Your Lake of the Ozarks Mortgage Lender: applying for a mortgage after bankruptcy

Thursday, December 20, 2018

Pro’s & Con’s for Paying Off Your Mortgage Early

A mortgage can be a great way to make payments towards an investment instead of paying rent every month. Mortgages also provide several tax advantages, which are just a few reasons that people want to keep them around for the full 30 years. However, there are some times where paying off your mortgage could be a good financial decision. Whether you’re purchasing a primary home or buying a vacation home at the Lake of the Ozarks, here are the things you need to know about paying your mortgage off early.

First Things First

What you have to remember is that every financial situation is different. While it may make financial sense for one person to pay off their mortgage, it may not make sense for another. When you sit down with us to start your mortgage, we can discuss what your future goals are, and how to set up the mortgage to match those goals.

Pros

There are some pros to paying off a mortgage early. Depending on your situation and reasoning, it could be a great financial step. Here are just a few reasons you may want to pay it off early:
Paying off your mortgage early lowers your required cash flow. It also changes your potential asset allocation, which lets you be a little more aggressive in other areas.
For every dollar you pay on your principal, you’re making the interest rate back because you’re keeping it in your pocket. For example, paying off or down, a 4% mortgage makes you 4% with no management fee.
Paying off your mortgage is 100% safe, there is no market risk.
When you pay off your mortgage you can then free up that money in your budget towards other things.

Cons

There are always cons when you make any large financial decisions, so it’s important to take them into account while making your choice. Here are a few, though they are a bit intertwined:
It can reduce liquidity. It’s easier to access your funds when they are in an investment account or bank account. It’s a bit harder to access them when they are in the form of home equity.
If you should decide to borrow against your paid-off home in the future, it could very well end up costing much more. A rise in interest rates could impact your new mortgage heavily.
For those who are near retirement age, you are most likely paying less in mortgage interest. So little, in fact, that barring the deductions, the mortgage interest and other itemized deaccessions is no longer more than the standard deduction.

Mortgage Considerations

These are all things you can consider both while you get your mortgage at the Lake of the Ozarks and even years after you have it. There are a lot of things to consider when getting a first or second mortgage at the Lake of the Ozarks, but it does provide a great way make solid investments and also get your dream vacation home! Do you have more questions about mortgaging a lake home? Team Lasson is here for you! Visit our website to learn more about our mortgage company at the Lake of the Ozarks, or give us a call. We look forward to helping you buy your dream lake home!

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Michael Lasson

Senior Loan Officer

NMLS #: 493712

4655 B Osage Beach Parkway

Osage Beach, MO 65065

Direct: (573) 746-7211

Cell: (573) 216-7258

e-Fax: (866) 397-0318

Email: mlasson@fsbfinancial.com

Website: www.YourLakeLoan.com

**The postings on this site are my own and do not necessarily represent First State Bank of St Charles’s positions, strategies, or opinions.

Monday, November 16, 2015

Applying for a Mortgage After Bankruptcy: 5 Steps

Declaring bankruptcy can be devastating and put a damper on your plans of purchasing a home at the Lake of the Ozarks. However, with some time and money, it is possible to apply for a mortgage after bankruptcy. With proper preparation, patience and financial planning, you might be able to purchase a home sooner than you think. While a personal bankruptcy will stand out on your credit report for as long as 10 years, the barrier it creates in obtaining a mortgage doesn't have to last that long. Follow these steps for applying for a mortgage after you've declared bankruptcy:

1. Be Patient.

First of all, you will have to wait until your bankruptcy is discharged before you can do anything in regards to applying for a mortgage. The mandatory waiting periods to apply for a mortgage backed by Fannie Mae or the Federal Housing Administration last from two to four years. Within that period though, you need to work on getting a few things in order. Immediately after your bankruptcy case is discharged, you need to stop and take a look at where you are financially. Know exactly how much income you have and what your necessary living expenses are. You have to have a tight lease on your discretionary income in order to move forward in purchasing a home. In addition, make sure you pay every one of your bills on time, every time. Now is also the time to scrutinize your credit report. If there are debts that have been paid back, but still appear on your credit report, contact the credit agency to have them removed.

2. Save Money.

Once you have a budget established and that budget is under control, you need to start saving money. You need to build up an emergency fund, as well as establish enough money for a down payment and other upfront expenses that come with buying a home. While down payment requirements have significantly decreased, it's best to have about 20% of the cost of the home saved for a down payment. Not only will that 20% down payment reduce your total loan amount and the monthly payment amount, but it will show the lender that you're invested in the home and assures that you won't walk away from it if/when hard times come again. By saving your excess money each month, you'll get in the habit of being able to make your mortgage payments or covering those unexpected expenses of home ownership.

3. Make a Plan.

Owning your own home is not cheap. As a homeowner, you'll be responsible for fixing everything. Home maintenance is a big expense for every homeowner. When making your plan, keep in mind that there is more to owning a home than just sending in a mortgage payment every month. Besides electricity, water and sewer, you'll have to pay property taxes and insurance. Consider the cost of services such as landscaping, snow removal, and pest control. Then don't forget about the unexpected services such as a plumber or HVAC repairman. Make sure you have a long term plan for how you are going to afford your own home. There's a lot to think about when deciding to buy a home.

4. Prepare Your Documents.

Now is the time to start getting your financial documents organized. While applying for a mortgage is not quite as detailed as filing for bankruptcy, similar records are required for most applications. Being organized shows that you're paying attention to detail and doing everything you can to get everything back on track after the unfortunate circumstances. Find out in advance what documents your Lake of the Ozarks mortgage lender requires and have them ready for your meeting. There's nothing worse than having your loan delayed because of a missing document, after you've already waited so long to get to this point.

5. Applying for a Mortgage.

When you actually do apply for your mortgage, the process will be the same as if you hadn't filed bankruptcy. The only real difference is that your financial situation may not look the best. If you're coming off a recent bankruptcy, be prepared for slightly higher interest rates than those offered to others. More important than interest rate though, you need to be aware of the upfront charges you will be required to either pay or have rolled into your loan amount. If you properly prepared during the previous steps, you should know how much you can afford and will be able to make the best decision.

Going through bankruptcy is not ideal, but it doesn't mean you can't pick yourself back up and move forward. As your mortgage lender at the Lake of the Ozarks, I am here to help you through the process of applying for a home loan. I will work with you every step of the way, offering the first class service you deserve. Contact me today at 573-746-7211 for more information about Lake of the Ozarks home loans.

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