mortgage loans

How to Begin Renting Out Your Property

You are considering buying or building a new home. You cannot afford the mortgage payments without selling your present home. The market conditions do not allow you to sell your present home without suffering a huge loss. Have you considered renting your present home and using the rent to make the mortgage payments?

Creative Financing Can Salvage Your Dream

This kind of creative financing can work. You can have the best of both worlds. If done properly, the rent on your old home will make the mortgage payments on an existing mortgage. If you are fortunate enough to have a low or no mortgage balance on your present home, the rent may make the mortgage payments on your new home. You could always upgrade your old home with the help of Red Deer home renovations personnel, which would allow you to charge even more for rent. As a fringe benefit, you have become a landlord.

Investing in propertyCheck on Local Regulations

First, government authorities must be contacted to be sure renting the house does not violate zoning regulations. It is important to have accurate knowledge of the local rental real estate conditions. The realistic rent must be high enough to cover mortgage payments, maintenance and other expenses. Allowance must be made for an occasional vacancy. If the rent is realistic and renters are properly screened, vacancies can be minimized.

Do You Have a Landlord’s Personality?

Be sure you have the temperament necessary for a good landlord. If you are a worrier, turn the property over to a property management company. If you live in another town, do the same. Long-distance management does not work well. If you have the right temperament and expertise, you can keep all the profit for yourself. Running a rental business also means being able to evict bad renters.

A Lease or No Lease?

If you have a good renter, a long-term lease is wonderful. With a problem renter, a lease makes it much harder to evict a renter. You will probably need to go to court, and you will need an indisputable reason for the eviction. Eviction may be easier when renting by the month. If the rent is reasonable, renters who are treated fairly usually stay a long time.

Screening Renters is Critical

There are many things you want to do before renting out your house to a prospective tenant. Start with interviewing the whole family. Check credit references and former landlords. If possible, inspect the prospective renter’s present home. If possible, obtain a security deposit equal to three month’s rent. This will help to cover damages and back rent.

If you are able to keep a good relationship going with renters who are able to pay on time then you’ll definitely have the revenue available to build that dream home of yours with the help of Red Deer custom home builders. And just think… in the future you may choose to rent out your custom home as well. Once you turn your first house into a rental property you have started yourself on the path to continual revenue.


What Are Some Typical Eligibility Requirements For Mortgages?

If you’ve ever been denied financing for a mortgage you know how deflating it can be. You may feel ready to move onto the next step and own your own home, but lenders don’t see you as a good investment for whatever reason, and it’s not a nice feeling at all.

However, before you get too bent out of shape about it, it’s probably a good idea to look at the situation a little more analytically and less emotionally. Emotions tend to get in the way when you’ve been denied for a mortgage. Keep in mind it has nothing to do with you personally, and it’s all about business.

A Business Decision

When a lender decides not to approve your mortgage, it is a business decision. It’s easy to get caught up in the thought of big corporations flexing their muscles and squashing the little guy, but think of it as if the lender is a person. If someone lends somebody else money, they want to do so feeling confident that they’ll get that money back someday.

You would be reluctant to lend someone money if you weren’t confident they could pay it back, and a big lender is the same. If your credit score or a handful of other factors aren’t what they’d like to see, you may be denied. And remember, the numbers, current situation and your history are all they have to go by when making a decision. Take a look at some of the typical eligibility requirements to make sure everything is in order.

Good Credit Score

A decent credit score is usually one of the requirements when looking for a mortgage. It doesn’t have to be perfect, but each lender will have a number in mind that they’d like yours to be before they give the green light. Credit score is affected by things like not paying your bills and debts, bankruptcies, consumer proposals and similar things.

Income

This one may seem a little obvious, but steady income is definitely a must if a lender is to believe you will make good on your mortgage. And the longer you’ve been at a particular job the better. It’s never a bad thing if you make a lot of money, but your income in relation to how much you owe is more important. A high income with even higher debts won’t do you any favors.

Low Debt Levels

And that is why your debt levels should be low in comparison to your monthly income. Your debt to income ratio must meet the current requirements or a lender will determine you can’t add to that debt amount and still make all your payments. Remember, they are in the business of making money.

Minimal Credit

Too much debt can put the brakes on your mortgage approval and so can too much credit. If you have multiple credit cards or lines of credit, they may be seen as your ability to run up a large amount of high interest debt. You might be the most responsible person around and have no intention of ever doing that, but the lender doesn’t know that. All they see is that you have the potential to use lots of credit. Talk it over with your mortgage broker ahead of time and consider closing a few outlets if necessary.

Are You Extended?

Not being a co-signer on anyone else’s loans is often a factor that results in a mortgage being denied. Even if your child or sibling or friend always pays on time and is in good standing, if they default that lender is coming after you for the balance.

It’s nice to help people out, and if all of your numbers are what they should be you may still be able to get a mortgage, but it is definitely something to consider. If you already have a home and don’t plan on getting another, you have nothing to worry about.

Create a Strategy

One of the keys in the mortgage approval business, is figuring out any potential issues before you dive in with both feet. Don’t just assume that everything is great because you have a job and don’t have a pile of debt. Take a look at possible sticking points and then address them prior to applying for a mortgage.

If it seems like some of the more conventional lenders have an issue with you, think of using a broker who has access to many different lenders. A good mortgage broker usually isn’t bound by certain products or systems and they can often find you the deal that you want.

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The author of the article is Jeremy Benson. He has been writing about finance, mortgage and Canadian law since 7 years. Blogging is one among his greatest passions. Follow him on Twitter@jeremybenson19.


How To Get Organized And Save Money

These are affluent times that we live in.  Our lives are stuffed with all of the things that we desire, from entertainment systems to ornaments to crowded wardrobes to music collections, the list goes on.  Although it may be nice to have all those things in some ways, becoming overwhelmed is also very easy.  Your house gets so crowded and full of stuff that you can’t even remember what you have.  It’s almost impossible to find what you are looking for.  You might even buy something and then realize you already had the item.  Maybe it was hidden away in a drawer.

One obvious solution to this problem is to go buy boxes, shelves and other kinds of storage solutions at a furniture store.  However, that can get expensive.  Your new storage could also wind up just as cluttered and messy as what you currently have.  There are some fantastic mortgages available for families and professionals, and this is something you may consider, however I have other ideas before you make a decision about purchasing a new home for storing all of your clutter.

“Here are some effective ways to save money and reduce clutter at the same time” says John Thompson from YourNextMortgage.co.uk.

Storage Inside Storage

Save empty takeaway trays and small cardboard boxes.  These work really well to store small things in that you have laying around the house, including pens, kitchen ingredients or accessories for your electronic devices.

Another thing you can do is take lidless boxes and line drawers with them.  You can divide the drawer into different storage compartments, similar to a cutlery drawer.  Doing this will prevent wires from getting tangled up and make it easier to find various items.

If you happen to have a cupboard stocked with different shaped containers, you might want to transfer the contents and put them into storage tubs.  You can neatly stack these and use your space more efficiently.  If you get clear plastic ones, you will be able to see what is inside them.

Ebay

Go through your stacks of DVDs and CDs.  Ask yourself whether you actually listen or watch them.  If you can’t decide whether to hold onto to something or not, check eBay to see how much you could sell it for.  Ask yourself whether you would like to have the money or the copy or the CD or DVD.

Then start selling on eBay, you can turn your unwanted entertainment items into cash and also reduce clutter, free up much needed storage space and provide yourself with some money to buy something that you will truly enjoy.

Your Mending Pile

Is there a mending pile in your house full of items that you don’t ever get around to fixing, like the broken vase or coat missing a button?  Do you have broken tools and toys hidden in the back of a drawer?

Anything that is broken that you are holding onto is just wasting space.  Think about whether it is something that you want bad enough to buy a new one.  If not, just throw out the broken one.  If yes, then maybe it is something worth fixing.

To ensure that your mending does get done and prevent having to buy these things new, have a box next to the television for your mending items along with any equipment or tools you will need to do your repairs with, such as superglue, needle and thread.  The next time you are watching one of your favorite shows on television, get something out of the box and start to mend it as you are watching your show.  This will make it not feel like such a chore if you have something enjoyable to watch.

Only Keep Good Food

Don’t allow your refrigerator to get cluttered with old food.  Once a week, go through it.  Look for jars and leftovers that are out of date.  Either get rid of them or figure out what you will use them for before they go bad.

Getting your house organized doesn’t need to be a huge task.  It also doesn’t need to be expensive,  In fact, you can save lots of money in the process, so why not start today?

Citations:
  • More ideas on how to de-clutter your home
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Amy Rice writes about de-cluttering your home and mortgages, when not writing she enjoys swimming and horse riding with her daughter.


How Can I Improve My Mortgage Credit Report?

There’s a new buzzword around town. And that buzzword is “mortgage credit report.” And it’s definitely in your best interest to pay attention to this new buzzword. Because if you ever hope to buy a home it is vital to know how important these mortgage credit reports truly are.

Mortgage credit reports explained

mortgage_card_explainedSo let’s start off with the basics, shall we? In order to recognize how important mortgage credit reports are, you first have to understand what they are. They really are a basic concept. When mortgage companies are considering you for a mortgage loan (and deciding what interest rate they will charge you), they want copies of all three of your credit reports. If your husband/wife will also be on the loan, they want copies of all three of their credit reports also. That equates to pages and pages to analyze in their loan acceptance process. That takes too much time.

So, in come Mortgage Reporting Companies. Instead of your mortgage lender having to pour over these endless pages of credit reports, they hire these mortgage reporting companies to do that for them. Mortgage reporting companies order copies of your credit reports and consolidate them into one report. This consolidated report created by the mortgage reporting company is called, you guessed it, your mortgage credit report. It is the information found in this report that is used by mortgage lenders to decide your acceptance or denial for your loan, and of course your interest rate. Everything to do with your mortgage loan rests on the information found in your mortgage credit report.

Ways to improve your mortgage credit report

Now that we’re all on the same page of understanding the importance of mortgage credit reports we can get down to the reason why we’re here: discussing how we can improve these reports. First things first, you are probably wondering how to access your mortgage credit report. As of right now, the only way for you to access your mortgage credit report is if you’ve already been issued a mortgage loan. If that is the case, then your mortgage credit report should be included with your closing paperwork.

If you don’t already have a copy of your mortgage credit report, don’t fret. You can start by accessing copies of your normal credit reports from the three major credit bureaus (Equifax, Experian, and Transunion). If you are wanting to improve your mortgage credit report this is probably your best bet anyway, because the information found on your mortgage credit report is pulled from your major credit reports anyway.

Now on to improving these reports. There is no way to go about particularly improving your mortgage credit report on its own. That is because, as explained above, the information found on it is pulled directly from your other credit reports. So if you want to improve your mortgage credit report, then you would go about the same processes and steps that you would use to improve your normal credit reports and scores. As your normal credit reports improve, then so will your mortgage credit report. So, the typical steps that you would use to improve your credit, including paying your bills on time, paying down balances, working with a credit repair company if needed, etc, will all also help to directly improve your mortgage credit report.

That is the good news! You don’t have to take any extra separate steps to improve your mortgage credit report. It really is that basic: if you want to improve your mortgage credit report, then start by focusing on improving your basic credit reports. As you see improvements in your normal credit reports, your mortgage credit report will simultaneously improve. This new and improved mortgage credit report will help you to find easier acceptance on a mortgage loan, as well as lower interest rates for your new home.

This article was contributed by Chase Sagum. Chase writes about credit repair and personal finance issues/opportunities.

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Can You Manage a Mortgage on Pension?

Paying off a mortgageWhen it comes to retirement planning one of the most common pieces of advice is to pay off your mortgage as quickly as possible. No mortgage = less financial stress. But what if you want to buy a new home after you retire? Will you be able to get a mortgage and will you be able to manage the payments?

What counts against you?

To be brutally honest, your age makes you very high-risk. Lenders can reasonably expect people in their 20s, 30s and 40s to live long enough to repay their mortgages. The chances of you living long enough to repay a mortgage for 20 – 25 years start to look a little slim when you hit your 60s.

Your income is also, obviously a factor. As a pensioner, your income is fixed and, unless you’ve been very, very good at planning for retirement, it won’t be as high as it was when you were working, which means that you’ll probably have to settle for a smaller loan than you would if you were 20 years younger.

What’s in your favour?

You’re probably not looking for a three-bedroom, two-bathroom, and double-garage house. Two beds, one bath, one garage and a modest garden will do you fine; something like a cottage. Small houses are cheaper than big houses, which is great on a fixed income.

Unless you’ve been renting all your life, you probably have a home that you can sell which will help significantly with a deposit. The ideal is for the sale of your old house to cover the cost of your new home. But if you’re moving to a very popular retirement area (Florida, to haul out a tired cliché) or want to buy in a retirement village then you might come up a little short. The shortfall shouldn’t be overwhelming, however, which means that your mortgage should be manageable.

If you have been renting and you don’t have a house to sell then you should (in an ideal world) have a comfortable nest egg (in addition to your pension) that can serve as a deposit. Deposits are very important.

You’ll have built up a good credit history and a solid financial record, which will stand you in good stead in any loan application process.

It’s illegal to discriminate against anyone based on age. Yep, credit providers are not actually allowed to deny you a loan because you happen to be over than 60 years old.

So, can you manage a mortgage on your pension?

If you’ve planned properly for your retirement then you should be able to manage a modest mortgage – provided you consider all sundry expenses, like maintenance, insurance, rates and taxes. It helps even more if you have an existing property to sell. It’s also a good idea to find a lender than specialises in mortgages for over 60s. Before you make any final decisions, however, you should talk to your financial advisor.

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Written by Sandy Cosser on behalf of Ooba, a home financial services specialist that offers bond registrations, pre-approvals and second bonds.


How Much House can you Afford?

How Much House can you Afford?

mortgage_loanWhen the economy in the United States started to take a turn for the worse in 2008, the housing industry was at the forefront of the problem. Being a bit more specific, it was the mortgage industry that took down a good amount of once-profitable banks, throwing the whole housing industry into turmoil. But how could one industry knock down the strongest economy in the world?

Cause of the Problem

The simple answer would be greed. Both lenders and homebuyers were greedy during the housing boom, as banks often lent money to those who could not afford the monthly payments. Banks and the media sold the idea of the American dream to homebuyers, and approved those same people for amounts that were much higher then they truly could afford. In turn, foreclosures started to pile up at an alarming rate until the banking industry could no longer afford the new amount of failed mortgages.

The good thing about history is that people can learn from the mistakes of those before them and hopefully not make the same ones again. Those who are looking to purchase a home, now that the market is starting to rebound, need to really sit down and analyze their budget to truly make sure that a new mortgage payment is within reason. But there is more to a affording a new home then just the amount of the mortgage.

How Banks Qualify a Lender

Banks use something called a debt-to-income ratio to determine how much of a monthly mortgage payment someone can afford. The ratio takes all of the potential homebuyers secure and unsecured debt, such as credit cards, auto loans and personal loans, and adds up the monthly payments on those. Then, the lender takes the total monthly income of homebuyer to come up with a debt-to-income ratio. If someone’s expenses were $300 from an auto loan, $100 in credit card payments and $75 for a personal loan, the total expenses would be $475. For this example, we will use an income of $4,000 a month, so the ratio would be 475 to 4000, or about 12 percent.

Most banks want the homebuyer to satay under 36 percent, including the new home mortgage. FHA loans, or Federal Housing Association loans, will stretch the percentage to 41 percent; however, they require the borrower to take out additional mortgage insurance on the loan. So, in the scenario above, that homebuyer could qualify for a payment up to around $1,000 a month, since that would bring the debt-to-income ratio to around 36 percent.

Hidden Costs in Owning a Home

Even though a person may qualify for a mortgage of a certain amount, that doesn’t always mean that they should max out the amount they were approved for. Besides the mortgage payment, a homebuyer has a lot more to consider when purchasing the home. First, they will have to purchase homeowner’s insurance, raising the cost immediately. Also, utilities may be more expensive at the new home compared to the old one, especially if the home is larger. Plus, if they are renting now, they may not have to pay all the utilities, but if they pay a home, all the utilities will be their responsibility. Finally, a new homebuyer needs to understand that the new home may have large, unexpected repair bills like a leaky roof or foundation. If they are smart they will have the problem fixed the right way by a pro like Tredent Contracting and it can put a strain on the budget unless they are prepared for it.

If a homebuyer truly wants to make a smart decision to avoid foreclosure, they should make a budget and come to a number they are comfortable with before even being approved by a lender. Then, as long as the lender approves the buyer for the predetermined payment, the homebuyer will be more comfortable knowing they can afford the payment. The main point for them to remember is to stick to their budget and not get caught up in the emotions of finding the “perfect” house and over spending.

Owning a home is still the American dream, and it is still within grasp for those who make wise decisions with their money. A buyer just needs to be smart and realize what they can afford before they jump into owning a home. When buying a home, the buyer just needs to make a conscientious, calculated decision, and they will be able to enjoy their home for years to come.

Bought the perfect home but can’t manage the lawn? That’s why Aaron Gordon writes on behalf of Champion Yard Service, where their services include Seattle lawn mowing.


Mortgage Loans That Impair Your Bad Credit

Mortgage Loans That Impair Your Bad Credit

Are you facing credit problems in the event of a bankruptcy or a home foreclosure? Or is that your credit score has dropped as a result of payment failure? Gone are the days when bad credit hindered your loan approval and lenders reluctant to approve your loans. Mortgage loans for people with bad credit have dissipated the taboo of good credit-mortgage loan. Few instances have shown that good credit can stoop down quickly to an average of 150 or more, but it is definitely possible to improvise your score and take advantage of a new mortgage loan. Bear in mind that repairing your credit is not the only means to avail a mortgage loan and the FHA —Federal Housing Administration has made it easier for individuals with a bad credit to qualify for a home loan.

This risk is apparent with the increase in economic crisis during recent years. You can definitely rebuild on the financial stats, however, this is going to take you sometime and qualifying for a loan in the span involves high rates of interest coupled with an increase in responsibility. Lenders in part have come to realize that this is a part of the economic process and there are mortgages, auto loans, personal loans and other types of credit that help individuals in undoing their bad credit with ease.

Credit score and mortgage loans

The role of credit score in mortgage loans is quite confusing. This is due to the fact that people with bad credit history have availed loans at competitive interest rates. There is a bit of contradiction that entails to the standard rules of bad credit, the mode of application and consideration.

On the whole, credit scores take the toll on the interest that can be charged with a loan. This implies that increased scores fetch a lower rate and the reverse holds true. This implies that although loan approval is independent of the score, it is dependent on the impact of the monthly payments discharged. In turn, the essence turns out lenders’ are not comfortable with increased deals.

Low rates of interest

Although credit scores have had a less impact, improvements are yet to be noticed for individuals with bad credit. Aside the factor of improving your score for a mortgage loan, there are a couple of factors that determine the risk of defaulting and keeping them to a minimal.

Improving on the first hand comes down to faithful payments of existing debts, which indicate lenders that approving your loan is not a bad idea after all. Say for instance, small payday loans could be taken and quickly repaid to gain a positive presence. The other way, you can go ahead with a larger consolidation loan that helps to pay off your existing smaller debts with ease.

Secured income is yet another way of demonstrating that you are capable of covering any mortgage loan payment efficiently on time. You can back up with evidence of your long-term employment, contract work, and demonstrate that nearly 40% of your income can be used to repay your loans.

Right lender

One of the most effective ways in getting a loan worked out at the lowest rates of interest is finding the right lender. This implies seeking help from the Internet as there are plentiful lenders in supply.

Getting hold of the right lender is definitely going to take time, however, thanks to the internet as the comparison sites make the task much easier.

This guest post is written by Jamie Anderson. She is an enthusiast blogger providing tips on credit card debt settlement as well as reduction and management of your debt.


Mortgage Loans Explained – Advice for First-time Buyers

Mortgage Loans Explained – Advice for First-time Buyers

Taking out a mortgage can be a difficult process for first-time buyers. Representing a loan tied to the value of a property, which is paid back with interest over a fixed amount of time, a mortgage is essential to buying a house. Banks and credit agencies may be less likely to approve a favourable rate of interest, while you may also find yourself tied down to a long term deal. Most mortgages will include either a fixed rate for a limited time, which will then become a standard variable rate, or will be capped and relative to changes in national interest rates.

It is important to be careful to get the right kind of mortgage for the property that you want, as well as understanding how you might be able to benefit from other schemes targeted at reducing mortgage pressures for new buyers. Buying a house with a mortgage loan consequently requires you to think about some of the following approaches and issues

1 – Shopping Around

As with any kind of finance, it is important to shop around as much as possible for the right mortgage deal. Advice should be sought from a number of different banks and credit agencies, while it is also recommended that you spend time using online valuation sites and price comparisons to make sure that you are receiving the best mortgage deal. At the same time, be aware that most credit agencies and banks are having to raise their standard interest rates as the result of the economy, and that you will often have to compromise to get the right kind of mortgage from a lender.

2 – Know the Details

Never enter into a mortgage contract without understanding how much you will be expected to pay, and what the terms and conditions are. A fixed rate mortgage might seem like a sensible choice, but may require a higher initial deposit, as well as being likely to become a variable rate mortgage after a few years. If deciding to take on a mortgage where the interest rate is tied to national base rates of interest, you also need to be aware of the risks of investing in the future of the economy.

3 – Understand Other Costs

As well as paying into a mortgage, you will have to add on a number of other costs associated with buying a property. These costs can range from everything from surveying and conveyancing fees through to valuation costs, and stamp duty taxes.

4 – Look Out for Support Schemes

There are a number of schemes aimed at first time home buyers. Perhaps the most notable recent addition to these schemes has been NewBuy, whereby the Government and builders will act as co-guarantors for a mortgage loan, allowing you to pay a higher deposit and agree a long term deal. The Government benefit from stimulating the housing market, while builders can receive assurances of long term new home building. While these contracts can lead to long term payments and the same vulnerability to interest rate changes, they do offer one way to get onto the property ladder.

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