How I Improved My Cash Flow Without Changing My Monthly Budget, Essay Example

In the past few years, price properties all over the world have been skyrocketing. Increased revenues from foreign investments and oil has led to an increased demand for housing. This is further enhanced by the fact that housing laws are more liberal, little to no tax in the housing tax and very easy and non-stringent home financing. Advisors Mortgage Group, LLC has always aimed at becoming the people’s preferred lender owing to the numerous personal perks that are associated with services.

As a mortgage consultant at the company, I have managed to gain invaluable experience working in a number of departments. One of the most important aspects that most clients pay critical attention to is the cost and available cash flows. Any client looking to acquire a mortgage. As a preferred lender for a number for a number of developers, Advisors Mortgage Group, LLC’s payments have one important advantage, quick and fast processing of payments and other transactions. While most clients find it very useful to have a reliable preferred lender, at advisors Mortgage, clients have always found it useful to have a preferred lender who is more of a partner as opposed to a traditional lender.

Mortgage Refinancing

One of the most important tools that I have employed over the past few years so as to increase clients’ cash flows is the refinancing of mortgages. In my experience, I have always found refinancing a mortgage to allow the client to cash out a given value of equity in their home. Refinancing always helped my clients balance their budget and realize their financial goals. In some instances, clients realized savings of hundreds of dollars on a monthly basis.

I have always encouraged clients to consider the refinancing alternative if, and only if, the conditions favour such an undertaking. This is mainly determined by the indicators that may signal an optimal time to refinance a mortgage. One of the most significant indicators is the decline in interest rates. A client would essentially realize a decline in interest rates as a result of market movements or their qualification for a lower interest rates as a result of improving credit scores. As a preferred lender I have advised customers on the most ideal level of interest rate reduction that would ideally help them realize increased cash flows without changing their monthly budget. A full single-point or two-point fall in interest rates is enough to save you up to tens of thousands of dollars, depending on the level and value of the mortgage.

While taking out second mortgages is a common alternative amongst clients, most preferred lenders advise lenders and their clients to always refinance when attempting to get rid of second mortgages. Second mortgages have the advantage of giving you extra cash o conduct additional repairs and work on your home, when clearing it out, refinancing the mortgage is a useful tool. I have advised a number of customers to take advantage of refinancing as it offers the ability of consolidating loans, including a second mortgage, into a single loan.

Second Mortgage

One of the most useful tools that I have been able to suggest to clients in order to increase their cash flows while maintaining their mortgage is through the use of a second mortgage. A second mortgage acts as a second loan that one can take to secure with the home equity, which is offered on the Home Equity Line of Credit (HELOC). As a rule of thumb, I take out this second mortgage for clients from a different mortgage dealer, which allows the home owner to pay off his/her first mortgage while making payments on the first mortgage. This ensures that the whole value of the house is under mortgage. I would ensure that clients who were own owners to be allowed to borrow up to 90% of the appraised value of the real estate.

Before a client would engage in a second mortgage, I would inform them of the increase in costs that they would realize. However, the debt consolidation that a second mortgage offers is an attractive incentive for most home owners. As earlier stated, the second mortgage is secured by the preferred lender based on the equity in the home, however these funds can be channelled to any use. The homeowner could use these funds to consolidate several debts, such as high interest credit card debt. This technique improved the home owner’s ability to save and in the process repay these high interest debt(s) at a lower interest rate that was linked with the second mortgage.

A second mortgage allowed for a home owner to make improvements that were not originally planned (Rich and Jason). This is because the funds from a second mortgage can be redirected for any use. This explains why home owners prefer taking out a HELOC giving them the option of cashing out on the equity for their home. Furthermore, there are some tax advantages that are associated with securing a second mortgage. As earlier stated, debts such as high credit card debts can be consolidated under the umbrella of a second mortgage. This is very important for many home owners in the United States, as, by law, this facet of the second mortgage gives them the power to reduce the interest rates on the second mortgage that they have chosen to take out.

A second mortgage gave a home owner a favourable interest rates. The option of taking out a second mortgage is only viable for a home owner if their savings potential surpasses the long-term costs of taking out the second mortgage loan. In order to achieve this, I would calculate the client’s difference, and if the difference was positive and significant, then the second mortgage loan would be a worthwhile investment.

While most of us focus on completing mortgage payments in time, very few people consider they can realize a cheaper expense on their mortgage by taking into consideration all the possible alternatives. Refinancing and taking out a second mortgage can be useful tools for any client to increase their cash flows without affecting their budget. I have found that taking out a second mortgage from your preferred lender, Advisors Mortgage Group, can offer you extra cash that you require to make additional adjustments and improvements to your home without incurring the significant cost of the whole process. Even, better, as your preferred lender, relative to the case conditions, I would advise on the mortgage refinance alternative to help with taking out a portion of the equity so as to realize the cash flows required for additional improvements. The best scenario would amount to thousands of dollars savings on mortgage payments as a result of lower interest rates