Ellie Kay on VA loans and credit card interest rates

We bought a house about a year ago & have been paying an extra $100 each month on the principle. At the end of 2010 we got a notice that our mortgage payment went down about $18. We are still paying the same payment each month as we did all last year. Is that wise? Is there anything else you might suggest. Looking forward to your advice.

Hi Ellie,

I have a 7 year ARM mortgage that has just finished it's 7 year period this month. Last year I lost my job when the company I was working for closed it's doors. I've currently got a short contract job (3 months). Will I be able to refinance even though I have a contract job? If so, do I reduce my chances of getting a good rate without a permanent job?

thanks

I was sorry to hear the advice Ellie gave the VA homebuyer.  VA is for 1st time homebuyers and allows 100% financing.  Why would someone suggest a borrower put all their money in their home, try to go 15 years and leave a payment outstanding on a car.  With our current econimic market it is very hard to get any equity out of your home unless you refinance.  This is costly and uses a portion of the equity in your home.  Why go 15 years, why not pay extra toward the principal.  You can pay toward the balance but at same time not be strapped with 15 year mortgage should financial position change such as loosing a job. Lastly many first time homebuyers have credit scores in 600 to 640 range.  No matter how much one puts down on a conventional loan the rate is not going to be as good as VA unless your score is in excess of 740.  It is always wise to keep money in other financial investments so that you have access to the funds.  Yes it is good to own your home free and clear but a home increases in value regardless of home much you owe on it.  I believe Ellie is out of touch with what best meets the needs of most homebuyers.  Sorry so many are listening to advice that is not realistic or financially to the best benefit of a homebuyer.