Leveraging Home Equity With Negative Amortization Mortgage Loans

Writen by Keith Hinkley

Every where I go people ask me if I recommend payment option mortgage loans. I have been selling these loans for many years, but I was called then negative amortization loans. You get a low monthly payment, and then at the end of the year the mortgage company holding your paper increases your mortgage balance. In some markets across the nation, this could be very risky to say the least. To be fair these loans have evolved. Now these home loans offer 3 or 4 payment options each month. Borrowers can select from the different payment options. Consider the fully indexed payment, the interest only payment, and the ridiculously low interest rate with the the neg am payment.

Why are negative amortization mortgage more common now? One of the reasons that these types of more complex loans are increasingly common on the market is that mortgage lenders have better data, support and technical tools for estimating risks as well as better credit scoring data available. Therefore home lenders today can handle more loan types, e.g. negative amortization loan, no interest mortgages and piggy back loans.

Remember when pricing a mortgage loan online, to check multiple resources, and get "Good Faith Estimates" from each mortgage lender that you talk to. Discuss the loan process and request for information about negative amortization mortgages. Take advantage of online calculators, rates and always request free quotes with no obligation. If you have decided on your home mortgage loan needs, start comparing interest rates and costs online.

Keith is one of the top mortgage writers for home mortgage loan related topics. To learn more about 2nd mortgages, and equity loan programs Bad Credit Home Equity Loans please visit the home mortgage resource center at the Mortgage Loan Outlet and learn more about 1% Payment Option Mortgage Loans. If you need more good advice from experienced loan professionals, visit Bridge Mortgages and ask then about their 1st time homebuyer specials for 100% Home Mortgage Financing.