No Deposit Christian Home Loan
No deposit Christian home loans allow homebuyers to purchase a house without the need to pay any money down. This type of agreement was generated by the rising costs of housing and people's inability to keep up with the prices. Lenders are anxious to keep a high number of customers, but fewer and fewer people are able to save the money for a down payment on a new home. In order to boost sales, the no deposit home loan was created.
Historically, this type of program did not exist, and home buyers saved five to twenty percent of the cost of the home to pay the down payment. This down payment ensured that the buyer was invested in the house, and less likely to default on the agreement. However, due to the rising costs of real estate, and the slackening of the economy, lenders have started offering no deposit home loans. This allows a borrower to receive 100% of the purchase price from a lender, minus the fees and costs of extending the agreement.
This type of contract can offer a viable alternative to potential buyers who cannot manage to save for the down payment, but it is a risky option for both borrowers and lenders. It is important to remember the reason for these no deposit home loans is the rise of housing costs. A person who finances a house at the top of market with a no deposit home loan runs the risk of having negative equity. The temptation for the borrower in this situation is to default on the agreement, which means both the lender and the borrower lose money.
The borrower faces other risks, as well. The more that is financed, the more interest is paid on that amount. Over the cost of a 30-year mortgage, this equals thousands more than the borrower would have paid if they had not gone with a no deposit home loan. Without a necessary down payment, borrowers end up paying a lot more in interest than they would have had to save for the deposit, so it should only be used as a last resort.
Certainly, a borrower's best option is to take the time to save ten to twenty percent of the cost of the house for the down payment. However, if it means missing out on the perfect house or market, then no deposit home loans may make sense. When making the decisions between this type of loan and a more traditional agreement it is important to seek God's wisdom. "Because the foolishness of God is wiser than men; and the weakness of God is stronger than men." (1 Corinthians 1:25)
A no cost loan can end up costing a borrower more in the long run than just coming up with a down payment at signing. This type of lending is designed to help people that don't have a stash of money put away to buy a house. The problem is, when one chooses this option, there will usually be a high interest rate attached to the funds.
The interest rate for this type of lending will only go up 2% or so, which may not sound like a big deal, but that's an extra $500 on the first payment! Some people say choosing a no cost loan depends on how long the homebuyer will be in the home, but doing the simple math of how much extra would be paid out for the higher interest rate, will show what the better deal actually would be. The amount of interest payment cannot be deducted on taxes, but (over the term) the closing cost amount can be. This is where the decision gets tricky.
One way for homebuyers to figure out whether this lending option is best is for them to guess about how long the house will be their home; to calculate how much a higher interest rate in that time period would cost; and to compare to the closing costs for a traditional mortgage. This way the borrower will be able to see exactly where the money will be spent and what action needs to be taken concerning no cost loans.
When choosing the right lending, borrowers need to look at more than the closing costs and the interest rate and figure in any hidden fees, such as, late payment and early payment penalties, and policies for overpayment. Some banks or loan institutes have insurance for homebuyers to protect the home from loss of income due to a loss of employment. No cost loans can be just as confusing as traditional mortgages, but if borrowers take it one step at a time it will work out. Each lending option will work a little differently. This kind of lending is going to have the same fees and penalties as regular loans so borrowers must read the fine print in the contract or ask the loan officer what the guidelines are for these issues. When working with a officer, it is wise to make sure he or she has offered all the options for no cost loans.
Homebuyers need to remember that just because they are applying for this type of lending doesn't mean they can't try to negotiate the interest rate. God wants us to use His money in the best way possible. If the homebuyer is uncomfortable with the no cost loan a bank has to offer, they should move on to the next bank. This may seem frustrating, but in the end the borrower will be happy with their choice. Just pray hard and be patient. "Rest in the LORD, and wait patiently for him" (Psalm 37:7).
Instant Christian Loan ApprovalInstant loan approvals are available from many different types of lending sources. Some examples are payday loans, mortgages, home equity funds, or even a car loan. The easiest way to obtain these contracts may be by researching lending sources on the Internet. Once a consumer has filled out an application, he could find out if he qualifies in as little time as sixty seconds to five minutes. Often, the length of time it takes the applicant to fill out the application and click, is the amount of time it takes for his instant loan approval.
An applicant can apply for up to $200,000 in four short steps. Step one is point, step two is click, step three is close the application form, and the fourth is to get cash. Some lenders offer terms in home closing with a 3.99 adjustable percentage rate (APR). This type includes no appraisal fees, no title costs, no annual renewal, and no hidden costs. Instant loan approvals for payday loans offer direct deposit up to a thousand dollars and no credit check. Online instant loan approval is an alternative to trying to accomplish the task of finding cash during the working hours of lending institutions, such as banks and credit unions. Most borrowers know the discouragement of busy telephones and voice mail applications. Using the Internet to apply averts these types of hassles.
For the person who needs cash fast, instant loan approvals online are the way to go. A qualified applicant can have the cash within minutes. For example, if a person is looking for mortgage refinancing, he may have the added bonus of getting responses from multiple lenders. This area of lending is very competitive and the competition between lenders is steep. Most of us have seen the many commercials on television, in magazines and newspapers, offering great terms. Because of the Internet, applications are available twenty four hours a day and seven days a week. Financial transactions that used to take days or weeks can now be accomplished in the comfort of the borrower's home and in an instant of time.
Modern technology has helped us gain access to many things that only the rich had before. Yet more dangers are also present. When cash is so readily available, we face a temptation to misuse what God has given us. Peter exhorts us to be "good stewards of the grace of God" (1 Peter 4:10). This includes our financial dealings. We cannot be good witness for Jesus and live in financial disarray. We serve God through how we use our money. Becoming dependent on quick cash will not glorify God. An instant loan approval may be the answer to a Christian's financial crisis, but he must first consult God about his financial choices.
Home loans with interest only can be beneficial or risky, depending on the current financial situation, and projected future finances. While lenders may be quick to point out the benefit to taking advantage of this type of financing, always be cautious. They may be attractive, but make sure to evaluate the risk that also may be involved. It is important to weigh all options and fully understand each option before making a decision.
Borrowers can make interest only payments for a defined period of time. At the end of that time, the money borrowed then will turn into fully amortized financing on which the borrower will have to pay on both the loan's interest and principle. There seems to be several benefits to taking a home loan with interest only. First, the borrower can have greater purchasing power and will qualify for a bigger home. Second, the borrower can have increased monthly cash flow because less of their income it tied into a mortgage payment. Finally, this type of financing allows unlimited cash out with certain lenders and eligibility requirements.
On the other hand, they also can pose some risk. The risk generally involves not being able to pay the full monthly amount once the financing becomes fully amortized. This is sometimes referred to a payment shock, and hits the borrower after the time of a home loan with interest only is over and payments may dramatically increase. Payment shock on a home loan with interest only can be especially significant if the borrower has not paid anything toward the amount principle during the interest-only period of the loan. Furthermore, some home loans with interest only carry significant early payoff fees. Therefore, if this is a consideration, be sure to understand fully the terms of the loan agreement.
For some people, taking home loans with interest only makes good financial sense. For example, high net worth individuals who don't want to tie up their money in home equity, but would rather invest it in something with a higher return, may benefit from them. Also, young professionals who are confident of their income dramatically increasing over the years as may benefit as well. In addition, short-term owners who are more concerned with making payments than equity, or real estate investors who are purchasing property in areas where the appreciation is high, may also benefit from a home loan with interest only.
Because home loans with interest only were designed with a specific Christian borrower in mind, they will not be appropriate for everyone. Therefore, ask the Lord for wisdom before deciding on any financing, "for the Lord giveth wisdom: out of his moth cometh knowledge and understanding" (Proverbs 2:6). With patience and trust He will make clear the answer to any financial question.