Saturday, August 30, 2008

Avoid Top 10 Mistakes Made By Real Estate Investors

Author: Real Estate Advisor

Real estate investment is perhaps one of the most lucrative forms of investment today. But it is also equally risk bound especially when one is not well versed with the trends and nuances of the real estate market. So if you are contemplating on investing in real estate, it is best to avoid costly mistakes in real estate investment especially when you invest your hard earned money into it. Knowing the most common mistakes made by real estate investors helps one steer away from making such mistakes in the future and ensures good return on investment.

Here are the top ten mistakes made by real estate investors, according to bankrate.com. Bankrate has put together the top ten mistakes after speaking to established, full-time real estate investors and other professionals involved in real estate investment such as bankers. Read on to know them and avoid them.

1. Not planning up ahead. Lack of a proper plan is the biggest mistake made by novice investors. Finding a house after forming a proper investment strategy is the right way instead of looking for a house to fit the plan. Many make the mistake of buying a house because it seems to be a good deal and then trying to see how they can fit it into their plan. Instead of buying a house and thinking one can plan in due course, investors should rather concentrate on the numbers and try to make offers on multiple properties. This will ensure a good property that not only matches their investment model but also works out well with the numbers they had planned for.

2. To believe you can make money quickly. The second major mistake that real estate investors make is to think it is very easy to get rich in real estate. This is only a myth and the reality is that investing in real estate is a long term project.

3. Doing it single-handedly. For becoming a successful real estate investor one needs to build a team of professionals who would assist the investor in his deals. This would ideally include a real estate agent, an appraiser, a home inspector, a closing attorney and a lender.

4. Making excess payment. One another reason that investors in real estate goof up in their investment is by paying too much for the properties they buy. Paying too much and locking up all the funds in the erred property deal will leave you with no money to redeem yourself.

5. Leaving out the groundwork. Not doing your homework could be a costly mistake if you were a real estate investor. Every field of business needs sufficient amount of homework to be done, and real estate investment is no exception. Learn the fundamentals and then venture into investing in properties.

6. Throwing caution to the winds. Investors have to exercise a certain degree of caution and take earnest efforts while making a deal. New investors often fail in this regard and sign a deal without doing adequate research on the property.

7. Miscalculating money flow. Investors whose strategy is to buy, hold and rent out properties need to ensure sufficient cash flow for maintenance. Property managers could be expensive and the owner has to incur more expenses such as mortgage, taxes, insurance, advertising costs etc. Investors have to allocate their budget such that all these expenses are taken care of, or end up having their asset turn into a liability.

8. Lowering the volume. A larger volume of deals or transactions helps in increasing the profits by reducing the impacts of marginal deals.

9. Getting trapped in your own deal. Having more number of options at hand for the property you buy is a wise strategy. This helps one to be prepared for fluctuations in the real estate market. Plans to rent out the house could go awry when the rental market slumps. Having alternative plans helps you cut down losses and tackle unexpected situations.

10. Making incorrect estimates. People who plan to rehab their house need to check if they will still reap the benefits at double the time that they had estimated. This ensures they do not miscalculate and lose money on the deal.

5 Tips for Refinancing Home Mortgage

Author: Alex Bellweather

Home loan market is one of the ever growing markets. Many types of people are using the mortgage the home for finance.

If you want to settle the home market than it is important for you to select the proper way for refinancing the mortgage.

It is important for you to select the refinance rout to get aware about the refinancing the home mortgage:

1. It is important for you to get the pre-approval from the home loan to get the competitive rates. It is essential to obtain the proper approval as per your needs. It is important for you to get the benefits by refinancing home loan. It is important to check the refinancing option for receiving the proper approval.

2. If you want to payoff the pre-payment so that you can’t get penalty to get the benefits. The pre-payment penalty is in the range of three month to six years. It is important to have proper pre-payment to get the refinance.

3. You should also get the prepayment process and interest rate as well as cost involved in the refinancing to get the benefits. It cost the lender to get the pre-payment penalty to give the benefits.

4. Once you finalize the rate than you can get the benefits of refinancing to get advantage.

5. You must have to select the appropriate refinance option so that you can get the benefits of it.

It is important for you to get the refinance through mortgage loan. It is important for you to get the benefit of refinance the mortgage loan.

Getting Your First Mortgage

Author: Chris Borthwick

There hasn’t been a harder time than in the past few months for those looking for a first time buyer mortgage with rising house prices and the credit crunch has caused lenders to tighten their lending requirements and cancel and reduce the number of mortgages they offer. There is only currently only one 100% mortgage lender on the market making it hard for many to get the first steps on the property ladder.

Mortgage rates are starting to return to levels very similar to those before the credit crunch and should set to get even more competitive however first time buyers are disadvantaged by new tougher conditions mortgage lenders are introducing with their mortgages.

To get a decent rate you need to either have a sizeable equity stake in a property (obviously counting first timers out) or have a fairly large deposit to put down on a new home.

However don’t worry things are getting better as mortgage lenders re-enter the market and property prices have come down, on average by £20,000, making it possible for many more to buy and afford repayments.

Before you commit to buying a mortgage you should think carefully – is it the right time for me/us to buy? Should I/we save a little longer? Saving for a bit longer will mean your choice of mortgages will be better as you are able to offer a higher deposit, easing lenders concerns who will in return offer a better interest rate, possibly saving you in the long term by renting for just that bit longer.

Once you are ready to start your property search, a good place to start is with a mortgage broker. A good mortgage broker will take time to understand your requirements and should search the whole of the market to find the best http://www.firstmortgage.co.uk/First-time-buyer-mortgage"> first time buyer mortgage for you. Many offer free, impartial advice so you can see what you can afford, what is available to you and how much you can borrow for your property. They should also be able to offer expert knowledge of the market and have experience to be able to recommend a lender when you have a choice between a few.

Start your search now to see if you can jump into the property market.

Tips for Reviewing Loans

Once your have begun the process of obtaining a home mortgage loan, here are some essential things to watch or watch out for in reviewing loan proposals and documents.

When you are in the process of obtaining a home mortgage loan, there are undoubtedly many aspects of the process that are new to you. The language that applies to loans, for instance can be different from the meaning applied to the same term in everyday life. It is far better to review each clause of the prospective loan document as soon as you have access to it and make certain that you understand the terms that are used and how they apply to your own financial situation. Here are some concepts regarding your loan that will be important in ensuring your loan package is acceptable in the long run.

Overall cost of the loan

There are many aspects that go into determining the loan cost on your home mortgage loan. The interest rate, mortgage type, loan fees, and term of the loan are just a few of these. You may understand the words, but it is important to take a look at what the words will cost you in dollars and cents. Even a few dollars less in the early stages of a loan can save you thousands of dollars over the entire loan period. It's important to take advantage of such savings.

Mortgage type

The basic mortgage types that are common when you apply for a home mortgage loan include the fixed rate mortgage, the adjustable rate mortgage, reverse or negative equity mortgages and interest only mortgages. Each of these has advantages and disadvantages and you are the best equipped to determine whether the type of mortgage will work for you. The important factor is that you review the documents and proposals so that you know precisely which type of loan you are getting. Being surprised in a few months by a two to five hundred dollar increase in your monthly payment due to an adjustable rate mortgage can result in the loss of your home.

Interest rate

When reviewing the loan documents for a home mortgage loan, one of the important factors that you should check and understand is that of interest rate on the loan. Mortgage interest rates can vary from low to high, depending upon such other factors as the type of loan, applicable usury laws, credit rating, term of the loan and others. Review the stated rate and make certain it is what was agreed upon. If you are expecting a fixed interest rate and the documents provide for an adjustment in 24 months, chances are good that the mortgage has been prepared with a variable interest rate.

Broker's reputation

Actually, checking the broker's reputation should come well before preparing or reviewing the documents for your home mortgage loan. Sometimes though, you won't see a problem until you actually get the documents in writing before you. If there is anything that is unclear or incorrect, the time to get the problem corrected is before signing. A reputable broker should be willing to work with you to correct problems or clear up any communication issues.

source

Easy Way To Have Dream Home At Miami Real Estate Property


For newly wed, home is the primary thing that they usually want to have. This is where they can build their own family and to start a new life with someone they have promised to live for the rest of their lives. But getting a new home in Miami real estate market is not that easy, thinking on how much does your pocket need suffer to have a dream home.

Let's make this dream possible, as everyone says "If there is a will, there is a way". Let's find ways on how to own a house even if you have a tight budget. But of course if you really want to own a home, you must to save money and if it is not sufficient, then there will be some tips on how to get immediate money to make your dream come true.

Aside from saving money; you can apply for a loan on a mortgage company. Lending money on a mortgage need some requirements and the very imperative requirement is having good credit score. You can ask for an help of a mortgage broker.

A mortgage broker is someone that can help you out in looking for lending investor so you can loan money for your home. As mention above you need to have a good credit score to qualify for the loan. Most mortgage broker have a lot of record of lending investor, and it is better to apply to a lot of this investor and wait for one that will approved your loan.

For faster approval of your loan credit score must be high. This means that you have enough resources to pay your loans; you must not have any unpaid credits and must have a track record in terms in paying loans or credit card. Once you have a high credit score, the lending investor will pre-approved your loan. When you have a pre-approved loan you can now scout for your dream home.

Maximize the aid of your broker, usually broker have a lot of list of house that are for sale. But before choosing to a home you should have to think things like, water and power supply, accessibility to different establishment like school, church, work office and other government offices.

Pick at least 5 you like most and conduct some inspection for each home. You can hire certified inspector to check if all facilities and amenities are all in good working condition. Check internal and external part of the house. And as much as possible, you should also be there to look at the house and check it yourself. Make a comparison to all houses that you have inspected and pick the best one for you and make sure to consider if it is worth paying for.

Aside from inspecting the home in Miami real estate market, you can walk around the neighborhood and see if you have friendly neighborhood. After making evaluation and before deciding to buy the home, bid for a lower price if possible, you might persuade the owner to lower the price and have a good deal.

source

Mortgage loan types

There are many types of mortgages used worldwide, but several factors broadly define the characteristics of the mortgage. All of these may be subject to local regulation and legal requirements.
  • Interest: interest may be fixed for the life of the loan or variable, and change at certain pre-defined periods; the interest rate can also, of course, be higher or lower.
  • Term: mortgage loans generally have a maximum term, that is, the number of years after which an amortizing loan will be repaid. Some mortgage loans may have no amortization, or require full repayment of any remaining balance at a certain date, or even negative amortization.
  • Payment amount and frequency: the amount paid per period and the frequency of payments; in some cases, the amount paid per period may change or the borrower may have the option to increase or decrease the amount paid.
  • Prepayment: some types of mortgages may limit or restrict prepayment of all or a portion of the loan, or require payment of a penalty to the lender for prepayment.
from wikipedia.org

Loan Calculator : Mortgage-calc.com


Loan Calculator is primary tool for you who intend to apply for some loan (Mortgage Loan, Housing Loan, Personal Loan, etc). Its Important for you to know what amount to be paid and how is the payment schedule. Simply enter your loan amount, annual interest rate (asumption), loan period, and start date. Yes, as simple as that.

Those are some Loan Calculator Collection List (Click Image for details):

1. Mortgage Calculator




2. Free Loan Calculator Software










3. BankRate.com

Friday, August 29, 2008

Understanding Mortgage Loan

A mortgage loan is a loan secured by real property through the use of a mortgage (a legal instrument). However, the word mortgage alone, in everyday usage, is most often used to mean mortgage loan.

A home buyer or builder can obtain financing (a loan) either to purchase or secure against the property from a financial institution, such as a bank, either directly or indirectly through intermediaries. Features of mortgage loans such as the size of the loan, maturity of the loan, interest rate, method of paying off the loan, and other characteristics can vary considerably.

According to Anglo-American property law, a mortgage occurs when an owner (usually of a fee simple interest in realty) pledges his interest as security or collateral for a loan. Therefore, a mortgage is an encumbrance on property just as an easement would be, but because most mortgages occur as a condition for new loan money, the word mortgage has become the generic term for a loan secured by such real property.

As with other types of loans, mortgages have an interest rate and are scheduled to amortize over a set period of time; typically 30 years. All types of real property can, and usually are, secured with a mortgage and bear an interest rate that is supposed to reflect the lender's risk.

Mortgage lending is the primary mechanism used in many countries to finance private ownership of residential property. For commercial mortgages see the separate article. Although the terminology and precise forms will differ from country to country, the basic components tend to be similar:

  • Property: the physical residence being financed. The exact form of ownership will vary from country to country, and may restrict the types of lending that are possible.
  • Mortgage: the security created on the property by the lender, which will usually include certain restrictions on the use or disposal of the property (such as paying any outstanding debt before selling the property).
  • Borrower: the person borrowing who either has or is creating an ownership interest in the property.
  • Lender: any lender, but usually a bank or other financial institution.
  • Principal: the original size of the loan, which may or may not include certain other costs; as any principal is repaid, the principal will go down in size.
  • Interest: a financial charge for use of the lender's money.
  • Foreclosure or repossession: the possibility that the lender has to foreclose, repossess or seize the property under certain circumstances is essential to a mortgage loan; without this aspect, the loan is arguably no different from any other type of loan.

Many other specific characteristics are common to many markets, but the above are the essential features. Governments usually regulate many aspects of mortgage lending, either directly (through legal requirements, for example) or indirectly (through regulation of the participants or the financial markets, such as the banking industry), and often through state intervention (direct lending by the government, by state-owned banks, or sponsorship of various entities). Other aspects that define a specific mortgage market may be regional, historical, or driven by specific characteristics of the legal or financial system.

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What is Mortgage?

A mortgage is the pledging of a property to a lender as a security for a mortgage loan. While a mortgage in itself is not a debt, it is evidence of a debt. It is a transfer of an interest in land, from the owner to the mortgage lender, on the condition that this interest will be returned to the owner of the real estate when the terms of the mortgage have been satisfied or performed. In other words, the mortgage is a security for the loan that the lender makes to the borrower.

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