Mortgage Rates Follow 10 Year Yields Higher? by Jesse W.

For the last three months the government has done everything in their power to make sure mortgage rates stayed under 5%. First their was a tax cut created for new home buyers. New home buyers receive an $8000 tax cut if they buy a home before December 1st, 2009. Then came the Making Home Affordable plan that President Obama hoped would help individuals lock in at low rates and refinance their homes are rates that were once unattainable. Ben Bernanke then announced that the Federal Reserve Bank was going to buy back over $1 trillion in mortgage backed securities. To compound matters, the Fed was going to buy back these securities with money they printed rather than with tax dollars.

With all of this going on for the last three months, it is no wonder that mortgage rates fell to almost all time lows. The problem was that these were artificial rates that were completely created by the Obama administration. Free market captalism was not allowed to work and the overall government played too big of a part in the interest rates. Now, free markets are starting to work once again as the 10 year treasury yield is dictating where overall rates are headed. Since 1971, there has been a very strong correlation with rates and the 10 year treasury yield. When the yield goes lower, mortgage rates follow; if the yield goes higher, so do mortgage rates. Since the beginning of the year, the yield has seen a steady uptrend but rates have declined. Now that the government has run out of ammo to keep rates down, it looks like they will follow the 10 year yield and start going higher.

Top Seven Mistakes First-Time Home Buyers Make by Kwame Kuadey

First-time home buyers get excited when they are looking for their first home. For one, they will be moving from the confines of an apartment. Also, buying a home provides them an advantage on their taxes.

However, there are those first-time home buyers that create problems for themselves because they don't educate themselves on what they need to do when they are buying their first home.

Here are seven top mistakes that first-time home buyers make:

1. Failing to find a reputable agent - Your real estate agent should be one that knows the real estate climate very well. They are responsible for taking care of the first-time home buyer. Ask around for recommendations. Get more than one candidate and ask them questions regarding selling homes to first-time home buyers.

2. Not counting the costs with the upkeep of a home - Some first-time home buyers fall in love with the home that they don't think about the upkeep costs. Eventually, they will have to account in costs for home repairs, utilities, lawn care, emergencies, etc. Those expenses add up. This is one mistake that first-time home buyers make that can prove to be costly if they are not careful. 3. Being unable to afford the home - Another mistake that some first-time home buyers make is not calculating whether or not they can afford the home. Some of them don't look at the big picture when getting a mortgage. They get the loans without reading the fine print. Also, they should sit down with the lender and ask questions before signing on the dotted line. Going in this blindly can cost them financially in the long run. 4. Not including property taxes - First-time buyers are required to pay property taxes on the home every year. For whatever reason, some don't think about this until the time comes around. When they are not prepared to pay the money, they risk losing their home. They should consult the tax assessor's office in their area to get assistance on what they need to do.

5. Failure to conduct an inspection of the home - Whether the home is old or new, it's important for first-time home buyers to have an inspection. You may find out things that the seller or home builder may not tell you. By doing an inspection, you can find out if the walls are sturdy and solid; make sure that all of the electrical outlets are working along with other items in the home. The mistake that first-time home buyers make with this is hiring an inspector that their real estate agent knows. They should hire someone that is not associated with the agent.

6. Being anxious or impatient for their first home - When first-time home buyers are looking for their first home, some can tend to get impatient. They want to rush the whole process when buying a home without counting the costs and knowing about the entire financial picture. 7. Knowing that you will get the first offer on the table - It is not etched in stone that whatever offer the first-time home buyer makes will be accepted. More first-time home buyers are looking for affordable homes and can make counter offers on the same home that you want. First time home buyers should not put their eggs in one basket.

Accredited Mortgage Modification - Be Safe and Know the Facts by Lindsy Emery

Once you have made the decision to apply for home mortgage modifications, the first step will be research. This is the process where you find a few institutions (maybe even 4 or 5) and rank them according to your needs and requirements. It may help to set up a list e.g. Low interest rates, speed of loan approval, legal costs etc. The very first requirement on your list however, should be accredited mortgage modification. But what makes accreditation so important? Why is it so necessary?

As the trend for credit repair rises, there are hundreds of small, fly-by-night companies that have stepped up to "help and assist" with mortgage modifications. Although many of them do a good job, there is a serious risk if they are not accredited. There have been quite a few horror stories, particularly in the property market, of people being duped. The classic case is when a couple approaches a financial institution, gets their mortgage modification agreement, signs it and then finds out afterwards that they have to pay between $2000 and $3000 for "legal and admin fees". What's even worse is the fact that very often their new loan turns out to be exactly the same monthly installment as before. Suddenly all sorts of strange additional fees have been added. This kind of problem can be avoided by making sure that an attorney or legal professional has a look at your agreement before you put pen to paper. There are many benefits to going with larger, accredited firms.

Accreditation requires compliance to strict government rules. This includes regular reviews and audits, maximum charges for fees and specific guidelines for loan qualification. Although you may find the process a little more tedious, you stand a higher chance of protecting yourself from individuals who just want to make a quick buck out of the deepening recession. It won't be hard to find accredited banks and financial institutions as it is something they are most likely to advertise quite proudly. A good rule of thumb is the larger banks, as government compliance and accreditation is mandatory for them. If you do find a smaller company that is willing to give you a lower interest rate, be sure to analyze your loan agreement with a hawks' eye.

Student Credit Cards - Your First Steps Into A Good Credit Score by Amanda Hash

If you are a college student, you probably have already heard about student credit cards. These credit cards work in the same way than regular credit cards do, but they have also some advantages that you should get to know if you have ever considered applying for a credit card.

Why To Apply For A Student Credit Card?

College students have many and unique financial needs. A regular credit card could suit these needs, but there are many requirements that financial institutions ask their candidates to accomplish before applying for credit cards.

Student credit cards are easier to obtain. Of course there are a few requirements to accomplish and documentation has to be presented as well as for regular credit cards, but it is a lot more simple to fulfill those requirements.

Advantages Of Applying For Student Credit Cards

First of all, you should have an employment with a fix income to apply for a regular credit card, and, if you are a full time student you know this is not always possible. Student credit cards are, as their names say, designed specifically for students. You do not have to be an employee to apply, and unlikely regular credit cards, there are no annual fees to be paid for this kind of cards. There are certain charges you will have like interest and maybe a small fee, but these charges will always be lower than those of regular cards.

Another good point to mention is that you can access to the different rewards or gifts that financial companies offer, as well as if you had a normal credit card.

Many financial companies offer for student cards owners as well as for normal credit cards owners, the possibility to access and manage their accounts online.

Where To Obtain A Student Credit Card

Although you may have received different credit card offers so far, Internet is still the best tool you have to look for your first card, you may also ask your friends and relatives which were their options and what did they chose.

Different financial companies, offer different student credit cards plans. First, try to determine what are you looking for, if low interest, a good reward program, student benefits, lower fees. And then you will be able to find and compare among those options you have, which student card suits your needs best.

How Can A Student Credit Card Help To Build Your Credit Score?

A student credit card may be the first step you give in building your credit record. This may not seem very important for you today, but you must have present that a good and well constructed credit history will turn into a car loan, mortgage, or any other loan type you may need to ask for in the future.

A Few "Always" Rules To Follow To Get A Good Credit Record

Always remember that your card should help you with your college's needs. Do not blow your credit doing unnecessary shopping.

Always keep record of your purchases. Making a list and comparing the amounts when bills arrive, will prevent you of paying for things that you have not bought or paying twice the same purchase.

Always try to be on time and pay your bills in full, this will give you extra points in the future and keep you off extra charges due to late payments. At the same time, this may help you to start being a responsible adult.

About the Author

Amanda Hash is an expert financial consultant who specializes in Bad Credit Debt Consolidation and Easy Credit Loans. By visiting http://www.yourloanservices.com/ you'll learn how to get approved and recover your credit.

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Refinance 2009 by Anne Dunne

Mortgage interest rates have never been lower than they are now. A thirty year fixed home mortgage refinance is currently priced between 4.750% and 5.250% charging the borrower with minimal or no points for a Rate and Term refinance. The rates fluctuate daily for home mortgages depending on market conditions, but have not deviated from this range since early April 2009.

Each lender has the opportunity to offer their service portfolio a government stimulus package program from the U.S. Department of Treasury called the "Making Home Affordable" Plan. This mortgage loan plan allows refinance with valuation from a lender automated valuation process and minimal qualifying. The automated valuation cannot show the home over 105% of the current loan amount, 110% in certain cases. The borrower must be employed and cannot have become self-employed in the last 2 years. The refinance must show a benefit to the borrower by lowering rate and payment or taking the borrower from an adjustable rate mortgage or pay option ARM to fixed program. Lender participation is voluntary and each lender's approach will differ slightly, but requesting your current lender's version of the "Making Home Affordable" plan should be enough to let your lender know the specific program you're interesting in exploring.

Lenders are rolling out this program in phases. The first phase pertains to the refinancing of 30/20/15/10 year fixed mortgages for the majority of lenders. Some lenders, but not all, added the 5/7/10 year adjustable rate mortgages. The mortgage loan is basically a streamline refinance, but with the added advantage of no appraisal. In this economic atmosphere of declining market values and rampant job losses, it allows a much lower monthly payment and a substantial monthly savings.

FHA home loans and VA rates, still allow the Interest Rate Reduction Loan (IRRL) with no appraisal except under certain circumstances. Borrowers currently in an FHA or VA loan should use this option as the stimulus plan cannot make the change from a government loan to a conventional conforming program. No "cash out" is allowed on the "Making Home Affordable" plan, but with rates dropping to below 5% from a median 6.5% six months ago, it is translating to sizable monthly savings for most refinanced mortgages.

Paying points will allow an even lower rate, but a borrower should plan to remain in the home long enough to recoup the cost of the points paid. Each point represents 1% of the loan amount. The closing costs may be added into the loan and refinanced as well so that no out of pocket charges will be incurred by the borrower, however, a borrower has the choice of paying closing costs at the closing table or rolling them into the mortgage loan.

Rates for loans less than the 30 year term are less attractive. It appears lenders are more interested in locking in a long term borrower than a short term one. Adjustable rate mortgage loans, 20, 15 and 10 year terms give no measurable break in rate from a 30 years fixed. It is suggested a borrower refinance on a 30 year term, but make the payment they wish above that based on the payment for the term they wish.

It is unknown how long this program will be in play, but it is widely anticipated not to be for too much longer due to the no appraisal option. Contact your current lender for information specific to your mortgage loan and refinancing tips.

How to Reach Your Financial Goals by Katherine Nagy

Most of us dream of living a little more comfortably, or living free from debt. While finances may be tight from time to time, your goals for a new car or a paying off the mortgage can be reached by setting reasonable goals. Here are some hints for scrounging up that money.

First, determine what your goal is, and be specific. If you want a car or house or new computer, how much money will it cost you and in what time span would you want (or need) to accomplish it? Be sure that this goal can be reached. If not, search for alternative or long term solutions or more reasonable goals. Setting unrealistic goals will only bring you frustration and distress.

Next, determine a reasonable amount of money to save on a regular basis, which will allow you to reach your goal. Also, it is important that you know where that money will come from every time. Use specified amounts, for example: "I will save $50 of each paycheque."

Set some other deadlines and sub-goals to judge your progress. If you need to save ten thousand dollars, determine when you should have saved two thousand, and five thousand, and adapt your strategy as needed. Always try to save more when possible, you never know when some unforeseen problem may arise.

Make sacrifices. To reach any financial goal will involve a sacrifice of some kind. You may have to give up certain activities in order to cut down on excess expenses. Identify which things you do not need and can be relinquished for a while.

Setting goals for your financial desires is easy if you're willing to give it a try. Doing so will help to motivate you and keep you on track for your needs. They help ensure that your needs are met regardless of circumstances that may arise.

About the Author

Kath is a businesswoman and devoted student of personal development. She is founder of The Awakening For Life Team which is part of the huge growth in Australia of LifePath Unlimited. Kath is a mother or two young girls, and lives on the beautiful south coast of NSW, Australia. Visit http://www.awakeningforlife.com

Acts of God and Home Insurance by Sarah Maple

Home insurance policies sometimes contain clauses which refer to an 'Act of God'. These tend to limit liability for natural phenomena such as lightning strikes, floods, hurricanes, tornadoes, earthquakes and plagues of frogs - freak occurrences which cannot be prevented.

Insurance providers occasionally include these clauses to protect themselves from the hefty payouts usually associated with such unpredictable events. So, in the event that your property is damaged by what is deemed to be an 'Act of God', you may find that your insurance provider refuses to pay out. At which point, you might well take certain names in vain.

To this end, it's always an idea to check your home insurance policy and see what's excluded under the 'Act of God' clause. Obviously, the very essence of these exemptions is that they are unpredictable, so it can be difficult to judge if they apply to you. For example, you may not think of your property as being particularly lightning-prone, but you never know. However, it is certainly prudent to check for supposedly freak events which are becoming more prevalent, such as floods. If you do live on a floodplain, and yet floods are considered to be an 'Act of God' by your insurance provider, then you may later regret being underinsured.

That said, policies today often provide cover for chance occurrences in their standard buildings insurance inclusions. A certain level of flood damage cover may be provided, for example - probably no surprise since flooding seems not uncommon nowadays. Likewise a certain degree of storm damage cover may be provided. To be sure of the extent to which you're covered, be sure to read the small print in your policy.

What if your house were to be destroyed? It is obviously unlikely, but not unheard of. In such a situation, if you have taken out buildings insurance (which you almost certainly will do if you have a mortgage, as it is likely to be one of your lender's requirements), then you will be able to recover your rebuild cost. Plus some policies may be able to provide an 'alternative accommodation' payment in the undesirable event that your property is rendered uninhabitable for a period of time.

Last, but by no means least, it is an idea to know exactly what constitutes this exemption in the eyes of your insurance provider. Don't get caught out by vague wording... If the situations which constitute an 'Act of God' aren't specifically defined in your policy, then request clarification from your insurer, so that they cannot hide behind something loosely defined in the event of a claim. Possibly the best advice that can be given - with 'Act of God' clauses and as with all insurance - is know your policy!

Are Offset Mortgages worthwhile? by Kate Tee

This question should be answered in the same way as most other questions about financial services products. When you understand what lies behind the label and realise what the product offers (i.e. just what it does), then it's a question of whether the price you pay is for something you genuinely want. Without seeming to answer the question too flippantly, therefore, the product is worthwhile if it delivers what you want at a competitive price.

What they are

First of all, then, what is an offset mortgage? The principle is really quite simple (many of them are!). The "offset" in the label refers to an ability to offset your debt balance (your outstanding mortgage) against other credit balances you may have - for example, any savings. Therefore, if you had an outstanding mortgage of, say, £150,000, but you also had savings of £15,000 an offset mortgage would let you discount one against the other so that you paid interest only on the net amount i.e. £135,000.

Offset mortgages will also offer similar benefits to so-called "flexible" mortgages, where you can pay back lump sums without incurring any penalty or take "payment holidays" if you have paid more than required during a given period (although you'll still need to take care that underpayments or payment holidays could result in an extension of the mortgage term and/or an increase in the total amount outstanding).

Offset mortgages are certainly popular. According to the Council of Mortgage Lenders, the number of offset borrowers leapt 50% in 2007 to 170,000. Their borrowing totalled £29.3bn, which represented 7% of all new lending.

Worthwhile?

There's no such thing as a free lunch, so as you'd expect, the benefits of such flexibility in repayment terms comes at a price. Interest rates for offset mortgages are usually higher than for standard mortgages. Furthermore, the rates are generally variable and will move as a reflection of the Bank of England's base rate. As we said at the beginning, it depends on whether the product is right for you and whether it fits your individual circumstances. If you've done your sums carefully, have credit balances against which to offset your mortgage repayments, and are in a position to make full use of the offset features of this type of mortgage, then studies done by lenders Barclays Bank show that holders of this type of mortgage repay the mortgage (and therefore pay less interest) on average 8 years and 8 months earlier than standard mortgage holders.

As you'll have already spotted, offset mortgages have the most to offer to people who either have significant savings or expect to save regularly in future. Such savings potential might come in the form of cash bonuses or dividends, for example. On the other hand, if your savings are likely to remain small or irregular, you could find that you are not using the offset facility as fully as possible and therefore paying an unduly high rate of interest for a feature you do not or cannot use.

So, just to recap, should you consider an offset mortgage? Remember...

* Offset mortgages might well be attractive to the self-employed, whose receipts might fluctuate from month to month * They may also be worth considering for you if there is a distinct advantage in being able to repay less during some times of the year and more during others * Do you have a lot of savings or plan to save regularly?