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So you have finally decided to own your own home! No more throwing money to a landlord, dealing with noisy neighbors tromping above you at all hours of the night, and begging your landlord to fix the fence, again. You can settle in a warm comfy couch, watching the TV with the surround sound system blaring without the old man next door banging on the wall to be quiet.

This home will probably be one of the greatest investments of your life, and you don’t want to lose it to something that is beyond your control. So how do you protect your house and investment? By getting home owner insurance.

This home owner’s insurance should cover the price of the house as well as the mortgage. In response to inflation and appreciation, the home owner insurance should address this annually as the terms change.

The insurance should address disasters. Does it allow you to have temporary housing until the problem can be solved?

It is not uncommon to take inventory of the items in the home so that if something is stolen or destroyed, the insurance company and you will have a good idea as to what the contents of the house are worth. This can save you from getting a smaller amount of money than what you really should have. Generally, the insurance should cover about 50% of the total contents in the house.

Be sure to see what safety objects you may need in order to qualify for home insurance. Perhaps you need to have a certain amount of smoke detectors per square feet or an anti-theft system that will help keep thieves away. Certain safety devices can assist in protecting your home so you don’t have to go through the hassle of going through the insurance company to get the money you need to replace your items. It is always good to know that the insurance is there if Read more…

Insurance is a great way to safeguard your self from the uncertainties in life. Mortgage Payment Protection Insurance is designed to protect you from getting into debt or missing the mortgage payments due to unemployment. If you are living in a country like UK mortgage insurance is extremely important to protect your self from getting into ever increasing debt. In case you are not able to make the mortgage payments on account of various reasons like unemployment due to ill health or old age etc, having the Mortgage Payment Protection Insurance or mortgage insurance really helps.

Earlier, the government used to pay the interest on the mortgage if you were unemployed. In the UK mortgage insurance was recommended by the government to the home owners. For millions of people in UK mortgage insurance is now becoming an essential part of their financial planning.

In UK mortgage insurance was brought into the market as a substitute to government help. The intention is to cover the mortgage payments in case of non-ability of the insured to make the monthly mortgage payments. Just like any other policy, the insurer has to pay a monthly premium depending upon the mortgage amount. In case of unemployment, the mortgage insurance company will make the payments on your behalf. There a many mortgage insurance policies available in the market. Many UK mortgage companies provide you with mortgage insurance. If you want to go for a mortgage insurance of your choice, then you can approach another mortgage insurance broker independently.

Choosing the right mortgage insurance.

There are many mortgage insurance policies available in the market. Choose the one that suits your needs and requirements perfectly. A mortgage insurance policy that covers a wide range of circumstances for accepting claims should ideally be picked. The mortgage insurance companies offer all kinds of covers like life insurance, handicap, ailment and severe illness.

The mortgage insurance policy should be carefully scrutinized. Read the fine print and understand the terms and conditions of the policy properly. There can be various conditions and clauses under which the mortgage insurance company is not Read more…

There are far more players in the Australian mortgage industry than ever before. Consumers no longer have to visit multiple banks and direct lenders personally, spending valuable time trying to sort through all the financial details and make a comparison on their own. Today, the mortgage is filled with competitive players that include non-bank lenders, mortgage managers and mortgage brokers, and most notably, online mortgage sites such as Mortgagemall.com.au that have brought unparalleled convenience and choice to the Australian mortgage consumer. In today’s highly competitive environment, it’s more important than ever for consumers to understand their options. The Internet has become an important tool in achieving that level of understanding, and in gathering and comparing relevant information from multiple providers.

With stable interest rates and affordability throughout the country, the mortgage market will continue to experience strong growth. In addition to a stable economy and job market, population growth, most notably in Queensland, will fuel the mortgage market as more Australians find themselves in a position to enter the housing market as first-time buyers.

According to the Australian Prudential Regulation Authority (APRA) (http://www.apra.gov.au), banks are starting to lose some of their market share to non-bank mortgage providers and brokers. The presence of non-bank lenders and Internet-based intermediaries is good news for the Australian consumer, for two reasons: more choice, and easier research. Besides independent online sites like Mortgage Mall, major mortgage brokers such as AFG (http://www.afgonline.com.au) and Aussie Home Loans (http://www.eaussie.com.au) dominate the mortgage broker field.

While online sites present the easiest starting point, Australian banks are refining their operations to become more accommodating to their customers. Banks like ANZ Bank (http://www.anz.com.au) and the Bank of Queensland Read more…

Many small real estate owners (1-4 unit properties) are confused about the best entity to hold their real estate, with potentially disastrous consequences.

In fact, the majority of small property owners still own their properties in their personal names.

Perhaps they read a book or take a course on asset protection. They become aware of the disastrous consequences that can befall property owners who own property in their personal names.

All it takes is a couple of mouse clicks in the age of the Internet to get a complete listing of every property owned by you in the entire county! You can lose everything you own, not just the real estate, to judgment creditors, lawsuits, liens, the IRS, etc.

It is a proven fact, that those who can be shown to own property are at a far higher risk of being sued than those who do not own property.

Then they have to decide. Should they use a corporation to hold their property, a C corp. or an S corp? How about an LLC or a partnership?

There are serious downsides to using the wrong or inappropriate entity.

? Double taxation on income and gains with a C corp.
? Corporate taxes are levied on property sold by an S corp.
? Ownership and allocation of profits is sharply restricted in an S corp
? The corporation itself (shares) can be seized by creditors along with any real estate it owns
? LLC?s can provide liability protection, but only to business, not personal property
? Neither corporations nor LLC?s provide secrecy of ownership
? The extra cost and complexity of setting up, reporting taxes and maintaining the entity
? Partnerships can expose partner?s assets to unlimited liability

Compounding the problem is the fact that banks will generally not OK the purchase of a 1-4 family property by any entity, even a limited partnership.

There is also a prohibition, the due on sale clause; that allows the bank to foreclose on the mortgage on a property that is transferred from the personal name of the borrower to an entity.

There could also be a problem if the owner wanted to do a 1031, tax-free exchange, if the title was transferred from the original owner.

The solution is for the real estate investor to set up a land trust.

? A land trust provides total secrecy of ownership.
? It provides asset protection.
? It carries no tax implications, it is a pass through entity, meaning that any gains or losses pass through to the owner?s personal tax return.
? Although most banks will not grant a mortgage to a property in a land trust, the due on sale clause cannot be invoked against the transfer of title to a properly constructed land trust.
? It does not impair the ability to do a 1031 tax free exchange
? It eliminates the need for probate upon the owner?s death

What is a land trust? It is simply a revocable contract between two or more parties. It has been in use for centuries.

The first party is the owner of the property; the grantor, in trust speak. He grants, or transfers title to the property to the trustee. He then becomes the Read more…

There is little doubt that we are currently experiencing one of the most heated seller’s markets in recent history. Today’s investment sales market has been reduced to an e-bay like environment where retail brokerage houses simply put an asset up for auction and wait for the buyers to circle like hungry sharks.

Many will point to the increased flow of funds in the commercial capital markets creating a demand-side frenzy that is causing a compression in cap rates and escalating prices to all time highs as justifying current market tactics. However while there is an element of truth surrounding the logic contained in the previous sentence, I believe it is simply easier for many buyers to blame the market and follow the crowd rather than adapt their acquisitions plan. This is evidenced by the fact that many institutional buyers like REIT’s, TIC syndicators or foreign investors seem content to participate in the madness rather than seek alternate investment strategies. The need to place funds seems to be taking precedence over making good investment decisions for many in today’s market.

The real opportunities in today’s market are not found by following the herd mentality but can be found in the application of any of the following strategies:

1. “Off-market” transactions: Seek out assets that are not listed by retail brokerage firms. Hire an investment bank to approach principal owners on a direct basis negotiating with them on assets that are not publicly for sale.

2. Change Market Focus: Focus your acquisition strategies on secondary and tertiary markets where there will be less competition for assets. Additionally stay out of the hot markets and look toward markets recovering from downturns.

3. Change Asset Class Focus: Rather than chasing multifamily and retail properties look for opportunities in office, hospitality and industrial asset classes.

4. Stay Away from Traditional Trophy Assets: If you must buy big look for opportunistic plays that have higher vacancies, lease roll-over Read more…

Despite the negative press that the housing market experienced at the beginning of 2005, there are a number of reports circulating that suggest that figures have shown an increase towards the end of the year. This is of course good news at the end of what some predicted would be quite a difficult year in the housing market.

However, there still remains a high level of activity from Landlords and investors alike with a number of buy to let mortgage providers suggesting record levels of applications being received.

There is of course the question of what will happen in 2006 and the property market. It is never a precise prediction as there can be many influencing factors but what we do know for certain is that over the last few months we have seen interest rates stabilize and property pricing stablising as a result of this. So does that mean we should avoid investing in property until the market starts to increase again. In some respects many people might suggest that investing in property at any time is a good investment. When you consider that historically property has doubled in value, and sometimes tripled in value, every last 10-15 years, then it is likely to see you a good return on your investment if you are prepared to take a long term view. For those looking for a get rich quick overnight scheme, then this is not for you. But when you consider the long term gains, it might be worth reading on and don?t forget that it is worth doing plenty of research and finding out as much as you can about investing in property. Perhaps pick up a Free Buy to Let Guide.

How to make ?166,500 in 15 years

According to research from the Centre for Economics and Business Research (CEBR), the average cost of a home in the UK could be ?300,000 by the year 2020. Currently that figure stands at around ?157,000 in 2005 which represents an increase over the next 15 years of 91%.

This figure of ?300,000 is achieved by the economic forecaster basing its prediction on the ever increasing population compared to a slower production of house building. As with many commodities, it is the result of lower supply and higher demand that will push up these prices.

With buy to let residential investment property, the maximum loan you can apply for is 85%. Based on an average value property in 2005 of ?157,000 this would require you to put down a deposit of 15% ?23,550 subject to valuation and rental cover which can vary between 115% to 130% in most cases.

Potentially over the next 15 years, this one investment could realize a return of ?166,550. This is based on selling the property at ?300,000 less the loan of 85% of the property value in 2005.

Over previous years there have been times when property has declined in value and other times where it has signifcantly increased in value but a good property investor will clearly see the benefits in both a rising and declining market and will utilize the facilities of a good buy to let mortgage provider to assist in this. For example:

During a rising market, a property investor may decide to use this window of opportunity to release some of that equity realized in the value of the property, to use for additional property investment. However, the property investor is less likely to use that capital released during a rising market. Instead, the landlord will wait until the market has re-stablised itself or experiencing a decline. At this point, they will then use this window of opportunity to purchase lower priced property and the circle continues. That is why property investors are in it for the long term and why they see the market as being profitable to them in all conditions. And when you consider that property prices only need to increase by an average of 4.4% year on year, it is easy to see why this type of investment is so achievable.

Successful property investors will do a lot of research on areas that they believe will become property hotspots and areas which are less likely to perform. There are many areas experiencing high levels of growth and financial investment with a lot of regeneration programmes in place or planned in the future. Even by simply monitoring publications such as Construction News can give a good indication of where new commercial premises are being built which can be a good indicator of new businesses moving to the area which it turn can lead to an increase in demand for property locally.

It is the general consensus that interest rates have stablised and there is even speculation of a drop but either way, they have been steady for a good number of months now. Slower capital growth does result in buyers having to put more effort into managing and developing their portfolios. And more importantly making a profit from property. Buying property at discounted prices can be done but you must do your homework to make sure they are genuine discounts and incentives. And don?t forget that in a slowing market, vendors will be more likely to listen to your offers. Albeit if they are a bit cheeky. In particular, you can use the negative press that is often surrounded by the property market to your advantage. For example when the media are circulating stories of a dropping property market, Read more…

You can pump high yielding, tax free profits secured by real estate directly into your IRA!

I don?t care what your banker or stockbroker told you, the IRS says you can.
(http://www.irs.gov/publications/p590/index.html)

You can earn up to 25% on your mortgage loan investment in a couple of months on short term deals. Long term loans can triple your investment while generating a cool, passive income stream over 15 years or more.

You are probably aware that for every $100,000, in mortgage money you borrow you are going to repay nearly $300,000 by the time its paid off in 30 years, right? Wouldn?t it be nice to receive returns like that, instead of paying them?

You can!

The risks are extremely low on this type of investment. Banks will loan over 100% of the purchase price if the loan is secured by 1-4 family residential real estate. How much will they loan you on your stocks? H?mmm!

The collateral is a family?s home, the default rate is less than 1% and it is the most in-demand type of real estate there is.

If the homeowner stops paying, you take the property and sell it to recover your money.

Generally, there are two types of loans you would make, short term and long term.

Short term loans carry a higher risk as they are usually made to real estate investors, who buy, fix up and resell houses. They borrow the money to buy a property all cash to get the best possible price.

They would then either fix it up and sell it or just sell it if it were in good enough shape.

These loans are generally for a year or less and pay interest rates as high as 12% or more!

Your loan amount on this type of deal would usually be from $25,000-$250,000.

The long term, purchase money mortgages made to homeowners, would have smaller returns, just below the rates the banks are charging, because of the relative safety of the loan. Read more…

If you want to make the most of your personal or investment real estate, you should consider a negative amortization loan. Mortgage amortization is basically mortgage balance reduction. Consequently, when a mortgage has negative amortization, the loan balance not only is not reduced, it actually grows. So, why should you consider this? Simple. It is a great way to invest money from real estate someplace else.

This is a very aggressive and fairly unknown approach to real estate investment. In fact, it is a method of investing that does not have to involve real estate, in usual way we consider real estate investing. In other words, a negative amortization loan can give you money to invest in areas other than real estate, and this is how many people use this type of loan.

Let?s assume your mortgage has a conventional loan that calls for a monthly payment of $800. If you refinance to a negative amortization loan, your payment may go down to $400 or less, Read more…

One of the keys to maintaining the middle class in America is homeownership. In fact, the government takes an active role in promoting one hears or reads about, the government usually does this in a passive wownership through incentives.

The government is famous for influencing the behavior of all of us. Despite the draconian conspiracy theoriesay. Specifically, it uses financial incentives or penalties to nudge us into certain actions. In the case of homeownership, the government offers a ton of information and incentives to try to get us to invest in our dream home or at least start the process of getting there by buying a first house. In fact, there are a number of government websites that provide all the information you could want.

The U.S. Department of Housing and Urban Development is one of the key agencies dealing with homeownership. The department, better known as HUD, maintains a website listing the various programs it has, benefits and requirements of the same, and HUD homes that have been foreclosed on and are now for sale. You can visit the site by simply doing a search for HUD.

In the case of HUD, it is important to understand the agency does not actually write mortgage loans. Instead, it guarantees loans if you meet certain parameters. Essentially, this is like having a really rich uncle cosign your loan, something banks love. In fact, down payments on HUD loans can very low given the fact the government is backing them.

If you have served in the armed forces Read more…

As a homeowner, you may be able to borrow against the equity in your home.
The equity is the difference between the property?s market value and the
outstanding loan balance. These types of loans have become increasingly popular
because they can be used for almost anything. Common uses include debt
consolidation (paying off high-interest credit card debt), home improvements,
purchasing or refinancing a home, and paying for education expenses like college
tuition.

The primary advantages of a home equity loan are a lower interest rate and
potential tax deductions. The interest rate you will pay on a home equity loan
is generally lower than the interest rate you will pay on the average credit
card or any other type of non-secured debt. Also, you can generally deduct the
interest you pay. The interest you pay on credit cards and other types of
personal loans is typically not tax-deductible.

Home equity loans usually come in two forms: a second mortgage and a home equity
line of credit. Here are better definitions of the two:

A Second Mortgage, like a first mortgage, is a loan that uses your house as a
guarantee that you will make your payments. The loan is a form of credit for
which your home is pledged as collateral. Read more…