Loan Amount

FACED with mortgage rates over 8 percent, homebuyers are rediscovering a type of loan that's been out of favor for most of this decade: short- and intermediate-term mortgages that cut your fixed rate by a half to a full percentage point.Mortgage companies and large investors such as Freddie Mac report that three-year, five-year and seven-year loans -- all with optional features converting to 30-year financing -- have suddenly begun pulling in rate-sensitive buyers and refinancers. The national financial reporting service HSH Associates, which surveys more than 2,500 lenders, found that last week five-year "hybrid" loans carried average rates of 7.38 percent nationwide compared with 30-year conventional mortgage rates averaging 8.01 percent.

IF YOU'RE DUE a refund on your income taxes, how fast can you get it? And is it worth taking a quick loan to lay your hands on the money even sooner?Here are the outside times for receiving your refund, according to the IRS: about five weeks if you send your tax return by mail; three weeks if you file electronically and get a check back by mail; one to two weeks for electronic filers who have the refund wired directly to their bank accounts.You can get money even faster -- within two to four days -- if you take what's called a "refund anticipation loan," offered by major tax preparers.

WASHINGTON -- In a bellwether victory for consumer advocates, a prominent mortgage lender has agreed to settle a national class-action lawsuit challenging its funneling of undisclosed fees to local mortgage companies who persuade borrowers to pay higher than the prevailing rates or terms for their home loans.A spokesman for Ford Consumer Finance Co., a mortgage subsidiary of the giant automaker, confirmed that his company has decided to settle the year-old suit rather than incur additional litigation costs.

WASHINGTON -- The federal agency that helps millions of veterans obtain mortgage money is cracking down on lenders who overcharge unsuspecting applicants seeking to lower the interest rate on their existing loans.In a national policy directive sent out to all Department of Veterans Affairs offices Jan. 25, the head of the VA loan program warned that the agency "has recently seen a number of [refinance] loans in which the veteran is being charged a high number of points, and the points are included in the loan."

HOME LOAN applicants nationwide should be the beneficiaries of a new Federal Reserve Board rule on upfront disclosure of fees charged by mortgage brokers.Effective Sept. 30, all fees levied by loan brokers and paid directly by the borrower must be included as part of the mandatory truth-in-lending "finance charge" disclosure that consumers receive within three business days of applying for a home mortgage.Before the new rule, the federal government offered no uniform guidance on what fees brokers had to disclose up front as part of the finance charge or annual percentage rate (APR)

A $4 MILLION Justice Department settlement with a large mortgage company this month highlights a lending industry practice that minority, female and senior-citizen loan applicants nationwide should know about -- and avoid whenever possible.The settlement, negotiated with California-based Long Beach Mortgage Co., alleged that not only employees of the firm but its network of independent mortgage brokers routinely charged minorities, women and elderly applicants significantly higher fees or "overages" than they charged white male applicants.

Washington -- A wave of national class-action suits against prominent lenders is focusing new attention on a widespread practice that few home loan applicants understand: The payment of extra money to mortgage companies who "upsell" the rates or fees on loans they originate.The extra fees -- known in the trade as overages or yield-spread premiums -- typically are paid to local mortgage brokers by large lenders who purchase their home loans. The concept is straightforward: If a mortgage company can deliver a loan at higher than the going rate, or with higher fees, the loan is worth more to the large lender who buys it. For every rate notch above "par" -- the lender's standard rate -- the lender will pay a local originator a bonus.

WASHINGTON -- Top legal experts who advise banks and mortgage lenders have just sounded an alarm that homebuyers and refinancers ought to hear, too.The warning in brief: Federal investigators are expanding their fair lending focus to a potentially explosive new arena -- the amount of fees charged female and minority mortgage applicants compared with the fees charged men and whites.Washington banking attorney D. Jean Veta argues that "women seem to be prime candidates" for being quoted and charged higher points and other fees on mortgage applications.

How do I get prequalified for a loan?The first task to take care of, even before you start looking athouses, is to find what price home you can afford to buy. Lender prequalification involves a brief, no-obligation meeting with a loan agent or mortgage broker to determine what size loan a lender is likely to give you. This loan amount, plus the cash you have for a down payment and closing costs, will determine how much house you can afford.Make an appointment for a prequalification interview and be prepared to discuss the intimate details of your financial situation.

Maryland home sales rose despite Jan. chillHome sales throughout Maryland rose in January, despite the month's bad weather, according to the Maryland Association of Realtors.Pending sales -- homes placed under contract -- reached 2,122, up 3 percent compared to January 1993.Sales that settled jumped 6 percent to 2,985. The average sale price for a home in Maryland fell 4 percent, to $135,205.Mortgage firm offers rebate to customersProsperity Mortgage, mortgage subsidiary of Long & Foster Real Estate, is offering a cash rebate to any customer who doesn't receive a loan decision within 30 days of application.

I was going to refinance my loan on my house. The day I was going to sign the closing papers, I asked again what the loan amount and monthly payment would be. It was higher than what I was told originally, so I canceled the refinance. My appraisal fee was going to be free, but now they're saying I have to pay it since the loan was not closed. But the only reason I did not close was because the figures changed. Do I have to pay it? You may have to. Often, when you sign an application to do a loan, you agree (in the fine print)

After six months of haggling and political gamesmanship, a huge housing-relief bill is heading for final approval. Though it has hundreds of pages and dozens of separate initiatives - including revamping federal oversight of mortgage giants Fannie Mae and Freddie Mac - the centerpiece is a $300 billion "HOPE" program designed to provide refinancing lifelines to as many as 400,000 homeowners in trouble on their current loans. But what are the specifics? Who will be able to qualify for help?

I sold my home and will settle Dec. 22. My $63,000 mortgage loan has a prepayment penalty. It states that I must pay six months interest on the amount prepaid in excess of 20 percent of the original loan amount. How much money can I estimate to pay for penalty? Some residential mortgage loans include a penalty for prepayment during the first three years. These loans usually carry interest rates that are higher than average. The prepayment penalty guarantees the lender a profitable return on the loan even if it is paid off within a short time.

Several Web sites have online calculators that can help a prospective homebuyer figure out the rate that can be expected and the amount of monthly mortgage payments. Here are a few: Bankrate.com www.bankrate.com/brm/calculators/mortgages.asp Features mortgage and amortization calculators. Relator.com www.homefair.com/homefair/usr/qualcalcform.html Determine the loan amount you can qualify for by income, savings and rate. HSH Associates, Financial Publishers www.hsh.com/calc-howmuch.

Dear Mr. Azrael: I own a townhouse as an investment property with a Federal Housing Administration mortgage at 7.25 percent. The loan-to-value ratio is 60. I have been getting frequent solicitations regarding "streamline financing" to a lower rate. The loan officer informs me that there are minimal costs involved in this type of refinancing and that the lending company will pay these costs in exchange for the business of reselling the loan on the secondary market. Could there be hidden fees that I'm not being told about?

THE $60 million "predatory lending" settlement reached last week with a once-powerful home mortgage lender should set off alarm bells around the country. The allegations against California-based First Alliance Co. were chilling: The lender was charged with intentionally misleading thousands of its customers into believing they were signing up for low- or no-fee mortgages, while in fact some loans had as much as $25,000 in fees tucked away per $100,000 of principal. First Alliance also was accused of misleading its customers about interest rates.

A Freddie Mac survey of refinanced loans in this year's first quarter found that the median age of the original loan was 1.6 years - the lowest since the secondary mortgage seller began tracking the age of refinanced loans in 1997. In their quarterly survey, Freddie Mac's economists attributed the shrinking ages of the loans being refinanced to "robust" house-price appreciation during the past three years, and recent favorable interest rates for homeowners. The survey found that properties with mortgages backing refinanced loans appreciated in value by 11 percent at the time the loan was refinanced.

Turning back an aggressive push from out-of-state finance companies, a Senate committee killed last night a bill that would have legalized high-interest "payday lending" in Maryland. On a unanimous voice vote, the Senate Finance Committee voted to reject the bill, but also to study the issue of short-term loans after the General Assembly adjourns in April. Many committee members objected to a practice that some community activists have likened to legalized loan-sharking because of the high annual interest rates.

A year after the General Assembly acted to ban "payday lending," which provides short-term loans at high interest rates, prominent legislators are pushing to make the loans legal again. To the dismay of community activists who have battled against what they call legalized loan-sharking that is widespread in poor black communities, two leading African-American lawmakers - Sen. Clarence W. Blount, the Senate majority leader, and Del. Talmadge Branch, head of the Legislative Black Caucus - are sponsoring legislation to allow payday loans.

FACED with mortgage rates over 8 percent, homebuyers are rediscovering a type of loan that's been out of favor for most of this decade: short- and intermediate-term mortgages that cut your fixed rate by a half to a full percentage point.Mortgage companies and large investors such as Freddie Mac report that three-year, five-year and seven-year loans -- all with optional features converting to 30-year financing -- have suddenly begun pulling in rate-sensitive buyers and refinancers. The national financial reporting service HSH Associates, which surveys more than 2,500 lenders, found that last week five-year "hybrid" loans carried average rates of 7.38 percent nationwide compared with 30-year conventional mortgage rates averaging 8.01 percent.