Students Of Success

Canny investors will tell you that the skill is knowing when to put your money into an opportunity. Who would not have bought into Tuscany or St Tropez 20 years ago if they had had the knowledge and the funds? But many people thinking about a holiday home are not hard-nosed investors but ordinary folk with some resources, looking to improve their lives, perhaps make a small return on their property and anxious not to make a mistake. Turkey has been immensely popular for all the right reasons for a second home.

But it has hit the news headlines over the past few weeks more for its impending health crisis than for its continued economic growth. The Avian Flu virus H5N1 strain has shown signs of becoming endemic and people fear it could spread further. Yet the truth is that this is still one of the best regions with a long summer season, superb scenery, amazing history and some very attractive and attractively priced properties in serene locations. Indeed, Turkey is often described as the last of the affordable paradises

Think twice before changing your mind about investing in Turkey because of recent events and the related media exposure that followed. This problem will resolve given a little time. As with every potential (and actual) epidemic in history, bird flu will eventually lose its power, certainly by the time any property you could buy today has been built. And, if you wait until all this concern is history, you will find that so have many other people and price inflation might make your purchase more difficult or its market appreciation less. Bright investors bought into Tuscany and St Tropez when many of the properties were basic farmhouses, or fishermen’s cottages. But buyers in Turkey do not have to wait a generation or two for gentrification. The new-build properties that are available off plan are to superb standards in superb locations at prices that are a fraction of those in the longer established getaway destinations, many of which today are overcrowded and have lost much of their charm. Turkey really is a paradise and the country plans to keep it that way.

The dream holiday location

So, in my opinion, bird flu is just a hiccup not a full stop. Yes, we have a vested interest as we handle some of the best properties in the finest regions of Turkey. But we are putting our own hard-earned money in so we are not advising anyone to do what we would not do. Is it not a golden rule to only put your money where your adviser is putting his? Would you take any notice of a horse tip from someone who smokes rollups and rides a bike?

Turkey is becoming increasingly popular as a holiday destination and is attracting knowledgeable property investors from across the world, particularly Europe and the US. Prices are still very low and properties that would cost you up to £1,000,000 on any of the Spanish Costa’s can be found for around £150,000 in Turkey, even by award-winning UK developers in an area we feel is the tops, Bodrum. With beautiful, historic, sun drenched locations and longer summer seasons than even Spain, Turkey truly is a delightful and affordable location.

A prospering country

The economic argument for investing in Turkey is as strong as the life-style one. Plans for Turkish accession to the EU officially opened on 3 October 2005. Though no date for joining is yet fixed, the candidacy of Turkey is expected to further increase foreign interest in the Turkish real estate market, not only by foreign investors but also from developers. Look at what has been happening in Bulgaria, which is currently looking forward to it’s own accession in 2007 - and that is only a year or so away! Investors are expected to reap the benefits by way of further investment into infrastructure and rising house prices. Your dream home in the sun may not be about capital appreciation but it is a comfort to know you and your family can enjoy a place that might one day soon reach a price that you could not afford! Or become a usable asset that would add something to your nest egg if you chose to sell at some time in the future.

Just days after the European Union and Turkey finally agreed to enter into talks for Turkey’s EU accession process, Dubai extended a hand of ‘friendship and cooperation’ to Turkey and committed to an extended real estate investment program worth five billion US dollars. A spokesperson for Amberlamb the property investment specialists said “This financial commitment from Dubai is the first foreign investment offered to Turkey since an agreement with the EU was reached and is therefore seen as highly significant. It is also the first in an estimated 1.2 trillion dollars of inward investment that Turkey is attempting to attract from the Gulf States.”

GDP growth in 2004 has been confirmed at 8.9%, considerably higher than expected. This figure is largely due to consumer spending and to investment, which picked up strongly throughout the year.

Turkey received a total of 17.5 million foreign visitors in 2004, a 25% increase on 2003. This trend seems to have continued in the early months of 2005, with visitor numbers up 25.9% in the first seven months of the year, compared to visitor numbers during the first seven months of 2004, helped by a renewal of interest from US citizens. The number of US tourists rose by 31% in 2004 to close to 300,000, which must prove it has a lot to offer to some of the wisest travelers in the world.

With the current improved economic conditions, property values have already recovered and passed pre 2001 value levels. Property funds, both domestic and foreign, are investing again, inflation continues to decline, the economy is growing and the government is expected to continue with the economic program formulated by the IMF.

The residential market is very strong due to declining interest rates and rising confidence in the economy. Commercial property markets, especially in Istanbul, are attracting foreign interest mostly from foreign European and Gulf property funds.

Currently, the most active segment of the real estate market for foreign developers and investors is in retail property. However, there is significant recent interest from foreign developers for holiday home projects located on the Aegean and Mediterranean coast of Turkey and compared to Spain and Portugal, Turkey offers a similar if not longer season at more affordable values.

Yes, but …… Could bird flu across Turkey prove a real disaster?

You are wise to look carefully at the downside. So, lets look at a worst-case scenario: Past pandemics have spread globally in two and occasionally three waves. Each wave can last from 5 to eight weeks and be separated by three to six months. A pandemic could last for a single wave of no more that a couple of months or in a worst-case scenario it could generate several waves of infection over up to two years.

An average build time for an off-plan property is two years, including those we are handling. So any drop in potential rental activity during the course of endemic infection is irrelevant because by the build time of a property. Whether you are buying to rent or as a holiday home - if you time your purchase carefully you are extremely unlikely to find your return on investment lessened by H5N1.

Some observations, in conclusion…

Don’t start putting the brakes on any intentions to invest in Turkey on the back of an unfortunate few weeks. It is almost inconceivable that this particular strain of influenza will not have been placed on the biological back-burner by Mother Nature or have been brought under control by means of an effective vaccine by the time any property bought off plan today is finally completed. Remember, current low prices will rise again once all the negative hype has blown over - making investors with foresight plenty of return.

As with all things, do your homework, keep your ear to the ground and employ common sense. The bottom line is that there are far bigger mistakes to be made choosing the wrong development/location/agent than in choosing Turkey as a location for a holiday home or an investment property.

James Wittering is the Marketing manager for EPI. They also have investment property for sale in Turkey

A bipartisan committee has made two recommendations to President Bush regarding tax reform. In this article, we take a look at the second option.

Tax Reform

A year ago or so, President Bush decided to spend his political capitol on tax reform and fixing social security. Social security reform went down in flames, so now it is time to see if tax reform is an option.

In an effort to eliminate the Alternative Minimum Tax, the committee was charged with coming up with alternative revenue sources. The biggest deduction on the books is the mortgage interest deduction and the committee has offered two plans. The first puts a cap on the deduction and would be a disaster. The second option, however, is very interesting.

The committee on tax reform has recommended a unique approach to eliminating the mortgage interest deduction entirely. Before you go ballistic, consider what they are replacing it with.

In this second option, a homeowner would be unable to deduct any mortgage interest. They would, however, be able to claim a tax credit equal to fifteen percent of the interest paid up to an undefined mortgage cap. While that is a lot of jargon, the key is the difference between a tax deduction and a tax credit.

A tax deduction is reduced from your overall income. If you earn $80,000 and pay $10,000 in interest, your taxable income will be reduced to $60,000. It looks good, but it doesn’t make as big a difference in the actual tax you pay. A tax credit, however, is a different story.

A tax credit is an amount deducted from the actual amount of tax you have to pay each year. Assume you whip together your taxes and owe $10,000 to the IRS after claiming all your deductions and checking the tax owed chart. Under the tax reform plan, you would total the interest paid for the year and then reduce your tax owed by 15 percent. If you paid $10,000 in interest during the year, you would take a tax credit of $1,500 against the tax owed. In short, this would reduce the check you have to send in from $10,000 to $8,500.

The tax credit plan offered by the tax reform committee is very interesting. It could be windfall for some people. Apply the numbers to your 2004 taxes and see how you come out.

Sergio Haros is with Great Western Mortgage - San Diego Mortgage Brokers - providing San Diego home loans. Great Western Mortgage is a San Diego mortgage company writing San Diego mortgages and San Diego refinance and home equity loan.

Google have launched another beta product called Google Trends. This enables people to check the popularity of keywords and the locations where they are most used. Being interested in the property market lets take a look at some of the major keywords that people will use to search the web.

Starting off with the keywords ‘property for rent’, ‘letting agents’, ‘houses for rent’, ‘flats for rent’ and ‘properties for rent’. The keywords were input into the Google trends search box, the report was ran off and it brought up a simple page with a graph showing the main trend for the keywords by search volume, however in this case there didn’t appear to be a scale on the y axis so the exact volume could not be known. However, looking at the graph it appears that the keyword search volume was fairly consistent over the period of 2005 and 2006 with the most popular keyword search for these 5 being letting agents.

The other section of the results show the top locations from where these searches were made in the UK. Looking at this data we could use an assumption that these are the property rental hotspots from the searches done on Google. With 76% of searches performed through google this could give us an idea of what the trends and patterns are for searches for rental property. In the example that Rentright performed the most searches for this keyword were performed by people in West Lothian, followed by Milton Keynes, Edinburgh and St Albans.

The great part of this tool is it is possible to do a comparison between 5 different keyword searches selecting different time periods, locations and areas. Another search that was performed was a comparison between houses for rent, houses to rent, flats for rent and flats to rent, the results showed that the most searches by volume was flats to rent with St Albans being the main area where this search was performed. The term houses to rent was searched on the most times by people in Bradford.

View the Full Report on Rentright

This tool provides an insight into what people are searching for in your chosen field and where these searches are most conduceted. This tool can be used as an excellent marketing resource to analyise markets and trends on the most popular search engine in the world.

All data provide in the reports are taken from the Google Trends Search Facility.

Chris Courtis is co-founder of the Rentright Residential Property Portal and is dedicated to the Rental Property Market.

What you need to know about the foreclosure process. Learn what your rights are.
How past due on mortgage payments can you be?

In a nutshell here is what happens in a foreclosure:

• You are behind in your payments to the mortgage company.


• Your home is security for the loan, so they want their money or your home.


• The mortgage company goes through the legal system in your state to gain possession(foreclosure) of your home.


• When the legal process is complete you are forced to leave your home behind.

The above is a little over simplified, so lets get into more detail.

Your are behind in your mortgage payments. Your dream of home ownership has begun to fade.
Because of some hardship that has left you without sufficient funds to make your payments you
will soon lose hearth and home.

When you are about 60 days behind, the lender will file a complaint with the court system in the county
where you live. The complaint will include a copy of the mortgage and a statement that payments
are not being made.

You will be sent a copy of the complaint with a notice that you can demand a hearing.
(You would want a hearing if for some reason the debt claimed is incorrect. Another reason might
be to delay the foreclosure process.) If you really owe the money on the security of your home,
then the motion started by the complaint will eventually be granted.

After you have received the complaint notice, the court will grant the lender the right to
proceed with the foreclosure.

The lender must then publish a notice of foreclosure in local newspapers stating their intention
to repossess your house. After 3 to 4 weeks of notices a Sheriff’s sale will be held.

If you have not paid the back payments plus penalties before the sale, then your home will be sold to the highest bidder.
At this point you, your family and all your possesions must leave your home, either voluntarily or involuntarily.

This whole process can happen as fast as 2 months or as slow as 10 months, depending on such
variables as who the lender is and which state you live in.

Here is the unfair part. Let’s say you are behind 3 months on your mortgage.
You are starting to have some good things happen. You find you have the 3 months of back payments to give
to the lender. You go the lenders office and make the payments. You walk away feeling happy that you are now
caught up with your mortgage. Next week you discover that the lender is proceeding with the foreclosure.
What gives? Simple. The lender has charged late fees and penalties that can amount to as much as another monthly
payment. You must negotiate with the lender before you make payment. Often you can get them to forgive the penalties.
However, you must do it before payment, so you have some leverage.

It is important to realize that you can get your loan reinstated. The requirements are that you have recovered from the events that caused you be get behind. If you are now able to make the payments, but aren’t able to make up the back payments, then you need to negotiate with the mortgage company. There are several approaches to deal with the missed payments and penalties. If you are unsure of how to proceed, then you must get help. You must not lose your home if there is a way out.

For more information on how to save your home from foreclosure go to
how-to-save-your-home-from-foreclosure.com

While the National Association of Realtors anticipates a near-record year in real estate sales for 2006, following five years of record-breaking sales, rising interest rates may have an effect, but are higher rates really so bad?

Mortgage banker, author and humorist David Reed, is steamed about so-called experts trying to scare people by making them think rising interest rates are going to keep them from buying homes, or put them out of the homes they’re in.

During a radio interview with a Los Angeles station, Reed was paired with another guest, a financial planner. The host of the show asked, “So, rates are at some of the highest levels we’ve seen for a couple of years … what will that do to the housing market?”

“Now, me being a Texan,” drawls Reed. “I minded my manners and let the other gentleman speak first. ‘Well,’ he began. ‘It doesn’t look good at all. Rates are up nearly .5 percent since earlier this year and that means thousands of additional dollars the homebuyer will have to pay. On a typical $500,000 loan (this is California, remember) an extra .5 percent means another $160 more each month in payments. Over 30 years, that means another $57,000 over the life of the loan. Home prices are high enough without this.’”

Hmmm … guess there’s reason to be worried — if homes don’t increase any in value for the next 30 years, which nearly 100 years of 3 percent averages say are unlikely. Plus, the borrower has to keep the home for the life of the loan which is extremely unlikely in the day-trading 21st century. And does the financial planner think interest rates are going to improve any time soon?

“What a nerd,” laughs Reed. “Yeah, rates have gone up, but gone up from what? From record lows, that’s what. Let’s not get too spoiled here. Thirty-year fixed rates used to be in the high sevens and low eights way, way back in what — September 2000? Give me a break! Just take any historical mortgage rate chart and you’ll see that compared to rates going all the way back to the Paleolithic period, we’re still in pretty good shape. And I think it’s irresponsible for so-called “pundits” to tell people how screwed they’ll be if they buy a house right now.”

He warns, “The “housing bubble” we’ve been reading about could also be a self-fulfilling prophecy if we’re not careful. An interest rate goes from 6.00 to 6.50 percent and the sky is falling? Yeah, yeah I know. “But David, that knocks a lot of people out of homeownership.” Fair enough, but buy a smaller house, I say. Instead of a $300,000 loan, get a $285,000 one. That’s the typical qualifying difference between 6.00 and 6.50 percent.”

“Well, David, much of the market now is for investment homes … we can’t kill that.” Okay. But nobody’s killing anything, the market’s simply adjusting. If people want to buy investment properties they’re going to have to buy fewer or smaller ones or negotiate a better deal. Heck, any good Realtor can do that one for you.”

He says he gets steamed when an “expert” predicts disaster and encourages people not to buy something because of an interest rate move — and a small one at that. Will there be fewer homes sold in 2006? Probably. But fewer than what? 2005? 2004? 2003?”

(Each of those years were record-breaking years for both new and existing home sales.)

“I suggest we all kick back a little bit and understand that often when consumers read an article or listen to a radio show — that just sometimes they might actually be paying attention. “Gosh honey, maybe we shouldn’t buy that home after all. That guy just said we’d lose $57,000.”

Fair debate and honest discussions are one thing. Scaring consumers is quite another, he fumes. Yet, the bubbleistas are out in force predicting that “the piper is about to be paid.”

“In the past few years, nearly a third of all mortgage loans have been in the form of adjustable rate mortgages (ARMs),” blared CNN in November 2005.

And they are about to adjust, which means those who borrowed hybrid versions of ARMs, are about to see their low-fixed-rate period end, and the loan will reset to an adjustable rate that can fluctuate for the term of the loan.

The Mortgage Bankers Association estimates that some $330 billion worth of ARMs will adjust in 2006 and $1 trillion worth will reset by the end of 2007. This could impact as many as three million homeowners (average ARM loan is about $300,000) who will pay larger mortgage payments for the duration of their loan’s term.

“If you took out an 3/1 ARM for $300,000 back in late 2002, your initial interest rate was probably around 5 percent and your monthly payment has been about $1,610,” supposes journalist Les Christie. The new payment, at a rate of about 7.1 percent will adjust more than two percentage points to $1,995 per month, a difference of more than $385 monthly or $4,600 annually.

“One-year ARM holders, whose initial rates last year were just over 4 percent, will also see their payment increase a lot, but because of caps, they still won’t be paying as much as 3/1 ARM holders, at least until they reset again,” he explains. “Holders of 5/1 ARMs coming due later in 2006 and in early 2007, should not have to undergo increases as big. Their rates were higher to begin with, about 6.6 percent in early 2002; going to 7.1 percent would only add about $100 to their monthly payments.”

ARM holders have the option of refinancing into a fixed rate — providing they have enough equity in the home and can qualify for the new rate.

“A 30-year fixed rate at 6.43 percent will still add about $260 a month to the borrower who had a 3/1 ARM. And the borrower will either have to pay about $3,000 to $5,000 in closing costs out of pocket or add that sum to the mortgage principle, sending monthly bills higher,” warns Christie.

However, the rest of the country doesn’t need to shake in their boots just yet. According to a joint study by the Housing and Urban Development and U.S. Census Bureau, nearly 40 percent of all residential properties in the U.S., both owner-occupied and rental units, are owned free and clear with no mortgage.

Borrowers should watch how the Fed continues to handicap lending rates, particularly if the critical yield curve gets close to inverting or does invert. When there is an unusually small difference between short-term rates and long-term bond market rates, there is a risk that the yield curve will invert, which means that “interest rates on the Treasury’s two-year note will go above the rates available on the benchmark 10-year issue,” wrote Dr. Irwin Kellner, Marketwatch, November, 2005, when only six basis points separated the two from the ten. “That’s the narrowest spread since early 2001, just before the U.S. economy tumbled into its 10th postwar recession.” The curve inverted Christmas week 2005.

Dr. Kellner points out that every time the yield curve inverts, the economy goes into recession. Banks simply won’t loan money when they pay more for deposits (which key off short-term rates) than they can make lending these funds, he says.

This dries up liquidity and shrinks money for lending. The good news is that inflation would be kept at bay, which could keep interest rates comfortable for homebuyers for some time to come. If they can hang on to their jobs.

Written for http://www.e-realestatelicense.com
By James Christensen
Real Estate Expert and educator. Our training site http://www.e-realestatelicense.com offers a valuable service to individuals looking to get into the Real Estate industry.

Consumer publications talk about why it’s a smart idea for owners to sell their own homes. These sellers are referred to as For Sale by Owners (FSBO). What’s hardly mentioned is what the other side (the buyer, customer, prospective homeowner) experiences so the seller can save a few bucks (usually at the buyer’s expense.)

There’s a whole laundry list of tasks that need to be addressed by one or the other party in a real estate transaction. Do you know what they are? Are you prepared to play the guessing game with a home purchase, which is likely the biggest purchase most people make in their lives? It sounds pretty risky, doesn’t it?

What about personality conflicts?

You never know what you’re getting yourself into when you start the process of buying a home from a complete stranger. When you work with a Realtor at least you can choose someone to act as your filter. The Realtor will work on your behalf, regardless of personality traits on the other side. Buying a FSBO means you might just have to deal with individuals who aren’t on your same wavelength. That can derail your purchase, even for a home you just love.

Who is doing the negotiations?

Unless you are a pro, negotiating for price and contingencies is a frustrating and unfulfilling task for any buyer. Plus, many buyers are unaware of certain things to ask for, what to expect and how to gauge the seller’s mood, capability or motivators. You should also know what form to use when making the initial offer and counter offer. Almost every sale involves a counter offer, so gather the information you’re going to need to know now, because counter offers generally have time limits.

Whose contract are you going to use?

Do you have your own attorney who can draw up your offer, or are you going to rely on using the seller’s contract? The seller’s contract is going to favor the seller. Your attorney is going to charge you to prepare the contract and any consultation time it requires.

Are you getting a deal?

FSBOs typically don’t know how to set price. If you’re not aware of market trends, the number of competing properties, current listing features and pricing, changes in mortgage rates and a multitude of other pricing influences, you might not be in the best position to judge the value of your intended purchase.

One of my first buyer prospects, prior to working with me, had found a FSBO that would not pay a fee for having a Realtor involved in the sale. At that point I had to back away from the transaction (to the horror of my prospect.) I continued to check in with the buyer during her negotiations. Each time we spoke, she expressed more and more frustration with the process. The negotiations took three times as long as she expected and caused considerable heartaches, at one point the she called me in tears. She got the property and overpaid by $25,000. To this day, I don’t think she even knows it. It will become apparent when she goes to sell that investment property and discovers her profit isn’t what was expected.

Do you have an established professional network?

To purchase an FSBO, your network should include a good attorney, title company, mortgage lender, pest inspector, home inspection service and a few others that may be called upon depending on the situation. Most buyers have to let their fingers do the walking and rely on instinct to quickly determine who to work with and which out of a pool of individuals represents the best choice. Your Realtor already knows the best of the best in each category. Working with a Realtor means you’ll never need to consult an attorney who will bill you, not the seller.

Avoid using the seller’s inspection network. The service providers will be working on the seller’s behalf, not yours.

How do you manage problems?

There are a multitude of challenges that will crop up during the transaction. It could be there’s a problem with termites, a water leak, the appraisal came in under the sale’s price, or the seller goes on vacation in the middle of your purchase. What is your course of action? If you aren’t prepared for any and all contingencies, you might be inclined to let it go. This is not a good idea, and in the long term, you’ll end up paying the cost of these contingencies, not the seller.

Are you still interested in buying an FSBO? Then contact Linda for her 9 point checklist of how to prepare yourself to buy a FSBO.

Linda Kazares is a Realtor with Windermere Sonoran Properties in abundantly sunny Scottsdale Arizona. She specializes in replacement property, 2nd homes, retirement living and Toll Brother resales in Scottsdale and North Phoenix areas. She can be contacted at 480-488-0221, kaz@kasakaz.com or visit her website at http://www.kasakaz.com

The Reverse Mortgage is quickly becoming the most popular senior financial vehicles in America today. Every senior who owns a home and is over the age of 62 qualifies for the program and the immense benefits that the Reverse Mortgage offers has helped thousands of seniors to safely maximize their assets and increase the enjoyment of retirement. This article will outlay some creative ways to manage the Reverse Mortgage effectively to ensure the best use of this fantastic senior product.

While the Reverse Mortgage is a great choice for many seniors in need of increased monthly income or to produce a fund for investments, there are some points that all should be aware of when managing the Reverse Mortgage. Most who have had information on this product are aware that the Reverse Mortgage, which has an unlimited time frame, does not require repayment while the senior remains in the home. With a system like this, all closing cost and fees are charged up front on the loan. There are no out of pocket cost for the senior except for the cost of an appraisal. All of these fees are financed into the Reverse Mortgage. When judging whether a Reverse Mortgage will be effective, this must be part of the decision, because a Reverse Mortgage is most efficient when keep for longer than a few years. The up-front charges of a Reverse Mortgage are the only charges or fees for a Reverse Mortgage and become extremely affordable when spaced out over several years.

While the management of the closing cost of Reverse Mortgage is one of the easiest ways to make the most out of a Reverse Mortgage, there all several more ways to take full advantage of the Reverse Mortgage. One feature of a Reverse Mortgage that is best managed is the accumulation of interest on the loan debt. Unlike a straightforward equity loan, all interest of a Reverse Mortgage is deferred and accumulates on the balance over the life of the loan.

Troy Shellhammer is Reverse Mortgage Specialist with http://www.ReverseMortgageNation.com, a national Reverse Mortgage Lender. He can assist you with any reverse mortgage questions and can also provide a free educational video, book, and brochures. He can be reached toll free at 1-888-973-8377.

From little acorns do great oaks grow! Provided, of course, the acorns are actually planted!

In property terms, that translates to identifying the potential of building a property portfolio and being prepared to do something about it. In recent years, both in the UK and here in Spain, there has been a tremendous appreciation in the value of the average property. The reasons for this are many fold; low interest rates, a shortage of property to meet buyer demand (especially in the UK) and a stable economic climate. However, these conditions have changed to a degree and we have seen a flattening out of annual property growth rates. Here, as in the UK, is it a ‘buyers market’. That means that buyers are less than those wishing to sell, so prices have fallen.

But that will, in time, give rise to greater returns as new buyers are acquiring their property at a lower level. So the supposed negative of a downturn in prices gives purchasers a bonus. It is a good time to consider buying again because you are paying less than you would have done just a few months ago.

And whether you wish to build your portfolio in the UK or here in Spain, the principles of funding are the same. If you already own a property you can look to purchase the next with 100% funding courtesy of a lender. You need not use any of your hard earned savings to grow the portfolio.

The basics are fairly simple; we have to provide enough funding to meet 100% of the purchase price and related costs. Here in Spain, we need to allow circa 11% over the headline number to meet taxes, solicitors costs and borrowing fees. If you own a property from which we can access the deposit of 20% and costs to a total of say 30%, then the remainder can be mortgaged on the new acquisition.

And, as with most property portfolios, the rental income on the new addition can be used to meet the debt service of the total borrowing.

‘A picture paints a thousand words’, so let’s see if I can simplify this. I am assuming the following:

• 200,000 existing UK property value. Not mortgaged.

• 150,000 new Spanish property = total cost 165,000

• Exchange rate 1.50 per (current rate 1.46 as at 26th August 05)

• 120,000 mortgage (80% of the 150,000) @ 3% = 3,600 per annum ‘Interest Only’

• 30,000 UK mortgage (45,000 deposit and costs) @ 5.5% = 1,650 per annum (2,475)

• 6,000 net rental income per annum (600

• 6,075 total debt service (1,650 plus 3,600)

In other words, not only is the property purchased with 100% mortgage funding but the net cost to you every year is all but covered by rental income.

And that is how property portfolios start.

In time, albeit in several years, both the UK and Spanish property are almost certain to have appreciated with equity being available once again to purchase a 3rd property. And so on and so on.

But what risks are attached to this philosophy? The are several really;

1) that property prices to not rise. Looking back over the nature of the UK market for the last 100 years, the returns on property have always been sound. Yes, there have been slumps but long term the investment is good.

2) you will not achieve the desired rental income. This is always a threat, but a cautious approach to letting (i.e. do not be greedy and consider the positive cash flow promise of long term lets) can overcome some of the vagaries.

Building a property portfolio is a long term plan; you cannot expect to achieve the desired goal overnight. That translates into a realisation that you must invest for at least 5 years and conservatively 10. And there has been no 10 years that have not seen a very strong capital appreciation either in the UK or here in Spain.

To continue the analogy with the acorn, in 5 years it may still be a juvenile, but it will be strong enough to withstand a few storms. In 10 years it will be well established and resembling it’s mighty peers and mature oaks.

Mark Mountney is a partner in Rose Financial Services, a specialist mortgage brokerage and financial advisor based in the Parque Comercial, Mojacar. He is a fully qualified mortgage and financial adviser in the UK with some 10 years experience in managing his own firm. Mark was also a founder of The Association of Mortgage Advisors, the trade association for mortgage intermediaries with 13,000 members.

Home equity loans allow you to borrow money using your house as collateral. These types of loans can be a very useful source of credit when you need it. The only problem is you have to pay it back, and you can’t afford to miss payments. Your house is at stake.

100% Home Equity Loans

When you get a home equity loan, you can usually borrow up to 100% (or more) of your home’s value. For example, if your home is worth $90,000 and you only owe $50,000, you have $40,000 in home equity to play with.

How Much Should You Borrow?

The amount of money that you borrow should depend on your personal situation. If you borrow 100% of your home’s equity right away, you are not leaving yourself with many options for the future. At the same time, home equity loans are a very good source of credit when you need it. Make sure you carefully assess your situation before making a final decision. Borrow enough, but don’t borrow more than you need.

Repaying Your Home Equity Loan

No matter how much money you borrow, you will have to pay it back. Consider this carefully before getting a 100% home equity loan. Remember, if you get a loan and cannot make the payments, you could be putting your home at risk.

A Final Piece of Advice on 100% Home Equity Loans

A 100% home equity loan may not be right for everyone. Before making a decision, contact different lenders, compare options, and find the home equity loan that meets your individual needs.

View our recommended 100 percent home equity loan lenders online.

Also, check out our recommended lenders for 100 percent mortgage refinancing online, or view our recommended cash pay day loan lenders online.

Are you excited about purchasing your first home? Or maybe this isn’t the first, but you should be excited anyway! It’s a big step and a big decision. Finding the right mortgage loan is key. The key to saving yourself money and probably a few headaches down the line.

Here are some helpful hints on finding a good mortgage loan.

First, consider the home you are planning to purchase. Know what you are looking for and want, but also realize what your limits are. How much home can you afford? Any mortgage company can tell you what they think you can afford, but know what that all breaks down for you per month.

Finding quality mortgage lenders is easy. Most companies are well known. There are several different places to look as well. Start with your own bank. Will they loan you the money? At what interest rate?

Another place to look for a mortgage lender is real estate offices. They often have their own lending companies set up to help their customers. Mortgage lending is big business. Fear not, there are places out there that will loan to you.

You can also find mortgage loans available to you online through mortgage companies. While they lose the personal touch of being near to your home, they often have the best rates available. It can’t be any easier to look from site to site to find the best rates out there.

When talking to the mortgage lenders, there are things you should know. You will need to know your income and expenses. You will need to know your basic credit rating. Good, Poor, or Excellent.

Then, there are things you need to find out about the lender as well. What are the rates? What are the terms? What additional charges are there? What length of loan can they give you? All of these things are things you can compare from one lender to the next. Easily.

Compile all this information. And then choose. Choose based on how you felt about that lender, about how they helped you, and the bottom line. Who has the best deal? Who can you trust? Getting all this down, will give you the understanding of what to expect from a lender down the road.

Enh Wah is the owner of Home
Buying Tips and Home Mortgage Loan Tips that offers tips in home buying tips and home
mortgage loan guide help you to find the best available home mortgage loans and
buying your dream home.