“sub prime” is used to refer to people who are below the prime credit line. This classification is applied to people who have filed for bankruptcy. If you have had a foreclosure, repossession, a recurring habit of paying bills late, or an eviction from an apartment you may also be dubbed as “sub prime” If any of these events apply to you don’t fret, you can still be approved it will just be more difficult then somebody who has a great credit history.

C) Does the interest on my loan have to be up front?
No. Many people think that when refinancing they must pay off the interest up front. This prospect can be fighting and often scares people away from refinancing. However it is true the majority of the interest is usually paid in the first few years of the loan.

D) Do I need a down payment of 10% or 20%?
At one time this may have been the case but now it is completely false. Different mortgages have varying requirements, some require. There are even
payment plans that require 0 down.

E) If I don’t put 20% down do I have to pay mortgage insurance?
No. This process is called “piggy back” financing, this has become one of the most popular ways to pay back a loan. This divides the process in to loans, the first is for 80% of the purchase. The second loan is for the remainder of the purchase minus the down payment. This strategy will allow you to avoid the cost of mortgage insurance.

F) Is a 30-year fixed mortgage right for me?
Even though this may be the traditional method, there are other ways to go. Adjustable rate mortgages are quickly becoming a widely used alternative. With this type of loan the rates adjust to the market. They can be lower then others, but they can rise when they need to.