Understanding Different Types of Loans
Today's
homebuyer has more financing options than have ever been available
before. From traditional mortgages to adjustable-rate and hybrid loans,
there are financing packages designed to meet the needs of virtually
anyone.
While
the different choices may seem overwhelming at first, the overall goal
is really quite simple: you want to find a loan that fits both your
current financial situation and your future plans. Though this article
discusses some of the more common loan types, you should spend time
talking with different lenders before deciding on the right loan for
your situation.
General categories of loans
Most loans fall into three major categories: fixed-rate, adjustable-rate, and hybrid loans that combine features of both.
- Fixed-rate mortgages
As
the name implies, a fixed-rate mortgage carries the same interest rate
for the life of the loan. Traditionally, fixed-rate mortgages have been
the most popular choice among homeowners, because the fixed monthly
payment is easy to plan and budget for, and can help protect against
inflation. Fixed-rate mortgages are most common in 30-year and 15-year
terms, but recently more lenders have begun offering 20-year and
40-year loans.
- Adjustable-rate mortgages (ARM)
Adjustable-rate
mortgages differ from fixed-rate mortgages in that the interest rate
and monthly payment can change over the life of the loan. This is
because the interest rate for an ARM is tied to an index (such as
Treasury Securities) that may rise or fall over time. In order to
protect against dramatic increases in the rate, ARM loans usually have
caps that limit the rate from rising above a certain amount between
adjustments (i.e. no more than 2 percent a year), as well as a ceiling
on how much the rate can go up during the life of the loan (i.e. no
more than 6 percent). With these protections and low introductory
rates, ARM loans have become the most widely accepted alternative to
fixed-rate mortgages.
- Hybrid loans
Hybrid
loans combine features of both fixed-rate and adjustable-rate
mortgages. Typically, a hybrid loan may start with a fixed-rate for a
certain length of time, and then later convert to an adjustable-rate
mortgage. However, be sure to check with your lender and find out how
much the rate may increase after the conversion, as some hybrid loans
do not have interest rate caps for the first adjustment period.
Other
hybrid loans may start with a fixed interest rate for several years,
and then later change to another (usually higher) fixed interest rate
for the remainder of the loan term. Lenders frequently charge a lower
introductory interest rate for hybrid loans vs. a traditional
fixed-rate mortgage, which makes hybrid loans attractive to homeowners
who desire the stability of a fixed-rate, but only plan to stay in
their properties for a short time.
Balloon payments
A
balloon payment refers to a loan that has a large, final payment due at
the end of the loan. For example, there are currently fixed-rate loans
which allow homeowners to make payments based on a 30-year loan, even
though the entire balance of the loan may be due (the balloon payment)
after 7 years. As with some hybrid loans, balloon loans may be
attractive to homeowners who do not plan to stay in their house more
than a short period of time.
Time as a factor in your loan choice
As
has been discussed, the length of time you plan to own a property may
have a strong influence on the type of loan you choose. For example, if
you plan to stay in a home for 10 years or longer, a traditional
fixed-rate mortgage may be your best bet. But if you plan on owning a
home for a very short period (5 years or less), then the low
introductory rate of an adjustable-rate mortgage may make the most
financial sense. In general, ARMs have the lowest introductory interest
rates, followed by hybrid loans, and then traditional fixed-rate
mortgages.
FHA and VA loans
U.S.
government loan programs such as those of the Federal Housing Authority
(FHA) and Department of Veterans Affairs (VA) are designed to promote
home ownership for people who might not otherwise be able to qualify
for a conventional loan. Both FHA and VA loans have lower qualifying
ratios than conventional loans, and often require smaller or no down
payments.
Bear
in mind, however, that FHA and VA loans are not issued by the
government; rather, the loans are made by private lenders. FHA loans
are insured to the actual lender and VA loans are guaranteed in case
the borrower defaults. Remember too, that while any U.S. citizen may
apply for a FHA loan, VA loans are only available to veterans or their
spouses and certain government employees.
Conventional loans
A
conventional loan is simply a loan offered by a traditional private
lender. They may be fixed-rate, adjustable, hybrid or other types.
While conventional loans may be harder to qualify for than
government-backed loans, they often require less paperwork and
typically do not have a maximum allowable amount.
Fractional Ownership
provides you with unparalleled benefits of owning a vacation home in
your favorite location, but without the burden and cost of repairs and
upkeep. Wouldn't you love to have the services and amenities of a
luxury villa without living out of your suit case? You're not alone.
This new breed of vacation home ownership, called "fractional
ownership," is becoming increasingly popular as individuals and
families look to maximize their family vacation time. Finally, you
have the ability to have the vacation home ownership you have always
dreamed of for a fraction of the cost.
Fractional Ownership
is a Management System around which one's entire leisure lifestyle
revolves. Unlike timeshare, which is truly a vacation product, the
pre-purchasing of a week or two of vacation, Fractional Ownership
is the centerpiece of a leisure lifestyle portfolio. It is an asset and
part of one's estate, when purchased as deeded real estate, and while
timeshare is also mostly sold as such, the two products are used very
differently.
The second home
Fractional buyer has a close relationship with their home's location.
They return to that location periodically throughout the year for
anywhere from three or four weeks to as many as twelve or thirteen, or
maybe a month at a time. It serves not only as a vacation destination,
but also as an escape weekend, a mid week hideaway, a gift to a friend
or relative, a location for a business retreat, a family reunion, or
any of a number of uses that one would make of a second home that is
available periodically throughout the year.
Another important benefit of Fractional Ownership
is that it is worry and hassle free. All properties are managed and
maintained by respected third party companies when residents aren't
there. Even if one could afford two, three or more vacation homes, the
upkeep and preventive maintenance would be daunting. Even managing a
single vacation residence steals time from more enjoyable pursuits.
Upon arrival at a Fractional vacation home, everything is setup
pre-arrival and the vacation can begin.
Many
Fractional Ownership enterprises operate a voluntary rental management
program, returning some amount of revenue to the second homeowner,
which is a much less important consideration, but, never-the-less worth
mentioning.
For more information about Fractional Ownership and your desired location, contact Bold Real Estate Group today.
Home Buying Negotiating
Tips
When it comes to buying a home,
the ability and willingness to negotiate is a must for both the buyer and
seller. In general, sellers ask for more than they are actually
willing to accept and buyers offer less than they are willing to pay.
The trick is to find the perfect balance so that you, as a buyer, feel
good about the purchase price without leaving the seller feeling
insulted.
Know Your Market
Real estate is a business
that either favors the buyer or seller, hence the terms buyer's market and
seller's market. When negotiating a purchase price, it's important
to know which of the two you are in. As the buyer, you will have
the best chance at a successful negotiation if you research the price of other
comparable homes in the area before making an offer.
Make It Personal
When you make an offer,
the seller will see nothing more than a piece of paper with some numbers on it
that represent the price you are willing to pay. If you really
want the seller to take your offer to heart, let them know why you want to buy
the home. You can do this by preparing a handwritten letter
expressing your interest and the reasons you fell in love with their
house. If you have a family, tell them about everyone who will be
living in the home. Let them get to know you and allow them to
picture the happiness that you can bring to their house. Believe
it or not, some sellers actually look at the process like finding a good home
for a lost puppy. They want quality people to buy their home, so
do your best to show them that you are sincere.
Nobody Likes
Rejection
Not every offer is
accepted, so don't be disheartened if your first offer isn't a winner.
In some cases, the seller will make a counteroffer for your
consideration. Have you ever heard the old saying, “never take the
first offer?” The same is true in real estate, and almost every
seller knows it. Your first offer is likely to be less than you
are actually willing to pay, which leaves you some bargaining room.
Why Your Offer May Not
Be Accepted
There are a number of
reasons why a seller may choose to reject an offer, including a feeling that the
offer was just too low, the house is newly listed on the market or another offer
may be higher than the one you created. In some cases, sellers may
also reject an offer that includes owner financing or other requests that are
impossible to meet. One example may be an offer that requires the
house be available within a certain amount of time. Most contracts
require that the seller move out within 30 days, but anything less would require
negotiation.
Read The Fine
Print
Before you sign anything
relating to a real estate transaction, make sure that you read over every detail
of the agreement. If you have any questions, ask a REALTOR®. After all, real
estate is their business and they are there to help you through every step.
Bold Real Estate Group is well
prepared to assist you in reaching your real estate objectives. If you are
ready to buy or rent, you can contact us at 772-224-1634 or by email at
floridagreathomes@comcast.net You may also visit our company Web
site at www.BoldRealEstateGroup.com for additional
information on all the real estate services we offer.
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Are you a
practicing Physician, Fellow Resident or Medical Student wishing to relocate to
Florida?
Bold
Real Estate Group knows that moving the Physician and family from one city
to another is always challenging. The demands of a Physician relocating could be
especially stressful. Bold Real Estate Group
assists staff Physicians, fellow residents, medical students and their families
through all the stages of relocating at no cost to the relocating
Physician.
Unlike
traditional real estate offices, Bold Real Estate Group is a
“concierge style” relocation service that caters specifically to Physicians and
their unique lifestyle needs at no cost to the Recruiting Company.
Bold Real Estate Group operates under the
leadership of President, Carlos J.
Gil and Vice President, Millie
Gil who have relocated many Physicians across the country. Our
nationwide network of professionals and firsthand knowledge, allow Bold Real Estate Group to provide the Physician with ease of
process and peace of mind through every phase of the relocation.
The
Physician is referred to Bold Real Estate Group by our network
of Physician Recruiters. We provide assistance with local area
orientation, home rental or purchase assistance, commercial property and loan
options, second home or investment opportunity. We provide
specialize lenders to customize a mortgage package tailored for Physicians.
Through our real estate network of certified team of agents Bold
Real Estate Group also provides assistance with marketing your current
residence worldwide.
Our Services:
"Relocations occur for business reasons, but more and
more often, they succeed because of a combination of family needs that are
met” |
If you are thinking of putting up a business, the first thing that you
should consider is the location. Location plays a vital role in making
your business a success, it will be very important to look for a place
that will give you the best market of your business.
If you are located in Florida, you should look on that Florida
commercial real estate that has a lot of people that can give you a lot
of prospected client or market of your business. You should also think
of a business that will provide the needs of the people. A good example
is starting up a grocery store or supermarket, you should look for the
best place in Florida in able to gain success on these kinds of
business.
The first thing that you need to consider in looking for a Florida
commercial real estate is the accessibility of the establishment.
Observe and see how the flow of people who passes the area, make sure
that it is accessible and must be easy to found so your market can
easily have an access on your establishment. In Florida, many people
from different places usually visit the state, knowing the fact that
Florida is known to its beautiful beach and tourist destination. It
offers a lot of opportunity that is why many people visit the state
every year.
In choosing a Florida commercial real estate, consider the size of the
commercial property and make sure that it will fit the size you need
for your business. it must also visible to the people, look for those
commercial property that can be easily seen by people who passes by the
area. You also need to consider the commercial space itself. If you are
looking for a commercial property, you need to check if all the
facilities are all in a good working condition. Check electricity and
water supply and see if there are parts that need to be repaired.
Florida commercial real estate
is one of the best place to start a business, taking in consideration
the area you need for your business is very important to gain success
in any business venture you are planning in the future.
Allison Ayson
Florida Commercial Real Estate
About the Author
Allison Ayson writes for Jump2top.com - SEO Company
Ways to Hold Title to Real Property in Florida
When a buyer is purchasing a home in Florida there are numerous matters
to consider prior to closing. One extremely important matter which is
often not given enough consideration is determining how to take title
to the property the buyer is purchasing. Factors such as asset
protection, taxation and estate planning needs must be considered in
determining the best way to take title to the property. Various ways in
which a buyer of a Florida home may take title to property are
described below.
Single ownership:
Title to real property can be taken in a person's own name, which is
generally referred to as sole ownership. Unmarried persons, legally
divorced persons, and married persons who wish to hold the property in
their own names may use this form of ownership. However, if a married
person will be taking title in his or her own name, at the time he or
she resells the property his or her spouse will have to relinquish his
or her rights in the property due to Florida's homestead laws. A person
can also take title to the property in the name of a living trust which
is commonly known as a revocable inter vivos trust.
Joint ownership:
If a person is purchasing the Florida property with other persons, they
can take title to the property as Tenants in Common. As Tenants in
Common each joint owner of the property has the right to sell, lease or
bequeath their interest in the property to his or her legal heirs. In
Tenancy in Common, any number of individuals can hold title to their
respective share of the property, depending on their contributions.
A person purchasing the Florida property with other persons can also
take title to the property as Joint Tenants with the right of
survivorship. Under Joint Tenancy all joint tenants have equal
possession rights to their respective share in the property. In
addition, due to the right of survivorship which is not present in
Tenancies in Common, when a joint tenant dies, by operation of law his
or her share is automatically distributed among the remaining joint
tenants. There are no restrictions on the number of persons that can be
joint tenants under a Joint Tenancy.
Similar to Joint Tenancies is the Tenancy by the Entirety which is for
married couples who wish to hold a joint title in the name of both
spouse. Under a Tenancy by the Entirety the property is equally held in
the name of both the husband and wife. This title is applicable and
available for married couples only. Both the husband and wife have
equal possession rights to the property and similar to a Joint Tenancy,
when one spouse dies, his or her share is automatically distributed to
the surviving spouse.
Other forms of ownership:
Title to Florida property may also be held in the name of a separate
legal entity organized under Florida state law such as a corporation or
a limited liability company. Corporations and limited liability
companies can have any number of shareholders or members, respectively,
but the rights to the property of individual shareholders or members
will be limited to the face value of shares or membership interests
held by them. Additionally, title to the Florida property may be held
in the name of a partnership of two or more persons. If the title is
taken in the name of a partnership it will be held in the name of the
partnership, with the partners having equal right to possession of
their respective share in the property. Finally, the title may also be
held in the name of a Florida Land Trust, in which the legal title of
the property is transferred to a trustee for the benefit of the named
beneficiaries. Some people prefer to take title in the name of a
Florida Land Trust because it offers privacy with no one knowing the
name of the beneficial owner of the property or the amount of the
purchase price paid for the property.
The information in this article is of a general nature only and is not
intended to be relied upon as, nor a substitute for, specific
professional advice. No responsibility for the loss occasioned to any
purpose acting on or refraining from action as a result of any material
in this publication can be accepted.
The hiring of a lawyer is an important decision that should not be
based solely on advertisements. Before you decide, ask us to send you
free written information about our qualifications and experience.
Matt E. Bales, Jr., Esq., MBA is a shareholder in the law firm of Bales
& Bales, P.A. located in Coral Gables, Florida. Matt focuses his
practice in the areas of residential and commercial real estate,
property management, banking & finance, corporate, and general
civil, commercial and complex litigation in state courts.
About the Author
Matt
E. Bales, Jr., Esq., MBA is a shareholder in the law firm of Bales
& Bales, P.A. located in Coral Gables, Florida. Matt focuses his
practice in the areas of residential and commercial real estate,
property management, banking & finance, corporate, and general
civil, commercial and complex litigation in state courts.
People who are engaged in the Real Estate market must know
about the Mortgage loans and rates. If you have not heard about this
term then let me tell you that it is just like a loan on a property or
a house. You have to pay back this loan within a specified time period.
Such loans are usually secured by a Real Estate property and you must
also have all the essential documents while taking a mortgage. A
mortgage is not a debt in itself but it is just like a lender's
security for the debt.
People usually take these mortgage loans while they are purchasing
houses or properties for them selves. There are various different types
of loans that you can take according to your requirements. In this
article I would mainly like to tell you about some essential facts that
you must know about mortgage rates.
1. Mortgage loans and the Originator
A personal who lends you loans on a property is known as the
originator. An originator may be a bank, a person, a company, a
financial institution or a credit union. Once your loan has been funded
you can use it to buy property or house in the Real Estate market. The
Originator earns money through interests that are paid to them on a
regular basis.
2. Mortgage loans Vs ordinary loans
You must know that mortgage loans are very different from the ordinary
loans. These loans are usually given to the borrowers only for a
specified time period which is always less then ten years. You will see
that the mortgage loans are usually negotiated for a single interest
rate that remains stable for the entire loan period.
3. Amortization Period
The period for which you have taken a mortgage loan is usually termed
as the 'amortization' period. This period is usually used to indicate
the amount of time you would require to pay off your loans. Usually the
amortization period is very long and in some cases it can also extend
up to thirty years. If your amortization period is of short term then
it can be very beneficial for you as you have to pay less interest.
4. Debtors
A debtor is usually a person or an institution that takes the mortgage
loan from the originator or the creditor. If you want to take a
mortgage loan then it is very essential for you to full fill all the
conditions that are imposed by the creditors.
So, while taking a Mortgage loan you must always keep these essential facts and conditions in mind.
About the Author
If you are looking for California Mortgage loans then visit us and get more information about Mortgage Rates here.
Palm City Farms, Palm City
-
Announcing a price reduction
on a 3,488 sq. ft., 3 bath, 3 bdrm single story. Now
$789,900
- PALM CITY NEW CONSTRUCTION.
Property information
A lease option basically means you are leasing or renting a property with
an option to buy it at a future date. The future price of the property should be
fixed at the time the lease-option is signed.
Usually there is
an up-front payment of some amount to purchase the option. That amount can vary.
Sometimes the monthly payment is larger than normal and the excess is used to
purchase the option. In some cases, the option money can be applied toward the
down payment for the later purchase of the home.
Lease-options are
usually done during a slow real estate market. During a hot market, the seller
can simply sell the home in the regular manner.
Benefits for sellers?
- They often get to
sell the house at a higher price than they could sell it in a normal
transaction.
- They can sell the
house during a slow market.
- By being able to
collect a larger monthly payment than they could obtain in a normal lease, the
property "cash-flows" and they don't have to come up with money out of their own
pocket each month to make the mortgage payment.
- They get some
up-front option money and when the buyer cannot exercise the option, they get to
keep it.
Risks for buyers?
Individuals who attempt to buy homes on a lease-option rarely end up
buying the home. This often has to do with the reason they try to buy on a
lease-option. They usually cannot qualify for a home loan and expect that they
will be able to qualify after a period of time. Later, they find they still
cannot qualify - whether it is because of poor credit, lack of income
(documentable income), or lack of savings to have a large enough down payment.
If this happens, you lose any option money you might have paid up front or as
part of your monthly payment.
Bold Real Estate
Group has an extensive rental
department. We offer properties of different price ranges, lifestyle golf
communities, 55+ active communities, including the white sandy beaches of
Hutchinson Island, Jensen Beach, Vero Beach and beautiful Palm Beach areas.
Our rental team acts as a liaison between the landlord and the tenant
providing extensive services including but not limited to finding tenants,
properly screening tenants, negotiating leases, etc.
Whether you are
relocating and in need of a short, seasonal, daily or annual rental property or
looking to rent out your investment property please complete form below to
contact Bold Real Estate
Group for your free
consultation.
$8,000 tax credit for first-time home buyers. This popular and valuable tax credit
of up to 10% of the purchase price or up to $8,000 was extended into 2010
(purchase agreements must be signed by April 30, 2010, and closings must be
final by June 30, 2010). The new program was also expanded to include a tax
credit of up to $6,500 (or up to 10% of the purchase price) for qualified buyers
of a second or "replacement" home under the same deadlines. To qualify, home
purchasers must have owned and occupied a primary residence for five consecutive
years during the last eight years. Most importantly, the new program
significantly increases previous income requirements.
There are other important guidelines to meet in order to qualify, so be
sure to discuss your situation with a tax professional. Don't forget, you
can still buy a home before April 30th and qualify – even you've already filed
your 2009 taxes – For more information please contact us 772-905-8173 or visit
www.BoldRealEstateGroup.com or send us an email at communityinfo@comcast.net
Hutchinson Island, Florida -
Announcing a price reduction
on oceanfront Condominium 3,262 sq. ft., 4 bath, 3 bdrm 4-level split. Now
$750,000
- Hutchinson Island Condo.
Property information
Cascades at St Lucie West
-
Announcing a price reduction
on a 1,257 sq. ft home, 2 bath, 2 bdrm single story. Now
$130,000
- Port St Lucie Home.
Property information
Castle Pines, PGA Village at St Lucie West
-
Announcing a price reduction
on 8235 Mulligan Circle, a 2 bath, 2 bdrm fully furnished condominium. Now
$119,900
- PGA Golf Villa Reduced!.
Property information
Palm City Farms, Palm City
-
Announcing new home price reduction a 4,130 sq. ft., 4 bath, 4 bdrm single story. Now
$879,900
- Palm City Estate Home.
Property information