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Consumer News and Advice Archive


What is a balloon mortgage?

It is a mortgage in which the entire unpaid principal becomes due and payable on a given date, five, ten, or any number of years in the future. The borrower must pay up, refinance, or lose the property. ...


Should I consider a “B,” “C,” or “D” paper loan if I have bad credit?

These loans do not meet the borrower credit requirements of "A" or "A-" category conforming loans, so if they are your only option for obtaining a home, then go for it. ...


Are shared equity and shared appreciation mortgages the same?

No. With a shared appreciation mortgage, or SAM, a borrower receives a below-market interest rate in return for the lender receiving a share, usually 30 to 50 percent, in the future appreciation of the property upon its sale. ...


Is equity sharing a good idea?

A shared equity mortgage, or partnership mortgage, can be a good way to purchase a home with little or no money down. In such an arrangement, the borrower/homebuyer has an absentee partner who, as the investor, provides all or some of the down payment. ...


What about a hybrid loan?

Also called a fixed-period ARM, these crossbreed loans combine features of fixed-rate and adjustable-rate mortgages. ...


What is a two step mortgage?

Not to be confused with a biweekly mortgage, this type of home loan is also known as 5/25s and 7/23s. It has one interest rate for part of the life of the mortgage and a different rate for the remainder of the loan. ...


Can I split my mortgage in two and pay biweekly?

The biweekly mortgage has become increasingly popular as more people favor paying off their home loan early and reducing interest charges. ...


What is an assumable mortgage?

It is a mortgage held by the seller that can be taken over by the buyer when a home is sold. Such loans are hard to find because most lenders stopped voluntarily writing them many years ago. Most new assumable loans today are adjustable rate mortgages. ...


Are there such things as no-cost and no-fee loans?

You see promotions for them all the time. But banking regulators have gone after lenders who misrepresent these loans. The reality is that no-cost and no-fee loans may actually cost the borrower more over the long term because costs are often hidden by rolling them into the new loan through ...


Is it true some lenders grant loans based on very little documentation?

Yes. They offer what are called "easy/no-doc" loans, mortgages that require little or no documentation to verify the borrower's income and assets - that is as long as the borrower makes a big enough down payment, generally 25 percent or more. ...


Should I lock in the mortgage rate?

Because the interest rate market fluctuates constantly and is subject to quick movements without notice, locking in a mortgage rate with a lender certainly protects you from the time your lock is confirmed to the day it expires. ...


Determining if Your Zip Code is Healthy

RISMEDIA, Dec. 6, 2007-Where you live may be as crucial to your well-being as how you live, according to an article published in the December issue of Oprah magazine. Taking steps ranging from investing in a HEPA filter to purify air or selecting a bedroom farthest away from the street ...


6 Steps to Avoid Foreclosure

RISMEDIA, Dec. 6, 2007-The AICPA, one of the nation's largest non-profit professional organization representing more 340,000 CPAs across the country specializing in the area of tax, accounting, auditing and personal finance, suggests the following steps to minimize the risk of foreclosure if they hold sub-prime mortgages: ...


Tips for Renters When a Landlord Forecloses

RISMEDIA, Dec. 5, 2007-Sixty-seven-year old Sharron Shagonaby was looking forward to a quiet Christmas at home - a home she has rented for more than a year, and has never missed a rent payment. Now, thanks to her landlord, she has just five days to get out - a hidden ...


What are conventional loan limits?

These are limits imposed by Fannie Mae and Freddie Mac on the amount of money you can borrow to finance a home purchase. The loan limit generally increases each year and applies to single-family homes in the 48 contiguous states, with higher limits in Alaska, Hawaii, Guam and the Virgin ...