Category Archives: Mortgage & Debt

Commercial Mortgage Loans

Commercial mortgage loans are integral to the financing of commercial real estate projects. They represent debt secured by the potential or current property owner on a recourse or non-recourse bases to finance the purchase or refinance/cash out the property. Adequate debt acquired at attractive interest rates and terms can increase the investment yield of commercial real estate while simultaneously decreasing the investor’s equity in the project, reducing risk and allowing more liquidity of investor capital for future launch. Finding a lending source which is favorable to the specific project is crucial and making sure the cost of debt is less than the investment yield to generate a profit, a necessity.

The process of getting a commercial mortgage loan entails the lender qualifying the property and the borrower to determine financial strength and capacity to pay back the debt. Lenders are not in the business of taking properties for payment delinquency, but generating an attractive interest on their money deployed to investors for their investment activities. This qualifying process is termed underwriting and the financial viability of the project is scrutinized including the potential gross income, down to the effective gross income and the property expenses are scrutinized including all recurring expenses to derive a representative net operating income. The capacity of the real estate to support the debt is important to lenders, it is analyzed and the debt service coverage ratio resulting from the NOI/debt service is calculated to determine if it meets the minimum acceptable level; 1.20:1 is the minimum acceptable for multifamily and 1.25:1 for other commercial properties; however, this can change depending on how the loan is priced and the investor profile variables which increases or decreased the risk quotient attributed to the project.

The borrower’s financial strength, investor experience and credit profile are relevant to the underwriting process, for both the property and borrower are considered. The borrower’s net worth, other commercial real estate holdings, liquidity, etc are factored into the decision making in determining if the funding request is approved, disapproved or lender modified because of associative risk. It is the lender’s objective to mitigate risk to within acceptable parameters while charging a risk premium, if necessary, and still fund the loan when all underwriting criteria are met. Commercial mortgage loans represent a viable means for borrowers to leverage their capital supplemented by debt secured elsewhere to fund acquisitions and refinancing. When the appropriate leverage is used it creates a fertile environment for profitability. However, over leverage can erode all profits. Lenders usually request property and borrower’s financials to facilitate deciding if the request is fundable and how to price the loan. Transparency on the part of the borrower expedites the process and helps the creditability and borrower-lender relationship. Remember lenders are in the business of loaning money, but they need a certain level of assurance of repayment of loaned funds. Whatever borrowers can do to produce this assurance will help to get loan approval.

Top tips on how to get a contractor mortgage

With low interest rates and lenders offering great deals getting a contractor mortgage doesn’t have to be tricky. If you are looking for a contractor mortgage there are things that you can do to put yourself, and your finances, in the best position possible.

Here are some top tips on getting a contractor mortgage:

1. A healthy deposit

As a contractor looking to secure a contractor mortgage, having a healthy deposit will get you a step or two closer. 100% contractor mortgages are a thing of the past now so having at least a 10% deposit will really put you in good stead. By having a substantial deposit you will find that getting a lower rate contractor mortgage will be far easier.

2. Get your credit rating in order

Contractor mortgage lenders love to see a sparkling credit history. If you don’t have a healthy credit rating then a contractor mortgage lender could refuse you. Make sure that you are up-to-date on your credit card bills and payments, keep them all in check. You can also help yourself by making sure you are on things such as the electoral roll.

3. Have an up-to-date contract

As a contractor making sure your contract is up-to-date will help your contractor mortgage plight. Your contract will need to state the length of your contract and the amount of your current contract. That way a contractor mortgage lender can clearly see how much you can borrow. It will also save you having to produce three years of accounts.

4. Working within your means

Mortgages for contractors are widely available at the moment but knowing your limits is key. Don’t push yourself further than you can or you could end up putting yourself in financial difficulty. As a contractor looking for a contractor mortgage make sure you work within your means. Be honest and realistic. That way keeping up with your contractor mortgage repayments will be easy.

5. Speak to a contractor mortgage expert

One of the most important tools in getting a mortgage as a contractor is to speak to a contractor mortgage specialist. High street lenders don’t have the experience or understanding of contractor mortgages in the same way that an expert contractor mortgage adviser does. By using a contractor mortgage broker you will be able to make sure that you get the best advice and contractor mortgage deal available to you.

The right contractor mortgage company

Our Experts at the Contractor Mortgage Company, are well aware that buying a home or remortgaging can be intimidating and at times very confusing. Alongside the worries of working as a contractor, trying to prove your income to the appropriate lender, can be quite difficult.

That’s why we specialize and are dedicated in assisting contractors with securing mortgages. We have professional knowledge of contractor mortgages and the lenders who are prepared to offer mortgages to you. We understand the world of contracting too, and the various ways that you may be remunerated.

The importance of the equity release calculator

Many of the senior home owners opt for the equity release plans to ensure a part of their property equity in liquid cash. This is a wise decision in ways that are more than one. However, most of the retired home owners are not much aware of the various nuances of how the lending institutions work and exactly how the equity on the property is calculated. The lending organizations offer the potential consumers an equity release calculator which helps the retired home owner in finding out the equity that is release able from their property. After the calculations obtained from the equity release calculator, the home owner can decide if the equity release plans are really viable as an option for them in terms of their property.

What is equity? Well the equity is the difference in the amount of the value of your property in the present market and the amount that you owe on your mortgage. It is the share in the value of the property that the home owner actually calls as own.

Out of the total available equity on the home, the home owner can release a part of the equity with the help of the equity release plans. The equity release plans are a way of releasing a part of the equity on behalf of the home owner to a lending organization who in turn will pay the amount in a lump sum or offer a fixed monthly instalment to finance the home owner’s regular life style and expenses on a daily basis.

If you are wondering about the equity release calculator, then the answer to that question is that many of the lending institution offers the home owners a free tool with which they are able to calculate the total amount of equity that can be released on the house. Based on this calculation by the equity release calculator, the home owner is able to figure out exactly how much money he can receive as the equity release plans take effect.

The equity release calculator is also available as a free tool online with various equity release websites. As a first step, the home owner is required to provide the equity release calculator with some vital information about the property that he wants to apply for the equity release plans. Based on the information provided, the equity release calculator will predict exactly how much equity can be converted into liquid cash. Some of the more advanced equity release calculator will also be able to provide some in depth information about all the possibilities in terms of the various equity release plans. The availability of such equity release calculator is of course dependent on the lending institution that is offering the equity release plans.

It would be a wise idea to use at least two different equity release calculators from two different websites so that he is able to get hold of the best equity release plan for his property and also get the best deal.

The Top 5 Characteristics Of A Good Credit Consolidation Partner

More and more consumers are now discovering that credit consolidation is a great mechanism for them to use to put their finances back on the right track. With so many companies out there willing to help, everyone should be able to find a service that can help them achieve all their financial goals. Whether its credit counseling, debt settlement, credit repair or even a credit card debt relief program, consumers do not have to look far to find such a service. Like everything else in life nothing is as simple or easy as people want to make it sound. If I had to describe this industry as a whole it would be the following, the good, the bad and the ugly. Instead of harping on the negatives, lets put our efforts towards identifying the good and not worrying about the bad and the ugly within the industry. Trying to decide which company to partner with to assist you with all of your credit consolidation needs will take the proper information and knowledge.

It could very well be that the beginning of this process is also the most important when trying to determine the right credit consolidation service for you. It’s important that you always check to see how many clients have been part of their program and have successfully solved their credit problems. When you get to the point where you are considering a company, make sure they have no problem sharing certain information with you such as the amount of years they have been in business, previous client success rates, and what their current rating is with the better business bureau. If a company should try to beat around the bush with these statistics, it would be wise to just back away from considering them.

Next we would like to discuss what happens when initially contacting a credit consolidation company that you’re currently evaluating. An absolutely no obligation free consultation should be the very first words spoken to you.Keep in mind also that in today’s world there are plenty of really good materials that cover everything about credit and debt. What you need to know is if they are going to supply them to further your understanding of these procedures. You should never under-estimate the importance of this. It will not only make you aware of any alternatives you may want to consider, but it will also be vital to all of the decisions you must make about the situation your currently in. This folks puts us right into the next chapter of this topic.

Credit consolidation will only work effectively if you choose and join the right program for your individual needs. Therefore when deciding which company you are going to use, make sure they offer a variety of methods and strategies from which you can pick from according to your own unique situation. Silent alarms should start going off in your head if any company tries to jam any one particular credit card debt relief program or debt settlement service on you. Stop considering them and just walk away. You will dramatically increase your chances of reaching your desired goals by choosing a company that offers a variety of programs from which you can pick from. With all that being said, it’s now time to move onto the next phase of finding a good partner.

As far as who you believe may be a good fit for your credit consolidation needs, I think you will find what we are about to say to be an essential part of your thought process. Do not let anyone charge you any fees up-front. If they try to, simply remove them from your list. There are new laws in place that do protect consumers from this practice but many companies will try to skirt around this by using different tactics. Generally speaking do not pay anyone any money until some work has been done for you that you are satisfied with, or at the very least started and verified by you. If you only deal with FTC compliant companies this will never be a problem. Lets close this by next talking about what fees you can expect to pay and what to be on the look-out for.

Whether your credit consolidation needs involve credit card debt relief, credit counseling or debt settlement, these services are not entirely free so you should expect to pay something. Paying a nominal monthly fee or making payments solely based on the amount of your savings is a completely acceptable arrangement. There is absolutely nothing wrong with compensating them in this fashion. I would also like to remind you though that its always smart to shop around for the best deal possible. Please be careful of the so-called non-profit credit counseling services. Its hard to only have a consumers best interest in mind when they are compensated by the creditors in most cases, and that my friends is what we would consider to be a conflict of interest. We can go on and on all day about all of this but we tried to keep everything as basic as we could without loosing to much information.

We are going to wrap this whole thing up by just simply reminding everyone that these are the top 5 characteristics you should be looking for with any credit consolidation company you are considering.

5 Steps to Help Shoppers Get Out of Debt

Do you use shop therapy to feel better when you’re depressed? When you see something you want, do feel the need to buy it as if driven by an unseen force? Are you over your head in debt but keep on shopping anyway? Is your spending affecting your relationships and personal life? Do you find yourself feeling depressed and guilty after a big shopping spree?

If you have all or a few of the signs above, you may be a compulsive spender or “shopaholic”.

Psychologists have defined the compulsive spender as a person who occupies so much time shopping or thinking about shopping that it affects their life in an adverse way. This can lead to broken relationships, low self esteem, depression and guilt. Psychologists have also said that guilty feelings actually make the problem worse, turning it into a vicious cycle. Compulsive shoppers try and soothe the guilt and depression by going out and shopping….again.

Luckily, if you are a compulsive shopper, you are not alone. There are groups and meetings that can help support you in your endeavor to stop compulsive spending. I’ve also put together some tips to help you get your shopping under control.
The Root Cause

Most compulsive spenders aren’t shopping because they actually really want what they’re buying, but to cover up deeper emotions. So instead of channeling those emotional issues into shopping, find another way to cope. Talk to a friend or get some professional help.
Cash or Credit?

One of the easiest ways to overspend is just to swipe your card and charge it. When you aren’t actually handing over the cash, your brain doesn’t immediately process it as spending money. So instead of using your card, try to pay with cash as much as you can. You’ll be less likely to overspend when you can actually see how much you’re spending, right there at the register.
Track and Budget

Keeping track of your spending habits can really open your eyes as to how much you are actually spending. Seeing it down on paper and adding up the total makes you more conscious and more likely to make an effort to change your spending habits.
Sleep on It

Next time you want to buy something, wait 20 minutes before you check out (don’t worry, you don’t actually need to sleep on it!) Window shop or walk around the store while your brain gets over the initial excitement. After 20 minutes, you’ll be surprised to find out you probably don’t really want it anymore.
Expand Your Social Circle

Shopping is often the center of the shopaholic’s social life. If you channel your socializing into other activities, like nature, exercise and other hobbies, you’ll have less opportunity to overspend. Plus you’ll discover new activities that you may enjoy!

You may enjoy shopping as much as the next gal, but you can’t let it take over your life. So stick to these easy tips and you’ll find your debt go down while your bank account and circle of friends grow!