This topic contains 6 replies, has 6 voices, and was last updated by Anonymous 7 years, 10 months ago.
- February 18, 2011 at 12:13 am #412934
do you mean a housing loan? or a house as a mortgage/collateral in your loan?
in housing loan, there are different terms and conditions that both the buyer and seller considers. and it all depends on your preferences.
let’s say you would like to loan a house worth 1M, with 16% (160,000) interest payable in 10 years with equal monthly amortization.
p = 1M
i = 16%
P+I = 1,160,000
= 9,666.67 —> this will be ur monthly amortization.
that’s just the basic computation, since we both dont know if your creditor (seller) has a service charge, or other charges like, fire insurance, transfer of title, etc. if there are other charges, it’s in your preference if you would like to pay it in advance or monthly amortized.
in Real Estate Mortgage, the creditor will appraise the value of the house and lot or the house alone if you prefer not to make your lot as a collateral.
there are banks which appraise the house/lot for 50-90% of the face value of the asset.
meaning if your house/lot can be sold at 1M, your appraised value would be 500,000.00 based on 50% appraisal.
meaning you can only loan a maximum amount of 500,000 based on your appraised value. If you give the creditor the title of your house and lot, you are half paid. but the bank will not let you know. this will serve as their security in case that you were not able to pay.
you will get your title from the creditor once you fully paid your account.
- February 18, 2011 at 12:28 am #412935
When you buy a house, the seller usually wants to receive the full purchase price. Usually the seller also has a mortgage on the house that must be repaid, and the buyer typically does not have the means to pay the entire price. Therefore, a lender is involved in the transaction. Let’s use an example.
S owns a house and owes $ 50,000 on a mortgage held by lender X. S is selling the house for $ 100,000. B offers to buy the house for $ 90,000 and A accepts the offer. B can pay only $ 10,000 so needs to borrow the remaining $ 80,000. Lender Y agrees to lend the money.
Lender Y writes a check for $ 80,000 to the agency handling the transaction. B writes a check for $ 10,000 to the agency. The agency pays $ 50,000 to lender X and $ 40,000 to seller S. Buyer B signs an $ 80,000 mortgage loan to lender Y and starts making monthly payments.
It can get more complicated. For example, lender Y is willing to lend only $ 70,000 so seller S agrees to accept a second mortgage for the remaining $ 10,000. B signs a first mortgage to Y and a second mortgage to S. B makes monthly payments to both Y and S.
A sub prime mortgage is a loan to a buyer who does have the best ability to repay the debt. In the above example, B can only pay $ 3,000 and has to borrow the remaining $ 87,000. B can barely afford to make the monthly payments on the mortgage, given his small income. In other words, B is not a prime buyer. Lender Y is taking a lot more risk by lending the money to B, so the mortgage has a higher than normal interest rate, making it even harder for B to repay the debt.
Some sub prime mortgages were arranged with adjustable interest rates. The first few years of the debt, the rate is low and the monthly payments are small. The assumption is that the buyer will be able to earn more in the future or the value of the house will be higher and it can be sold at a profit. Three years later the interest rate is adjusted upward and now the monthly payments become larger, but the buyer is unable to make the larger payment. The housing market is in a slump and it is hard to sell the house for as much as the original price. The buyer might have lost his job, or has high medical expenses due to an accident and does not pay the mortgage for 2-3 months. The lender forecloses on the house in order to sell it and recover the remaining debt. The situation is common today because many banks made sub prime loans and the housing market has become stagnant. Foreclosures are taking place every day and the sub prime owners are losing their houses.
- April 16, 2011 at 5:29 am #199138
Hi, i am looking for the cheapest and best debt management company, do you have any details please?
- April 16, 2011 at 5:35 am #256644
Your own bank would be the easiest and cheapest for debt consolidation but they still own your a’ss, don’t let them fool you they will sing a song maybe 6.5 percent apr but the slightest default and they’ll screw you. I had a 5k consolidation loan in the end i ended up paying 9k as a final settlement. I took out the insurance, now heres where it gets nasty i got paid of from work, the place i used to work for told the bank when asked told them i walked! and left work. They refused to honour the insurance hence the 9k settlement. If you can as a final solution get bankruptcy instead of a loan. You win they loose. I know other companies charge 12-13 percent on a consolidation loan or as they call it “debt management” the only thing they manage is getting you into more debt.
- April 16, 2011 at 5:42 am #256756
Firstly don,t pay for debt management
it is free and impartial see below
- April 16, 2011 at 5:50 am #256872
There’s a good article at eHow on steps to take to begin tackling your debt. Take a look at it:
How to Stop Escalating Debt
It includes information on companies (both non-profit and for-profit) that can help you with debt consolidation and reduction.
You can also look here for tips on earning some extra cash online:
How to make money on the internet, scam-free
Lastly, here’s an interesting alternative to conventional lending…getting a “social networking” loan from Virgin Money (from the same folks who run Virgin Airlines):
Social Loans from Virgin Money
Hope these help.
- April 16, 2011 at 12:10 pm #257148
The best start is to make sure to start saving. Dont wait until everythign else is paid off. If you are to hit a rough patch, having the old debt paid off will do absolutely no good when you have to go into debt yet again since nothing is put back for a rainy day. This is the #1 mistake listed at many websites I have visited.
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