Monday, May 31, 2010
Money in Foreclosed Properties
• What type of property to buy?
• Where to get money to purchase the property?
• What to buy- foreclosed or auction properties?
• Where to buy- from banks or from the government?
• How much taxes needed in buying and selling the property?
• How much are the renovation and upgrading costs?
• How to renovate- thru owner’s labor or thru expert construction workers?
• Will he either to sell or rent out the upgraded property?
• How long will the investment be recovered or makes a profit?
Some schemes of buying foreclosed properties offer a no-down payment plan. This seems very attractive, because whatever happens to the housing loan, the buyer will not absorb any loss. But this is not the case. Once the borrower-buyer fails in his amortization, and his property foreclosed, definitely his credit standing will greatly suffer. And to recover good credit standing, it will take years of being a good loan payer.
Sometimes, it is better to get a housing loan from a good local lender than banks. The former gives lower rates and shorter loan processing period. It is also a good move to hire a reliable mortgage broker, because in spite of the addition 1% broker’s fee expense, it is worth in terms of expert advice, time savings and getting the best possible terms for ones loan. Buying foreclosed properties is most logical and attractive move of a real estate investor now. Because of the dirt-low prices and the easy terms that financial institutions are offering, to unload these properties out of their systems. But still, the prospective must be careful in making the move. Seek experts’ advice.
Saturday, May 29, 2010
Computing Your Mortgage
Real estate was no exception. There were many short sales and foreclosures when many people could no longer afford to pay their mortgage (aside from the fact that many were laid off from their jobs). To avoid this, it is always good How much can you comfortably spend for a house of your own?
A simple rule to follow is to multiply your annual salary two and a half times. An annual salary of $72,000 can afford a $180,000 home. Beyond than that it would cause some inconvenience. Married couples would be better of by pooling their incomes together, so they can afford a better home.
As for the monthly pay, lenders have this 33/38 guideline. Your housing costs should not exceed 33 percent of your total monthly income (before taxes). When added to all your other consumer debts, should not exceed 38 percent. This 33-38 figure is called debt-to-income ratio.
Housing costs include mortgage payment, taxes, insurance, if any, and homeowners association fees, if any. Hence, for an income of $6,000 a month, housing cost should not exceed $1,980 given the 33 percent front ratio. Make sure your mortgage is below that too, as you have other payments to consider in housing costs.
As for consumer debt, this includes credit card balance, student loan, and other related debts. If you ever have car payment, that would take up much of your consumer debt. Going back to the $6,000 monthly gross salary, your consumer debt plus housing costs should be around $2,280, given the 38 percent back ratio.
The 33/38 debt-to-income ratio is only a guideline for lenders, not necessarily a rule. They can loosen up the figures if you give more down payment, or if you have good credit background. It also depends on what kind of loan program you choose. The 38 back ratio can even extend up to 41. On the other hand, if you only give a small down payment or have a less-than-likely credit report, lenders may be a little tight for you.
For your own safety, stay within this guideline. Take note that you’re not only paying debts with your monthly salary, you need to feed too. You also have leisure, recreation and other basic needs. If you have children, then you have more mouths to feed. Save yourself from sleepless nights by staying within your budget.
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Friday, May 28, 2010
Affordable Tremblant Investment
Many dream of owning a piece of real estate property in this fantastic place. But the cost of properties here are sky high, considering that average cost of a vacation house here is US$ 1 million.
But Tremblant real estate men solved this high cost of real estate by means of the Condo-hotel scheme. This scheme involves the construction of high-rise luxury hotels, and have them operated by well – known hotel-chain operators like Westin, Carlton, Fairmont, Ritz and others. In this scheme, hotel structures are built like condominium units, unified into a hotel setup.
With this scheme, individual condo units are made available for sale with affordable prices. Though smacked in expensive areas, the cost per unit is reduced because of the multi-story concept. Furthermore- while the condo unit is vacant, when it’s not used by the owner, it can be rented out thru the hotel administrator; this is if the owner allows it. The fees charged are quite steep, but the condo unit will be maintained well and will have a good reputation and selling point. This will enable the owner to get a good resale price if he decides to sell it.
With the prevailing economic condition now, if one has extra money to invest, now is the time to dabble in real estate ventures, while the market prices are on the down side. Joseph Kennedy, the father of Pres. Kenned, made the bulk of his wealth by buying bargain real estate properties during the Great Depression period. When the good times came, his properties multiplied in value, several times over their acquisition costs.
Now, one could be a Tremblant property owner, a place where only multi-millionaires could afford.
Thursday, May 27, 2010
How to Compare Home Equity Loan Products
Monday, May 24, 2010
Realtors: Surviving in Tough Times
Of course, this is in addition to good personal relationship of the agent with the buyer- as a result of his reputation as a real estate man.
The agent must also be aware of the trends of real estate in the locality where he is specializing in. Are the demand and market prices going up or down? Thus, he could advice his buyer as to what moves and what kind of property the said buyer must consider. In this aspect, the agent must act not just as a salesman, but also, as a real estate professional whose advice is valued in this field.
Rental transactions play an important part of the industry that helps it to survive during hard times. These include leases and rentals of residential, business, agricultural and industrial warehouses.