| What’s the best option for financing your automobile?
If you're financing the purchase of a car with the equity in your home, that is exactly what you could be doing — paying for a car over 10 or even 30 years.The use of home equity loans, lines of credit and cash-out refinancing to purchase an automobile grew in the last decade as interest rates dropped and property values soared.It also has become popular as lenders hyped the fact that interest on a home loan is tax-deductible, unlike on a vehicle loan.In 2006, about 24 percent of homeowners used a home equity line of credit to purchase a car or truck, according to Synergistics Research Corp., a financial services consumer market research company based in Atlanta, Ga. About 8 percent of homeowners took out a second mortgage specifically to buy a vehicle, says William H. McCracken, chief executive of Synergistics.But is buying a car or paying off your remaining auto loan balance with the borrowed equity from your home a good financial move?“I issue a note of caution on this," says Don Taylor, a columnist for Bankrate.com and an associate professor of finance at The American College in Bryn Mawr, Pa.“If you don't have the discipline to do more than the minimum payments on these loans, then this is not a good idea."The assumption people make is that the home equity loan is cheaper than a traditional car loan because of the mortgage interest tax break.However, if you don't make extra payments or pay the loan off early, you end up paying more in interest over the life of that loan than you would with an auto loan, erasing any savings on your taxes.Plus, because the car money is rolled up in a home mortgage, you could still be paying on a loan for a vehicle you've long since sold or traded in.I asked Taylor to run a few financing scenarios to compare the total cost of four types of auto borrowing: a 60-month car loan, a 10-year home equity loan, a 10-year home equity line of credit and a 30-year cash-out mortgage refinance.To view the full results or to plug in your own loan figures, income tax rate and interest rates, go to www.bankrate.com/compare.So let's look at one example of an auto loan versus a home equity loan in which you finance $30,000.
New Mortgage 'Rate Relief' Program Offers Discounted Rates as Low ...
Katz Mortgage Team, www.KatzMortgageTeam.net, of Amtrust Mortgage Corporation, announces a new mortgage program called "Rate Relief," which offers borrowers a discounted interest rate for the first two years of their home loan. This program can be used with a variety of loan products including 15- and 30-year fixed, interest only and Zero-down loans. Atlanta, GA (PRWEB) March 27, 2007 -- Katz Mortgage Team, www.KatzMortgageTeam.net, of Amtrust Mortgage Corporation, is pleased to announce they now offer a new discounted mortgage program called "Rate Relief," which offers borrowers a discounted interest rate for the first two years of their home loan. This program can be used with a variety of loan products including 15 and 30-year fixed, Interest-Only and Zero-Down loans. The way the program works is simple.
Sun America Mortgage changing name
Sun America Mortgage has changed the name of its mortgage lending offices, including one in the Triad, to SunTrust Mortgage Inc. SunTrust Mortgage acquired the offices that became Sun America in July of 2003, had has operated them as locally managed divisions. After the name change that took effect April 1, those offices are operating as a separate SunTrust Mortgage region. SunTrust Mortgage is a subsidiary of Atlanta-based SunTrust Bank. .
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