Real Estate - Market, Mortgage, Buying Homes, Selling Property » income

Mortgage Calculators

admin — Wed, 14 Jan 2009 17:24:36 +0000

There are many mortgage calculators you can find on the internet as well as various variations. The most common mortgage calculator works out how much you can borrow from a UK mortgage lender. You enter your income and your partner’s income if applicable and the calculator will produce a figure to give you an idea of what you can borrow. This is a good starting point, narrowing down for most what homes they can look at buying. This of course is just an indication and the borrowing offered by lenders will vary. Other criteria are also taken into consideration when deciding on whether to offer or not such as credit history and financial commitments.

Another useful calculator is the monthly repayment mortgage calculator. Working out what your monthly payments might be for your mortgage in relation to how much you want to borrow, the term of the mortgage and the current interest rate. As interest rates are constantly changing at the moment it is worthwhile doing a few calculations to see if you can still afford to borrow the sum once interest rates return to rates seen a few years ago. There are other calculators available that will allow you to compare two rates, highlighting approximately how much more you will have to pay on a monthly and usually annual basis.

You can also find a mortgage calculator that will work out whether it is worth remortgaging even if you have to pay early repayment charges. Very useful especially at the moment for those who took out fixed rate mortgage deals in the last year or two. They could potentially save hundreds of pounds per month by getting our early and moving on to a variable rate.

There are many other useful calculators available. If you are after a buy to let mortgage, you can get a Mortgage Calculator that will estimate the rent you need to charge your tenant to satisfy lenders.

There are many useful mortgage calculators available, helping you to decide with your house purchase

DTM has 4 years experience in the financial service industry and working with Mortgage Advisers. She enjoys writing on various financial topics

Mortgage Overpayments

admin — Mon, 15 Dec 2008 18:24:04 +0000

I recently received a letter from one of our Buy-to-Let (BTL) mortgage lenders. No names here, but their parent company was recently nationalised. In it, they were encouraging us to use the opportunity of reducing mortgage interest payments to make overpayments on our mortgage account to reduce the size of our mortgage debt. There was a nice glossy leaflet extolling the virtues of doing so.

Please be in no doubt, their interest in encouraging you and I to do this is entirely for their own commercial benefit. After all, if you as a borrower are paying mortgage interest at say 2.75%, I can’t imagine why the lender should want to encourage you and other borrowers to make overpayments. Maybe it might have something to do with improving their balance sheet or, maybe, just maybe, they have worked out they can then lend the money from these overpayments to new borrowers at a lending rate of 5% to 6% and charge the new borrowers an application fee of 2.5% too. Or am I being a little too cynical?

I find the communication from the lender both very self serving and also worrying in its lack of honesty and objectivity. For many borrowers, making such overpayments could actually be very detrimental to them. Let me explain a little more;

The Benefits of making overpayment on a Buy-to-Let mortgage

1. It reduces your debt

2. It reduces the amount of interest you pay in the future

3. The lower the debt as a Percentage of the value of the property, the more likely you are to be able to re mortgage onto a competitive rate in the future, (once competitive remortgage deals reappear on the market).

4. If you are likely to need the income from the rental properties to supplement your other income to live on in the foreseeable future, reducing your mortgage will free up more of the rental income for you to use. (Though this does raise a further question as to whether maintaining and rely upon a rental portfolio through retirement is appropriate for you as an individual).

5. If a rental property is vacant at some point in the future, you will spend less from your other income servicing the debt.

The disadvantages of making overpayments.

1. A borrower can only offset the interest payments against the rental income to reduce the tax liability, NOT any capital repayment. So, any overpayments you make will result in an increase in Income Tax liability going forward.

2. Unless you are using an ‘offset mortgage’ any overpayments you make on your mortgage are a repayment of capital, which are no longer available to you. If you want to borrow this money again, it will be a new loan subject to the terms currently available and subject to your status at the time of the application. If you find that in the future you have lost your job, your business cash flow is going through a tight patch or your sources of income are not high enough to meet your needs, you are not likely to re secure such facilities. Had you not made the overpayments and simply placed them in a deposit account, that capital would have been available to you to use, thus providing you with more breathing space until your situation improved or to give you a chance to sell a property.

3. It is highly likely that the mortgage interest rate you are paying on an existing deal is significantly lower than the rate on new deals currently available. Thus if you want capital to put toward future property purchases, (or even other purchases such as a car), you are not going to be able to secure new borrowings at the rate you currently have. Currently, most borrowers who have a deal which was secured before the onslaught of the credit crunch and has now reverted to the variable rate, is likely to be on a pay rate of between 2.5% and 3.8%. New borrowing facilities are typically starting at circa 4% yet have application fees of 3.5% and are limited to lending a maximum of 70% loan to value (LTV). If you need 75% LTV, the deals start at circa 5.3% with application fees at circa 2.5%.

The above is not intended to be an exhaustive list. Neither should it be construed as personal advice. Each individuals circumstances and needs should dictate the appropriate course of action.

There is another very important matter the letter from the lender does highlight. The importance of not being short sighted and simply spending the new rental income surplus in excess of the mortgage payments. There is a huge opportunity here for individuals to use this as an opportunity to save more tax and to significantly increase their long term wealth and financial security.

I would strongly urge those of you contemplating mortgage overpayments, (be they on a BTL mortgage or even on their own domestic mortgage) to seek good independent advice as to the best options for you.

To find out more about;

1. The authors background, motivation

2. To Contact Karl or ask him a question

3. To access his useful website resources

4. To read his controversial and incisive articles

5. To register for his free bi-monthly newsletter or load the RSS feed

6. To download his self help e-book on understanding how the different layers of the industry work, so you can seek out the most appropriate type of adviser for your needs. It also provides you with the tools to do it yourself

Please visit the website, http://www.karl-lavery.co.uk

Alteratively, you can also discover more about the Holisitic Financial Planning service he offers by visiting his work website http://www.baxterfensham.com

Buy It, Flip It, Cash In

admin — Sun, 30 Nov 2008 22:00:54 +0000

Now is the time to buy and make money doing it. Right now, the real estate market seems to be in a slump for people that are low on cash and is making money for those who have plenty of it. So many people in America today are leaving their homes, either by choice or by force, and banks are now looking to recoup the money that they have lost. In several cases, not much has to be done to the property that your are looking to invest in. These homes are usually well maintained and need very little “fix it up” help.

If you are in that slump and are almost at the end of your financial resources and you have a little bravery, take the leap. Dive into another home purchase right now, while the market allows for extraordinary houses to sell for dirt cheap. If you are the handy man or possibly the handy woman, make some upgrades to your new purchase, make your property more curb appealing, and then remarket your precious prize and sit back and see what you get.

Now, if you are the established house flipper, there are some tips for you to maximize your potential earnings on the properties that you have purchased. Definitely look into getting your own team together; look into creating a crew that can attack these properties and have them flipped by the end of the week. Your crew can range from two to five people, you decide, usually depending on the quality of person you select, you can get away with a two man crew that is skilled in several different trades.

Hiring this crew to take care of all your household needs will provide you with a couple of securities. Loyality is the number one asset to have on your side. Your crew will know that they will be the first choice you go to when you have a job that needs to be taken care of. If you are the regular buyer of properties, the crew that you select will have that little fire that tells them to hurry up, there is plenty more houses to work on and much more money to be earned.

Anyone can buy real estate and start making money. If you are at the end of your resources, it may require a little bit more bravery, but as more money is released to lenders for consumers to purchase homes again, your bravery can sky rocket your income. If you have the money to purchase real estate, start looking at ways to increase your time, productivity, and your profits!

You can also get more information about Property Management including an extensive collection of free property management forms

Oregon Real Estate Investments

admin — Sat, 16 Aug 2008 09:28:43 +0000

For generations, people have made investments to secure recurring revenue from it, in the years to come. Though there is no formula to ensure a profitable return, a large number of individuals opt for such income sources. Similar to other places Oregon real estate investments are, a booming business opportunity for real estate companies. A unique factor of real estate investments is that they are largely influenced by local factors. This includes local events and situations that affect the popularity of an area. Unfortunate events such as car bombings can result in adverse returns, for Oregon real estate returns on investments for a short period. On the contrary, a simple rock show can send profits soaring.

The popularity of Oregon real estate investments depends, upon events that occur in and around a locality where a property is situated. For this reason, localities that are already popular or favorable prove to be higher “price point” investments. Statistics reveal that expensive investments are likely to offer higher returns. This is because posh locales have the reputation of housing individuals with a higher “spending capacity.” Apart from local factors, Oregon real estate investments are also affected by global recession and inflation.

Oregon real estate investments refer to any property, barren land or land that has permanent buildings and fixtures upon it. They are not used as residential properties and can be sold if needed. Most investors rent such real estate to guarantee a regular source of income. At times, these returns can even exceed the cost of an investment. It includes apartment buildings and rental houses that generate income. It also refers to barren land that is fenced and can be rented out as a parking lot, even. So long as it provides a return, it is looked upon as an investment property.

Oregon Real Estate provides detailed information on Oregon Real Estate, Portland Oregon Real Estate, Bend Oregon Real Estate, Oregon Coast Real Estate and more. Oregon Real Estate is affiliated with Denver Real Estate Agents