Top benefits of paying full cash amount for your new home.

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You may have skimmed through the glut of apartments in Houston and may have finally come across the perfect home that you have been dreaming to buy for ages. You may have already planned about its interiors and the colour that would adorn the walls. However, when it comes to paying for your home, you must always consider paying the full amount in cash. There are a number of benefits in taking this step and it eventually helps you in the long run. This may seem like an impossible feat but considering the varied benefits that it promises to offer, you must give it a serious thought. The amount may seem humongous to you but you must realize that in the long run, it will be one of the finest deals that you may have made. The basic and the most obvious benefit of having your home paid for in the full cash amount is the certainty factor. You know for sure, that you will be in a position to purchase the home without having to worry about any kind of loan approval. There are several other benefits and they are mentioned below:

1.)  An advantage when it comes to getting the approval from the sellers:

Needless to say, sellers will first give preference to buyers who are interested in apartments in Houston and are willing to pay the full amount in cash. It eliminates hassles and smoothes the entire home buying procedure. Besides, a potential buyer may have got the pre-approval from their mortgage lender for now. However, this does not imply that the situation will remain the same. There is every possibility that the lender may decline the request at any given point of time, leaving not just the buyer but also the seller in jeopardy. Besides, if you are a buyer who is willing to pay the entire amount in cash, you have an upper hand over the seller and you can haggle for a better price. This increases your ability and power to negotiate. Sellers, too, give in and therefore, you get a home for a much cheaper price than you may have anticipated.

 

2.)  Eliminates hassles and makes the entire home buying process easy:

The best thing about paying for your home in cash is the fact that it saves you from the trouble and worries or loan repayment. You cannot, with all certainty, guarantee that you will be able to repay a loan. You run the risk of losing your home if you do not have all the arrangements made. This can leave you and your family homeless. While there is no harm in taking a loan and is a preferred option for most of the people, you must only opt for it when you are confident and have the resources to repay the loan. Besides, the repayment of loan requires you to pay it off along with the interest amount. Therefore, if you spend over 10 -15 years repaying the loan, you will eventually realize that you paid much more for the house than its actual price. Therefore, it is wise to pay in cash. Even if you do pay

Although the idea of paying the entire amount in cash may send a shiver down your spine, careful planning and saving can help you achieve this dream in absolutely no time. Apart from the basic rule of keeping away a chunk of your salary as savings, you must also save all the money that you get as bonus. Instead of keeping it stored at home, you must lock it away in a long term CD at the bank. Within years, you will have earned a good amount as interest for it. Besides, avoid making unnecessary expenditures and you will be good to go.

Author’s bio:

Shane Bennett is a real estate agent and helps clients find some of the best apartments in Houston. He has a professional background in finance and was briefly working in the stock market before changing his career path.

5 Things That Could Prevent You From Refinancing Your Mortgage

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No matter where you’re at with your mortgage payments, there’s a good chance that refinancing could help to reduce your bills, especially if you also pay a home equity line or you hold a second mortgage on the property. And since rates are still ridiculously low, now is definitely the time to make your move – they’ll likely follow the growth in home values before too long. However, you need to make sure that you’ve done everything you can to prepare for a refi, including addressing any issues that could prevent you from getting the new rates you want. Here are a few situations that could throw a wrench in the works.

  1. Missed payments. A few years ago it seemed like missing multiple payments was the only way to secure a refi from the bank. But with the economy slowly beginning to recover (and the housing market on the rise, in particular), banks are finally starting to reward homeowners that are making payments in full and on time by offering them the refinancing options they’ve been unfairly denied. Unfortunately, this means that homeowners who have not been so reliable with their payments could have a hard time convincing lenders that they deserve this boon.
  2. No money. In case you didn’t know, refinancing your mortgage is not a free process. It comes with plenty of out-of-pocket expenses. Even though you stand to save a significant amount on your monthly payments when you complete a refi, that doesn’t precisely put money in your pocket right now. And you’re going to need some cash up front in order to secure the refi you want before the mortgage rates return to pre-bubble highs.
  3. Underwater property. If you owe more than your property is worth at this point, you’re going to be hard pressed to get a refi. And many homeowners still find themselves in this boat despite the fact that housing prices are on the rise. The sad truth is that the banks simply aren’t willing to take any more of a loss than is absolutely necessary on these homes, and that includes offering you savings on your monthly mortgage bill. Luckily, you can always try again when your home value increases.
  4. Mortgage insurance. Let’s be honest: if you’re paying for this type of insurance, chances are good that you have not yet paid off 20% or more of your home loan, since banks generally require you to carry it in this circumstance. This is not to say that paying for mortgage insurance will ruin your chances to refinance, but there’s a high likelihood that it will complicate the process.
  5. Poor credit. When you visit your lender with the intention of refinancing, you might want to do a little leg work beforehand to ensure that your ducks are in a row where your credit is concerned. The easiest way to do this is to get a copy of your credit report and you can order one at no cost from AnnualCreditReport.com. This will not only tell you what your credit score is, but it will also provide you with pertinent data concerning black marks (late or missed payments, pending collections, bankruptcy, etc.) and even alert you if you have been the victim of identity theft. With a credit report in hand you can begin to contact creditors that have failed to remove black marks even though you’ve paid them in full and you can basically get your score back in ship shape before you even consider approaching a lender for a refi.

Mortgages: Lifelong partner or short affair?

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A mortgage loan is a type of loan which is taken by a debtor by placing real estate or some personal property as a surety that in case he/ she is able to repay the loan on time, that property will be taken away in the form of damages.

Mortgage loans range from a variety of different durations. Starting from a year, mortgage loans can go up to five, ten and a maximum of thirty years! The question is, should you go for a short mortgage loan or a longer one?

Obviously, both of these durations have their advantages and disadvantages, so you have to be very careful when deciding the type of loan that will be the most beneficial for you. In order to better understand mortgage loans and whether they should be preferred in the long run or for a shorter period of time, here is a brief guide of their advantages and disadvantages:

Mortgages loans in the short run

In most common cases, generally people prefer to take mortgage loans for a longer period of time. Long term mortgage loans can be classified from twenty to thirty years of repayment. Moreover, there are a number of different features that set them apart.

Firstly, if you take a mortgage loan in the long run, you are going to be charged a slightly larger amount of interest on your payment. Secondly, whenever it comes to taking a mortgage loan in the long run, one of the most important things that you need to keep in mind is what you are putting up as collateral.

In most cases, mortgage loans are generally related to real estate and property, and if that is the case, you must make sure that you have a carefully thought out plan of repayment before you apply for a mortgage. The question is, are you able to set out a plan of repayment thirty years in to the future?

However, if you choose a long term mortgage loan, it leaves you with more money to invest in to other assets. On a longer period of time, your monthly installment will be much smaller as compared to a shorter loan span. So, it is a choice that you must make carefully.

Mortgage loans in the shorter period

If you are thinking of taking a mortgage loan ranging anywhere between five to fifteen years, you should know that your monthly installment will be comparatively higher, although the overall level of interest that will be charged on your payment will be reduced.

However, taking a mortgage loan with a shorter repayment period will make it very difficult for you to invest your money in to any other place, since most of the money will be used up in repaying the monthly installment.

If you wish to claim property of your house as soon as possible, it would be a wise idea to go for a mortgage loan in a shorter period, since it will allow you to get the house transferred on your name sooner rather than later, hence allowing you to plan in your later years.

Regardless of the loan that you sign up for, the one thing that you need to keep in mind is to make sure that you have ample job security, or several different sources of income by which you can repay the loan easily. This way, you will at least have enough security that you are able to pay back the loan in case circumstances change in the upcoming years. Hence, the length of loan depends upon your preferences and circumstances.

Hugh Tyzack is the founder and managing director of GBP Loans Limited, which provides loans for people with bad credit. You can can read more details by visiting his site. Follow Hugh on Twitter @GBPLoans and also on Google+

 

Buyers versus Sellers: The Fight for Supremacy on the Aussie Property Market

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The property market in Australia has been showing signs of resuming an ‘up-and-up’ trend for several months now. On ‘Super Saturday’, the weekend right after Melbourne Cup Day, which is traditionally a time of numerous home auctions, expectations were exceeded. Clearance rates soared in most major cities, and most states, for that matter. In the meantime, Australia’s central bank also enforced yet another official cash rate cut, whose main goal was to drive down interest rates on mortgage loans. Thus, authorities implemented a further step in their effort to lower debt, while also encouraging the general population to regard loans from a more positive perspective. The latest data released by RPData, i.e. the RP Data Home Buyers Index indicates that the Aussie realty market is largely a buyers’ market, though sellers are also making timid attempts at a comeback in various parts of the country.

In simple terms, the real estate stock is plentiful, prices are stagnating, and the home loan approval rate is still not budging. Indeed, mortgage interest rates have dropped, by all accounts, as well as according to our research at http://www.bankwest.com.au/personal/home-loans/home-loans-overview. The current situation has been brought on by the fact that potential buyers are now holding out for longer before finally making the purchase. They’re putting down more money for the advance payment, choosing to cover the existent holes in their budget and pay off any debt they may have incurred before. Also, with increased access to online property portals, buyers will not rush into a purchase if they feel the price is unjustly high, given the home’s condition and location – they go by what they see listed on real estate websites and are often very determined not to give into pressures from sellers.

In the view of one real estate agency operations manager (Sean Green from Raine & Horne), several parts of Sydney, Perth, and Brisbane will reward buyers with some amazing opportunities, especially in the $450,000 – $500,000 range. Green advises sellers to bargain, but not for too long, since buyer volatility is running high these days, given the large number of homes currently up for sale.

According to the RP Data poll, sellers still have the upper hand in several parts of the country. Perhaps the most favorable areas to be a seller are the Central Highlands, Loddon, and Melbourne in Victoria, as well as Canberra in the Australian Central Territory, and the north western part of New South Wales. Meanwhile, buyers can really drive the transaction in areas such as Southern Tasmania, the lower great southern part of Western Australia, as well as in West Moreton, Wide Bay Burnett and the far north of Queensland. There still exist fairly balanced markets, such as various sections of south western and inner Sydney. Highly optimistic buyers should also bear in mind that the market is diverse and ample enough to allow for major differences between cities and among various states.

RP Data’s senior analyst explains that buyers are heavily relying on the fact that prices on residential property have seen little to no variation during the past decade. If they do increase now, they won’t vex the potential buyers too much, since they are the people who have spent the last ten years saving money and getting rid of debt, in order to allow for slight fluctuations in the price tag of their dream home. Meanwhile, however, the existence of online property portals is also working in favor of sellers, to a certain extent, in the same sense of cultivating a head-strong attitude. People are now choosing to keep their homes listed for sale, while they wait for the right buyer to come along and pay them the price they think is right. It’s all in the power of free, easily accessible advertising.

 

Your Mortgage

Home Mortgage

So you have saved your deposit for your first home. Your ready to move in all you need is a mortgage. You have heard people talking about them often enough, family, friends, even the news, but you’re not quite sure what they are.

Mortgages are basically loans. They are loans that are given in order to buy a house. It is different to a regular loan in that the lender will take a look at your credit history along with a few other aspects of your life and confirm whether you would be a risk to their company by not paying them back. Mostly there is no damage apart from to your credit rating if you cannot pay them back. With a mortgage, if you cannot pay for whatever reason throughout the loan then the lender can simply take your house.

Banks are the usual lenders for mortgages. This does not mean you have to go with your current bank you can shop around to find the bank with the best deal for you.

Mortgages are like other loans in that they do have an interest rate however they do carry other costs such as:

Arrangement Fee -This is the cost to set up the mortgage.

Mortgage Valuation Fees – this is the cost to evaluate the property to make sure it provides enough security for the loan

Higher-lending charge- this will only apply if you are borrowing a high amount of the properties value

Early Repayment Charges- you usually have to pay a penalty to get out of the mortgage. If possible try and avoid mortgages that carry ERC’s

Exit Fee’s – many lenders charge an exit fee to close your mortgage account or when your switching lenders.

When you are setting up a mortgage you are asked to pay a down payment. This is the lump sum that affects the amount you are going to pay each month. You can choose as much as you like to pay but the more you pay then the less you have to pay each month. The amount that you are lending after your down payment is called the principle. On top of the principle you have the Interest. You also have your property taxes to pay (this is normally put into a third party account until they atre due to be paid) and finally the bank normally requires you to take out insurance to cover you form Fire, Storms, theft and floods.

Author Bio:

Katy works for Quick Cash for House, helping people sell their home quickly. When buying her home, she found that this was one of the more complex parts of the experience so has started blogging on the subject to help others.