Friday, February 16, 2007

No Cost Financing For Home Owners

By Greg Lucas

The No cost financing option is a good option for homeowners. Why? I will come to that at a later stage. Let me discuss some facts, as one can understand that no cost finance is a reality not a myth.

How does one get away with no cost finance? It is a quite simple fact you have to pay for what you get. Nobody is ready to dole out money just for the fun of it.

If you need money you need to pay for it but "no cost financing" options are financing options that have no hidden charges and are quite gentle. A financier who is going to give you a no cost finance option will be charging you something between 0.5 % and 0.85 % more than one who is going to give you a full cost loan.

The above advantage that I have given is for homeowners. As homeowner one can go for a no cost option mortgage provided the interest rates are significantly lower. This is the advantage if the current interest rates are lower.

Homeowners who plan to live in their houses for not a long period of time say between three and one year can take advantage of this loan option. If you are unsure about the period of stay in your house then you should consider refinancing, keeping in mind that you could still go in for no cost financing.

Once you go in for no cost financing, you should be ready to bear little surprises. Once you have gone for refinancing you will not be required to pay any lender fees or for that matter settlement fees. As borrowers of the loan you will be held responsible for the per-diem interest and other escrow costs. However your old lender as your old loan closes will credit the escrow costs.

Before going in for a no cost finance option, it would be a great idea to talk to your financial advisor. There were two kinds of financial advisor's up to now, an Independent financial advisor and a tied agent.

An Independent financial advisor will do all the dirty work for you like browsing through the whole market and finding out what is most suitable for you. A tied agent will talk to you about only what his employer has to give you.

Now the third type of financial advisor that has emerged is the multi tied agent. They have their own limits to talk about from a choice of companies and how they are commercially arranged with them. They were basically arranged for people who would have been otherwise tied down to tie advice.

These financial advisors when they give you advice on any no cost option will be charging you for their advice. This will relate to your full cost loan. You can always strike a bargain with them to give you the best in this zone. You can find advisors relating to the specialized field like mortgages to give you specific advice on no cost financing.

Greg Lucas is a small business owner and an on-line marketing expert who owns and operates a large network of informative and educational websites. for more information please visit: zero down home loans

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