Whether you are getting a first mortgage on your house, refinancing an old loan for better rates or terms, or taking out a home-equity line of credit, there are several traps that you can fall into if you aren’t careful.

Especially now that the economy has done so badly for the last few years because of this major recession we are in that has lasted from 2008 all the way up to 2010, banks have been less apt to loan money and when they do they may be more strict about how they do it.

This translates into several traps that you can fall into that may make your loan more expensive than it should be. But if you know about these things before hand then you can confront your bank about them and threatened to go to a different bank if they don’t remove them which is why I wanted to write this article for you today.

I’m pretty sure that everybody is aware of the variable interest rate trap where a bank tries to give you a variable rate that can go up or down every year depending on a set of criteria that the bank defines. In times of falling interest rates these are good for you because your interest rate can go down; but interest rates right now are at all-time historical lows, meaning they have nowhere to go but up so it’s a very bad idea to get a variable interest rate loan right now.

I’m also probably sure that everyone’s aware of the trick that banks use to try and get you to sign a 20 year loan instead of a 30 year loan. Yes by definition you’ll pay off a 20 year loan quicker, ten years quicker to be exact! And yes it’s true that you’ll pay less interest… but the fact remains the same that a 20 year loan will give you a much higher monthly payment than a 30 year loan will and especially for people who are refinancing in order to lower their payments this is an especially important fact to consider.

But in this article I wanted to discuss one of the less known traps that you can fall into. I’m talking about balloons. Many borrowers have never even heard of what a balloon is.  But they can be especially common in refinances and second mortgages. Basically a balloon is a balloon payment. It gives you a very low interest rate for a period of time, say five years. But then after that period of time the entire amount of the loan becomes due all at once.

In the old days this was attractive because you could take advantage of low interest and low payments for those first five years and then when it came time for the entire alone to be due on the fifth year you could simply go out and get a new loan and used the proceeds from it to pay off the old loan. The problem is, with the recession it’s harder to get new loans than it’s ever been so you may not be able to refinance in five years and then you’ll be stuck paying the entire amount of your loan all at once which can be devastating for most people.

So there you have three common and not so common traps to look out for when it comes to getting a mortgage. Hopefully now you have the information you need to get the best deal possible so that you pay the least amount of money for your loan.

Jason Markum has been an article writer online for well over 13 years.  When he’s not writing articles, he has a good time running a dinnerware web site where he also reviews corelle square dinnerware for your home use.
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Home refinance interest rates fluctuate just like regular first mortgage interest rates. Due to the down turn in the economy largely blamed on the sub prime fiasco, home refinance interest rates are at an all time low.

Which Rate is Best

Obviously when discussing home refinance interest rates, the lowest rate would thought to be the best, but in reality it is a combination of things that count. If a home refinance interest rate is low but the terms are not great than that may not be the best rate. The best rate would take into consideration the following ideals:

Low Rates

Term of the Loan

Fixed Rate

A fixed rate is far better than a flex rate. Home refinance interest rates that are set in a flex arm mortgage can change drastically over time. This change can leave the homeowner unable to pay their mortgage. So locking in at a rate that is slightly higher but will remain the same over time is a far better option.

The length of the loan also plays a key role in home refinance interest rates, take for example a loan for $100,000 taken out for 30 years may have a lower interest rate because it is being paid over 30 years and ultimately the interest will still be collected at a higher rate. A fifteen year loan for the same amount may have a higher interest rate but overall will be a cheaper option.

Home refinance interest rates can be researched via the internet and print material, where you can find in depth information and rate comparisons.

Want To Know More?

Click Here Home Refinance Interest Rates

Free Information and Advice http://allstaterefinance.com/home-refinance-interest-rates

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For several families who are looking for ways to get assistance on their home mortgage loans, the answer may be with the Citibank First Mortgage Loan Modification program. This is one way Citibank is giving out help for the many homes that have undergone foreclosure ever since this current economic turmoil began. Aside from this financial institution, there are others that have accessible programs for loan modification so that foreclosure can be avoided. Because to be frank, there is no one who benefits from getting a foreclosure.

If you foresee that application for such program is very complicated, then you have thought wrong. The hard part is on getting your application approved by the lender. This is because your application is vying for the program among other applicants who are applying every week. In order to get an approval, the bank must be convinced that you are one candidate who is truly reliable to receive their approval for the program. Because of this, it is important for you to comprehend how this loan modification plan operates before even thinking of applying or even submitting your application.

The very first aspect which you must know about the loan modification scheme offered by Citibank is that it is not directed towards everyone’s benefit, no matter how wonderfully effective it is. There is an eligibility criteria which you must initially and most importantly prove that you are truly experiencing a financial hardship. Such examples of this hardship can be supported by a recent loss of business or job or even a sudden increase in expenses which may have been caused by unexpected medical bills.

The bank is strict with their process for verification. This means that there are no white lies, no matter how little they are. You must be thoroughly honest, completely transparent and even a hundred percent accurate in whatever you state in your application. Along with this application form, you will be required to submit some income statements, bank statements, some tax returns, and even some other financial documents which will verify the claim which you are presenting.

To add, you must be capable of demonstrating that once your mortgage terms are modified, it will result to a lesser monthly charge for you and this will result to improving your financial condition. Also, it will let you avoid falling into experiencing some arrears on the current loan.

The Citibank First Mortgage Loan will only be given to you once the lender has been indisputably convinced that granting you the loan will be advantageous to them as compared to foreclosure. It is then your responsibility to encourage the lender of how reliable you are when it comes to finances and that you are thoroughly capable of repaying once the monthly charge is more affordable and easier on you.

For additional information and useful resources for home loan modifications, visit the #1 loans modification spot on the net: http://HomeLoanModifications101.com.

Article Source:http://www.articlesbase.com/mortgage-articles/how-to-obtain-a-citibank-first-mortgage-loan-modification-1420098.html