Monday, December 30, 2013

To Buy or To Rent?
An eternal question asked by those looking for a home to move into: Is it a better idea to purchase a house or simply rent one? The answer cannot be generalized, and depends on certain factors such as:
· Your income (most important factor)
· Number of family members
· The location, city and current market value of real estate.
· The rent to emi ratio

The first question you should ask yourself is how long you plan to stay in the house you are looking for. If your purpose is permanent in nature, then yes buying a home is the best option. Yet, the choice continues to daunt us, so let us take a look at how you should compare and choose between these options:

1) Monthly expense

Compare how much you will have to pay towards your monthly rent and your equated monthly installment towards your home loan. The point is to have an overall expense estimate for the duration you have in mind.

2) Convenience of location

See whether the house you have chosen to purchase is located in fair distance of the schools and offices. If not, renting a home in the said area is a good idea, until you find a suitable home to buy.

3) Down payment value

When it comes to availing home loans, you must know that only 80% of your property's value will be funded by your bank, the rest 20% needs to be arranged for from your personal resources. This involves some prior planning and saving. Similarly in the case of a rental home, you will be required to pay an advance sum (an initial amount before you move into the place) which is usually 6 months to 1 year rent value.

4) Amenities check

Keep a checklist of the amenities you want and cross check it against the amenities you find in the house you are looking for. This will help you analyze if the house is worth investing in or renting.

5) Percentage of rising cost

Keeping in mind the rising cost of real estate and interest rate of your home loans, similarly the percentage increase in your rent; evaluate and compare which is affordable according to your income and choose the one that is most suitable to your family as well as your finances.

6) Investment advantage

The one advantage that comes automatically with purchasing your home is that you are making an investment. Even if you don't plan to sell or rent it in the near future, with the ever appreciating value of real estate your home is bound to increase its worth, through the times. Obviously, you don't enjoy this advantage in your rental home.

The choice is yours, but let it be an informed one.

For starters, visit our site you will find a whole lot of details on home loans and to find out if you are eligible for availing best home loans by visiting

Thursday, December 26, 2013

How Do Banks Decide on Your Loan Eligibility?
When you apply for a loan whether it is a personal, housing or mortgage loan, the first and foremost aspect banks look at, is your ability to repay. Although, there are other specific criteria to be fulfilled by every applicant, the following are the basic points or rather calculations based on which your loan eligibility is determined.

It is not all that difficult to understand how these calculations are arrived at, in fact if you are able to work it out on your own then you can find out what will be the maximum loan you can avail, irrespective of which bank you apply to.

1) IIR- Installment to Income Ratio

Banks understand that your loan value should not exceed your repaying capacity. This ratio is 33.33% to 40% of your monthly income. Using the IIR, how much you can borrow as well as repay will be decided by the bank.

For instance if you earn Rs.50,000 per month, then your IIR is Rs.16,500. That is, the maximum emi payable by you is not more than 16,500 per month. This determines your maximum loan amount, and will vary depending on the tenure you choose.

2) FOIR- Fixed Obligations to Income Ratio

This is perhaps the more popular calculation, the banks go by. The Fixed Obligations to Income ratio helps in determining if the applicant has any other loans he is repaying, while he applies for a new loan. Those loans which require more than 6 installments to be paid are the ones considered for FOIR. Let us see how it is done;

For instance, if your income is Rs.75,000 per month, and you have an auto loan running for which you are paying an emi of Rs.5000 and another personal loan of Rs.7500 per month. Considering that 50% of your income can be paid towards your loans,

We have,

50% of 75000 = Rs.37,500

Auto Loan Emi = Rs.5000

Personal Loan Emi= Rs.7500

So, your disposable income for this fresh loan is:

37,500 - 5000 - 7500 = Rs.25,000

Although FOIR is mainly a ratio, you need to look out for the value mentioned above. This will help decide how much you can afford to pay as monthly installment despite paying your other emis.

3) LTC or LTV - Loan to Cost or Loan to Value Ratio

This ratio is most often used for calculating an applicant's ability to repay a housing or a mortgage loan. Here, rather than an applicant's income, the property's value is taken into consideration. Around 60 to 70% of the value of the property is used to determine the maximum borrowable loan amount.

For instance, if the value of your property is Rs.1 Crore. Then the maximum loan amount you can avail based on your property would be Rs. 50 to Rs.60 lakhs. Of course, when it comes to determining your repaying capacity, your income will definitely be considered. The LTV ratio varies depending on whether all the aspects of the property is proper or not. Sometimes, even 80% of value is provided as funding depending on the application.

Most banks consider up to 60% of an individual's income can be paid towards monthly installments. However, it is always advisable to keep this percentage down to 40%. You don't want to seem too credit hungry when you go ahead with applying for a new loan. Every loan you pay or don't pay is recorded, and is made as a part of your credit information report. Your credit score is also based on it, and is one of the key factors for your loan to get approved.

Priya is a financial consultant with RupeeZone, visit you will find a whole lot of details on personal loans and how to make yourself eligible for easily availing one.

To check your personal loan eligibility visit

Tuesday, December 17, 2013

Why Do Hard Money Lenders Fail?
This vital pillar of our economy almost vanished when the economy and the housing market tanked about four years ago. Private lenders were left holding large inventories of real estate whose values were eroded by between 30% and 50%. Consider this scenario: A $200,000 mortgage loan balance, originally secured by a property valued at $285,000 (Loan to Value 70% [LTV]), was suddenly under-secured as the securing property value dropped by 40% to $171,000 (Loan to Value 117%). Conventional banks suffered somewhat similar consequences, albeit on a smaller scale. The difference was due to the credit analysis methods that were practiced prior to the collapse of the property market. On one hand, conventional lenders subjected credit applications to more stringent analysis that included borrower's credit history, character, income, collateral, ability to repay, stress testing, terms and economic conditions. On the other hand, Private lenders or hard money lenders, as they are popularly known, were mostly concerned with the value of collateral, paying very little attention to the borrower's ability to repay. This has now changed to a large extent. Many hard money lenders are applying more or less similar credit underwriting standards as the conventional lenders. The only setback for most of the hard money lenders now is lack of prudent underwriting skills. However, the good news is that they can outsource the underwriting role to professional loan underwriters, right here in the United States, at an affordable cost. Remote loan underwriting firms, whose teams consist of highly experienced ex-bankers, are well positioned to provide the most current loan underwriting techniques in the industry.

Here are a few roles that a hard money-lender can outsource to improve delivery times and credit quality:

1. Creating loan package - Application (Fm. 1003), Income, Credit, Asset documents, Policy of Title Insurance and Property Profile Report

2. Gathering and reviewing title information

3. Ordering and reviewing an appraisal

4. Loan underwriting for a private investor

5. Creating final documents and coordinating settlement or closing

Prudent credit underwriting, whether for conventional lending or hard money lending, should follow these simple underwriting guidelines:

1. Know your customer, character and credit history

2. Read the market conditions well

3. Ensure that a borrower has a reasonable stake in the deal

4. Understand borrower's indebtedness and sources of income or losses

5. Obtain adequate and easy - to- sell collateral

6. Test the borrower's ability to repay the loan

7. Impose simple and achievable loan conditions. Be aware of the prevailing environmental and economic conditions.

Franc Jo is a Senior Underwriter at Loans Underwriting LLC, the leading provider of outsourced Credit Underwriting support to lenders and funding solutions consultant to small businesses throughout USA. He may be reached at 3330 Pkwy Suite 324-178 Acworth, GA 30101, Phone 1-800-858-8593, and Website:

Wednesday, December 11, 2013

Easy Financing Through Bridging Loans

As you might have probably thought, bridging loans are a short term funding option. The reason why the name bridging is used is because the loan will be used in merging the gap between a debt coming due. In short, the use of bridging loans or bridging finance as is commonly referred is a way of acquiring financing in a short timeframe and for a pressing matter. In most cases the pressing matter that will necessitate a bridging loan is a mortgage.

Just how does this loan work?

A bridging loan is used to help a person be able to complete a property purchase prior to them selling their existing property. This is common when shifting properties to move to a much larger house or moving to a new location. This is the reason the loan is of invaluable help as without it, a new property purchase would not be possible.

Although the financing that is made through the loan is of much help to the person in need, the loan is somewhat expensive when compared to normal loans as the time that the funding is required is short and of great importance. The bridging financing is said to be quite expensive as the rate of interest the money accrues is quite high.

• Where else could you expect to see the use of bridging loans in high numbers?

• When there are gaps in completion dates of a property

• When buying at an auction without cash at hand or the financing necessary to buy

• When needing to sell a property quickly after renovation.

Following the financial crisis that brought the world economy to its knees, banks are quite reluctant to lend as most of the customers are seen as high risk vendors. To avert this, use of bridging loans is becoming quite poplar as the money is only lent for a very short period and it comes back with quite a handsome interest.

For most lenders that qualify for the normal loans, it is advisable to take these loans as the alternative that is bridge financing is a very expensive affair. Income institutions, a monthly fee of 1.5% per month is charged, making the sum total be 18%, not to mention administration fees.

Among the people who are recommended to make use of the bridge financing include property owners, property developers and a person purchasing a property at an auction which needs proper financing. Some wealthy borrowers who are asset rich and who want to go straight and start lending can also get the financing.

Among the instances where bridging is recommended include: buy to let properties where the income amassed by the property can be used in paying back the high interest. Property investment is also a good way to look at this type of financing. In instances where banks take too long to approve a loan, especially when high amounts are required, bridging loans become the next best available course of action.

In as much as the bandwagon of the people advocating for bridge financing is concerned, it seems to be a fast growing market segment. It is however advisable that prior to signing up for this form of financing, a thorough evaluation of the exit strategy to use is made. Lack of an exit strategy means that you risk foreclosure of the property acquired as you might be unable to meet the monthly repayments of the loan.

Be sure to ask of the different alternative lending options from your financial service provider rather than sign up for the first available financing that is presented to us. If you have never done it, it is advisable to take some time to think through the bridging loans proposal and enquire about the minor details such as the cost of administration fees.

We are associated with a loan providing company of Supreme Finance. They are able to arrange short term property loan to fulfill your urgent need; Here, I penetrative to provide detailed information on bridging loan and benefits that suits your need.

Wednesday, December 4, 2013

How to Keep Informed on Mortgage Rules and Regulation Changes

If there ever was a time when home loans were easy to qualify for, it must not have lasted long. These days, it feels like it is getting harder and harder to receive a home loan. This does not mean it is impossible to get a loan but the bank requires a lot of information from the borrower lately.

Keeping informed on changes to rules and regulations could stop homeowners from missing out on opportunities to lower their monthly payments, receive cash out of their homes and even purchase a larger house. Luckily staying informed is not difficult tasks with the many online publications that will even display on mobile devices like smartphones and tablets.

Finding Websites with Mortgage News and Information
If you want to stay informed, the first thing to do is find a website with the right information for you. Some websites are geared toward the homeowner and some are geared toward the mortgage industry professionals. You also want to make sure it is a mortgage website and not real estate, because a real estate website will speak more about changes to the housing market along with how it affects sales and purchasing. Mortgage rules and regulations are impacted slightly by the housing market but it should not be the main topic of discussion.

The features of a website can also draw you in, whether offering a mobile friendly option or presenting information in a certain way. This can make it easier to find what you want, when you want it. So once you have found a few websites you like, play around with viewing them on different devices and sign up for their newsletters (you can always unsubscribe later). Playing with the websites will give you a better feel for how they can help you even when you are on the go.

Knowing When to Work with a Lender
Although it is always a good idea to speak to a mortgage lender, knowing when to actually move forward could mean the difference between a large savings and a little savings. Mortgage rate trends will shift along with the rules and regulations. By following when the next shift in rates will be or reading about new mortgage programs that become available, along with the rules attached to those programs, you can make a better decision on when to commit to a new loan.

There are situations where loan programs change depending on who they are offered by. Whether a homeowners current loan is offered by the FHA, VA or some other government entity, shifts in regulations could mean shifts in insurance premiums as well as qualifications. This could be both leniency or more stringent lending rules. Being well informed, if a rule were to come into effect, you would know when your deadline would be to change over to a new program possibly with a refinance.

The Future of Mortgage Rules and Regulations
Looking towards the future will always benefit homeowners because mortgage rules and regulations are so well documented. They clearly state when they go into effect and who will be affected by them so homeowners can always plan in advance for upcoming changes or possibly opportunities to save money such as through new programs or refinance options.

Start finding the right option for you when it comes to mortgage news and information. There are many publications that can offer both friendly approaches to information and well as easy to use functionality. It may also be a good idea to follow a few so that you can match the information up between them.

There has never been a better time to stay informed on mortgage rules and regulations. The government is offering programs and incentives to refinance and there are plenty of investment opportunities available as well. Fred Bohman understands that homeowners and home buyers benefit from mortgage news and information so he provides articles to help them prepare.

Sunday, November 24, 2013

What Steps You Have to Follow to Apply for Payday Loans

Maybe you've heard of payday loans but don't know how to go about applying for one, or maybe you've never even heard of a payday loan. This is because short term credits aren't offered in every state. While they are easy to get since there is no credit check, they can be easily abused.

The Payday Loan Process

The reason it is called a "payday" loan is because it is designed to be a short-term loan which must be paid back by your next payday. If you can't pay it back in its entirety by your next pay date, you must at least pay the interest on the loan to avoid having it automatically taken out of your bank account.

This is where it gets tricky. Most people don't realize how high an interest rate of 16% can be. This is the average amount of interest charged by check cashing places. For example, if you take out a loan for $300 and cannot afford to pay it back in full, you must pay the interest of $50 every two weeks. $100 a month is a big extra bill to take on for some people.

This is why you should avoid short term credits unless you know 100% for sure that you can pay it back in two weeks or less.

Who Offers Payday Loans?

You can find places that give payday loans by looking in the yellow pages or Googling 'check cashing'. You will find many places that offer some services similar to a bank; however these businesses are not banks.

Check cashing companies mainly serve to cash checks, as their name implies. Some people with poor credit cannot qualify for a bank account. They pay small fees, deducted from their checks, to get similar services from these places.

Check cashing companies may also offer bill pay, registration renewal, and money orders.

These can be found in any neighborhood across the country. They are popular and retain customers because of the instant nature of the service and convenience they afford those that need cash.

What is needed to apply for Payday Loans?

When you go down to a check cashing place to apply for a loan, you'll need to bring several documents with you. If you are missing just one, you will be sent away. To avoid extra trips, take with you:

* ID card
* Social Security Card
* Checkbook
* Utility bill
* Bank Account Statement
* 2 most recent paystubs

If you have all of these items, you will be given a short application, usually just one page in length. The check cashing company will ask for at least three references, along with your employer's phone number. Make sure you pay the loan back, or they can call any one of these references!

Payday Loan Tips

Don't take out more money than you can afford to pay back. Just because you can get up to a certain amount, doesn't mean you have to take out the full amount.

If you are stuck in a cycle paying interest and can't get out, you can request to pay off your loan in four equal payments. However, this may mean that you cannot borrow again for up to a year.

Look for check cashing companies that offer zero interest on first time short term credits. Only you can decide if you need the money bad enough to pay a high amount of interest. If you have bad credit, this may be your only option for emergency cash, but make sure you know you can pay it back! Short term credits are easy to get, but not always easy to get out of.

I have been writing for many of the best websites offering expertise, and have acted as a rep for an industry leader in payday loans. I am passionate about the financial world and am based in Manchester, England.

Tuesday, November 19, 2013

How to Plan a Family Holiday Without the Headaches
Bring the entire crew together for an adventure abroad or just down the street for an unforgettable holiday experience - it can be a daunting process. Deciding the best plan of action for to make it all run smoothly is certainly a challenge. However, with the proper advice, planning a trip, complete with family holiday insurance and an exciting and fun itinerary, is a simple and satisfying way to enhance the lives of every member, no matter their age.

Gather the 'Troops'

Everyone can participate in the initial planning of a holiday. First, brainstorm the best options for destinations considering time and budget. Think of a few that could work at a stretch and others that might be more reasonable and grade them accordingly. Then choose what type of activities the group as a whole might be interested in: are you more hikers, beach goers or foodies? This can help narrow down the list. Let even young children offer their opinions too; encourage them to look at books to help pick a destination. Older children or teens will love feeling part of the organisational team, especially if they also get input on specific tours, restaurants or hotels booked. While the younger members won't be involved in choosing the best family holiday insurance policy, it's not a bad idea to explain to them its purpose so they get used to the concept.

Prepare For It All

As opposed to the freedom of a solo traveller, keeping a whole family crew in line can be difficult. There are more suitcases, tickets, tears, toilet stops and photo opportunities along the way, all of which need to be handled seamlessly. To streamline things from the very start, take packing seriously and have each member responsible for their own bag, if age appropriate. Keep snacks, minor first aid materials and breathable clothing in every bag, ready to go at a moment's notice. Research your final destination ahead of time to gather facts and work out if any specialise items/clothing etc may be needed. Things like learning a few phrases in the local language, knowing typical weather patterns and any safety precautions are key too. Surprise is half the fun on holiday, but all excitement ends if someone is missing a favourite item, gets injured, or falls ill without the right game plan to help in the situation.

Add Backup

Packing and reading up on your destination are not the only ways to stay ready for anything. Leave contact info with friends or family at home in case any issues should arise. Have extra copies of identification, passports and other useful information (like business cards from your accommodation) in easily accessible places in case anything (or anyone) gets lost. Family holiday insurance can be greatly beneficial in times of emergency and inconvenience on the road - but it's important everyone on the trip understands how to utilise it. Ensure older children know the whereabouts of all important documents.

We provide low cost travel insurance visit: and offer a range of policies including family holiday insurance, annual, multi-trip and single-trip insurance. For all your travel cover needs, Insuremore can help you in the quickest and most cost-efficient way.

Wednesday, November 13, 2013

Do All-Inclusive Holidays Really Save You Money?

How can you give your family a wonderful holiday and save money while you do it? Over recent years, all-inclusive package holidays have become increasingly popular. The attraction has been in the potential savings that can be made from not having to spend additional money on food, drinks and entertainment. The question is; do all-inclusive holidays really save you money?

Initially, all-inclusive holidays were part of the thrill of a long-haul package holiday to places like the Caribbean, Mexico, or the islands of the Indian and Pacific Oceans. Now they are a standard offering from even the most budget holiday destinations. Holidays to Turkey, Spain and Greece are increasingly being offered with all-inclusive options. They are being marketed as the best ways to save money on a family holiday. So, is it a marketing ploy or are there real savings to be made?

An all-inclusive holiday means the inclusion of all food, drinks, entertainment and accommodation. So what you are getting is everything. For a family of four, paying additional costs for several meals a day, drinks, and additional activities can take its toll and add approximately £200 per day to a credit card bill! So an all-inclusive package does appear to be a much cheaper, money saving option. But always read the small print.

All-inclusive very rarely means all you can eat whenever you want to eat it. These package deals usually involve breakfast, some form of lunch and an evening meal at set times during the day. They are usually buffet style meals from set menus of local produce. Eating from an a la carte menu will most likely involve an additional cost. Likewise, free drinks will usually mean a selection of locally sourced drinks, and it will not always include the standard choices of alcoholic and soft drinks you and your family may normally choose like spirits.

Before you book, check the information and feedback about the standard of local cuisine that is provided as part of the package. And remember that it is usually local cuisine so if you and your family have particular tastes or dietary needs they may not be catered for. Also find out what drinks actually are included. Remember, going all-inclusive will only be a saving if you actually don't need to pay for anything else.

This is also true for the free entertainment that is offered. Check what this is. There may be additional charges for kids' clubs, water sports and organised tours. The included entertainment tends to be what is made available within the complex like evening dances or discos, games, cinema rooms and so on.

Many families want to explore and experience their holiday destination. One complaint of all-inclusive holidays is the feeling of being stuck to the same routine every day for two weeks. People like to explore, and visit different restaurants, bars and attractions. If this sounds like your family, maybe buying an all-inclusive holiday may not prove to be as much of a saving as you had hoped.

If however, all you want to do is spend time on the beach and relax within the complex as the kids play in the pool, it may be the perfect way to enjoy the luxury of a two week holiday for a reduced amount of money.

The best advice is to read the terms and conditions of the all-inclusive package carefully. Calculate approximately how much your food, drinks, and entertainment will cost you, and compare the prices with a non-inclusive holiday. You may find that there are many family package holidays at half board that will save you just as much money while giving you and your family the flexibility to enjoy, explore, and fully experience your holiday resort outside of the hotel complex.

The author of this article is a customer service manager at He is also a staff writer for the company.