JCKC Realty

Real estate office located in Sturbridge, Massachusetts. Articles and blog posts located on the Internet.

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Interest Rates: Home Equity Lines of Credit No Longer Simple

Rate

Not long ago economists were recommending that homeowners should tap their equity to buy stocks. This is not a very good practice because if you risked your house before the dotcom crash you may have lost your home. For most everyone our home is our biggest cash reserve. It is like piggy bank and dipping into made financial sense when interest rates were at historic lows and home values were appreciating at double digit rates. This appreciation refilled the piggy bank. Now the market is soft and interest rates are up. With that being said is there any reason to dip into home equity?

Home equity lines of credit or HELOC is no longer cheap money. Rates may drop this year but recently the interest rate on this type of loan has been going up. At the avg. rate of 8.7% the interest only monthly payment on a $100,000 dollar HELOC loan is $725 vs. $387 when rates hit their lowest point almost 3 years ago.

 

You may end up owing more than you own. Lenders have made it possible for you to borrow 100% of your homes value. For example, during the housing boom home buyers that were stretching to afford a home financed the down payment with a HELOC. If you do this today and prices fall, your home loan could add up to more than what your home is worth. What happens if you have to sell for some reason? For starters you will have to pay a realtor 6% unless you are one yourself or a FSBO (for sale by owner). Then you will have to pay the difference out of pocket.

 

During the housing boom, homeowners financed luxurious upgrades with HELOC loans. Borrowers were confident that the run-up in their home’s value would outstrip the cost of upgrades. Now that appreciation has returned to normal or single digit appreciation you may not recoup everything you put into your home. You’re paying nearly 9% to make an investment that is not a sure thing.

 

Even though these facts are present you may want to tap your equity for the right reasons. It is simple to do and interest on any loan that is as much as $100,000 is tax deductible. If you are during renovations on a home you plan on staying in for a while or indefinitely then a HELOC loan is good. If you want to costs of high interest credit cards then again a HELOC isn’t bad.

 

Don’t be pressured by a lender or mortgage broker who says that waiting to take out a loan or line of credit will hinder you from borrowing as much.

 

Be a smart shopper. You can eliminate rate worries by locking in a fixed rate. Rates on old fashioned home equity loans are lower than what HELOC rates are today; 8.1% on average.

If you prefer the flexibility of a HELOC then take advantage of all competition among lenders. If you get HELOC payments debited from your checking account then this can lower payments by lowering the interest rate by half to a full percentage point.

 

References:

bankrate.com

First Person: The Pros and Cons of ‘Strategic Foreclosure’

Strategy

*Note: This was written by a Yahoo! contributor. Do you have a real estate story that you’d like to share? Sign up with the Yahoo! Contributor Network to start publishing your own finance articles.

“Strategic foreclosure” is a term you’re likely to hear a lot about in the coming months. If reports are true that housing prices will continue to fall throughout the year, chances are homeowners will elect to walk away from their underwater mortgage even if they have enough money to pay loan installments.

 

Strategic foreclosure has been a hot topic of conversation within the real estate networks I participate in. It’s a controversial subject and responsible for plenty of forum flame wars. Some investors feel it is a brilliant financial strategy. Others think it is financial suicide, immoral, and unethical.

 

Until recently, strategic default has been used primarily by homeowners and investors with stellar credit who are fully capable of paying their mortgage. Instead of continuing to pay on real estate that is no longer worth the paper it’s written on they choose to stop making payments and force the bank to provide options. Banks aren’t willing to work with homeowners who can afford their payments. You can’t just call up the bank and say, “Hey, my house is worth $50,000 less than I owe you. Will you write that off and reduce my payments?” Instead, you have to stop paying before the bank will negotiate.

 

Many of the real estate investors I know are using this strategy to force banks into short sales, deed in lieu of foreclosure, or mortgage principal reduction. This can be a risky proposition, so those who elect to go down this path need to hope for the best and prepare for the worst.

 

While it may seem logical to voluntarily default on an underwater mortgage, take time to calculate the true costs. If it works and the bank offers a foreclosure prevention strategy that either allows you to short sale, return it using deed in lieu, or reduce the principal balance it might be a smart move. However, if the bank calls your bluff and commences with foreclosure it will tarnish your credit for quite some time. Anyone who has engaged in credit repair will tell you it’s a painfully slow process to boost FICO scores. Not only will you be unable to buy a house for at least a few years, you’ll pay through the nose when you do qualify for credit.

 

Lenders assess interest rates based on credit scores. The lower the score, the higher the interest. FICO scores can plummet by 100 points or more once foreclosure is reported to credit bureaus. Chances are insurance premiums will rise. Interest rates on credit cards will go up and credit limits reduced. It might be challenging to find a landlord willing to rent unless you pay first, last, and security deposit.

 

Subprime lending is a major player in the foreclosure fiasco, so banks have tightened lending criteria. In fact, a mortgage standards reform proposal is in the works that will make qualifying for a home loan even more difficult in the near future. While reduced FICO scores might not seem like an overwhelming challenge, they can become a mountain if your mortgage lender holds you responsible for monetary deficiencies. Most banks require homeowners to pay the difference between their loan balance and sale price. If you owe $200,000 and the house sells at auction for $170,000 you might be holding the bag for thirty grand.

 

When banks issue deficiency judgments they can take action to collect the debt. Usually this in the form of garnished wages. At minimum, the judgment remains on credit reports for up to 10 years after the debt is paid. Judgments can reduce credit scores that won’t rebound until removed.

 

A final consideration of strategic default is that of morals. Even when it makes perfect sense to go forward, most homeowners feel an ethical obligation to make good on their promise. They understood when they bought the property it carried risk. So, they are willing to ride it out and hope the market eventually turns around.

 

Only you can decide if strategic foreclosure is in your best interest. It may provide the mortgage relief required, but not without financial consequences. If you can afford the payments, you’ll have to search your moral database to decide if you can walk away guilt-free.

 

More from this contributor:

Is the Las Vegas Real Estate Market the Greatest Sin of All?

Improper Foreclosure Could Cripple Major Banks

ForeclosureGate: The Fed Investigates Wrongful Foreclosure

 

How to Reach Chinese Investors in Canada & United States?

Chinese

Chinese speaking investors are the fastest growing investor communities in Canada  amp; United States. Increasing number of companies such as fund managers, real estate companies and mining companies are interested in reaching these communities.

 

You can observe this by looking at how many financial services companies are adding a Chinese language website as a way to attract customers. This ranges from HSBC, Scotiabank, Royal Bank of Canada to organizations like Toronto Stock Exchange and Nasdaq.

 

How do you reach Chinese investors in these markets?

 

Newspapers ‘” The main challenge for newspapers is duration. Advertisements can only last for a very short period of time, but advertorials can sometimes generate good level of interest on particular products.

 

Banners ‘” It may work sometimes, but usually only have limited exposure period, it is good for branding, but may not be the best way to promote certain investment opportunities.

 

Google Ad word ‘” Google Adword did not work well in the Chinese market, but in the English market.

 

Articles Marketing ‘” This is definitely the most active web marketing technique, we send out regular company updates, articles and this has generated significant number of responses; you can reach Chinese investors by posting on various Chinese language websites and forums based in North America.

 

Blogs ‘” This is also very cost-effective, I now write daily or at least weekly diaries ‘” and publish them on Chinese website, this has generated consistent traffic ‘” you may not get instant hits, but it will build up loyal subscribers over time. If you combine with Blog marketing, you can post articles on related financial blogs, and add comments on financial blogs. We had implemented this for some mutual funds and IPOs, and it has increased their traffic by more than 10 times in some cases.

 

Videos and Audios ‘” These are also very effective ways especially if you are conducting webinars or specific courses like investment strategies. One way to maximize this tool is to upload them on popular Chinese language news websites. You should also produce videos  amp; audios in Chinese language instead of having them in English.

Stanley NC Real Estate and Homes

For sale

Prior to the famous California gold rush, Stanley, North Carolina was populated with these seekers of quick fortune. Gold was discovered in a creek that feeds the Catawba River and the rush was on. These miners where the first to claim Stanley, NC properties in hopes of striking it rich. The gathering of these residents began the small Stanley’s Creek Community. The coming of the railroad cemented the settlers upon their Stanley real estate. With the rails comes prosperity. Despite the fact that the gold has “played out”, 3000 residents still reside in Stanley, NC homes.

Stanley, North Carolina homes for sale are still rich with history and stories of the past. One such event that placed Stanley on the map happened when France sent a famous botanist, Andre Michaux, to the area during the late 1700’s. During Michaux’s repeated visits he discovered and named the large leafed Magnolia tree, which has the largest leaves and flowers of any native Magnolia tree in North America. The leaves reach three feet long and one foot wide, and the flowers can be 18 inches in diameter. While searching through Stanley, NC homes for sale, ask if you have one of these rare beauties in your yard!

 

Stanley, North Carolina real estate was also home to the first man to fly an airplane at supersonic speed. Hubert Henry Hoover was the first to pilot the prototype Bell X-1 supersonic airplane, before Chuck Yeager was awarded with this achievement. Another famous moment in Stanley history came when a young girl was televised having open-heart surgery – in 1960! A Charlotte television station was experimenting with the early concept of reality TV and filmed and aired the procedure. Stanley, NC homes have been the residences of some amazing people. These and other stories can be experienced at the Brevard Station Museum where a collection of Stanley artifacts, photos and memorabilia are housed.

 

This small town in the southwestern part of the state has a varied geography of rolling hills typical of the Piedmont of North Carolina. Your Stanley real estate agent can match you with just the setting you are looking for from the available Stanley, NC listings. If you enjoy living in town and walking to the library or the café for lunch, there are Stanley houses that fit the bill. If you would like to try your hand at farming or gardening the fertile soil on the outskirts, Stanley homes for sale have this option. Regardless of your choice, you are sure to feel welcome in this friendly community rich with the history of its past.

Hickory NC Real Estate and Homes

Home

The wood of the grand hickory tree is prized for its strength and flexibility. It has been the choice of wood for centuries in the making of tool handles, bows, wheel spokes and sporting equipment. It the premier choice for burning in fireplaces and wood stoves due to its high energy content, and is the favorite flavoring for smoking food. What has this to do with Hickory, North Carolina, you ask? The parallels are clear! This town is one of great strength of character and flexibility of spirit. The residents of Hickory properties display versatility and adaptability in their homes and community. They apply “high energy” toward the preservation and celebration of the Hickory real estate.

The remarkable and attractive town of Hickory, NC real estate is a feast for the eyes of those desiring the beauty of historic preservation. There are structures and landscapes dating back to the 1700’s. There are Empire, Federal and Victorian style homes standing as proudly today as they did over a hundred years ago. Contact your Hickory, NC real estate agent about touring the Waldensian Trail of Faith fortress, Murray’s Mill, Quaker Meadows and Bunker Hill Covered Bridge. The latter is the only remaining covered bridge in the world with the General Herman Haupt truss design. There is a very active Historical Association that is always looking for volunteers!

 

Among the Hickory, North Carolina homes in 1944, a miracle occurred. The deadly disease of polio had found its way into the town, and escalated to one of worse outbreaks ever recorded. The Hickory residents demonstrated their strength of character by building, staffing and equipping a children’s hospital in the short space of 54 hours! The residents occupying Hickory properties did not hide in their homes – they faced the problem head on with the community spirit that stills resides in the town today.

 

Interestingly, the wood found in Hickory (the town) plays an important role in the commerce. For centuries, the finest furniture makers and cabinetmakers have resided in Hickory, NC homes. One of the oldest and most respected furniture makers in the country, founded in 1902, still operates there today. The Hickory, North Carolina region produces an astounding 60% of the furniture made in the US. Also, 40% of the fiber optic cable production for the US comes from this region. From practical uses to artistic design, Hickory, NC homes for sale offer you the chance to be a part of this amazing town!

From Homeless to Homeowner: Buying Real Estate in Marietta, GA

Real estate

The first Molotov cocktail exploded into the neighbor’s front yard. Two gray figures swept across a ditch behind the house and disappeared into the thick smoke as the sky turned black. Two more yards had burst into flames. I ducked back into my car. People were screaming as the day turned to night-black darkness. War had started.

Pregnant and scared, I did not want this to be my daughter’s life. I wanted out. My fiance and I had been living in a rental house that we were renovating and house-sitting for a local landlord that we both worked for on our spare time in return for free living space. It was a great location for us to live in and it was great security for his expensive construction materials, but some of our neighbors really hated each other, and the situation was growing worse with each passing day.

 

My fiance and I fled to a friend’s apartment. She had recently lost her job and needed to take in boarders to help pay the bills, and we needed a safe haven. We stayed in her apartment while I worked and my fiance sifted through the local real estate listings and worked with a local real estate agent who was also a trusted friend of ours.

 

The first stumbling block was the real estate market itself. I was buying cheap real estate in some of the hottest markets in the country; the Marietta and Atlanta real estate markets were brutal to navigate because some houses were on the market for less than two hours before being sold. We would also mention our finds to local mortgage brokers during the financing process only to find the houses snapped up the next day. Sometimes we would inspect a house on my day off only to discover that it had gone under contract that very morning at 6 am or even earlier. We went through at least twenty of these frustrations. I learned not to disclose the address to anyone other than my own trusted real estate agent until the property is officially under contract.

 

Several mortgage brokers we visited had their own preferred real estate agents in the Marietta and Atlanta areas who would then try to sell us their properties, all of them more expensive than I could afford. It took us at least two months to find someone who we could work with. The hard part was finding someone who would not try to poach our real estate finds out to their own friends and family. Cheap Marietta and Atlanta houses were increasingly hard to find as time passed on. The baby was due in mid-December, and it was September. The clock was ticking.

 

Another hindrance was our credit and financial statements – I had barely acceptable credit scores while his was poor, and we both had almost no money in the bank. So it was determined that I was to get the loan and we would work on getting a zero down loan while enforcing Georgia’s custom that the seller pay closing costs. It was October. I went to the doctor, who determined that my official due date was December 23.

 

We both were looking at potential properties, inspecting them, and going over contracts. More houses disappeared the days that we looked at them. Things were looking grim. A plague of roaches took over our friend’s apartment and her son was causing problems. Her son had broken our fax machine in a fit of anger at having us living in ‘his’ living room. We fled back to our landlord friend’s property because things had quieted down in the neighborhood and the conflicts had stopped. We felt that we were finally in a safe place again.

 

It was November, and our friend had stumbled upon a great one-story house that she did not want to buy. It was priced below market value by at least thirty thousand dollars and the price was something I could afford. We ordered inspections and had our real estate agent produce a contract. We offered several thousand less than what the house was priced and required that the seller pay closing costs. We hoped for the best and waited for the response. Meanwhile, I went to work and told my co-workers to wish me the best of luck – my American Dream finally seemed to be within reach.

 

The seller accepted our offer, and closing was set for the last week in January. But things took a turn for the worse; people were burning garbage off a waterway near our renovating house, and a cat died underneath the house, causing a terrible stench. A hole that we had cut in the concrete in the garage to repair some piping had become an entryway for rats. One of them leaped at my fiance and snapped its jaw shut, catching on his pants leg. I watched as my fiance beat it away and ran from a large group of running rats that had exited the garage. We spent several days and nights living out of my car. I was determined not to have to go back to our friend’s apartment until the cockroaches were gone, but our patience was wearing thin, and the weather was getting cold. We went back to the apartment.

 

It was now December and we were in the process of securing financing. The company, not named, suddenly required more proof of my income. I called the personnel department of my work and had them send out more copies of my W-2 and income statements to a local PO Box of ours. We went to my bank and requested more statements to fax to the financing company. I took up some of my computer tools and fixed our fax machine. We were faxing documents and securing quotes on loans.

 

Things seemed to go well, except the roaches were getting to be a problem. In the middle of the night, I woke up to a large,one inch long, black roach scurrying up the inside of my right leg. I woke up later, early in the morning and slapped another huge roach off my face. My patience was wearing thin again, but we had no place to stay, as rents were rising in all the apartments because of the increase tenants available from foreclosures.

 

I continued to go to work, nervous about my due date. It was the second week of December. I stood in the office at my desk and turned to a co-worker and announced that something was leaking. I went to the restroom to take care of the ‘problem’ and my water broke as I sat on the toilet. Approximately thirteen hours later, my daughter was born in a hospital room full of cheering people. My parents arrived at the hospital and offered to let my fiance and I stay at their house. I quickly agreed.

 

My daughter and I were discharged from the hospital. My mom picked us up and the arguments started almost immediately upon our arrival ‘home.’ The third day that we were there, my fiance was ordered to leave and my parents then tried to convince me to cancel the purchase of the house. I refused, and left my parents’ house with the new baby.

 

My fiance took us over to our friend’s apartment. Our stay there lasted two days – her son was upset that we were there with our daughter. So we were ordered to leave and our things were thrown out onto the street. We spent a tense two days out in the winter’s cold, living out of the car. The only decent place we could think of was at one of the landlord friend’s empty houses, but there were no working utilities. So we parked the car at the driveway and slept in the warm car, bundled together in heavy blankets that we pulled out of a storage unit we rented for our things as we waited for Closing Day.

 

A mean neighbor called the police on us in the middle of the night, and the police officer on dispatch to our location asked us to leave. We started calling on all of our friends to find a place to stay. One person agreed to take us in. Our friend lives out in the countryside in a rented double-wide trailer with his wife and three children. Our daughter finally had a warm place to sleep at night. I returned to work from maternity leave in mid-January.

 

Closing Day approached, and we continued to work with the financing company. We had been told that our note would be a zero-down loan with 6 percent interest. Twelve hours before the closing was scheduled, the Federal Reserve Banks declared a nationwide immediate end to zero-down loans. Three percent down was suddenly required. We asked our families for the money. My fiance was able to come up with most of the money and my grandparents helped me out with the rest of what was needed.

 

The seller and I went into a local real estate office and signed a mountain of documents. They consisted of the contract and copies, finance documents and copies, HUD statements and copies, and various legal documents written up by a Marietta real estate attorney. I hugged my real estate agent and thanked her. After it was all said and done, a few pictures were taken and we left the office to get started on moving everything into our new home.

 

As a first-time buyer, I never cease to wonder how we coped with rats, roaches, a fire, evictions, and all the other stresses that we were forced to endure. My co-workers will never find a better story to re-tell. Even though I bought the house in January, I consider my success to be a Christmas-time miracle.

 

So many things could have stopped us. We had nothing but our faith. In retrospect, buying real estate in Marietta, GA has been the hardest thing I have ever done in my life. It was worth it, though, because my children will have a wonderful place to live and are free of the violence that plagued our old neighborhood.

 

From homeless to homeowner, I am a success and I invite  amp; encourage anyone else to try to succeed as well.

Weichert School of Real Estate Hoboken, New Jersey

School

Weichert School of Real Estate

1 Newark Street

Hoboken, NJ 07030

(800) 544-3000

one block north of Lackawanna Terminal

Being a real estate salesperson in New Jersey can be an exciting and rewarding career. The course you must take requires a 75 hour classroom study that is a lot to take in. Finding a good instructor who runs a nice program is very important and you do not have to look any further. The daytime classes at the Weichert School of Real Estate in Hoboken, NJ taught by Frank Plasencia are in my opinion the best that New Jersey has to offer. Weichert School of Real Estate will furnish you with the text book and Frank Plasencia will give you the tools you need to succeed.

 

The class consists of seven days of study from the text book and three days of testing (one practice and two finals) for a total of ten from 9AM to 4:30PM. The course is pretty intense as you will be going over a lot of information in a short period of time. It is more than possible to complete this as is proof by Frank Plasencia’s track record at the Weichert School of Real Estate in Hoboken, NJ.

 

Frank Plasencia is far and above better that any other instructor I have ever been taught by and it is a pleasure to sit in his classroom. He has a method of teaching and making you remember things that is remarkable and I recommend it to anyone who would like to become a real estate salesperson in New Jersey. It is a very fast moving class but Frank makes it fun and enjoyable and easy to get through. The way he speaks and the context in which he presents the information is a fantastic way of instructing. Especially his word association tips. This course and the state exam for that matter involve some math problems in word form and Frank has an effective way of teaching that as well. Obviously we are all different and all learn in certain ways and he can have a very patient demeanor and slow down for a second and make sure that nobody falls behind. If you follow his program and pay attention any person taking this class should have few problems in obtaining the passing grade you need to complete this step and move on to the state exam.

 

To say the least Frank Plasencia is a true gentleman and a true professional. The best first step you can take on your way to becoming a real estate salesperson is to sign up for the daytime classes at the Weichert School of Real Estate in Hoboken, NJ with Frank Plasencia. You will be glad that you did.

 

The school does not offer on site parking. There is plenty of public transportation to Hoboken, NJ. Certain NJ transit buses and trains as well as the Path Train end up at Lackawanna Station around the corner from the school. If you must drive, street parking in Hoboken is virtually non existent for that length of time although there are municipal lots nearby for a fee.

Gulf Homes for Sale – Reasons Why You Should Invest in Gulf Real Estate

Gulf

There are a lot of gulf homes for sale that are good real estate investment because of their locations and affordability taking into account of the region’s overall geographical resources, sceneries, and commercial prosperity.

Being the ninth largest body of water in the world, the Gulf of Mexico has abundant natural resources. The wide array of natural resources includes fisheries, minerals, and ecological habitats. Specifically, fisheries such as shrimps and oysters account for half of the U.S.’s fisheries products. Mineral resources such as petroleum in the Gulf produce a quarter of the U.S. domestic natural gas and one-eighth of its oil. Lastly, ecological habitats like coastal wetlands, submerged vegetation, important upland areas, and marine/offshore areas have great commercial values to the region.

 

The Gulf region is famous for its beautiful sceneries. Florida beaches are one of the hottest spot for vacationing or local recreations. The spectacular beauties and first-class facilities and services are the best features of Florida beaches that have drawn million of people there monthly. Mississippi river is another beautiful spot in the Gulf Region where people can visit Jefferson National Expansion Memorial, and national historical parks like Natchez National Historical Park, and New Orleans Jazz National Historical Park. Down to the more southern part of the Gulf region, one can visit the El Cielo and other attractions in Mexico. Even more south, you can also enjoy Cuban beaches such as Varadero Beach, the Eastern Havana Beaches (Playas del Este) which are also famous for its sunshine and great facilities.

 

In addition, geographically, the Gulf of Mexico is surrounded by Gulf Coast states of the United State such as Florida, Alabama, Mississippi, Louisiana, Texas; regions from Mexico such as Tamaulipas, Veracruz, Tabasco, Campeche, Yucatan; and also the inland of Cuba. Because of its unique geography, the Gulf region definitely has tremendous commercial potentiality. Tourism is one of the most important commerce in the region. The beautiful beaches and shores are popular spots for tourists and local alike that generates billion in revenues for local businesses.

 

Ports and shipping industries, on the other hand, are also commercially important in the Gulf region. The entire region is approximately 600,000 square miles which is measured of about 995 miles from east to west, 560 miles from north to south. Specifically, the area from Cape Sable, Florida, to the Yucatan peninsula is more than 3,540 miles, with another 236 miles of shore on the northwest tip of Cuba. And the total shoreline will be more than 16,000 miles in the U.S. if bays and other inland waters are also counted. Seven out of top ten sea ports in the U.S. are located in the Gulf of Mexico. For instance, the Port of South Louisiana in New Orleans and the Port of Houston are two of world’s busiest sea ports.

 

Residential real estates in the Gulf region offer you varieties of styles from villa to townhouse. And investing in Gulf homes is a wise choice not only because of the region’s rich resources, and commercial values, but also because of the many beautiful sceneries and mild weather.

Why Do Lenders Offer the Best Remortgage Rates? Receive Approval for the Best Fixed Rate Mortgage Deal

Best Remortgage Rates

Since house prices started to slide, lenders have become increasingly cognisant of high risk secured borrowing. According to the Mortgage Bankers Association, 1 in every 200 U.S. family homes will be repossessed during the current downturn. It is a fair assumption that the best remortgage rates will be offered to homeowners who are least likely to default. Foreclosing on a property is not only time consuming, it is financially expensive and tarnishes the image of the lender.

How to Get the Best Remortgage Rate

In order to minimise risk, banks use a more stringent set of criteria to determine eligibility. The cheapest mortgage loans will be made available to customers who are in stable employment, have a low income to debt ratio, have excellent credit and are able to offer a decent house deposit. This approach ensures that the borrower is well placed to make their monthly repayments. Also, the bank knows that they can easily recover the full loan value in the event of default.

A Low Interest Mortgage Requires Good Credit

Any homeowner who is looking for the best remortgage rate will need to avoid a low credit rating. Those who have missed payments will only be eligible for a bad credit mortgage. Whilst it can take several years to improve credit, some credit reports do contain inaccurate data. It is important to get hold of a report from Experian, Equifax and TransUnion to check for errors. Always get these corrected several months before performing any mortgage refinancing.

Stable Employment Leads to the Best Fixed Rate Mortgage

The borrower’s employment is fundamental to sustained affordability. Not surprisingly, the best remortgage rates won’t be offered to those who are in temporary employment or still in their probationary period. This is because their income can stop at any time. Customers in a trade or professional job will always be favored by lenders, but it is the length of time that person has held their job that is most critical.

A Low Income to Debt Ratio

Just as the sudden loss of employment regularly leads to default, an unsustainably high level of debt relative to income can be equally catastrophic. Lenders are unlikely to lend money to those who have an income to debt ratio that is greater than 36%. In practice, the lower this figure the better.

Mortgage Refinancing Requires a Sufficient House Deposit

Whilst this criteria is often relaxed when property prices are rising, the greater the home equity the more likely a homeowner is to receive approval for the best fixed rate mortgage deal. Should the customer be unable to maintain their monthly repayments, the lender wants to be able to recover its money. Whilst they are obliged to get fair market value, equity provides a cushion against any repossession deficiency.

Achieving the Best Remortgage Rate

The cheapest mortgage loans will only be offered to homeowners who present minimal risk of default to the lender. This means that credit history, employment and home equity are fundamentally important. Always compare mortgage rates online and check for feedback regarding how existing customers are treated.

House Auctions Offer Cheap Property: Buying Properties at Home Auctions Can Save a Lot of Money

House auctions are exciting affairs. The normal long-drawn out process of house buying is telescoped into a few minutes of frantic bidding. While the unwary may be in danger of paying over the odds, the pressing need to sell ensures that auctions offer an excellent opportunity to buy cheap property.

Repossessed homes are always on the menu, and not everyone likes the thought of benefiting from someone else’s misery. But the dispossessed would be still worse off without home auctions. In order to get some money back they need people to buy their former home.

Finding Cheap Property at House Auctions

Those interested in buying properties in this way must first find their auction. Home auctions are advertised in specialist property publications, on the property pages of newspapers and magazines, and online. And all property auctioneers will, of course, happily give information on their upcoming sales. Having established where and when an auction is to take place, the next step for those in search of cheap property is to acquire a catalogue. This will give details of all the properties available.

Viewing Auction Properties in Advance

The prospective buyer must now move fast, for there is seldom more than three weeks between the appearance of the catalogue and the auction itself. And while some are prepared to take the risk, it really is pretty stupid to buy a home without checking it out carefully in advance.

The sort of property sold at house auctions is always different in some respect from that marketed in the normal way. Houses for auction include, for example, property which is considered too run down for a normal sale. This is why many property developers are to be found at auctions.
For the ordinary home buyer, the most promising auction properties are repossessed homes. Generally speaking, these are sold at home auctions simply because the lender, having no interest in owning a house, wants the quickest possible sale in order to recoup the unpaid loan. There is no point in being squeamish about buying properties which have been repossessed: only when the house is sold does the former owner get any money back.

Researching Auction Properties

Having found something which appeals, the prospective buyer should look carefully at other properties in the area in order to see how attractive the guide price is – always bearing in mind that that figure is designed to attract interest, and is often lower than the price finally achieved.

Unless the building is new and built to stringent standards, it should be looked at by an expert. It goes against the grain to pay for a survey of a house which may in the end go to someone else, but it would be much worse to buy one which turned out to be unsound.

Houses for auction come with legal packs which are available from the auctioneers. A prospective bidder should show the legal pack to a solicitor in order to be aware of potential difficulties – there often are with auction properties.

Buying Properties at Home Auctions

It is possible to preempt the whole process by submitting a bid before the auction. If the seller accepts, the property is then withdrawn from the list.

But for properties sold on the day of the auction, the buyer must have financial arrangements – for example, a mortgage or a bridging loan – already in place. A ten percent deposit, payable on auction day, will be forfeit if the balance is not paid within twenty-eight days.

On the day itself, auction rooms usually being very crowded, those who arrive late may well have to stand. And those who mean to bid should make quite sure that they are easily visible to the auctioneer. For those who cannot be present, it may be possible to bid by telephone. The auction house will advise.

Having decided on a maximum price, the bidder should not exceed it. If the property goes to someone else, then time and money have been wasted, but this simply has to be accepted. Otherwise, when the hammer falls, the deal is done. There will be no anxious weeks of waiting, no possibility of being gazumped. Everything has been accomplished in three weeks.