Tuesday, February 21, 2006

Are You Really Ready to Buy a Home? by Bob Gatchel

To most people, the home buying process can seem like a complicated and confusing process Even though it seems like a daunting task can be made much easier if you take things step-by-step, you will soon be holding the keys to your own home! But before going into the process of buying that home, you really need to honestly ask yourself if you are honestly ready to buy a home in the first place! Think about this.

Do you enjoy or even prefer moving into different places or areas of the country? Do you prefer to use your money for things like vacations, appliances, retirement or having your own business? Do you dislike doing typical household maintenance, repair and handyman work around the home?

If you answered yes to these questions, you may not be ready to delve into the home buying experience. You may think you have a lot of good reasons for buying a home. but it's very important that you should also consider your reasons for not wanting to become a homeowner!

Remember that buying a home isn't just the biggest financial decision you'll probably ever make but it can also be the most nerve wracking emotional choice in your life! So be prepared to make wise decisions and be willing to logically and unemotionally think out the entire process before you buy. Basically, look before you leap!

In today's hot real estate market, buying a home always seems to be a great idea, but it's important to completely understand that homeownership also comes with a great deal of responsibility too! Of course, being a homeowner is something to be proud of, but it also means having to invest heart earned money, time, energy and financial resources. So you have to really be sure this is right for you.

Typically the first thing that comes to mind when we dream of homeownership, are the wonderful things that are connected to it, which are great reasons for buying a home. Here are some of the tremendous advantages for buying a home:

Yes, it's really nice to think about the positive aspects of owning a home, it is also a crucial part to consider the downsides as well. Here are some of the disadvantages on home buying.

Financial Stress

Probably the most common feeling in the home buying process. Coming up with the down payment, meeting regular mortgage payments and other ongoing costs will tie up a lot of your cash, and can put considerable stress on your finances. So it's very important that you carefully manage your budget and finances to make sure that you can meet all of your obligations. Many new homeowners get a shock in their first year of owning a home. Proper planning and preparation can help you avoid this.

Maintenance Costs

Unlike renting where a landlord may take care of the maintenance, when you're a homeowner you are solely responsible for keeping your home in good working order. Keeping a home operational and looking good requires time and money. Once again, it's important that new homeowners carefully monitor their finances and also carefully keep an eye on small maintenance issues and work on them before they become huge repairs.

Higher Monthly Payments:

It's entirely possible that you will pay more each month for your home payment that you ever did as a renter. You not only have to pay the mortgage, you pay taxes, you pay utilities, you pay expenses, you pay for maintenance, everything. And when you add that up it can be shocking at how much that can be. Yes, in today's tax code there are benefits that come from homeownership that can defer some of that expense, but you still have to pay it first!

Still think you want to buy a home? GOOD! If you feel that now is the time and homeownership is right for you, you need to make sure that you are truly financially ready to do so.

To avoid any future surprises, you can do some financial planning to see where you stand, including: calculating your net worth, determining your current monthly expenses and your current monthly debt payments.

Gathering this detailed information and knowing things like your net worth is important because you'll need this information when you discuss financing with your mortgage lender. Going through this exercise will give you a snapshot of where you stand financially and show you how much you can afford to invest as your down payment on the home purchase. You do not want to rush this process since finding the best type of financing for your particular situation will determine how much you will be paying every month.

Also be sure to work with a trustworthy and professional real estate professional. In today's market there are real estate agents and Realtors that work specifically in representing buyers. These professionals will help you in everything from finding the right home for you, to helping you understand the contracts and paperwork, to negotiating the deal for you, and representing your interests in the buying process. They can even help direct you to good financing sources and be a "one stop shop" to help you in every step of the way to find your home and get you in it with the least amount of stress.

After you've found your dream home, and contracts have been accepted and your financing is in place you're ready for closing day when you finally settle the transaction and become the proud, legal owner of a home that you can call your own.

Although this is a GREAT day, it's also very confusing and full of papers flying around and being signed. Your closing attorney or title company will handle all of the details of the closing including making sure the money is in place from your mortgage company, make sure that tax bills are paid, any outstanding debts resolved, takes care of the seller's paperwork. Bottom line, they make sure that all the T's are crossed and I's are dotted so that when you leave you'll have a deed which calls YOU the owner of that property!

When all the dust settles, you'll be handed the keys and you'll be able to walk into a home that you can call your own! Enjoy the moment and congratulations on becoming a homeowner!

About the Author
Bob Gatchel is a noted real estate investment consultant and Realtor in the Delaware / Maryland regional area. He provides a wide range of programs to help home sellers, home buyers & real estate investors. To learn more about his services & free reports plus learn about his exclusive 10 Step VIP Home Seller Program, visit http://www.BobGatchel.com. This article can be freely reproduced if this resource box & active link to authors's site are intact.

Take Out a Home Loan and Get Rid of Your Rented House by Vipul Jain

Housing is one of the basic human needs. Everyone needs a house to get protection from the nature and the outside world. You can either live in a rented house or your own house. There are far too many problems in a rented house. There always arise conflicts between landlords and tenants. Your landlord may ask you to pack your bags and leave the house. You will have to search for a new rented house in such a situation. The monthly rentals that you pay go down the drain because you do not own the house even after living in it for a very long time.

You can get rid of all these problems if you buy your own house. It has been estimated that 70% of Britons own their own house. According to a survey, more than half of young Britons wish to own a house when they are 25 to 30 years old. Buying a house requires a huge cash outflow. You cannot pay a lump sum amount to buy a house unless you work for a number of years and save for it. A better option is to take out a home loan.

There are many lenders who grant 100% the house price so that you do not have to pay anything from your pocket. You will be required to repay the loan in the form of affordable monthly installments. The loan repayment is spread over a long period so that the amount of monthly installments becomes small. A home loan is secured against the house that you are buying. If you fail to repay the loan, the lender will have the option to repossess the house. The amount of money that you will have repaid will be forfeited by the lender.

A second home can also be bought using a home loan. You can take out a second home loan against the second home or your primary residence. Buying a house on a home loan is a good investment opportunity. The appreciation in the value of your house is much more than the interest that you pay on a home loan.

For more information please visit:http://www.adverse-credit-home-loans.co.uk

About the Author
The author is a business writer specializing in finance and credit products and has written authoritative articles on the finance industry. He has done his masters in Business Administration and is currently assisting adverse-credit-home-loans as a finance specialist.

Deciding Whether to Invest in Rental Property by John Mussi

Finding the right place to invest your money can be difficult... there are so many investment opportunities that create a great return and generate a large profit, but there are even more that end up with very little if any return and minimal profits or possibly even losses. For the careful investor, real estate can generate a much larger return than some other investments, especially if the property purchased is used as a rental property.

Not everyone is cut out to be a landlord, however, and care must be taken to make sure that you're not getting into something that will only lead to problems down the road.

To help you to make the decision as to whether or not you should purchase rental property, here are some of the pros and cons of buying property for rental purposes.

Advantages of Owning Rental Property

Rental property can be a great way to make money, especially if the property is well taken care of and lies in a good location. If the property is low-maintenance, then the majority of the money that is paid in rent will likely be a profit for you the profit being determined after all property taxes and other costs are paid. As long as the rental property is occupied, you should continue bringing in money... and if the location of the rental property was well chosen and is in a popular area, then you shouldn't have very much trouble keeping the property occupied.

Depending upon where the property is located and the individuals that you rent the property to, you may also be eligible for government programs or tax deductions for opening your rental housing to low-income or special needs families.

Should your rental property begin to perform below your expectations in regards to rent, you also will still have the option to sell the property just as you would any other real estate though there may be some legal restrictions if the property is occupied at the time.

Disadvantages of Owning Rental Property Just as there are several advantages to owning rental property, there are also several disadvantages that you should be aware of. Since you are the owner of the property, you are responsible for all taxes and costs associated with owning the property... and these are due whether you've made a profit from the property or not. You are also responsible for maintaining the property in a livable condition, and some of the repairs that may arise in meeting this responsibility (such as repairs to electrical systems or cleaning up of health issues) can be quite costly.

Additionally, the income potential of rental property is based on the assumption that the tenants will pay their rent on time... some tenants are constantly late with their payments, or may decide to withhold payment altogether and force you to evict them.

Landlord/tenant conflicts can sometimes even become legal matters that can become bogged down in court and cost more than the issue that started the conflict in the first place.

Of course, not all tenants will be bad... nor will all of them be good. The advantages and disadvantages listed above are intended to show you the potential for both good and bad experiences that exist when investing in rental property. Consider both carefully so as to better make your decision and to help choose your investments wisely.

You may freely reprint this article provided the following author's biography (including the live URL link) remains intact:

About the Author
John Mussi is the founder of Direct Online Loans who help homeowners find the best available loans via the www.directonlineloans.co.uk website.

Buying vs renting property - which is better? by itrealtor

Buying vs renting property - which is better? Looking for property in Singapore? Still deep in thoughts about whether buying or renting is the better option? Here are some points that you could consider in your decision-making process. Hopefully, it will help you will to select the option that is suitable to your needs.

Do you have sufficient initial capital?

When you make a property purchase, your initial capital outlay is 10% (out of which 5% can be from your CPF and the remaining 5% is to be in cash). For renting purposes, you would typically be looking at somewhere between 1 to 3 months rental value for the security deposit (depending on lease terms and the landlord's requirements).

Tax and depreciation shelter

Property buyers enjoy tax and depreciation shelter whereas tenants do not. If a loan was taken up for the purchase, the interest component (being an expense item) reduces the taxable income.

Looking at it from an investment point of view

It has been well documented that there is strong correlation between real estate growth and the country's economy. If the GDP is expected to rise significantly in the mid to long term, it would be quite likely that home prices follow suit and this will give home buyers potential on getting good returns for their investments whereas tenants do not enjoy any returns on the rental paid out.

Using real estate as a inflation-hedging tool

Real estate has often been used as a hedge against inflation - the effects are transferred onto the tenants through rental increments. Inflation will work against the tenants when the market rises, landlords will increase rents during lease renewals and this becomes additional cost to the tenants.

About the Author
www.itrealtor.com is a Singapore property portal for real estate agents and home owners to post property listings for sale or rent in Singapore.

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