Protect Your Deposit When Buying Real Estate
June 28, 2010
When you start the process of buying a home or any type of real estate, you’ll no doubt hear the term “earnest money deposit” (EMD). So what exactly is an EMD?
An EMD becomes relevant when you are ready to make an offer on a property. In most states, your Real Estate Agent prepares the offer on your behalf. The offer usually takes the form of a written contract that is submitted to the seller by way of their agent.
In addition to the offer document, sellers typically expect an EMD. An EMD is a monetary deposit submitted via check to demonstrate to the seller that you are a serious buyer. In some regions of the country, only a photocopy of the check is submitted with the offer, and the original check is delivered to the appropriate entity if the offer is accepted. Ask your Real Estate Agent to clarify how deposits are handled in your region of the country.
The check is usually made out to an independent third- party such as a Title Company, Escrow Company, Real Estate Attorney or your Real Estate Broker. Ask your Real Estate Agent to clarify who will hold the EMD.
The amount of the EMD sellers expect varies by region. The EMD amount is based on the customs and practices for a region, but is generally from 1% to 2% of the purchase price. In a competitive market place where demand exceeds the supply of homes, some buyers may offer a higher EMD than expected to impress the seller of their intent. In determining the amount of your EMD, consult your Real Estate Agent and balance the need to demonstrate your serious intent, against the good business practice of minimizing the deposit amount.
The amount of the EMD is usually applied to reduce the purchase price of the property or to cover closing costs, as you dictate. For example, if you are purchasing a $300,000 property and you give an EMD of $3000, then the remaining balance owned at closing is $297,000 (plus closing costs). Alternatively, you may direct that the EMD be applied toward the closing costs.
Once a valid contract for purchase is created, an independent third-party usually holds the EMD until the purchase is either completed or cancelled. At this point, the money belongs jointly to both the seller and the buyer.
In cases where you make an offer that is accepted but later decide to cancel the offer, the terms specified in the contract (or state law) will dictate if, and under what circumstances, the EMD is returned to you. Be aware that you could loose your deposit if you do not not comply with the terms of your contract. Your Real Estate Agent can provide you information about how EMDs are dealt with if a contract is cancelled.
Since state law varies by region and practices can differ even within the same state, be sure to consult your Real Estate agent about the rules that apply to EMDs in your region of the country. You should also be aware that the EMD is not related to any down payment that you make toward your home loan.
Real Estate Advisor
http://www.articlesbase.com/advertising-articles/protect-your-deposit-when-buying-real-estate-52155.html
Mortgage Options to Help You Get on the Property Ladder
June 28, 2010
Mortgage options naturally change primarily the percentage of a deposit required is the main generic change in types of mortgages available since the credit crunch took hold.
10…25…40% Deposit Required
Zero percent mortgage have almost disappeared, there are currently only ten deals available however your credit rating would have to be perfect and more than likely have a high salary and or a partner.
Other low deposit mortgages have dropped drastically right up to those who have a 25% deposit. Mortgage lenders are becoming less competitive as they carefully pick only those with gleaming credit records. The lucky ones among us though who can afford a 40% deposit do have more choice than a year ago and this segment of the market has seen a large increase in deals available.
Other options…can a family member help
If you have a family member or close relative who is willing to take an equity stake in the property you can get over the hurdle of needing a deposit at all. A family equity loan means you keep 100% ownership of the property and the family member can help you get your first property as well as make a profit from their investment should it be sold at an ideal time and as the property can’t be sold until the family loan has been repaid, there is security for the person/s taking the equity stake.
If not the government can help you
For those that can’t put up sizeable deposits there is the option of applying to a government support scheme in Scotland. The Low-cost Initiative for First Time Buyers or LIFT scheme will see the government take a stake in your property, normally 20-40%, giving first time buyers that much needed help to buy their first home. When the home is sold the government will receive their stake back at the sale price. Check the “social landlords” that are currently running the scheme to see if your area is eligible. Currently available in major cities including Edinburgh, Aberdeen those wanted a mortgage Falkirk and even the highlands.
Many mortgage brokers have included the above schemes to their library of lenders; if you go with a whole market broker you can get them to search the whole market and can check if they offer the above schemes. If you are looking for a Scottish mortgage then there are mortgage brokers based in Scotland that can provide the above services and often for free.
Chris Borthwick
http://www.articlesbase.com/mortgage-articles/mortgage-options-to-help-you-get-on-the-property-ladder-710907.html
The Top-10 Universities in the United Kingdom
June 28, 2010
An assessment carried out by AllAboutUni.com found that Scotland has the highest density of the World’s Top-500 universities in the United Kingdom. AllAboutUni.com is an independent, global and interactive website where visitors can obtain information about universities (global rankings, student reviews, university news and campus pictures).
The Academic Ranking of World Universities (ARWU) is produced by the Institute of Higher Education at the Shanghai Jiao Tong University . Several indicators of academic or research performance are used to establish the ranking, these include highly cited researchers, articles indexed in major citation indices and staff winning Nobel Prizes.
The World’s Top-500 universities (2008) are mainly located in Europe (n=210; 40%), the Americas (n=190; 40%) and the Asian/Pacific region (n=100; 20%). There are 42 (8%) universities located in the United Kingdom (UK), representing 20% of the universities in Europe.
The top-10 universities in the UK are: University of Cambridge (ranked 4th in the world), the University of Oxford (10th), University College London (22nd), Imperial College London (27th), The University of Manchester (40th), University of Edinburgh (55th), University of Bristol (61st), University of Sheffield (77th), King’s College London (81st) and University of Nottingham (82nd).
The UK has the highest number of universities in the World’s Top-500 universities (42) compared to the other European countries: Germany (40), France (23), Italy (22), the Netherlands (12), Sweden (11) and Spain (9). In the ranking of Europe’s Top-10 universities, five are located in the UK and in the Top-25 universities, 9 are located in the United Kingdom.
The UK universities are located in following regions: England (34), Scotland (5), Wales (2) and Northern Ireland (1). An interesting difference is that universities in Scotland are much older than in the other three regions: the median age of the Scottish universities is 513 years (range 127-598) compared to 101 years (range 39-912) in England and 107 years (range 88-125) in Wales.
In order to make a comparison with other industrialized countries, AllAboutUni.com calculates the number of universities in the World’s Top-500 (2008) per one million inhabitants. The overall number of universities per million inhabitants in industrialised countries is 0.5. An earlier assessment found that small countries in Western Europe (Sweden (1.2), Finland (1.1) and Switzerland (1.0)) and New Zealand (1.2) have the highest number of universities per million inhabitants.
The number of universities in the World’s Top-500 universities that are located in the UK is 0.7 per million inhabitants, which compares favourably with other large industrialized countries: Canada (0.6), Germany (0.5), United States (0.5), France (0.4), Italy (0.4) and Japan (0.2). For the four regions of the United Kingdom, the numbers are as follows: Scotland (1.0), England (0.7), Wales (0.7) and Northern Ireland (0.6).
Conclusions
Within the UK, Scotland has a much higher density of top universities compared to England, Wales and Northern Ireland. Scotland also performs very well compared to other industrialised countries and the number of Scottish universities per million inhabitants is one of the highest in the world.
John Paget
http://www.articlesbase.com/college-and-university-articles/the-top10-universities-in-the-united-kingdom-719948.html
From Home you Can Market your Vacation Rental Property
June 23, 2010
I worked for other people for the first fifteen years before I realized we would never get rich like that. So I set up on my own. Then for the next fifteen years I was traveling the world, setting up companies, getting sales, handling finance with hardly any time to spare for the family. Had a wonderful time. I just wish I’d started earlier.
So I’d like to help others to start their business and here is a simple way to go about it.
We do it ourselves with a property of our own, and enjoy it, even though it is pin money for us now.
I run a free blog site to help vacation rental owners to market their property properly using the web.
Here is how to start your development.
Find an area where there is little property development, but a high tourist trade. We found the Highlands of Scotland. There is very little development there – difficult to get domestic water supply to this region, as rainy as it is.
Compare the high season rental income between different areas, and compare property prices between popular regions. You are looking for a reasonable income against a low property price.
We started it by looking through several tourist areas and comparing the vacation rental income. Strangely, the vacation letting rates were close to each other but the cost of buying properties was very different.
Then we had to think through the problem of managing a property at long range. You need people to do the cleaning for you, and you will definitely need builders and local suppliers. You’ll have problems if you cannot visit the site frequently. Best to try for your first property somewhere near where you live, within driving distance
Research the area
It is important to search for some national statistics about the tourism business, to find out how long is the season, and whether there is off-season business.
You need to research the area, talk to agents, lawyers, but remember they are selling you something – themselves. Better by far to talk to other owners and neighbors. You’ll get far more valuable information from them.
Market through the internet
Now to market your property through the internet.
First of all, behave like a customer and dial in a few search terms to find holiday properties like yours. See what turn up on the first pages.
The search terms that you and your customers use normally are vital to your web site design. The website url, title, description, and opening text on the index page, page one should all concentrate on your critical keywords.
Your area is a problem. If you choose “vacation property USA” your site will be on Google page 3,000 and no one will find you. It is a bit better if you say “vacation rental Florida” but the same problem applies. Better to go for “vacation property, Saratoga” You could get up to page 4 or 5 there. You can find and evaluate keywords if you go to “Google suggest keywords” and use the facility there. Also look at the Google advice to webmasters on setting up your site and making it suitable for Google. Their notes are easy to understand.
Vacation rental directories
There are vacation property directories. A few are free, and might be worthwhile as inbound links but they will not produce much in the way of bookings and referrals. They make their money in other ways, by selling advertising, or books or tours. Your mention in their directory is just a traffic builder for them, and a service for their site visitors.
Agencies
Some of them are agencies. These will take you on their books and do the marketing job for you but at a steep cost – 30% or more, commission, most of them. Take care with these, though you should experiment with one in the first year until you gain experience and can dump them later as your site builds up traffic. Some of them want to take all your high season period and market it, but give you no guarantee to get business. Bad news, this lot. You might find an agency which will let you market the high season yourself and just take the shoulder season.
You’ll just be another name on their books though, and they’ll put no real effort into selling your property. These agencies will not put a link to you on their own site – they prevent people from finding you direct.
But some vacation directories will do a good job for you if you pay them $100 or more a year for a good position. They’ll put on a photo of your site, sometimes more than one, and a description, a link to your web site and a straight through to you e-mail link.
Ring round some vacation rental property owners in other areas, non competitive with your area, and ask them on the phone for their experience of internet marketing. Some of them will be reluctant to talk, but at least a third will tell you how they do it and what works for them.
Finally you can select several good ones, which have been recommended to you and which seem to get high on many pages and use them.
Good luck. Within a few years you may have a big vacation rental company.
John
John Winkler
http://www.articlesbase.com/home-business-articles/from-home-you-can-market-your-vacation-rental-property-128175.html
Mortgages for the Self Employed and Buying a Property at Auction
June 23, 2010
Traditionally, mortgage providers have been reluctant to lend to self employed people, preferring the lower risk of those on steady, provable incomes. This left many self-employed people with very little choice in lenders despite often having very high incomes. However, with increased competition in the last few years many lenders have introduced ‘self certification’ mortgages.
Self certs (as they are known in the trade) allow the applicant to state their income without providing any further proof of income. Sometimes all that is needed is a reference from a certified accountant of affordability. These mortgages are particularly suitable for people whose income streams are many and variable.
How much can I borrow and at what rate
What should I do now?
How much can I borrow and at what rate?
Interest rates are usually a little higher for non status or self cert mortgages to reflect the higher risk involved for the lender. Statistics show small businesses have a higher chance of going bust than larger, more established ones so the interest rate will reflect this
Whilst many status mortgages now can go to up to 95% without a higher lending charge, most self cert mortgages require a substantial deposit. Many of the better self cert lenders will not lend above 85% of the purchase price. If this level of loan to value is exceeded, many will decline, apply a much higher interest rate or charge a higher lending charge.
Mortgage providers lend either according to income multiples or increasingly to affordability calculators. Traditionally, three times your income (less regular commitments) would dictate how much you could borrow. Now it can be as much as seven or eight. The important thing to ask yourself is ‘is it affordable’? It is important to factor in how much your ancillary costs will be: e.g. the cost of running the house, associated insurances.
What should I do now?
Get in touch with a mortgage broker. You have to be very financially savvy to be able to satisfy what many lenders will need to prove your status. Furthermore, some lenders only deal with intermediaries, so your broker will be able to fix you up with a great many more mortgage providers than you could via your own research.
Consider a flexible mortgage. These allow you to make overpayments and underpayments- even take ‘payment holidays’. These features can be vital for self employed people who experience peaks and troughs in their monthly income. Some products also offer a drawdown facility where your mortgage functions like an overdraft: you can draw money out from the equity in your home up to an agreed limit. Lenders who provide flexible mortgages include Nationwide, Bank of Scotland and Halifax.
With the advent of lifestyle TV shows like the BBC’s Under the Hammer, buying at auction is becoming increasingly popular. Bargains are possible, with up to 40% off the open market value, and the process is extremely quick.
The most obvious properties that spring to mind are ones which lenders have repossessed. However, perfectly ordinary property and redevelopments are often seen at auction too!
Unfortunately, these auctions are not always well publicized. The best place to look for property for sale by auction is on the Internet, or via local and national newspapers. Remember the process takes roughly three to four weeks from advertisement to auction day, so it is important to get a catalog and investigate your property well in advance. Top Tips
Click below for a shortcut to each section:
Get a catalog
Do your research
Have a realistic budget
Make sure the finance is in place
Get a decision in principle
Retention
Know your maximum bid Get the catalog.
Contact the auction house several weeks in advance and ask for a catalog. Those in the trade get sent these automatically, so a little more work is required on the private buyer’s behalf.
Do your research!
This is vitally important as the tight timescales mean that it is tempting to cut corners or take the catalogs’ description as gospel. Cut corners at this stage could be expensive if structural defects are established after the sale. View the property, ask the neighbors about it, instruct a surveyor and establish good root of title.
Have a realistic budget.
There will be considerable legal and valuation fees to be paid without any guarantee of getting the property you desire. Whilst this will deter people who are not serious about bidding, it does mean that you must have the ability to match other bids. If you don’t win, a bill of over a thousand pounds is likely on a standard residential dwelling.
The finance will have to be in place by auction day.
This means that a deposit of 10% will have to be available on the day, with the remaining 90% payable within 28 days. The 10% will not be refunded if the sale doesn’t go through! This means that there’s no backing out without a significant financial penalty. Be sure that you want the property.
Get a decision in principle
If you need a mortgage or bridging finance, make sure you have a decision in principal from a mortgage lender. The best way would be to use a broker: ask them whether the illustration they are showing you is a Decision in Principle (DIP). A DIP means that the lender has agreed to lend a certain sum based on certain assumptions and details submitted to them.
Retention
If the property needs substantial repair, the mortgage lender may place a retention on the mortgage. This means that they may keep a portion of the funds until changes are made to the property. The auction winner must make adequate provision for these extra costs.
Know your maximum bid
Know your maximum bid and don’t get carried away. It’s easy to get carried away in the atmosphere of an auction room. Ever bought something you regretted on Ebay? Imagine that mistake magnified by thousands!
James Berry
http://www.articlesbase.com/finance-articles/mortgages-for-the-self-employed-and-buying-a-property-at-auction-100784.html
UK Hotel Commercial Property Market Experiences Further Decline
June 23, 2010
Falling hotel occupancy levels and room rates mean that there is less income for hotel investors, many of which have financed these commercial properties through high levels of borrowed debt. As a reaction to the adverse market conditions many hotels are now offering rooms at highly discounted rates. The three and four star hotel market has been hit especially hard and they have had to heavily discount their room rates in order to remain competitive. Holiday Inn / Holiday Express have implemented a credit crunch action plan which includes lowering their rates to around £21 pp in the UK, increased promotions and marketing to their customers and target audience, and asking suppliers for either better terms or lower costs so that they can continue to remain competitive within the hotel commercial property industry.
Budget hotels are not completely recession proof either and companies such as Travelodge have experienced a fall in business stays and leisure at the weekends. However, despite these slight declines they are taking full advantage of the credit crunch’s effects on the commercial property market and have purchased several great value real estate deals that before the recession would have been unavailable to them.
Budget hotel chain Jury’s Inn are also taking full advantage of the increasing demand for budget hotel accommodation that has been created by the recession and are spending £90 million on opening four new hotels across England and Scotland. They are developing hotels in Portsmouth, Bradford, Newcastle and Glasgow as part of their plan for accelerated growth. They are hoping to take full advantage of the trend for business users and British tourists to stay in cheaper hotels and have also secured several lucrative commercial property deals that before the credit crunch simply were not feasible or available to them.
Despite the overall economic downward trend in the UK there have been nationwide sales increases for budget and cut cost retailers and service providers, whether they provide food, clothing or leisure breaks. The UK consumer products and commercial market is becoming increasingly buyer led. Consumers are finding that there are great offers available to them either through heavy discounting of high end brands or through taking full advantage of budget products and services that are also offering promotional pricing and offer based marketing to their customers. Travelodge and Jury’s Inn are taking full advantage of this trend and are setting themselves up for long-term growth with new commercial properties and increased customers.
Despite the overall decline in the UK hotel market cash rich buyers will find that over the next couple of years there will be some great hotel commercial property investment opportunities available to them.
Matt Grimes PC
http://www.articlesbase.com/real-estate-articles/uk-hotel-commercial-property-market-experiences-further-decline-740575.html
Affordable Homes are Available Across Scotland Now
June 23, 2010
Many affordable homes are available to first time buyers. The Scottish government offers the Low-Cost Initiative for First Time Buyers scheme (LIFT), helping people get on the property ladder. However with current uncertainty in the market and tighter lending criteria, mortgages being taken up are very low. There are around 280 homes currently lying empty, available under the shared equity scheme.
There is a lack of confidence in the market as prices have been dropping over the past year and are predicted to drop further. However many people are still buying as it still makes more sense than renting. If you feel like this is you there take the opportunity to see what is available to you, many selling homes are willing to take offers, so negotiate and you may get yourself a good deal, saving you money in the long run. If you have an immaculate credit history and can afford the minimum 15% deposits you could be one of the few to become a homeowner this year.
The government takes a stake in the property by taking an equity stake between 20 and 40%. The buyer then makes up the remained and only needs to repay the government when they decide to sell the home. The government gets their investment back at the current market rate, whether it has dropped or increased.There are currently homes available in Glasgow, Edinburgh, Perth and Kinross. The scheme is available through other ‘social landlords’ throughout Scotland including the highlands. First time buyers can find out what areas have homes through a number of methods, the usual estate agent, internet research or you could take the pain free option of using a mortgage broker.
Check to first of all see if the mortgage broker supports the lift mortgage scheme. There are many good mortgage brokers around, look for one that will search the whole market and without a fee so you can ensure you are getting the best deal without spending a penny. So whether you are looking for a mortgage or would just like to find out what is available to you without the cost and the leg work, a mortgage broker is the way to go.
Chris Borthwick
http://www.articlesbase.com/mortgage-articles/affordable-homes-are-available-across-Scotland-now-720078.html
Holidays at Scotland Would be an Invigorating Experience
June 22, 2010
Planning for holidays! Then why not choose Scotland. Scotland is mainly countryside with hills and mountains, pristine lakes, and a lot more for tourists to explore.
Certainly from the hustle and bustle of city life, a few days here would rejuvenate you. You would also get enticed by the sceneric beauty which this country envelops.
Many of the holiday cottages listed offer availability calendars with secure online booking. Look out for those holiday cottages in Scotland offering late availability discounts and short breaks – real value for money!
Your decision for a hotel to stay would find an answer in holiday cottages in Scotland. These cottages serve the guest in cordial atmosphere amidst all the facilities which a traveler is looking for.
Holiday cottage owners advertising at this site can elect to have their own interactive website and optional availability calendar which they can update whenever required, and so provide you with complete and current information to enable you to make an informed choice and perhaps book online
The rooms of these cottages are endowed with all the amenities to make the stay of travelers comfortable. So pack your bags and make Scotland as your coming holidays’ destination.
Whatever your requirements are for self catering holiday cottages in England, Holiday Cottages Lincolnshire, Holiday Cottages Northampton shire or Holiday Cottages Nottinghamshire you’ll find them at U.K. Holiday Cottages Online.
Town & Country Cottages were established over twenty years ago in the City of England and we offer Self Catering Holiday Accommodation in some of the most beautiful areas of Southern England.
david
http://www.articlesbase.com/vacation-rentals-articles/holidays-at-scotland-would-be-an-invigorating-experience-729413.html