Category Archives: Home Mortgage
Reasons To Invest In Private Mortgages
It seems that no matter where you turn, there are stories of people losing their hard earned investment capital in the stock market due to the poor money management of a trusted adviser.
Although this news can be bleak at times, there are a few lessons that can be learned.
*Regardless of your financial successes, you can lose it all at a moments notice. Therefore, you must stay focused. Keep your eyes on the road at all times.
*Don’t let your emotions, especially greed; convince you to make an investment that does not make sense.
*Educate yourself on the different methods for securely investing your capital. So many would-be investors get swindled out of their money based on investments that have no economic or financial foundation.
*Every investment opportunity should have multiple exit strategies. If there is only one way to profit from an investment, then you will always be limited.
The moral to the story is that you have to be proactive and take control of your investments. It is ultimately your responsibility to ensure that your capital is invested in safe and secure opportunities that will also provide you with above average returns. The stock market is unpredictable and offers little control after an investment has been made. However, those who are looking for a better alternative have begun to flock to the real estate market by investing in private mortgages.
As a Private Lender, you will be financing investment properties with your own private capital (or that of your IRA). This allows you to become the bank and invest your capital in loans that are secured by real property. These investment properties also add a level of security, generally with at least a 30% equity position in the property.
The Benefits of Becoming a Private Lender
As a Private Lender, your capital is protected by a mortgage on the investment property which is no more than 70% of the after repaired value of the property. This allows you to have an adequate means to recoup your investment in the event that the borrower defaults on their payments.
To a certain degree, this form of passively investing in real estate is hands-off and stress free. As the lender, you simply enter into a loan agreement with the borrower and collect your monthly payments and/or capital gains.
Conceptually this investment strategy is very simple and straight forward. If you finance $ 70,000 for a property that is worth $ 100,000 after repairs are completed, you will receive a pre-negotiated interest payment, normally in the 8% – 12% range. You immediately know what returns you will make on a particular deal and best of all your investment is secured by the real estate.
In order to succeed as a Private Lender, you will need the following:
*Access to experienced real estate investors
*The capital to finance the properties they are attempting to purchase
*A team of professionals that will help you to close your deals quickly and ethically
You investments should be working hard, so you don’t have to. Begin to take control of your financial future by investing in private mortgages and watch as your capital grows.
For more information on Private Lending, please visit www.privatemortgagesnow.com.
Introduction to Credit Cards
You probably already know what a credit card is. You see the ads every day – in the television, on the radio, in the newspapers or on billboard advertisements. Your friends, parents and relatives use them all the time. But just to clear up any misinformation, lets look at what credit cards are, why you should have one and what risks are involved with using one.
Simply stated, a credit card is a financial arrangement between you the card holder and a financial institution such as a bank or credit union. The arrangement specifies that you can borrow money from the lender as long as you promise to pay them back in the future. The lender sets the terms for the deal, including how often payments are due, what the minimum payment will be and what interest rates will apply. Your payment will include not just the amount of money you borrowed, but also an additional charge based on that rate of interest.
Credit cards can be used as a tool, offering many benefits for consumers. Some of these benefits include:
Convenience: With a credit card, you can buy anything you want right away, whether or not you have the cash available at the time. If youre purchasing a big ticket item like a computer or a washing machine, you dont have to wait for months until you save up the money.
Emergency Protection: If youre ever in an emergency, youll see how helpful a credit card can be. Whether youre stuck with medical bills or auto repair fees, using a credit card can help you get back on your feet again.
Security: Large amounts of cash can be lost or stolen. But if your credit card goes missing, you can have the account cancelled and a new card issued without losing any of your money.
Building Your Credit: If you dream of buying a house or really nice car, you need to have a credit history that demonstrates you can take on debt and pay it back on schedule. You can use a credit card to make small purchases and build up your credit score by paying your statement on time.
When used responsibly, credit cards can help improve our daily lives. But the temptation to live beyond your means and max out your credit limit can be a problem. Thats why its important to think of your credit cards as tools that you can use, not free tickets for anything you want. Here are some simple tips to help you cope with your credit card debt:
Make a Budget: One of the first steps to financial freedom is a realistic budget. If you dont already have one, check out the article Creating a Budget on Smart Young Money and set one up for yourself. Sticking to a budget will help keep you from splurging with your credit card.
Set a Limit: Many analysts recommend keeping your credit card balance around 30% of your credit limit for maximum benefit in the formula used to calculate your credit score. Promise yourself not to exceed that limit and you wont have with out-of-control credit card debt.
Go Back to Cash: If youre having trouble keeping your credit card in your pocket, switch back to cash for awhile. When you use a credit card, you dont get the same feeling of having forked over your hard-earned cash, so youre prone to spending more. Using cash for a bit will help you remember that little purchases add up.
Get Credit Counseling: If your debt gets out of control, talk to someone! Ignoring your credit problems wont make them go away it will only make them worse. Talk to your parents or a trusted friend who may be able to help, or consider getting help from a group or institutions that can help you with your problems.
Credit cards can be helpful tools, but the potential for abuse always exists. Taking the time to learn how to use credit cards properly can help you prepare for a bright financial future.