Archive for September, 2009
Sep
08
Credit Repair-bankruptcy
Posted by: | CommentsWhat is Bankruptcy?
Bankruptcy is one of the more effective ways to deal with debts you cannot afford to pay. Once you declare that you are bankrupt, all assests in your possession will be used to pay your outstanding debts. After a period of one year, all your remaining debts will be written off and you can start anew. You can either file your own petition of bankruptcy or your creditors can do it for you. Either way, the effects are the same. Most of the Bankruptcy rules in effect have changed since April of 2004 when the Enterprise Act was approved.
How to go Bankrupt
Filing your bankruptcy petition
A petition for bankruptcy is readily available in your local County Court. Processing the petition may cost about £310 deposit and £150 court fee. These fees should be paid along with the submission of your petition. If you are on low income or on certain benefits, you can be awarded exemption from paying those fees.
Only the larger County Courts accept bankruptcy petitions. Although you are obtaining the form from your local County Court, you will need to take a trip to the High Court to submit the form. If, for example, you reside in central London, you will have to go to the High Court to submit your petition. The District Judge will usually call for a hearing that same day to decide whether it is appropriate to issue the order or not.
Once the order is made, you will get in touch with the Official Receiver who deals with your bankruptcy and report to him all your personal details. The information that you will be asked about usually pertains to your finances including your incomes, expenses, assets, Insurance policies, and Pension policy details.
A creditor making you bankrupt
Your creditor can file a petition for your bankruptcy if you owe him £750 or more, which you are not able to pay dutifully. If you have several creditors, they may join forces to file for your bankruptcy although this is rarely done. You can also be made bankrupt if your Individual Voluntary Agreement (IVA) fails.
Before a petition of bankruptcy is filed in court, your creditor will first send you a “Statutory Demand”, which will ask you to pay your debt either through installments or through the property you own.
The Statutory Demand is usually used by creditors to force its debtors pay the amount they owe immediately without any intention of filing for bankruptcy. This is because no amount is required for filing a Statutory Demand while filing for Bankruptcy charges fees upfront.
Within twenty-one days, the creditor and debtor must reach an agreement otherwise, a bankruptcy order may be filed in court. If your debt is less than £750 or there is an ongoing dispute about the money you owed, you can apply to have the Statutory Demand set aside.
ADVICE - Statutory Demands
Once you receive a Statutory Demand, your next move should be to check if you can have it set aside.
Do I have Assets?
Once you are declared bankrupt, the Official Receiver or appointed trustee may rule out to sell all your assets to pay for your debt.
INFORMATION - Please know that certain items or goods are not counted as assets. These items are basically your domestic needs such as clothing, bedding, furniture, and household equipment. Items that are necessary for you to carry over your profession or vocation are also not treated as available assets and in effect, cannot be taken away from you. Your antiques or expensive appliances can be given up for auction as well as your car so long as it is not needed in your profession. In some cases, a car that is necessary for employment is sold and is substituted by a cheaper one.
All your assets that have been discharged from your possession must be sold as soon as possible. If any of them remains after you have been released from bankruptcy, they will still no longer belong to you. The Official Receiver will continue to take possession of them until all of them have been sold.
INFORMATION - Assets
The only asset or valuable that is treated differently is your home. For details, see below.
Bankuptcy and Hire Purchase Agreements
A clause in the hire purchase agreement states that you will have to return the item once you are declared bankrupt. This means that your contract with the company will be terminated altogether. In some cases, however, you can be allowed to continue ownership by making payments dutifully even while you are declared bankrupt.
Pensions
If you went bankrupt before May 29, 2000, your personal pension could be taken in as an asset. This means that you will receive no lump sum or weekly payments in the future. This rule has been changed, however. Therefore, if you went bankrupt after May 29, 2000, your pension, may it be personal or occupational, should be left untouched. Some debtors used their pensions to stop creditors from taking away their savings. In this case, the pension fund may be lost to the Official Receiver.
Property and your home
A property or home is an asset that is treated differently. If it is yours alone, it can be forfeited to be sold regardless if it has any equity in it or none. If you are living in it with your spouse and your children, the sale will be delayed for a year to give them sufficient time to find somewhere else to live. Once you go bankrupt, your interest in your property is naturally transferred to the Official Receiver. If you co-own it or in some form of joint ownership, the Official Receiver should only take away your equity share. This is also known as your “Beneficial Interest”. In certain circumstances, you can be considered to have a beneficial interest even when you are not named in the mortgage. In certain circumstances as well, your co-owners can make an offer to the Official Receiver to buy out your equity share so the house will remain intact.
REMEMBER - Beneficial Interest
If your co-owners have any intention of buying out your equity share of the property, they must do it quickly. Otherwise, the Official Receiver may take it into his hands in selling your home altogether. Those who want to buy your beneficial interest must get in touch with your Official Receiver and transact with him directly. The Insolvency Service charges very low for the transfer of your beneficial interest so this should not really be a hard thing to manage. You also need to reach an agreement with your Official Receiver on the actual value of your beneficial interest before this kind of transaction is made. If there is negative equity in the property, the value of your beneficial interest may go from a minimal amount of £1.00.
INFORMATION - Low cost conveyancing scheme
To avail of details about low cost conveyancing scheme, there is a leaflet entitled “What will happen to my home?” which are available in The Insolvency Service. You may also call National Debtline on telephone numbers 0808 808 4000 for more information.
If you fail to have someone buy out your beneficial interest in your home or property, your Official Receiver will have no other choice but to sell it. If your home has very little or no equity in it, the court will have to postpone the sale up to three years and see if your property has risen in value. Make an agreement with your Official Receiver about your beneficial interest to keep this scenario from happening.
If you still have mortgage or secured loan on your property, your monthly payments should be maintained to stop your lender from taking possession of your property.
New rules from April 2004
Before April 2004, the Official Receiver is allowed to come back at any time in the future to take your property and sell it. This has now changed. If you went bankrupt after April 2004, the Official Receiver is given only three years to deal with your property. If he is not able to sell it within the period, he will have to give your property back under your ownership. To counteract this law, the Official Receiver can either sell your home immediately, apply for an order for sale, or apply for a charge. If your Official Receiver applies for a charge, he will be given 12 years to ask for an order for sale.
Will I have to pay anything from my wages?
You may be asked to pay a specific amount from your earnings if the Official Receiver has proven that you have money to spare. He will think out your income and your expenses (including your mortgage, your rent, your household bills, and any other form of expenditures) and study whether you will have allowances for a monthly due.
Income Payments Orders & Income Payments Agreements
The Enterprise Act states that Bankruptcy orders expires after a period of one year. However, you may be asked to enter a binding agreement that will have you pay monthly fees from your earnings for three years under an income payments agreement. If your circumstances change at any period that the agreement is in effect, you can send a notice to your Official Receiver so your case will be looked at again. If you fail to pay your obligations, however, your Official Receiver will have the option to go to court and file for an income payments order against you. This way, the court will rule, based on the Official Receiver’s recommendations, how much you will need to pay for a period of three years.
The Effects of Bankruptcy
Once you went bankrupt, you will need to close your bank account or your building society account. You may open another one for as long as it has been agreed by your Official Receiver and that the bank or building society allows you to. That is why it is best to open an account when you are already discharged from bankruptcy.
INFORMATION - Instant access type accounts
Instant access type accounts may allow you work through a cash card. If you are interested to obtain more information regarding this, you get in touch with the National Debtline on 0808 808 4000.
Going bankrupt can affect your life greatly. In fact, the people that you are going to transact with will usually be more careful not to make you pay any amount that involves credits. If you live with a partner, you may transfer all your payable accounts under his name to make it easier for you and for the companies that you deal with — gas, electricity, and telephone companies.
Your employment status may also be at risk by going bankrupt. To be on the safe side, you must check your employment contract for any clause regarding bankruptcy. If you really want to be sure, you can ask the staff welfare officer or the trade union. If you belong in a professional body that prohibits bankruptcy then you must be prepared for your contract to be aborted. Any job that requires you to handle money could be at risk. Those who work in financial industry could even lose their consumer credit licenses once they go bankrupt.
Even after you are discharged from bankruptcy, you will still find it hard to obtain credits. Your credibility in handling financial obligations is obviously destroyed. This is because your record of bankruptcy will remain with credit reference agencies for a period of six years. Your bankruptcy status will also be kept detailed in the Insolvency Register for three months after you have been discharged from it. “The London Gazette” may also publish about your bankruptcy in its classified section or even in your local paper.
Bankruptcy offences
While you are on bankruptcy status, it is illegal to:
- Take a credit of more than £500 without your creditor knowing about your status.
- Use another business name to deceive people about your financial state.
- Act as a director of a company without permission.
- Act as an insolvency practitioner.
Bankruptcy restriction orders
Bankruptcy status should be lifted out exactly one year after it has been declared. That is in agreement with the Enterprise Act. Your Official Receiver, however, may petition for a Bankruptcy Restriction Order which can last between two and fifteen years, appearing on a public register, nevertheless. The grounds that may call for this order is your misbehavior and dishonesty in any way. If your Official Receiver feels that you have displayed “unfit” conduct, he can ask the court to issue the Bankruptcy Restriction Order. Breaking the order would mean a criminal offence.
Qualifications of an unfit conduct include:
- Deceiving the Official Receiver about your assets and businesses two years before you went bankrupt.
- Gambling.
- Making business transactions at a time when you know that you cannot handle debts.
- Taking out credits you cannot pay.
- Giving away your assets to avoid them from being taken away by the Official Receiver.
- Prioritizing some creditors over the others.
- Failure to cooperate with the Official Receiver.
- Concealing your assets and properties from the Official Receiver.
Being issued a Bankruptcy Restriction Order means that you cannot avail of credit that is more than £500 without letting your lender know about your status. You also cannot hold any significant position like an MP, a local councilor, a director of a company, or an insolvency practitioner until after the order has been lifted.
WARNING
The Bankruptcy Restriction Order does not stop your Official Receiver to take criminal actions against any of your offences. If you sell goods that you have on hire purchase agreement or you fill out false information on your loan application, your actions will be taken into account to the attention of the court, no less.
Discharge from Bankruptcy
The Enterprise Act of 2002 ruled out for discharge from bankruptcy after a period of one year. If you cooperate well enough with your Official Receiver and act to the best of your behavior, this can be moved earlier. A discharge from bankruptcy would mean that all your remaining debts even after your properties and assets have been sold will be written off so you can make a fresh start.
If, for example, you went bankrupt on April 1, 2004, you will be discharged from bankruptcy on April 1, 2005 unless it is about to end earlier.
WARNING
The rules on discharge from bankruptcy only applies to first timers. If you have had previous petitions for bankruptcy or your automatic discharge has been suspended, this may take long than you expected. Not keeping an amicable relationship with your Official Receiver could also lengthen your suffering.
If you want a certificate of your discharge, you may request the court to issue you one but this will cost £60.00 on your purse. Also, if you want to apply to have your bankruptcy annulled, you may well do so for as long as all your financial obligations have been paid off.
Alternatives to Bankruptcy
Individual Voluntary Arrangements
An Individual Voluntary Arrangement or IVA is a formal agreement between the debtor and the County Court made to avoid a petition for bankruptcy. You can either set an amount to pay your creditors monthly and dutifully or pay them in full. To file for an IVA, you will need the help of an insolvency practitioner who will act as the middle man. It is usually costly to hire an insolvency practitioner. Asking them for an initial meeting where you can seek advice whether filing an IVA is appropriate in your case or not is best suited. This way, you can be sure that every cent you pay for is worth it. Names of local insolvency practitioners can be obtained through the court offices or the Official Receivers.
The insolvency practitioner prepares the proposal of payment scheme that is according to your capabilities. If your creditors agree to the terms stated in your IVA, the arrangement is put in place. If you fail to comply with the terms in your IVA for the period that it was in effect either your insolvency practitioner or your creditors could file a bankruptcy petition against you.
WARNING
Be wary about companies offering to put you on the line with an insolvency practitioner as this requires a fee. You can very well deal directly with an insolvency practioner without having to go through a third party.
FACTSHEET - Individual Voluntary Arrangements
If you need more information regarding Individual Voluntary Arrangements, you may get in touch with the National Debtline on 0808 808 4000.
Fast Track Individual Voluntary Arrangements (FTVA)
This is another alternative that you could sort through. The FTVA is used to have your existing bankruptcy annulled by way of submitting an installment plan to your creditors and hope against hope that they agree with it. This arrangement is much appealing to creditors because they could be paid more under FTVA than what they would under bankruptcy.
Instead of the insolvency practitioner, the Official Receiver works directly to put an FTVA in place. The FTVA is much cheaper than the IVA to arrange because the set fees and costs are lower. If you fail to adhere to the FTVA while it is in effect, your Official Receiver will have no other way than to make you go bankrupt again.
WARNING - Fast Track Individual Voluntary Arrangements
Weighing up the ways an FTVA could work for or against your advantage is important before tackling this road. If you choose to have an organization act on your behalf instead of the Official Receiver, you may want to consider a free debt management plan. This way, you can devise affordable repayment schedule for your unsecured debts.
COUNTY COURT FEES
DO I HAVE TO PAY A FEE FOR AN APPLICATION IN THE COUNTY COURT?
Every transaction with the County Court usually requires court fees. If you feel that you are incapacitated to pay the fees by way of benefits, you can submit an EX160 or the “Application for a fee exemption or remission” together with your main application. If the court agrees to your petition for exemption then you will not have to pay certain fees. If, however, you have paid a fee when you should have been exempted, you can file a petition for the court to waive or refund your paid amount. You can do this within six months after the payment has been made.
EXEMPTIONS
The court awards exemptions from paying fees to those deserving individuals who are on benefits. If you are on income support or income based job seekers’ allowance (JSA), you can automatically be awarded exemption. This is also the case with those who are on working tax credits. If you are on child tax credit or you have received the disability or severe disability element in your working tax, you can be eligible for exemption. This is considering your gross annual income taken into account for working tax credit is not more than £14,600.
To qualify for both, you must present substantial documents that will prove that you are on the above mentioned benefits. If your case does not fall under both, you can ask for your paid fee to be waived under the remission rule.
REMISSIONS
If the court fees will cause you “undue financial hardship”, you are qualified to file for remission, upon which your paid fee will be refunded. This can happen under exceptional circumstances that should prove you are not capable of shedding extra cash for your petitions. To apply for remission, you must present a list of your personal budget, your incomes and outgoings. You must present proofs that your current financial situation makes it impossible for you to pay the fee without having to go though “undue financial hardship.” Upon studying your petition, the court may refund part or all of your paid fee depending on what it feels you can afford.
Real Estate Professionals
Sep
08
New Types of UK Mortgages
Posted by: | CommentsNew Kinds of Mortgages in the UK
The UK mortgage business has recently changed. Not long ago, mortgages were only available to a man with family and a substantial income. Other people would rent.In recent years, however, the mortgage market in the UK has developed. New lenders have appeared who are providing mortgages designed for normal people that don’t fit the old description of a mortgage borrower. The following is a list of the new types of mortgage loans.
Another new mortgage type in the UK is known as the Muslim Islamic Mortgage. There are a growing number of Muslims residing in the UK. Under Islamic law, paying interest is not permitted. For British Muslims this has put them in a difficult position. They must either rent or they must compromise their beliefs to take out a traditional UK mortgage. To approach this matter Muslim Imams have agreed to set types of home loans which have been especially designed for devout Muslims.
Mortgages were originally designed to only be for people with families and reliable employment. They would entirely pay off the mortgage loan throughout their career. Usually a 30 or 25 year mortgage would extend to retirement at 60. Those over the age of 40 had difficulty taking out a loan. The system as it was could not accept that they may actually pay off their mortgage before they planned to retire. Those who had already retired would not be able to get a mortgage. But things are different. Now it’s very feasible for the elderly or mature people to buy a new home. Many lenders will now be more than willing to help them, and mortgages for the elderly are fairly common.
Remortgages for people with poor credit records are not uncommon. Some people who have a home loan later find themselves with credit problems. They don’t realize it is a problem until they need to Remortgage. Previously, the mortgage lender would have rejected their request for an additional mortgage loan. Today a lot of lenders will be happy to offer them a new loan. The drawback is that the homeowner must pay extra due to the fact that they are high risk.
Equity release home loans are aimed at those that already own a house, but are in need of money. They’re perfect for elderly citizens who can’t afford retirement costs and nursing care. There are quite a few different types of equity release mortgage deals.
You need to be warned if you are thinking about taking out this type of mortgage. They aren’t often recommended by experts that say they’re inappropriate for a lot of homeowners. If you have money problems there are other ways to earn money.
Guarantor mortgages are becoming more and more common. Many people, such as first time buyers, have a hard time affording a mortgage payment. Their salary may not be high enough. Or they have surplus debt. A mortgage guarantor is someone that agrees to be responsible for the mortgage payment. If the person getting the mortgage can’t pay then the mortgage guarantor will continue with the payments. Usually the person who guarantees the mortgage is the parents of a young buyer. Or it can be another family member. Or perhaps a close friend.
About the writer:
Sam Enright writes on UK personal finance web sites and newspapers including MortgageSorter, a Website that makes Mortgages in the UK easy to understand.
Rent Back Fast
Sep
06
Sell and Rent Back Schemes
Posted by: | CommentsSell and rent back scheme is a tax-free scheme, which allows you to release the equity, tied up in your property without having to move out. When you sell your home to a house sales specialist you can join their rent back scheme. This allows you to remain in your home for as long as you wish but as tenants rather than owners.
Rent Back Schemes are ideal if you find your self in any of the following circumstances:
Retirement – if you have reached retirement or are planning to retire and want to release the equity that has built up in your home, so you can enjoy retirement, but don’t wish to move. This will be an ideal scheme for you and you will always be given the opportunity to buy back later at a pre-agreed price if you want to.
Financial Difficulty -If you are having difficulties trying to keep up repayments on loans or your mortgages a house sales specialist will be able to help. They will quickly buy the property from you giving you a cash sale and allow you to remain as tenants at a rent you can manage to pay. They can even stop repossessions, right up to the very last minute, if your home is at risk and allow you and your family to stay in your home. If the financial problems are just a temporary set back, again they can agree to sell your home back to you at a pre agreed price, in the future, if your circumstances change.
Emigration - If you are planning to sell up so that you can move away. You will find that you have enough things to worry over without having to be concerned about broken chains, deferred sales or sales falling through. A house sales specialist can buy your property quickly from you and allow you to stay as a rent-paying tenant until you have made all your preparations and are ready to go to your new home.
If for some reason you decide not to move on and want to stay after the sale you will be welcome to stay as our tenant or you will be given the opportunity to buy back your home.
You may also decide to sell and rent back if you have health problems and want to fund an operation, divorce or separation, or even if you are a landlord who has problem tenants. If you have a commercial property and wish to release equity a house sales specialist can offer you a similar deal so that you can sell, rent back and still run your business.
When I discussed the possibility of these schemes with company operating in this manner in Leicester, An Instant Sale, I was told that selling in this manner is quick and discreet and the your friends, family and neighbours will be none the wiser, unless you tell them.
The rent is set in line with current market rents; you can fix the rent and the term. They pay for your buildings insurance, and a Corgi registered engineer will service your boiler each year.
Sell and Rent Back
Sep
06
It’s the Income, Stupid. Thoughts on Fixing the Subprime Mortgage Crisis
Posted by: | CommentsSlowing foreclosures have given a spark of optimism to investors on Wall Street who see the trend beginning to slow down. For the last year the foreclosure rate has steadily risen month by month over the previous year’s month of foreclosures causing speculation of a continued trend in homeowner foreclosure rates. RealtyTrac, an online marketer of foreclosure properties, said “that foreclosures fell to a 5% increase from a 6% increase in foreclosures the previous year” causing speculation of brighter days.
However, foreclosures continue to rise they are just doing so at a slower rate. On Capitol Hill the politicians are working feverishly to come up with legislation to slow this rate even more, but they seem oblivious to is the underlying problem that is causing the foreclosures. Ignoring the sickness and treating the symptoms is a sure way for the disease to spread. What they appear to have ignored is that these hybrid loans were not exclusive to low income borrowers with bad credit which is not the situation at all.
By in large the first wave of foreclosures has come and gone primarily affecting low income borrowers with poor credit. For the most part these borrowers were bought homes or refinanced into 2 year ARM’s (adjustable rate mortgages). However, there is another wave of foreclosures coming and it’s a tsunami that will affect the middle and upper-middle class of borrowers and deliver a one-two punch to reeling lenders. According to Keith Carson, with TransUnion’s financial services the foreclosure rate is trending towards the higher end neighborhoods that were seemingly immune to the first wave of foreclosures.
Self employed borrowers with good credit are responsible for almost as many of the “sub-prime” loans as the latter. These loans were made to people with good credit but needed a riskier loan that conventional mortgage lenders would not make, the subprime loan. These loans are called stated income loans and do not require the borrower to prove their income, only that they have income. These loans are common practice for self employed business owners who can rarely show their full income on their tax returns due to deductions and depreciation.
Due in part to increased credit score requirements these loans have been almost as stable as the prime loans that were backed by Fannie and Freddie, the Nation’s number one and number two purchasers of mortgages. The problem is that the smaller lenders that do not lend their own money but instead buy and sell loans as a commodity began lowering the guidelines during the refi boom to compete for loans. Eroded underwriting guidelines on portfolio loans made it possible for stated income borrowers with good credit to purchase expensive homes with no money down. This is the riskiest loan a lender can make because the borrower doesn’t have an investment in the property and can easily walk away from it in stormy waters.
Meet the next wave or foreclosures. These are middle to upper class business owners in expensive houses that have mortgages that are about to adjust or already have. These homeowners held on by the skin of their teeth during the first wave of foreclosures but are looking at rough seas ahead. These borrowers are now in homes they probably can’t afford due to the economic slow-down and have little reason to continue paying on an asset that is worth less than they owe money on. Add to the mix looming legislation that will prevent them from refinancing out of these adjustable rate mortgages foreclosure becomes the most viable option.
Most, if not all legislation aimed at “bailing out” the mortgage market offers borrowers strong recourse against lenders that loan money to people who cannot afford the home. This liability will bring stated income loans to a screeching halt. This sounds like good legislation on the surface it but doesn’t address the underlying problem that is about to hit us. If self employed borrowers cannot prove their income because of legal tax deductions and they cannot get another loan to pull their selves out of their adjustable mortgage what can they do?
There are over a million self employed small business owners that have mortgages. A large percentage of these borrowers cannot and did not prove enough when taking out a mortgage. An equally large percentage of these borrowers are in adjustable rate mortgages that are common to stated income borrowers to offset the higher rates. These loans were born out of necessity and served a good purpose until they were abused by portfolio lenders.
The problem is the income and the tax deductions that self employed borrowers have to take to operate in the black. These deductions cause their tax returns to show virtually no income after the deductions. We can’t ask these business owners to not take these deductions can we? This will close thousands of small businesses and cause economic havoc on too many levels to count. We cannot ignore a million people the ability to buy homes can we? The answer is in the underwriting.
As most everything, the devil is in the details. Long gone are the days of actual underwriters looking at all of the documents and making common sense decisions on would-be borrowers. In the age of automated underwriting where lenders and brokers plug in the numbers, assets credit scores and documentation type into the computer and the program spits out an approval. There is only one large agency that still makes common sense decisions on loans and that is Uncle Sam, FHA, ironically the agency that will end up bailing everyone out.
The only problem is that they do not do “stated” income loans, which is why they are solvent. They hold mortgage holders to a moderately strict debt to income ratio that can only be proven by tax returns and w2 statements. This excludes our self employed borrowers who have to write their income off to make a living. However one thing could be done to fix this problem. Banks and underwriters could calculate their income ratios from the gross amount on the taxes instead of the gross adjusted (after deductions) and make a common sense decision like they do with w2 wage earners.
This move would require that banks and lenders begin to employ real loan officers and underwriters and empower them to make lending decisions. Not commission junkies and high cost secretaries that have computer guidelines memorized and little authority to deviate from what the computer program tells them to do. This would actually put lending back into the hands of professional bankers that know their business.
Instead, legislators are determined to change the rules right now that affect the retail end of the market in essence throwing the car in park at 60 miles an hour. This crisis did not happen overnight and it will not be solved with one piece of legislature overnight. Changing the rules mid game will only perpetuate the crisis and punish a lot of Americans who were playing by the rules. It began with a failure in fundamentals and it will end by repairing them. A gradual change with a grace period for current homeowners is the only way to usurp the next wave of foreclosures, it’s the income.
Quick Property Sale
Sep
06
Knowing Which Homes for Sale you Can Afford
Posted by: | CommentsDriving by homes for sale in your area, or leafing through those glossy magazines, can be really exciting. Buying a home is one of the biggest investments you’ll ever make, and usually marks a major life transition as well. That’s the problem. Too many first time homebuyers are so swayed by the excitement and opportunity that homes for sale represent, that they forget to look at the most basic factor: what can I afford?
Finding Homes for Sale in Your Price Range
It sounds simple. Take what you’re paying in rent and apply it to a mortgage calculator to determine which homes for sale are in your price range. Please- wait. This is a rookie mistake that accounts for a huge number of homes for sale on the market each year. Because the buyers didn’t understand the true costs of home ownership the home went into foreclosure or they sold it and moved into a cheaper one.
Owning is not renting. It’s that simple. The most basic rule of thumb is that you should add 40-45% to the base prices of the homes for sale you look at when calculating true monthly cost. Why?
Well, that 40-45% is what it will take to cover home insurance, property taxes, maintenance and repairs, and PMI (Private Mortgage Insurance) on the homes for sale you like. So if you are looking at homes for sale around $250,000, you really need to start calculating your monthly payment from a price of $362,500. Sobering isn’t it?
How to Test Drive Homes for Sale
Once you’ve calculated the true monthly costs of the homes for sale that you want- give them a test drive. If the monthly mortgage payment is higher than your current rent, put that extra money into saving for a few months. If you can do this, then you can easily afford the homes for sale in your price range. And don’t be discouraged if you have to move down in price range and get less of a house than you really want. This is why they’re called “starter homes.”
If you look at homes for sale in a lower price range than what you really want, just come up with a plan for your next move. There will still be plenty of homes for sale on the market in a couple of years. And now that you understand the true costs of home ownership, you can plan ahead, put money aside for a larger down payment, and get into the home you want when you can really afford it. One of the benefits of taking this delayed gratification route is that you can avoid PMI costs completely by having a 20% down payment.
Looking at homes for sale is exciting. But actually buying a home should be a well-planned process with few big surprises. Knowing the true costs of homes for sale will ensure that home ownership is empowering, not overwhelming.
Rent Back Fast
Sep
06
Why Home Insurance?
Posted by: | CommentsMany people used to ask the question repeatedly again and again, why home insurance? They in general out there with so many arguments against the home insurance. But I found all of them would be having same types of reasoning to argue why we need not go for home insurance. They will tell like this. See my area where I am staying for last two decades, nothing untoward instance have happened. There were no earthquake, there were no floods, there were no fire, there were no vandalism, and our area is very calm without any terrorist attacks and so on. And after all they will suggest that home insurance is not at all required, why to spend dollars from your wallet year by year. All the above are correct, but when I ask them back, what you will do if your house is got damaged or destroyed by some reason? Are you 100% assured that your area would not be affected by any one of these eventualities? I simply asked then did any of us believed that, at least in dream, such an attack would have happened on 9/11. Do you think that your earth under your foot not having any earthquake genes in it? Is it not true that a cyclone like Katrina can occur at any time, irrespective of your prediction? If just a flood happens, what will be the status of your dream home? Who can rule out an angry mob coming and vandalizing all homes they come across? At least can you assure that a firebreak out will not happen at all in the home? Is it not enough a simple lighting or electric short circuit? There was only one answer. The chance of coming such an eventuality is very less. True, but if any of such eventuality happened do you want to go with an empty wallet and a huge mortgage credit on your head? Is it not a right approach to insure the home for an equal amount of the cost of your home? You have to make a premium payment for the sum insured, which will be a much less amount comparing the amount of the policy insured. In case of a worst catastrophe, you stand to gain much; you can get back another dream home with the insured amount. If no eventuality happens, thank God and nature; you are just losing only a minimal amount. This minimal amount will assure you a perfect sleep, without any stress about the home and its contents. Home insurance is a necessary protective precaution every one has to take to safeguard the hard earned money invested in the home. You must have taken huge amount as mortgage loan to acquire your dream home. Home insurance can only assure you from the credit debt like mortgage loans and other personal loans in case of any natural eventualities. It is imperative to go for insurance, make sure that you insure your home equivalent to an amount by which you can rebuild a dream home. Are you not clear now, why you require your house to be insured?
Passive Income
Sep
05
Quick House Sale – the Best Solution to Your Problems
Posted by: | CommentsThere are many situations when lack of the necessary cash stands in the way of your plans. Whatever those plans may be, quick house sale is often the best solution to your problem. Apparently, selling your home quickly for cash would take a miracle. In reality, the situation is a lot different.
You probably already know what selling your home in the traditional way means. Selling your home through a real estate agency may be a good option, but it certainly isn’t your best one when you need a quick house sale. Involving third parties in the process of selling your home equals more time, more expenses, and a lot more reasons for things not to go as planned. On the other hand, leaving all third parties out of the house sale process is more advantageous in terms of expenses, yet very time-ineffective. And in both situations, you always run the risk of not agreeing over the price and being forced to start the whole process all over again. You buyer may change his mind at the last minute, leaving you with no solutions. Furthermore, if you choose to use the services of a real estate agency, you must be aware of the fact that the chain of individuals who are involved in the sale process can collapse at any time. In addition, selling your home takes time, and more often than not time is something you do not have.
Fortunately, all these unpleasant situations can be avoided. The quick house sale process can be completed to your advantage. This means that you can get the amount of cash you need in a timely fashion, without having to wait for several months. Until recently, when it came to house sale, homeowners were presented with two options, namely that of selling their homes with the help of real estate agents or looking for potential buyers themselves. Recently, a far better option has been added to this list. You can now sell your home directly to investors who specialize in buying homes quickly and can offer you the amount of cash you need. And when we are talking about property buyer networks that have a property asset base worth tens of millions, you can imagine that selling your home quickly for cash is something that can be easily achieved. Selling your home no longer has to be that complex and time-consuming process. All you have to do is contact such property buyers via the Internet. Once you have provided some information about yourself, your situation and your property, you will be made an offer within forty-eight hours and the quick sale process can be completed in less than five weeks! No hassles, no potential buyers coming to your house and intruding your privacy, no chances of buyers changing their minds at the last moment, and so forth.
If your reasons for wanting a quick house sale include divorce, separation, immigration, financial difficulty, repossession, or any other situation in which you need quick cash but you don’t want to leave your home just yet, you can always opt for the sell and rent back scheme. This too is available from the same property buyers who are willing and able to buy your home quickly for cash.
For more resources about Quick house sale or even about selling your home please review this webpage http://www.24-7-cash4homes.co.uk
Quick House Sale
Sep
05
How Do I Get a Quick Sale?
Posted by: | Comments“ How can I find someone to buy my house quickly for cash?” Many homeowners ask themselves this question when they have unsuccessfully attempted to sell their home through a realtor or when they are in desperate need of a large amount of cash. Facing problems such as debt, divorce and separation, repossession, bereavement, or emigration is not easy. Coming up with the necessary cash in any of these situations is always the hard part, and the preferred solution is often a quick sale of property.
A quick sale is the answer to all your problems. Do you need a large amount of money for a specific purpose? A quick home sale will give you that. Do you need to complete the house sale process as soon as possible, say, within two weeks? The answer is quick sale. Do you need privacy and discretion? A quick sale is once again the perfect solution. ‘Ok, but where do I find someone to buy my home quickly for cash?’ The answer is simple. Go directly to cash property buyers. They are the only ones who can guarantee a quick sale, with no hassles and no wasted time.
A sale on the open market is anything but a quick sale. Many people choose to sell their home this way when time is not an essential factor. However, even if time is not of essence, an open market sale is not an excellent option for a number of reasons. Think of all the strangers that will go through your home as potential buyers. Think of valuation fees, real estate agent fees, and legal fees. Think of the possibility of the property chain breaking at any time. Think of having to invest a lot of time, and possibly a lot of money in this process. With cash property buyers, you can forget all about that. You will have a quick sale (the sale process can be completed in a matters of days, rather than months), as well as a large amount of cash at your disposal. You won’t have to worry about indiscrete neighbors, about fees and documents, or about endless visits to your home before you can finally find a buyer.
A quick sale may be the only way in which you can pay your mortgage arrears or repay your debts. If you have overdue payments or debts, you know that the longer you wait, the more you will have to pay and the more you risk losing. A quick sale enables you to put an end to the financial crunch that you are currently in, and leaves you with some extra cash that you can spend to your liking. Taking out another loan means having one more financial institution to repay. It may be a solution for the moment, but it won’t be long before you find yourself in the same situation. The only difference will be that you will owe even more money.
If you desperately need a large amount of cash but are reluctant to sell your home, you will probably be happy to learn that you can opt for the sell and rent back scheme. This means that you can sell your home quickly for cash and then rent it and go on living in it. This way, you can come up with the necessary cash without losing your home. ‘But who will buy my home and then rent it back to me?’ The answer is once again cash property buyers.
Passive Income
Sep
03
Affordable Home Insurance - Protect Your Investment
Posted by: | CommentsWhen we buy our homes, it is with a great sense of fulfillment that we view this great investment. Why then do we wonder if it is really necessary to insure it? Haven’t asked yourself why If there is mortgage involved the mortgage company insists on insurance at least until all the money has been repaid. This are business people who do not want to loose their investment. This should give you some thought if you have ever thought that your home doesn’t need insuring.
Have you ever thought of waking up one day to say “I used to own a home.” Your home insurance coverage ensures that when you make such statements, it would be that you sold your home as a business decision and not that “fate” ripped it from you.
If you on top of owning a home also have valuables in your home, then your reason for needing home insurance coverage has just increased because you should secure these valuables you acquired with your hard earned money.
Your concern in this matter rather than being if you should have home insurance coverage should be how to get affordable home insurance rates.
To ensure you get the best rate, take time to find out all the discount available even if you do not qualify for them the idea being that even if you do not qualify for them, you become aware of them and can work towards qualifying for them.
Also ensure that yo have taken adequate care to secure your home by adding more security features. These would help further reduce your rates.
Note this important rule, every and anything you do to further secure your home and make it less likely to burn down, get robbed etc increases your scores towards a more reduced rate.
Finally, you need to compare quotes from quotes comparison sites. The more sites you compare quotes on, the more likely for you to get the best of rates.
Sell and Rent Back
Sep
03
Home Insurance Online Quote: Assist you to Secure Precious Home
Posted by: | CommentsHome insurance is the way of keeping your home free from anything that might be dangerous for your home. Home insurance is thus the prime requirement for home owners but due to the wastage of time involved in searching the suitable policy of home insurance mostly people avoid to take home insurance. Home insurance online assist them by giving the quotes with out any wastage of time in searching.
Home insurance quotes available online not only help you in making the best use of your time but also gives you a chance to choose the right quote of home insurance. Online you get so many quotes of home insurance that you can very easily select the quote which suits your requirements. Hence it helps you in keeping your home safe and secure from either natural disasters or man made disasters. Home insurance policy provides cover to your home against the impending calamities like flood, fire, earthquake, hurricane, riots and vandalism. Online quotes of home insurance pave your way towards the search of policy.
The benefit of online search is that you will not have to worry about the changing term and conditions of policy. Insurance companies make instant online change in the terms and conditions of policy in case any change is done and it gets approved by higher authorities. Now insurance companies have their own websites thus making it easier to access online for the home insurance quote just by sitting at your home. You can search as many quotes of home insurance online by browsing on your pc as you want to search. Until the advent of the internet, if you want to buy any policy of home insurance you were supposed to go to the insurance company and search the appropriate policy. But now online you can do your task of search about the home insurance quote right from your computer and without having to make a single physical visit.
The main advantage of online search for home insurance is that you can find out multiple quotes quickly and easily hence saving your time to shop around. But you can also compare these various quotes of home insurance online. This gives you the ability to choose the best coverage for the lowest possible price. From various quote collected of home insurance online you can buy the one which comply with your requirements and is also affordable to you. Hence finally you get the satisfaction that you your home is safe with home insurance quote you purchase online.
Quick Property Sale
