"You can take a 30-year mortgage and if it turns out your interest rate’s too high, next week you refinance lower. And if it turns out it’s too low, the other guy’s stuck with it for 30 years.”
We all remember Freddie Mac and Fannie Mae, the twin quasi-public organizations who backstopped the home loan industry for the whole country. Freddie and Fannie were thought by some to be on the verge of extinction during the home loan crisis, but they revived when Washington stepped in. Freddie’s latest quarterly financials show assets that have a small ‘t’ in front of the number (that’s short for ‘trillions’), so it looks like they aren’t about to go out of business. In fact, whenever one of today’s Minneapolis home loans is originated, Freddie or Fannie are probably in the wings. They remain the big guns in the U.S. secondary home loan market, which is so huge its repercussions are felt globally.
You don’t have to tell anyone who is self-employed in Lakeville, MN there are extra costs that go with the benefits. In addition to the long hours and weight of responsibility that come with the job description, getting a home loan has always added special challenges. Now that we are into the new Dodd-Frank era of federal oversight, some of the changes warrant an early heads-up.
Mortgage Insurance is often a necessary expense that borrowers must incur if they don’t have the standard 20 percent down payment amount. Mortgage lenders will require a private mortgage insurance (PMI) as a result of the lower down payment. Choosing to pay the insurance yourself or opting to allow the lender to pay it depends on how long you plan to stay in the home and whether or not you are in a moderately appreciating real estate market.