South Korean banks’ combined profit rose 1.2 percent last quarter as gains in fee income and trading in derivatives helped offset an increase in funds set aside for defaults and smaller loan margins.
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Singapore may boost handouts in its 2011 budget, seeking to narrow the income gap and help households cope with inflation that’s accelerated to a two-year high ahead of elections due within 12 months.
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Fifth Third Bancorp reported that fourth-quarter originations were up 32 percent from the third quarter. The mortgage servicing portfolio was 4 percent higher. Net income during the fourth quarter climbed 40 percent.
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What is a Hard Money Loan?
Hard money loans are a specialized type of real estate backed loans. Hard money lenders or private lenders provide short-term loans based on the value of real estate that has been collateralized for the loan.
Hard money loans typically have a much higher interest rate than bank loans because they fund deals that do not conform to bank standards and have higher risks. Hard money loans are more expensive than traditional loans because they are not based upon traditional credit guidelines. Hard money lenders may not require the income verification, credit score, etc. that typical lenders do, but their interest rate and points are higher.
“Points” on a hard money loan vary widely, some lenders may charge 1 to 3 points, while other lenders may charge up to 7 or 8 points. Some lenders base the points charged on the rehab experience of the borrower with regular clients getting reduced points the more business they do.
New rehabbers should not do more than 1 project at a time, especially in this economy. You don’t want to be stuck with a couple of houses when you do not have the finances to maintain them until they are sold. Also, as a new rehabber, you should get yourself registered (qualified) with a Hard Money Lender first so you can act fast when you find a house to rehab. You will able to get a “proof of funds” letter quickly from your Hard Money Lender to be qualified as a cash buyer. It is important to be a cash buyer since the sellers of foreclosed or distressed properties want fast deals. In fact, most ads or MLS listings require a pre-approved buyer and request the proof of funds letter to be submitted with the purchase contract. With most Hard Money Lenders, it is not difficult to get qualified. Usually it takes a simple application, a bit of information about your experience or lack thereof and some personal information.
The advantages of using Hard Money Loans are:
THINGS YOU NEED TO THINK ABOUT WHEN PURCHASING A HOUSE FOR REHAB
Pricing your home is one of the most important aspects of your rehabbing. You should determine a selling price when you purchase the property. However, sometimes things change and the original price you calculated to sell it is not longer an option. Always remember that you make a profit when you BUY the property, not when you SELL it!! This means that if you do not make a wise and well thought out purchase, there is no way you are going to make money. It just doesn’t happen because you want it to happen. This is a process that needs to be calculated to the end and that includes the SALE of the property after it has been rehabbed.
Pricing: Realize that because of the economy and the current housing market conditions, there are many properties on the market. Some are in great shape, some need a little work and some need a lot of work. Also there are a lot of pre-foreclosures, foreclosures and short sales. Ask yourself some questions:
Test the neighborhood:
1. Are there many distressed properties in the area?
2. Are there a lot of vacant lots?
3. Do the neighbors keep up their properties?
4. Are there schools nearby?
5. Are shopping areas convenient? Within walking distance?
6. Are there streetlights and sidewalks?
7. What about transportation? Bus lines? Train Lines?
8. Do comps in the neighborhood. Have your Realtor pull rehabbed properties in the same area that have recently sold (within 6 months), or do drive-bys yourself and look up the comparables with www.zillow.com or www.realtytrac.com. These sites will give you approximate values and can help you make the decision whether this is the right house to buy for rehab. Don’t fudge the numbers. Make sure you comps are similar size, number of bedrooms and baths, design, frame or brick, etc. If one or more of your “test items” does not work out, then move on to another property.
All of this must be considered when making a purchase for rehab.
The actual funding of the deal, the paperwork and how it works will be discussed in my next article.
I have ten years experience in Real Estate Investing. As a Real Estate Broker with my own company, I have personally rehabbed properties and wholesaled single family and two-flats in the Chicago area.
I am currently writing E-Books on Real Estate as an Investment, Hard Money Lending and Rehabbing for Profit that will be available on my website at http://www.RealEstateRehabProfits.com. Hard Money Lending criteria is available on the website http://www.zdeinvestments.com
I will also continue contributing shorter articles on many subjects pertaining to Real Estate.
Author: Rebecca A Miller
Article Source: EzineArticles.com
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Victoria, British Columbia, Canada (AHN) – British Columbia Premier Gordon Campbell announced Wednesday that residents of the province would get a 15 percent cut on their income tax rate beginning in January. The reduction applies to all income earned, with a cap of $72,000.
Campbell’s announcement is seen by observers as a last ditch effort to save his political career. His voter support plummeted following the collection of a harmonized sales tax in July.
The premier said that with the reduced rates, BC residents earning $50,000 annually would save $348 on taxes and those with income of $72,293 or more would enjoy the maximum savings of $616.
Campbell said with the tax reduction scheme, BC residents would have more money in their pockets that they could use to provide what they deem as best for their families. He expects the measure to boost the province’s economy.
The tax rate cut would cost BC coffers $568 million on the first year of implementation and would go up to $638 million yearly by 2013-14. Finance Minister Colin Hansen said the lost revenue would be made up by $2.1 billion extra income BC expects to earn in the next three years.
This is the second time that income tax rates were reduced under Campbell’s administration. The first was a 25 percent cut in 2001 when he assumed office as premier.
Campbell said that the imposition of the HST in July shook the BC residents’ confidence to spend, which he hopes to restore through the income tax rate cut.
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The equity release loan can be accessed by the persons aged over 55years. Such loan is available against one’s property. The release of equities is a great idea to supplement the insufficient income of the elderly persons. Flushing out money using one’s home is an enticing scheme in the modern age when the rate of interest in the banks and other financial institutions is continuously dipping down.
The retired persons are really frustrated with the low rate of interest and this has played a vital role in pushing up the demand for the equity release loan. There is a large gang of the aged persons taking resort to such loan to supplement their scanty incomes. The flow of the prospective borrowers will surely rise in the near future.
The prices of the necessary goods are spiraling up at a rapid pace and there is hardly anything in vision to put an end to such a rise. The elderly persons find it hard to make the both ends meet. If they are the homeowners, they can adopt the equity release loan to fund their needs. If the person is not willing to move out of the house, he or she can live there till the end of the life. They only need to extract the requisite money in exchange of the equities tied up in the property for a long time. They can ensure getting the lump sum amount once the deal is closed or can avail the partly flow of cash as long as they live. The combination of both the schemes is also available. Such a mix policy of getting the equity release loan can finely complement the scanty income of the pension holders.
It is not mandatory for the borrowers to use the amount to meet the monthly expenses only. They can use it for a holiday trip or buying a car or sending their grandchildren abroad for the higher studies. Whatever be the purpose, the equity release loan fits everyone’s needs. Whenever you release equity on house, you have to maintain a systematic and sequential procedure. It is very tedious process to get the equity release loan sanctioned and the whole procedure is replete with too many intricacies too. So the borrowers must consult an expert advisor to guide them through the entire procedure and make them avail the best deals available in the market. The equity release loan is a great plan to avail a goodly sum in times of financial quagmire in the last phase of one’s life.
Washington, DC, United States (AHN) – Legislation ending tax breaks for U.S. companies that outsource and providing tax incentives to those that move jobs back home failed in the Senate on Tuesday.
Democrats were short of the 60 votes required to overcome a Republican filibuster of the measure, Creating American Jobs and Ending Offshoring Act. By a vote of 53-45, the GOP blocked the bill with the help of three Democrats and Sen. Joe Lieberman (I-CT).
“This is about as pure a political exercise as you can get,” Senate Minority Leader Mitch McConnell (R-KY) said in a floor speech before the vote. “The way to get U.S. businesses to produce more here isn’t to tax them even further, it’s to stop punishing them with our high corporate tax rate.”
The legislation would have provided 24 months of payroll tax relief to businesses for each job brought back to the United States. The bill would have fixed tax loopholes that allowed employers to receive subsidies for ending their operations in the United States or expanding overseas.
Under the measure, the policy of deferral would be repealed. The policy allows companies to defer paying taxes on income of their foreign subsidies until this income is sent to the United States.
Democrats believe deferral put business with foreign counterparts at a competitive advantage over U.S. companies that employ Americans. But the ranking Republican in the Senate Finance Committee, Sen. Chuck Grassley (R-IA), argued, “There has been no finding that such income is often earned outside of the United States by a motivation to avoid U.S. tax.”
About 4.7 million manufacturing jobs were lost in the United States from 2001 through 2009, according to Sen. Debbie Stabenow (D-MI), whose state accounted for 1 million of those jobs.
“For too long, we have had policies in place that create the wrong kind of incentives and encourage businesses to ship jobs overseas,” Stabenow said in a statement after the bill failed. “If we don’t make things and grow things in America, we will never rebuild our middle class in our country.”
Democrats were hoping to pass a jobs bill this last week of session before lawmakers leave the Capitol to campaign for the general election. They were pushing hard earlier this month to pass a measure that would extend tax cuts for the middle class implemented in 2001 and 2003 during the Bush administration, but not those for earning more than $250,000 a year.
Republicans want to extend all the tax cuts, which are scheduled to expire in January. But they have had a difficult time gaining support for their proposal of making these tax cuts permanent for all, which would cost $3.7 trillion over 10 years.
The Democratic plan, extending the cuts to middle class families earning less than $250,000 a year, would cost $3 trillion.
Debate on the issue has grown increasingly vitriolic, with the unemployment rate at 9.6 percent, the mid-term elections looming and Republicans threatening to regain the majority in Congress.
Congress is due to hold a lame-duck session in November, and lawmakers are expected to take up the tax extensions when they return.
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Rising income inequality presents long-term problems for the economy, says Businessweek.com columnist Chris Farrell
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Hard money loans are the amount being borrowed to solve some urgent financial problems. The term hard signifies it’s quite Herculean to obtain because these loans are not provided by banks or financial institutions rather they are disbursed by private financial groups or lenders known as hard moneylenders. Hard can also be interpreted in different manner as there is high upfront cost involved and exorbitant interest rates are being charged. These loans also have high origination fees and cost more than an average mortgage (in some cases going as high as twice that of average mortgage).
Hard money loan is generally explored as the last resort. It should be understood like if one is willing to sale his/her business venture or the property and he/she thinks with a little bit of renovation and repairs the money generated can be quite high then hard money loans can be the best suited option for him/her. All he needs to do is to obtain the loan utilize it make some extra money and return it.
The uniqueness of hard money loans lie in their various characteristics like they have private lending sources. They come with short interest term of one to three years they charge upfront fee on closing before three months of the due date that is quite astronomical. There is limited number of debt covenants and they are shorter in duration. Moreover the failure in repayments results in the sale of the assets to nullify the debt.
Hard money comes in forms like hard money business loans or residential hard money loans. The hard money loans are usually secured by real estates of commercial viability. Hard money borrowers get the fund based on the estimated value of the commercial or residential real estate. The lenders are interested in money generating properties such as apartments, shopping malls, office buildings, hotels, hospitals and so on. However potent income generating activities like land acquisitions, bankruptcies are also seen with interest.
People who have been turned down the mortgages by the financial institutions because of various reasons like having a poor credit history, non competence to pay as they lack in desired income etc. also look upon the hard money loans as their saviors. Hard money loans are also sought by persons who are falling behind the repayments of their mortgage or fear the foreclosures.
The investors are lured by the typically high return on their amount which banks fail to provide them. So investing in hard money loans to borrowers having equity of 30-40% in the property seems to be a better proposition to them. These loans are given on the appraised value of the commercial property unlike traditional bank criteria which seek too many documented proofs like credit card scores, tax returns and income statement of the borrowers. Lesser paper work and lesser verifications make the procedure to obtain these loans very brisk.
Author: Steve A Clark
Article Source: EzineArticles.com
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It would be an understatement to say that the decline in the real estate market changed the lending environment. Lenders who used to allow stated income loans no longer offer them, or they may claim to offer them but decline 99% of the stated loan submissions offered. This is extremely bad for investors who have made their incomes solely from real estate investing, or other self employed endeavors.
Primarily because when they do their taxes they have a lot of items to deduct from their income, and so their tax returns do not effect the true gross income that they earn. W2 employees do not have this problem, as they are qualified based on their full gross income and even if they do write off their incomes, the tax returns are hardly ever requested when W2′s are provided.
A good Residential Hard Money Lender, understands this is the case for full time real estate investors, and they will not have much taxable income on purpose at the end of the tax year. Even if tax returns are requested, its just to verify that the investor really does what he said on the application provided, and not to calculate debt to income ratios.
Another benefit to obtaining a Residential Hard Money Loan is that the loan is based on the After Repair Value, and not the Purchase Price. With a conventional lender, it doesn’t matter if you are buying at 10% of value; they would still require a certain percentage down payment on that purchase price. In other words, conventional lending methods ignore the fact that you are getting the property at a deep discount.
When you obtain a mortgage with a Residential Hard Money Lender you can rest assured that the After Repair Value (ARV) is being considered in the transaction. In a lot of cases the deep discount an investor is getting will allow room for the lender to roll in closing costs, rehab costs, etc… This decreases the amount of capital that an investor has to put into their projects, and therefore leaves more capital available so that he can do more deals.
If you have a real estate investment in mind, and are concerned with minimizing risk, and maximizing return on investment, you should consider utilizing a Residential Hard Money Lender. Its easier to qualify, and they are more flexible on the structure of a transaction.
Are you an investor looking to minimize risk, and maximize ROI by partnering with an aggressive Residential Hard Money Lender? Does including closing costs, rehab costs, and basing your loan on After Repair Value sound appealing?
If so, you owe it to yourself to see if you too can qualify for an Investor Rehab Loan by visiting this website: http://www.residential-hard-money-lender.com/
Michael is an active real estate investor in Florida, and also specializes in hard money financing options for other real estate investors. Being an investor, its easy to understand the importance of solid funding as a foundation for any real estate investing business.
The keys to investing with minimal risk and maximum Return on Investment are within every investors reach with the proper use of Other peoples time and Other peoples Money.
If you would like to learn more about using other peoples money for investment leverage, CLICK HERE to visit the website.
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