the lowest interest rate possible.

Avoiding San Diego Mortgage Fraud

Tue, 14 Jul 2009 09:46:54 -0500

In the past year, the number of reported mortgage fraud cases has risen over 80%. Mortgage fraud is now at an all-time high and costs over a billion dollars each year. According to mortgage giant Fannie Mae, California leads the nation in mortgage fraud. San Diego, in particular, is one of the state’s leaders in mortgage fraud; in fact, the FBI recently set aside an entire team to solely examine San Diego mortgage fraud. Here are two schemes they’ve uncovered so far.

Scheme #1 - Foreclosure Rescue
A popular San Diego mortgage fraud scheme involves solicitations claiming to help rescue a home from being foreclosed. The foreclosure "rescue" squad offers to help the desperate homeowner remain in their home if they pay an up-front fee and/or sign over their property. The FBI San Diego mortgage fraud team claims they have yet to find a foreclosure rescue scheme that is legitimate. So if your San Diego home is in danger of being foreclosed, ignore "rescue" solicitations that arrive in the mail, appear on the internet, or occur over the phone.

Scheme #2 - Defrauding Lenders
Another type of San Diego mortgage fraud involves defrauding lenders. Here’s how it works: a buyer purchases multiple properties at once and offers more than the list price for all of them. Why would they offer more than the list price? The buyer says he or she will use the extra money to upgrade the home. When the lender asks how they will get the property appraised at the higher price (e.g. 400k home appraised at 500k), the buyer says they have their own appraiser. As it turns out, the schemers are able to find banks willing to give them the additional money for their mortgage. This is called defrauding the lender. The seller gets the full price offer, but the fraudulent buyer pockets the extra money. So far, participants in this San Diego mortgage fraud scheme have pocketed over $11 million.

So who gets hurt in this type of San Diego mortgage fraud, other than the lender? Tax payers get hurt, because the defrauded lenders must be bailed out. The participants behind this particular scheme bought 220 San Diego homes, received mortgages for the inflated price, and then walked away with the extra cash and allowed all 220 properties to be foreclosed. Multiple foreclosures also significantly drag property values down in San Diego neighborhoods.

So if you’re a seller or homeowner thinking about selling your property, be aware of this kind of scheme, and be weary of any offer that is higher than your selling price. You won’t get the extra money, and the home will end up being foreclosed and affecting your fellow San Diegans. The good news, however, is that 24 members of this scheme were indicted in early April. It is the largest real estate scheme ever discovered in the San Diego area.

Do Your Research & Ask for Referrals
One of the best ways to avoid San Diego mortgage fraud is to do your own research. Find a San Diego mortgage lender that has a solid reputation and is trustworthy. Ask your friends and family which lender they’ve had a good experience with. You can also check the reputation and financial status of each San Diego mortgage lender with the Better Business Bureau or other government agency.