Refinance Loans – East Lansing, MI

A mortgage loan, also referred to as a mortgage, is used by purchasers of real property to raise funds to buy real estate; or by existing property owners to raise funds for any purpose while putting a lien on the property being mortgaged. The loan is “secured” on the borrower’s property. This means that a legal mechanism is put in place which allows the lender to take possession and sell the secured property (“foreclosure” or “repossession“) to pay off the loan in the event that the borrower defaults on the loan or otherwise fails to abide by its terms. The wordmortgage is derived from a “Law French” term used by English lawyers in the Middle Ages meaning “death pledge”, and refers to the pledge ending (dying) when either the obligation is fulfilled or the property is taken through foreclosure.^[1] Mortgage can also be described as “a borrower giving consideration in the form of a collateral for a benefit (loan).

Mortgage borrowers can be individuals mortgaging their home or they can be businesses mortgaging commercial property (for example, their own business premises, residential property let to tenants or an investment portfolio). The lender will typically be a financial institution, such as a bank, credit union or building society, depending on the country concerned, and the loan arrangements can be made either directly or indirectly through intermediaries. Features of mortgage loans such as the size of the loan, maturity of the loan, interest rate, method of paying off the loan, and other characteristics can vary considerably. The lender’s rights over the secured property take priority over the borrower’s other creditors which means that if the borrower becomes bankrupt or insolvent, the other creditors will only be repaid the debts owed to them from a sale of the secured property if the mortgage lender is repaid in full first.

In many jurisdictions, though not all (Bali, Indonesia being one exception^[2]), it is normal for home purchases to be funded by a mortgage loan. Few individuals have enough savings or liquid funds to enable them to purchase property outright. In countries where the demand for home ownership is highest, strong domestic markets for mortgages have developed.

Refinancing may refer to the replacement of an existing debt obligation with another debt obligation under different terms. The terms and conditions of refinancing may vary widely by country, province, or state, based on several economic factors such as, inherent risk, projected risk, political stability of a nation, currency stability, banking regulations, borrower’s credit worthiness, and credit rating of a nation. In many industrialized nations, a common form of refinancing is for a place of primary residency mortgage.

If the replacement of debt occurs under financial distress, refinancing might be referred to as debt restructuring.

A loan (debt) might be refinanced for various reasons:

To take advantage of a better interest rate (a reduced monthly payment or a reduced term)
To consolidate other debt(s) into one loan (a potentially longer/shorter term contingent on interest rate differential and fees)
To reduce the monthly repayment amount (often for a longer term, contingent on interest rate differential and fees)
To reduce or alter risk (e.g. switching from a variable-rate to a fixed-rate loan)
To free up cash (often for a longer term, contingent on interest rate differential and fees)

Refinancing for reasons 2, 3, and 5 are usually undertaken by borrowers who are in financial difficulty in order to reduce their monthly repayment obligations, with the penalty that they will take longer to pay off their debt.

In the context of personal (as opposed to corporate) finance, refinancing multiple debts makes management of the debt easier. If high-interest debt, such ascredit card debt, is consolidated into the home mortgage, the borrower is able to pay off the remaining debt at mortgage rates over a longer period.

For home mortgages in the United States, there may be tax advantages available with refinancing, particularly if one does not pay Alternative Minimum Tax.

What is the HARP Program?

When you have little equity in your home, or owe as much or more on your mortgage than your home is worth, it can be difficult to find a lender willing to help you refinance. But for borrowers who have remained current on their mortgages, and have loans owned by Fannie Mae or Freddie Mac, there is hope. It’s called HARP.

Introduced in March 2009, HARP enables borrowers with little or no equity to refinance into more affordable mortgages without new or additional mortgage insurance. HARP targets borrowers with loan-to-value (LTV) ratios equal to or greater than 80 percent and who have limited delinquencies over the 12 months prior to refinancing.

Significant changes have been made to HARP since the program was first introduced. For example, in 2011 the LTV ceiling was removed, property appraisal requirements were waived in certain circumstances, certain risk fees for borrowers selecting shorter amortization terms were eliminated, and certain representations and warranties were waived. In 2013, the eligibility date was changed from the date the loan was acquired by Fannie Mae or Freddie Mac to the date on the note, increasing the pool of eligible borrowers.

HARP has also been extended several times and will now expire on December 31, 2016.

Through HARP, you can get a lower interest rate (which means less out-of-pocket costs each month), get a shorter loan term, or change from an adjustable to fixed-rate mortgage. There’s no minimum credit score needed, either.

And now that HARP guidelines are simpler, even people who were formerly turned down may now be eligible for HARP refinancing.

HARP Frequently Asked Questions (FAQs)

East Lansing

East Lansing is a city in the U.S. state of Michigan directly east of Lansing, the state capital. Most of the city is within Ingham County, with the rest in Clinton County. The population was 48,579 at the 2010 census, an increase from 46,420 in 2000. It is best known as the home of Michigan State University.

East Lansing was an important junction of two major Native American groups: the Potawatomi and Fox.^[6] By 1850, the Lansing and Howell Plank Road Company was established to connect a toll road to the Detroit and Howell Plank Road, improving travel between Detroit and Lansing, which cut right through what is now East Lansing. The toll road was finished in 1853, and included seven tollhouses between Lansing and Howell.^[7]

Michigan State University was founded in 1855 and established in what is now East Lansing in 1857. For the first four decades, the students and faculty lived almost entirely on the college campus. A few commuted from Lansing, and that number increased when a streetcar line was built in the 1890s, but there were few places to live in the then-rural area immediately around the campus.

That started to change in 1887, when professors William J. Beal and Rolla C. Carpenter created Collegeville, along what is now Harrison Road and Center and Beal Streets, north of Michigan Avenue. Few faculty were attracted to the location, and the first residents were “teamsters and laborers”.^[8] In 1898, the College Delta subdivision (including what is now Delta Street) had the support of the college itself, which provided utilities, and several professors built homes there (one of which survives today at 243 W. Grand River Ave.).^[9] Other subdivisions followed.

At that time, the post office address was “Agricultural College, Michigan.” A school district encompassing the nascent community was created in 1900. In 1907, incorporation as a city was proposed under the name “College Park”; the legislature approved the charter but changed the name to “East Lansing.” The first seven mayors, starting with Clinton D. Smith in 1907 and Warren Babcock in 1908, were professors or employees of the college.