There's still a lot of money management to do once you have your mortgage. See what circumstances might change and how they might affect you.
Just because the closing is over doesn't mean you don't have to pay attention to your loan anymore. In this chapter, we'll explain what happens when your mortgage is sold to a servicer, why your monthly payment might change, the upsides and downsides of paying off your mortgage early, how to rid yourself of PMI, when you might consider refinancing and how to avoid foreclosure in the event that you can't make the mortgage payments.
What you can expect to learn from this chapter:
- When your mortgage is handled by a mortgage servicer
What you need to know and what you need to be told when your original mortgage holder turns over the loan to a mortgage servicer, often when the debt is sold.
- Payment changes
Your monthly payment may change for several reasons. Here are tips for ARMs and for fixed-rate mortgages.
- Paying ahead
The upside of prepaying your mortgage is what you save in interest. The downside could be penalties for paying your loan early.
- Removing private mortgage insurance
Knowing how much equity you have in your home may let you stop paying PMI. Here's how to calculate your home's equity.
The two types of refinancing -- rate-and-term and cash-out -- are explained. Plus a link to Bankrate's refinancing calculator.
- Avoiding foreclosure
Foreclosure is when you can't pay the mortgage and your lender takes your house. Here's the foreclosure timeline -- and ways to avoid foreclosure.