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Credit History can Bite you in the Butt
A recent study has shown that the number of people who pay more than they should for their mortgage is rising. And if you look at the surface, the number one reason this rise is happening is because of race.
A study done by the Federal Reserve shows that around 55 percent of African-American borrowers pay higher than normal interest on their mortgages. But it’s not just the African-American community. The same study showed that 46 percent of people who identify as Latino also pay more due to a higher than average interest rate on their loan. As for Caucasians, only 17 percent of borrowers fell into that category.
The overall numbers of people who pay more than the average interest rate is up considerably, from 11.5 to 24.6 percent in the last two years.
While these numbers appear to be caused by rampant racism amongst seemingly all lenders, there might be another explanation. The connection between the interest rate offered and the borrowers credit history.
The interest rate that is offered on a mortgage loan is directly proportional to the amount of risk the lender feels that they are taking. If you have sparkling credit, the chances of you getting the best possible interest rate are fantastic. On the other hand, if you have declared bankruptcy or if there are any other black marks on your credit history, the chances of you getting a great loan are almost zero.
Another possible culprit is the rise in speciality loans that have gained in popularity over the last few years. While the idea of buying a house without a down payment was once a rarity, these days, it’s fairly common. And in almost all cases when this happens, the interest rates are higher because the lender is taking an additional risk by not having a down payment.
Sometimes, home buyers are agreeing to let the closing costs associated with buying a home be figured into the interest rate. Again, this is a less than honest way for a family to buy a home with very little to no cash on hand. The catch is, of course, that you will end up paying significantly more over time than if you had just paid the closing costs up front.
While no one can suggest that racism is dead in America, it is possible that while African-Americans and Latinos pay more for their mortgages, it could be caused by various other factors that may or may not be connected to a persons’ race.
Canadian Markets Hot and Cold
For many Americans, Canada has been a refuge from instability for generations. Canada was the final destination for thousands of runaway slaves before the American Civil war, and then later during Viet Nam, for draftees that felt the war was unjust. The slow and steady migration to Canada continues to this day, although it’s mostly to get away from gun violence and George W. Bush. For those looking to buy real estate in Canada, the third quarter numbers had both good and bad news.
The good news? Canadian real estate is on a record pace in 2006.
The bad news? The third quarter numbers are down sharply from the second quarter of this year, and even down from the third quarter of last year. What does all this mean?
It basically means that Canada’s sizzling real estate market is still hotter than ever, but that it can’t keep up the incredible pace that it’s been on.
Breaking down the numbers, Canadian real estate is down 6 percent compared to the same quarter last year, and down 2.5 percent from the second quarter of this year, according to the Canadian Real Estate Association.
Overall, sales during the first nine months of this year are still up over the same nine months from last year, but things do appear to be slowing down.
The hardest hit cities during the third quarter slow down were Vancouver, home of the 2010 Winter Olympic Games, red-hot Calgary, which is still booming thanks to the local oil industry, and Toronto. Sales in Edmonton, Alberta and Hamilton, Ontario are actually up for the third quarter, helping to offset the losses in other cities.
Proving that the incredible Canadian real estate market is still on fire, year-to-date sales records were set in various cities all across the country in the third quarter. Montreal, Winnipeg, Ottawa, Saskatoon, Edmonton and Calgary all reported record sales for this year.
The average price for a home in Canada has been sky rocketing in recent years, with the total now at $258,000 (US dollars) up from $234.000 just in the last calendar year.
This real estate frenzy is being led by the province of Alberta and their incredible economy. The cities of Calgary and Edmonton, which reported their highest level of new real estate listings ever in the third quarter. Montreal and Toronto reported their second highest amounts of new listings for any quarter, as well.
The Canadian real estate market is still breaking records and making money despite the third quarter downturn. The breakneck pace simply couldn’t be sustained. But if you’re looking to move north of the border, do so knowing that it might cost you a few more loonies than you thought.
Buying a Home Overseas: Practical?
For those of us that have been lucky enough to travel to Europe, Asia or Australia from North America, we have seen some of the most beautiful land on Earth. The people, the sights and especially the food make international travel one of the most exotic and special things you can do. But what about making that trip to another country permanent? If you can afford a second home and the thought of spending your summers in the Hamptons isn’t doing it for you, what about buying a little place in Italy? Or Ireland? Here are some tips on making your dream a reality.
First off, rest assured that you’re not the first person to do this. It’s estimated that about four million US citizens live abroad right now. The first thing you should do is check the local country’s property rights. There are websites run by the International Real Estate Association that can tell you if it’s even legal for non-residents of a country to own land there. You should also check with the US Government about the stability of a particular region. Remember, if you vacationed somewhere nice, that doesn’t mean it’s necessarily safe once you leave the resort.
The next step would be to seek out a real estate broker in that particular country for help. This is when a possible language barrier could be a problem. Luckily, there are websites available that will have links to international brokers who do speak English. A broker who is familiar with the local laws and customs of the region you’re looking to move to will be able to help you find out how the local laws work when it comes to real estate.
Another good tip is that you should expect to pay cash. Most countries don’t have as sophisticated a system for loans and mortgages as the US and Canada, so you are looking at either paying cash or if you are looking to move somewhere where you might be able to get a loan, a down payment of almost 50 percent wouldn’t be unusual. If that’s too rich for your blood, you might want to think twice about the whole thing.
Being able to retire in that pretty Tuscan villa overlooking the vineyards is a dream millions of Americans have, and while it may only become a reality for a select few, you CAN make it happen with proper planning, a helpful heaping of common sense and a few tips to help you on your way.
Are you House Poor?
The great American Dream has always revolved around owning a home. Sure, having the 2.3 kids, the cushy corporate job and the stylish car to drive to work everyday are part of the myth, too, but nothing quite summed up Americana quite like the white picket fence. But if recent economic numbers are any clue, this dream is becoming a nightmare for many in the US.
According to date released by the United States Census Bureau, an increasing number of homeowners are spending a larger and larger amount of their incomes on housing than in previous years. People in 49 out of 50 states reported an increase. The only state that didn’t, Alaska, spent the same amount. The report showed that people are spending around 21 percent on their housing needs, up from 19 percent in 1999.
This is a huge problem for first-time buyers who may now be priced out of housing markets all across the country. Economists point to rises in home prices in the last 7 years, as well as higher interest rates, coupled with stagnant wages over the same period.
While everyone seems to be in agreement that the housing “bubble” is either bursting, or getting ready to burst depending on where you live, housing prices are still up a remarkable 32 percent since the beginning of the decade.
Household incomes, on the other hand, haven’t done a very good job of keeping up. The same Census report showed that income has actually dropped, not risen, over the past 7 years, down 2.8 percent.
Maybe the worst news in the report was the percent of people who allot more than 30% of their income for housing. The numbers are up almost 8%. National guidelines suggest that more than 30% of household income for housing is excessive and not financially healthy.
What does this mean in the long run?
Most experts agree that until income can catch up to housing, the real estate market will remain lifeless. And since real estate is one of the biggest drivers to the overall economy, a weak real estate market means a weak economy.
Things appear to be the worst in California. Not only do they have the most expensive real estate in the nation, 48 percent of California homeowners spend more than 30% of their income on housing related costs.
Until income can begin to grow as quickly as the real estate market, this trend shows no signs of slowing down. Which could mean that the upcoming real estate slump could last much longer than anyone predicted.
A Second Home: Take it or Leave it?
For many, wanderlust is just a part of life. You buy a beautiful home somewhere, settle down, have a family, but there is always a part of you that’s itching to get away. Vacations are part of that wanderlust; the chance to get away someplace beautiful. And then you see it. The local newspaper at your vacation destination, and lo and behold, there is a real estate section right there. Dare you even look? You can’t afford it, can you? Two homes? Is dual home ownership for you?
A second home can work for you, but you have to go into the process knowing what to expect. If you’re looking to get rich quick, don’t count on it. According to recent data, the price of real estate in areas that are deemed “Vacation Markets” has risen twice as fast as real estate in other areas. So, not only is a second home in your destination of choice going to cost you a pretty penny, it’s no longer a well-kept secret anymore and the chances of you flipping it to make a quick buck are slim.
The best piece of advice a possible vacation home buyer can heed right now is to buy for love not for money. Recent sharp downturns in vacation markets like Naples, Florida, Lake Tahoe, Nevada and Cape Cod, Massachusetts, have shown that trying to turn a profit in a vacation market is close to impossible. But there is a bright side to all of this. With the housing bubble going poof all across the country, those that are looking to sell will be doing so at lower prices. Now could be a great time to buy a place that you’re planning on keeping for a long while.
But how do you know if you have your head on straight about the whole thing? Well, take some time and evaluate the pluses and minuses of buying another home. Once you’ve decided on a area, spend some time there to make sure you like it. If it’s going to be a vacation home, you’ll want the scenery to be relaxing (if that’s what you’re looking for) or exciting (if that’s what you go on vacation to experience). A final check should be the bottom-line cost. If the price of the two houses makes up more than one third of your total income, you’ve spent too much.
Buying property is a huge investment for everyone, even the rich. Take the time to properly evaluate the pros and cons before you decide to own a second home or you could find yourself on a permanent vacation.
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<a name="hdng0"></a> You might get a foreclosed-on investment property cheaper if you buy it before they list it with a real estate agent. 7. <a href=" http://www.mywikibiz.com/investment/find-investment-properties-10-ways.php" TARGET="_blank" [1]</a> Russ Whitney - The Real Estate Boom Russ Whitney - The Real Estate Boom Russ Whitney has developed training programs, education packages and a great volume of literature in order to educate people on the best wealth-building techniques. The very same techniques that he teaches, writes and speaks of, he uses himself to add to his existing fortune Russ Whitney the author Millionaire Real Estate Mentor is a book written by this financial genius that reveals his secrets to building.<a href=" http://www.mywikibiz.com/investment/find-investment-properties-10-ways.php" TARGET="_blank" [1]</a> Things have really kept a steady pace of increasing. One of the reasons for this is because of the availability of utah real estate. Property For Sale In Bulgaria - Emerging Property Markets 1 Property For Sale In Bulgaria - Emerging Property Markets 1 The latest investment property headline is this: Popular and well trodden markets such as France and Spain are out, Bansko is in.<a href=" http://www.mywikibiz.com/real-estate/real-estate-negotiation-secrets.php" TARGET="_blank" [2]</a> Utah Real Estate Utah Real Estate Looking to buy real estate in Utah? The market has changed over the past few years and is going to continue to change over the next few (drastically) and here are a few things you should consider before buying any Utah real estate.First, the Olympics didn't affect the state as much as people thought it would.<a href=" http://www.mywikibiz.com/real-estate/real-estate-negotiation-secrets.php" TARGET="_blank" [2]</a> Before the olympics, people thought the olympics would bring with it a rise in home values. It didn't.Second, unlike California, real estate values in Utah have not shot up in the past 10 years.<a href=" http://www.mywikibiz.com/real-estate/real-estate-negotiation-secrets.php" TARGET="_blank" [2]</a> Kings Bay Georgia Real Estate - Be Picky When You Choose Your Realtor! Kings Bay Georgia Real Estate - Be Picky When You Choose Your Realtor! I have been a mortgage lender for many years and have seen a few transactions go sour. How To Sell A Home That Didnt Sell How To Sell A Home That Didnt Sell If your home has just come off the market and hasn't sold, don't be discouraged.<a href=" http://www.mywikibiz.com/real-estate/real-estate-negotiation-secrets.php" TARGET="_blank" [2]</a> Real Estate Investment - One Simple Formula Real Estate Investment - One Simple Formula I saw the ads in our small-town newspaper for years before I realized exactly what was going on.<a href=" http://www.mywikibiz.com/real-estate/real-estate-negotiation-secrets.php" TARGET="_blank" [2]</a> My friend Roger does property investing and is a real estate agent. Recently he told me how he negotiated a transaction. He spotted the property on the internet off a real estate agent's website.While property investing for over 20 years, Roger typically purchases his properties off line.<a href=" http://www.mywikibiz.com/real-estate/real-estate-negotiation-secrets.php" TARGET="_blank" [2]</a> Flattery has been proven to be worth an average of $1962 in real estate negotiations. That's a joke, by the way, but you know if he likes you, you'll probably get a better deal. Pass over problems, and return to them later.<a href=" http://www.mywikibiz.com/real-estate/real-estate-negotiation-secrets.php" TARGET="_blank" [2]</a> Ask questions, talk slow, ask for help, and never show off your real estate expertise. Sellers are afraid to budge if they think a smarter person may be taking advantage of them.<a href=" http://www.mywikibiz.com/real-estate/real-estate-negotiation-secrets.php" TARGET="_blank" [2]</a> Dream Town"s site has a live chat feature so users can ask questions and have real-time conversations with a licensed real estate agent via the Internet.<a href=" http://www.mywikibiz.com/Directory:Dream_Town" TARGET="_blank" [3]</a> Founded in 1998, Dream Town's company headquarters is located in the city"s Lincoln Park neighborhood, with a second office in the West Loop neighborhood. Dream Town currently employs 120 licensed real estate agents and developers, offering both brokerage and construction services in Chicago and its suburbs.<a href=" http://www.mywikibiz.com/Directory:Dream_Town" TARGET="_blank" [3]</a> The company"s website, DreamTown.com <a href=" http://www.DreamTown.com" class="external text" title=" http://www.DreamTown.com">DreamTown.com</a>, provides a wide range of online tools and services including a real estate search engine with more than 130,000 current MLS listings of Chicago area properties.<a href=" http://www.mywikibiz.com/Directory:Dream_Town" TARGET="_blank" [3]</a> The most experienced real estate agent in the Houston area for over 30 years.<a href=" http://www.mywikibiz.com/Directory:Houston_Realtor_Ann_Minks" TARGET="_blank" [4]</a> Understands all areas of real estate - background includes closing transactions & owning a title insurance company, mortgage business - processing & closing loans.<a href=" http://www.mywikibiz.com/Directory:Houston_Realtor_Ann_Minks" TARGET="_blank" [4]</a> Many were purchased "all cash" for quick closings, with mortgages added later. For beginning real estate investors, looking for an owner willing to sell their property "subject to" the existing loan adds a frustrating component to the search for a profitable property. Today's savvy home sellers just won't sell to a buyer who can't cash them out.<a href=" http://www.mywikibiz.com/real-estate/real-estate-investing-beware-of-subject-to-promises.php" TARGET="_blank" [5]</a> Jeanette Fisher teaches real estate investing and credit college courses. She became a credit expert to help her real estate students buy their dream home and multiple investment properties.<a href=" http://www.mywikibiz.com/real-estate/real-estate-investing-beware-of-subject-to-promises.php" TARGET="_blank" [5]</a> Another real estate writer's mini course, full of promises and fluff, ended with a "lesson" on why you need to buy his book so you can finance multiple properties "subject to." The reason, he said, "because banks won't let you finance more than ten mortgages." This simply isn't true.<a href=" http://www.mywikibiz.com/real-estate/real-estate-investing-beware-of-subject-to-promises.php" TARGET="_blank" [5]</a> Beware of "subject to" seminars, books, and promotions. This real estate investing method worked last century.<a href=" http://www.mywikibiz.com/real-estate/real-estate-investing-beware-of-subject-to-promises.php" TARGET="_blank" [5]</a> Many Ways To Make Money In Real Estate! Many Ways To Make Money In Real Estate! Real Estate is a multi-faceted investment arena - there are MANY different methods to earn money from different niches in real estate. Yes But, How Do I Evaluate Buying Undeveloped Land And Get Into The Business? These real questions on buying undeveloped land are answered by a U.S. Master Builder and myself after receiving them from readers of my e-book, "Residential Development Made Easy."<a href=" http://www.mywikibiz.com/real-estate/real-estate-investing-beware-of-subject-to-promises.php" TARGET="_blank" [5]</a> Experienced real estate investors just move on to another lending institution.<a href=" http://www.mywikibiz.com/real-estate/real-estate-investing-beware-of-subject-to-promises.php" TARGET="_blank" [5]</a> Homes that were worth thousands of dollars are now only worth a fraction of that amount while the homeowners still owe almost the entire full amount of the first mortgage. While diversity is always a good idea and placing all of your investment funds in one vehicle, such as real estate, is never a good idea; there is reason to believe that the real estate bubble in the U.S. is not about to end any time soon. This is true for a wide variety of reasons.<a href=" http://www.mywikibiz.com/real-estate/the-real-estate-bubblewhen-will-it-burst.php" TARGET="_blank" [6]</a> Some investors have found that a mixed strategy of holding and selling works well to provide income returns; however the best strategy in real estate investment remains flipping on short term projects to maximize profit potentials and reduce risks.<a href=" http://www.mywikibiz.com/real-estate/the-real-estate-bubblewhen-will-it-burst.php" TARGET="_blank" [6]</a> Pre-qualify for a mortgage. Fixing Houses For Resale: Three Beginning Steps To Increase Profits And Have Fun Fixing Houses For Resale: Three Beginning Steps To Increase Profits And Have Fun Real estate investors specializing in fixers make higher profits when they have a detailed work plan and know how to get around the future resale appraisal issues.Before you begin your fixer makeover, taking a few extra steps helps you make more money, avoid future appraisal pitfalls, and have more fun. 1) Planning for Profits Visualize your final home presentation for sale.<a href=" http://www.mywikibiz.com/real-estate/the-real-estate-bubblewhen-will-it-burst.php" TARGET="_blank" [6]</a> There is a lot of money and emotion involved! There are also time pressures and numerous privacy issues to deal with. The sale and purchase of real estate can be a lengthy process involving numerous professionals from many fields.The Real Estate Center at Texas A&M University asked 3,000 Texas home buyers to describe their recent purchase, about 400 replied. Their responses showed how stressful buying a home can be, for buyers and sellers.<a href=" http://www.mywikibiz.com/real-estate/the-real-estate-bubblewhen-will-it-burst.php" TARGET="_blank" [6]</a> Buying Houses: Types Of Bargains To Find Buying Houses: Types Of Bargains To Find To make a good profit in real estate, you must buy right.<a href=" http://www.mywikibiz.com/real-estate/the-real-estate-bubblewhen-will-it-burst.php" TARGET="_blank" [6]</a> High Tension For The Buyer And Seller Of Real Estate Can Be Reduced High Tension For The Buyer And Seller Of Real Estate Can Be Reduced Tensions can run high in both the selling and buying of real estate.<a href=" http://www.mywikibiz.com/real-estate/the-real-estate-bubblewhen-will-it-burst.php" TARGET="_blank" [6]</a> Real estate provides the assurance of a higher yield of return than other types of investment.<a href=" http://www.mywikibiz.com/real-estate/the-real-estate-bubblewhen-will-it-burst.php" TARGET="_blank" [6]</a> More and more individuals are realizing that real estate is much safer, and a better return on investment than many traditional investment vehicles.<a href=" http://www.mywikibiz.com/real-estate/the-real-estate-bubblewhen-will-it-burst.php" TARGET="_blank" [6]</a> As with any type of investment, one of the keys to investing in real estate is in understanding when to sell.<a href=" http://www.mywikibiz.com/real-estate/the-real-estate-bubblewhen-will-it-burst.php" TARGET="_blank" [6]</a> Unlike stocks or bonds, real estate investments can usually be liquidated in order for the investor to access funds in far less time.<a href=" http://www.mywikibiz.com/real-estate/the-real-estate-bubblewhen-will-it-burst.php" TARGET="_blank" [6]</a> Unlike many other investment vehicles, real estate does not come with the stiff penalties associated with early withdrawal.<a href=" http://www.mywikibiz.com/real-estate/the-real-estate-bubblewhen-will-it-burst.php" TARGET="_blank" [6]</a> Simply supply and demand. Mark Twain once suggested investing in real estate because as he intimated, they simply aren't making any more of it.<a href=" http://www.mywikibiz.com/real-estate/the-real-estate-bubblewhen-will-it-burst.php" TARGET="_blank" [6]</a> <a href="#top"><img alt="Back to Top" title="Back to Top" src="  " style="border: 0px solid ; width: 72px; height: 14px;"></a>
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