Real Easy Mortgage

Beth Collingz, PLC International Marketing Director for Pacific Concord Properties Inc’s Lancaster Brand of Apart-Hotels or Condotels in the Philippines said a recent study published by UK National Savings & Investments found 84 per cent of 18 to 30-year-olds believe buying property abroad is a more viable option than
buying in Britain.

Young people buying abroad and renting in Britain are and will continue to be a growing phenomenon. They generally look at spending less than 200,000. This comes on the back of recent reports by Barclays Bank that revealed the number of Britons keen to buy property abroad has doubled to 18,000 in a year.

When you consider these facts along with aging population, increased property wealth, Self-Invested Pension Plans and leisure lifestyle aspirations of the populous it is easy to see why many shrewd property investors are looking for better lifestyle and hassle free overseas ownership and why many advisors are looking aside from the traditional UK buy to let and Spanish holiday let for property options for Condotel Investments in the Philippines. Collingz said: Since the pound value depreciated and UK Pound Sterling hit 96:1 on the Philippine Peso, my phone has been very busy with buyers from the UK interested in purchasing investment properties and holiday homes here in the Philippines.

A lot of this interest is being driven by relatively cheap market prices in the Philippines compared to Europe, especially UK Housing prices, and easy payment options available for our Condotel Developments, but there are other factors, too. Offshore Property Investors, Foreign baby boomers as well as overseas Filipinos, are looking for ways to maximize their return on investments as they approach retirement, and so are purchasing second homes, particularly Condotel Investments where they can use the Condo for vacations and rent it out through In-House Management when not using the unit thereby gaining rental incomes that on todays purchase prices, give a projected ROI on their investments of some 8-16% depending upon the mode of payment for the unit.

Collingz, who also runs PLC Global Pinoy, an internet based marketing network specializing in Condotel Investments, indicated more than 85% of all sales in Metro Manila were to international clients. These international buyers know its a buyers market in the Philippines right now – there are a lot of properties available and fewer local buyers, Collingz said. Im working with clients who are purchasing their second property with me. We also have referrals from many of our prior customers and new clients who have found us through our Web sites, lancastersuites.com and plcglobalpinoy.com which include a special section for international buyers.

Another major driving factor in overseas property investments from the United Kingdom is UK Tax Payers taking advantage of tax incentives and Investing their Self-Invested Pension Plan [SIPP] In Philippine Condotel Investment Real Estate for Rental Income and Retirement said Collingz.

A Self Invested Pension Plan [SIPP] is a personal pension plan but with one very significant difference: administration is separate from investment content, giving the plan holder freedom to choose for himself and change the investments within it. The long-awaited rules on what savers can include in their personal pension plans were unveiled in April 2006 by HM Revenue & Customs. The Guidance Notes confirm that the Chancellor is permitting Self Invested Pension Plan [SIPP] holders to invest in hotels such as the Lancaster Brand of Condo Hotels in the Philippines. The only stipulation is that SIPP holders may not stay in their rooms. With more nights available for paying guests, this not surprisingly increases the room owners’ returns. It is estimated there are now more than 70,000 plans holding over 14bn.

A year or so ago, few people in the UK realized that they could manage their Pension Plan portfolios themselves, and even fewer knew that they could invest their SIPP retirement money in homes in the sun which now prove to be among the most popular potential investments to include in a SIPP

If youre considering using your SIPP to invest in real estate, there are some excellent reasons that you should choose Philippine Condotel Investment real estate to drive your retirement portfolio into high profit margins. The Philippines is ideal for this type of investment because a SIPP can establish title to a property in a country whose legal framework recognizes trusts and a SIPP is simply another form of trust.

Investing in foreign real estate is neither as risky nor as tricky as a lot of people would have you believe. While land and housing prices in the U.K. have soared astronomically in the past decade, the world real estate market is a far different story. Its still possible to buy a preconstruction Condotel suite at Lancaster The Atrium located in Metro Manila, Philippines, for less than GBP 25,000.00

The beauty of holding property in the Philippines is the low cost of property taxes and maintenance. A GBP 25,000 Condotel suite will only set you back GBP 100 in property taxes per year, and maintenance costs are similarly low. When you add in the tax-protected status of investments made in your SIPP, annual off plan property appreciation and the 8-16% returns through rental income through the Condotel advantage, you have an incredible ROI on a purchase of Philippine Condotel investment real estate enthused Collingz.

With preconstruction property in the Philippines appreciating at some 20% per annum not only do real estate investments look good but the rental income return in the Country is in excess of what many Pension Plans offer for the same or similar investment.

Many new investors are looking to replace failed pension plans and other future saving schemes with a solid investment in Real Estate. Clients are looking for investments that will give them an income for retirement as an alternative to traditional private pension plans that have failed. Most company pension plans are insufficient as are Government Pensions. Bank rates for Savings accounts are at record lows. Savvy investors are now looking for a more solid investment with potential for monthly income. Condotels in the Philippines fit the bill.

Collingz said this potential, high rates of rental returns from Condo Hotel Investments, up to 16% per annum, opens up a huge market not traditionally looked at by Real Estate Agents and Brokers whom all so often run around looking for normal residential profile buyers without looking at the by far bigger picture of investments, investing and retirement. “Were here to help our clients and advise them of emerging investment opportunities in the Philippines. Self-Invested Pension Plans and Lancaster Condotels, fit this bill exactly.

Pacific Concord Properties, Inc., Flagship Lancaster Condo Hotel [Manila] development located along Shaw Boulevard, Mandaluyong City, Metro Manila, is currently one of the hottest Condotel Investments in the Philippines. Lancaster – The Atrium is accepting Reservations for Studio, One, Two & Three Bedroom Suites adopting International Standard Escrow Trust Account Buyer Safe Easy Secure Payment Plans with 6 year interest free payment terms or up to 12 year “In-House” financing available, full condo ownership and minimum monthly maintenance fees, you really should take a moment to look at this Philippine Condotel Investment Opportunity encouraged Collingz.

Further info regarding Condotel Investments in the Philippines, Lancaster Suites currently available suites, price and terms of payment can be found on the firms website.

Mortgages. First-Time Buyers Let Down By The Governments Homebuy Scheme.

Late last year, accompanied by the usual razzmatazz, Gordon Brown announced the Governments new Open Market Homebuy mortgage scheme for first-time buyers.

Under the Homebuy scheme, first time buyers take out a mortgage for 75% of a home’s value with no deposit and the Government and the mortgage lender will in practice buy the remaining 25% of the property. Then when the borrower eventually decides to sell the property, the borrower will receive 75% of the net sales proceeds and the remaining 25% of the sale price will go to the Government and the mortgage lender. In the mean time, if the owner wishes to buy out all, or part, of the Governments or mortgage lenders 25% interest, the borrower can simply repay the money the Government and mortgage lender initially put in.- there will be no penalty.

In our view, first time buyers shouldn’t become too excited about this scheme for six reasons: –

The Government has recently confirmed that buyers will have to pay a 1% premium on top of the usual mortgage rate.

There has been no announcement as to the amount relative to income, which borrowers can qualify for. So at this stage it’s impossible to judge what sort of house a first-timer could buy. However, we bet it’s a very small one!

Despite hopes that more mortgage lenders would join the Yorkshire Building Society, the Halifax, and the Nationwide, as co-sponsors of the scheme, no additional lenders have been added to the list.

The Government expects Homebuy to lend to 4,000 first time buyers per year. That’s only fractionally over 1% of the 361,000 first time house purchases arranged each year. In terms of availability, it seems as if Homebuy mortgages are going to challenge hens teeth!

The Government hasn’t even announced the rules under which a first time buyer can qualify to even apply for a Homebuy mortgage.

The scheme is not planned to be operational until October 2006.

So even if you’re happy to pay the 1% premium, your chances don’t look too good for qualifying for an Open Market Homebuy mortgage. Our advice is to forget about them and find a top class mortgage broker to seek out a great deal on the open market.

Signs that our reticence is shared amongst Members of Parliament came from a comment from Michael Grove, shadow housing minister. He is reported as telling the Sunday Telegraph that he wanted to see the Homebuy scheme made easier and cheaper for lenders in order to encourage greater participation from the mortgage providers. We think that’s fine, but participate in what? Until we know who can apply and how much they can borrow, the scheme means nothing.

A home is the single most expensive thing most people will ever purchase. In addition, paying off a home loan can take as long as forty years and will involve paying an amount of interest that exceeds the cost of the house itself. In short, buying a house is not something to be done without a lot of forethought. With the average American living in their homes for seven years or less, most mortgages are probably offered to people who have purchased a home before. But there are always people who are buying for the first time, and for them, knowing how the process works is important.

Here are some useful tips for first-time homebuyers:

Know how much you can afford to pay. This includes not only the total price of the house, but the monthly payments, as well. Do not be fooled by the monthly amount the lender tells you that you can afford; that number is usually high enough to be well beyond most buyers’ comfort zones. If the lender suggests that you can pay as much as 2000 per month but you only feel comfortable paying 1500 per month, then that is your limit. You should buy a house that will allow you to pay that amount, and no more.

Check your credit ahead of time. No one wants to be denied a home loan because of errors on your credit report. You can check it for free at annualcreditreport.com. Get a copy and make sure the information is accurate.

Shop around for a good lender. The interest rates and terms will vary from lender to lender, so you should seek out the best terms. Additionally, you should try to find a lender with whom you feel comfortable. You will be paying on your mortgage for decades to come, so find a lender and terms with which you are comfortable.

Be aware of closing costs. The amount of money that a buyer is expected to bring to closing can be astonishing. Don’t be caught off guard when it come time to close and the lender asks you to bring a certified check for 15,000 that you do not have. Find out ahead of time exactly how much it will cost you to close on the loan and have those funds ready.

Most of these items will seem like common sense, especially to those who have financed a house before. But anyone who is buying a home for the first time should be prepared for the process. By being prepared, the process should go smoothly.

Young families are now living their dreams thanks to a range of home loans designed especially for them. Gone are the days when bad credit or lack of funds meant you cant obtain a home loan to purchase the home of your dreams. While these factors may have been insurmountable factors in the past, they are no longer legitimate obstacles for the first time home buyer who is seeking a home loan.

New opportunities have appeared throughout the nation thanks to an abundance of creative home loan (mortgage) programs to help the first time home buyer who previously had been denied access to the housing market. There are credit workshops, down payment assistance plans, home buying initiatives and grants earmarked especially for first time home buyers springing up everywhere. Many people either don’t know about these first time home loans or grants or they don’t know how easily they can get them.

Overview of First Time Home Owner loans

Its difficult for young people to often buy a home since they are just starting out with their careers and may still be paying on a large student loan. Some people turn to first home buyer options to help with overcoming the money hurdles of the home loan. There are a variety of these programs to choose from and each one is different, depending on where theyre offered. The objective is this: first time home buyer loans give financial assistance to qualified borrowers. They have the options of doing this in the following ways:

-Allow for a very low (or no) down payment
-Subsidize interest costs (they pay all or part of it)
-Offer grants
-Forgive loans
-Limit fees that lenders are allowed to charge
-Defer payments

The Government will help with a home loan for first time buyers

Many first time home buyers are discovering they qualify for down payment or home loan assistance. The U.S. Department of Housing and Urban Development gives states and municipalities money to distribute to low- and moderate-income families to put toward their down payment or closing costs each year. Prospective homeowners can obtain up to 15,000 for a home loan. The good news is that sometimes, the money is made available as a home loan that is completely forgiven if the home buyer promises to stay in the home for three to five years. Some programs offer up to 10% of the purchase price. To qualify for down payment assistance, a person typically can earn no more than 80% of a region’s median income.

The first step for hopeful buyers seeking a home loan should be to contact their state housing finance agency. There are dozens of relevant agencies listed on the National Council of State Housing Agencies’ Website at http:www.ncsha.org. There is a wealth of information to be found online for first time home buyers seeking a home loan.

Prospective home owners should also check with their community development office and ask about home loan programs and grants offered for first time home buyers. Dont overlook local community organizations and church leadership. They may know of housing assistance programs in the community.

Usually the home buyer will try to put together several grants totaling the amount of the targeted home loan. Quite often local banks participate in issuing these home loans to first time home buyers. There are often strings attached but it can be a small price to pay for the possibility of receiving free money or financial aid that could not be obtained otherwise. Each home loan program will have its own individual set of rules.

One of the contingencies of receiving these home loans for first time home buyers is that prospective home buyers must attend several hours of informal counseling. The industry wants to make sure prospective first time home buyers know how to steer clear of predatory lending practices. They may also discover their credit score is good enough for a traditional mortgagehome loan.

Counseling Classes for Obtaining a Home Loan

The home-buying process can be confusing even for people who have bought several homes. Being familiar with offers, counter offers, appraisals, closing procedures and so on, before beginning the search will help alleviate some of the stress and allow a person to make more informed decisions.

Local first time home buyers counseling services offers home buyer education classes. The programs are free and open to anyone interested in buying a home.

Programs For first Timers

Banks, financial institutions, and even nonprofit groups, such as Goodwill are making it easier than ever for you to go from renter to homeowner. There are numerous programs available to provide down-payment assistance. These programs can alleviate some of the initial stress of coming up with enough cash upfront. The following is just a sampling of what’s out there.

-Wells Fargo www.wellsfargo.com. The Home Opportunities program is available to public employees and members of the military. It offers no-money-down, up to 100% financing on a single-family home, condominium, co-op, or multi-unit property.

-Washington Mutual www.wamu.com; WaMu offers potential home buyers deferred payment or low-interest loans, down payment and mortgage assistance, and shared appreciation mortgages.

-The Neighborhood Assistance Corporation of America www.naca.com ; Services from this nonprofit community advocacy and housing organization include home-buying workshops, financial counseling, and home evaluations.

-The Nehemiah Program www.nehemiahcorp.org; this is the nation’s largest privately funded down payment assistance program. Among the features of The Nehemiah Program are gift funds up to 6% of the final contract sales price to put toward down payment andor closing costs and financing for new construction or the purchase of an existing home. There are no income, asset, or geographical restrictions to qualify.

While they are a perfect fit for some, first time home buyer loans are the wrong choice for others.

Pitfalls of First Time Home Loan

For some first time home buyers, these programs are perfect. They open the door to home ownership where a family would not have been able to buy a home. Communities also benefit from first time home buyer loans – homeowners take care of their property, get involved, and contribute to the economy. Nevertheless, first time home buyer loans can be the wrong choice in some cases.

With a subsidized first time home buyer loan, you face some challenges:

-Lower value home may not be the home you want
-You might lose some of the benefits of the program if you sell your home too soon
-You may have to pay recapture tax for some of the benefits you received
-You may be limited to a short list of loan types (only 30 year fixed rate mortgages)
-You may have to share increased home values with the program

Given these restrictions, you may do best to avoid subsidized first time home buyer loans. Youll probably come out ahead using a plain-vanilla mortgage if youve got decent credit. With a FICO credit score above 720, you probably wont see an advantage with the subsidized first time home buyer loan. Once you get below 680, the subsidized program will start to look better. These days, you can get traditional home loans mortgages with very little down.

Florida has been labeled a progressive state before, when it introduced radical ‘green’ measures throughout the state, but this time its innovative idea is to offer help to first time buyers. Florida has recognized that younger people are being pushed out of the housing market, and are trying to rectify this with fairly substantial financial incentives.

This failure to accommodate young people in the realty market has happened because nationwide, most homes have become larger and more expensive. Consequently, they are too pricey for the average first time buyer.

A spokesman for a local builders association told the St. Petersburg Times that builders will still be building over-sized homes but there will also be an increase in smaller houses being built. This change in strategy is not seen as a fad by builders; it is simply sound economics as smaller homes are in short supply.

Building smaller homes in the Florida area could also be one way of keeping the younger generation active there. There have been extensive studies involving the affordability of house prices for young people. One recent study was carried out in Boston, Massachusetts. This is an area known for its lack of moderately priced housing.

Boston is the third most expensive property market in the nation and according to the ‘Boston Globe’ newspaper, young people are moving away in droves because of the house prices. This is costing Massachusetts the ‘human capital’ needed for future growth and economic expansion. This type of situation could easily be replicated in Florida because it is such a popular retirement area; approximately 17% of the population is over 55.

This youthful exodus has been recognized and hotly debated in Boston. Part of the blame has been laid at the local government’s feet with their zone rulings favoring large residential lots. A study proved that homes built from 1998 to 2002 used an average of 1.3 acres per lot.

With the cost of a building lot in Boston quoted at around 300,000 and a house costing around 250,000, young people have no chance of owning a home.

Perhaps learning from Boston’s mistakes, the news in Florida is that the government is trying to encourage more first time buyers. This will expand the younger segment of Florida society and consequently will also be likely to increase the permanent population.

The first time buyer program is designed to help those people who may have only a modest income. (There is a ceiling on the monthly salary.) Income limits are not rigid, but determined by the number of individuals living in the house.

The help that the state of Florida is offering is very worthwhile to look into if you are a first time buyer. Help can come in the form of assistance with the down payment, with the closing costs and in the provision of low, fixed rate mortgages.

There are several requirements to be met in order to qualify, including established credit worthiness and not having owned a home in the last three years. The program details can be found on the web listed as Florida’s First Time Buyer Program, or you can ask your real estate agent to help you sort out the details.

Changes in the threshold for stamp duty failed to stop the inroads made by the tax, a new study by a leading mortgage lender reveals.

Portman Building Society shows that in the following months after the rise in the exemption threshold from April 2005, British homeowners paid almost 60 million more in stamp duty than in the same period before April. Portman Building Society also advises that even though the government raised the threshold to 120,000, the change made minimal impact at a time of rising house prices, considering that the average property stands close to 200,000 and the typical first-time buyer purchase amounts to 145,000.

Matthew Wyles, group development director at Portman Building Society commented that “Stamp duty is no more than a form of advance capital gains tax – paid long before buyers have enjoyed any of the financial benefits achievable from home ownership”. First-time buyers should be liberated from this unjust tax.

Newcastle Building Society is hoping to help first-time buyers by launching new mortgage deals aimed specifically at graduates.

Steve Urwin, the marketing manager from Newcastle Building Society advises they understand the issues first-time buyers face so they launched the 100 per cent mortgage and the guarantor mortgage at the society. Mr Urwin says that there are parents and grandparents who want to help their offspring become first-time buyers. This is made possible through sharing the initial cost of a mortgage, with the first-time buyers taking on increasing responsibility as they start getting paid more.

The new first-time buyer mortgage offerings include a deal that offers 100 per cent loan-to-value on properties valued up to 200,000.

The guarantor mortgage is available to first-time buyers between the ages of 21 and 35 who earn an annual salary of at least 15,000.

Please visit MoveTo for a wide range of properties suitable for first-time buyers.

Homeownership is one of the pillars of the American economy. To keep it propped up, there are many programs to help first time buyers make down payments.

First Time Buyers Program – Down Payment

Are you a home buyer looking to buy your very first home? Do you believe you can make the mortgage payments on the home but just dont have enough cash on hand to make the down payments? Are you not able to buy the home because of this mortgage down payment problem? If this defines you, then dont be worried. There are many programs out there that can help you to make the down payment and move in to your very own home.

Firstly, check with the FHA – the Federal Housing Association. The FHA often offers many programs to various people who cant make the down payment on their home. The Department of Housing and Development is another organization that has many programs in place to allow first time buyers to be able to buy their very own home and get over the hurdles of down payment costs. Both of these organizations should be sought out right away and you should contact them and see what sort of programs and assistance you might be eligible for.

For minorities and low income families in particular, there is another big program in place that can be of great assistance. If you fall into one of those categories, you may be eligible for the American Dream Down Payment Initiative. Passed in 2003, ADDI allows for eligible first time home buyers to receive as much as 10,000 in assistance for making the down payment on their home.

In addition to these organizations, there are also many programs in place by states that seek to encourage first time home buyers. These programs often offer grants and other assistance to first time home buyers so that they can meet the down payment requirements for their home. Make sure to do an internet search for the housing department in your state to seek out information on programs relevant to your location.

First time home buyers who cant make their down payment should not worry, there are many programs in place that can help them. If you are a first time home buyer and need assistance, you can seek out many of these different groups so that you can be able to make the down payment and be able to move in to a home of your very own.

If you have a dream about owning your own home and applying for a mortgage then you may be a bit nervous at the present moment. While having your own home is the American dream the high prices involved can be overwhelming. In addition to this, many lenders will be more concerned with earning a profit than with helping you find a home that matches your income. Below are some steps you can take to properly apply for your first mortgage.

Applying for a mortgage used to be simple. People would compare the prices and rates on houses they wanted, and once the found a lender they were comfortable with, they would make a large down payment and then move in. Today things have changed, and going through the number of options available can be very stressful. One thing you should do before shopping for a house is to educate yourself.

First Mortgage Application Steps

The first thing you will want to do is look at your current income. How much do you make per year? How secure is your job? Remember, if you go about getting a mortgage the traditional way, it could take 15 to 30 years to pay it off, and if you get behind on your payments, you could lose your home and have your credit ruined. If you can’t afford a home, it is best not to move into one until you can. This will keep you from taking on debt you can’t afford.

How Much Can You Afford?

If you feel that you can afford a mortgage the next thing you should decide is how much you can afford. Lenders have a tendency to offer you mortgages which are more than you can afford, and this is important to remember. In addition to the cost of the mortgage itself, you will have to pay taxes, insurance and other expenses as well. These costs should be included in your monthly expenses.

Apply Directly Or Via A Broker?

When you begin looking for a mortgage you will encounter two types of lenders; mortgage brokers and direct lenders. The direct lenders are the people who have the money to lend you. They are ultimately the individuals who decide if you will be approved for a home. The mortgage broker acts as a middleman, going out and finding direct lenders who can give you the best deal.

While the lenders may have a limited number of loans available, a mortgage broker will often have access to multiple lenders simultaneously. If you are looking for a specific type of mortgage, a mortgage broker may be better to use than a direct lender. However, a mortgage broker will charge you for their services, and this could be a certain percentage of the mortgage loan you end up with. With the rise of the internet, online mortgage brokers can help you save money.

Get The Paper Work In Order

Once you have found a loan through a direct lender or mortgage broker the next step is to fill out an application. There are a number of things you will need to fill out on the application and it will help if you have some supporting documents. You will need to provide information about your income, length of employment, and your assets. They will also want to know what other loans or credit cards you have.

Once this information has been provided, the lender will look at your credit report. In addition to this, they will want to see your bank statements and check stubs from your job. You may also need to show them tax information and data about your insurance. If your credit is good, an appraiser will be hired to make sure the house is valued at the loan amount that will be given to you.

Introduction:

Property is an investment, and if purchased in a planned way is beneficial otherwise it may be dangerous if a high amount is borrowed. Most of the financial authorities prefer the first time buyer and offers various incentives. You should contact to an estate agent and discuss about your financial health, repayment options, and selection of mortgage and redemption options. On the basis of your financial repayment capabilities, you should select a most beneficial option.

Benefits of home over rented house:

The rent you pay is not admissible to give you benefits under state or federal law. The mortgage loan interest is deductible from income tax. This saves a lot of amount.
The property tax paid is also accounted for tax deduction purposes.
The value of own house will rise over a period of time and it will be an additional benefit.

General Mortgages:

(a)Fixed rate Mortgage and Adjustable rate Mortgage:

Whether you are eligible for a particular mortgage or not, it is better you know about all types of mortgages. The common types of mortgages include fixed rate mortgage and adjustable rate mortgage.

In fixed rate mortgage, the interest rate remains same for throughout the mortgage periods. Some mortgage may be as high as for 30 years and some may be lower periods. The benefits of fixed types of mortgage are that you can plan in advance the amount to be paid.

In adjustable rate mortgage, interest rate generally starts lower than the fixed rate mortgage and may vary once or twice during the year as these rates are linked to a financial index. Depending on financial index (Treasury Security Index for United States) the rates may be either low or high. As the initial amount in these rates is always lower than the fixed rate mortgages, a more mortgage loan can be secured for the same burden.

(b)Repayment and Endowment Mortgage:

First time buyers prefer repayment mortgages, as at present conditions endowment mortgages are not capable to cover the mortgages.

(c)Interest only option of payment:

Some lenders may give an option for a few years for repayment option of loan interest only. In such cases, the repayment amount will be low, but principle amount will remain as such. So this option is not favorable.

Mortgage Amount:

Many lenders may offer 100% of the property value and up to 5 times salary of the individuals. It is recommended that single person should take between 2.5 to 3 times of the salary and couple should take 2 to 2.5 times of the salary.

Mortgage Indemnity Guaranteed (MIGs):

First time depositor may be asked by the lender to deposit a few percent (5 to 10%) of the loan amount for a lower risk of mortgage default. If the deposit amount is less than the expected amount, the lender may force the borrower to buy MIG. This is an insurance policy and provides protection to lender in case of default. These MIG are of no use to the borrower, as the premium amount of these policies has to be paid by borrower. Therefore the borrower should initially deposit 5 to 10% of the loan amount, to avoid MIG. If the borrower has to take a MIG, the borrower should ensure a good deal.

Penalty:

The lender lends the money to the borrower against a mortgage deal for a fixed period and if the borrower does not follow the deal, a provision of penalty is made.

Getting a foothold on the property ladder is not easy particularly these days with property prices above the amount most peoples salaries can cover.

Reports from the property market show that the age of first time buyers has increased in recent years as younger people struggle to get a mortgage. Some first time buyers struggle to cover all the costs of buying, and often hadnt anticipated all of the extra costs beforehand. There are some solutions to these problems, however.

The market is responding to the needs of first time buyers and can offer special types of mortgage and extra support. If you mention to your lender or advisor that you are a first time buyer, they will offer advice specifically for your situation.

No Deposit?

Finding 10% of your mortgage is no mean feat. Younger people often dont have the savings to put down a deposit, and have to borrow the money. There are 100% mortgages available for those unable to find the cash deposit, or mortgages where you provide just 5% of the total amount. Unfortunately many of these mortgages apply charges (Higher Lending Charges) and have less flexible terms than other mortgages.

Salary Not High Enough?

If your salary doesnt qualify you to take out a large enough mortgage, you may want to look at guarantor mortgages. Basically, someone who is more financially secure (often a parent) will undersign your mortgage agreement, promising to honour the debt should you fail to meet repayments. This type of mortgage is often chosen by students, who either then pay rent to the guarantor, or pay the mortgage directly to the lender. The guarantor should be totally clear about the responsibility they are undertaking, and its a good idea to have a legal document written up laying out all terms of the agreement.

Share The Cost

You may want to consider taking out a joint mortgage. This doesnt just apply to couples two or more people can enter a partnership and apply for a mortgage together. Normally a bank will pay up to 3.75 times the largest salary plus the amount of the second salary. If you choose to undertake a joint mortgage you should have a legal agreement with the person you are going into partnership with. All the terms should be clearly understood by all parties, and the paperwork should be processed by a solicitor.