 Why don't we hear of squatters anymore? |
| In the 70/80's if there was a house emtpy for a certain amount of time, the house would be filled with sqatters, why not now?... |
|
 What is the best way to confront my landlord about a maintenance man suspected of stealing from my apartment.? |
| i was not home at the time and i gave the maintenance man permission to enter without me being there. When i returned home later that night i noticed my psp game system was missing, i always keep it ... |
|
 My landlord is loseing the house i'm renting to a tax sale what can i do and what will happen.? |
| Ok heres the deal, my family and i recently moved to a new home(new to us) 2.5 months ago. We just today received 2 letters in the mail From the tax auditor in our county one for our new landlord and ... |
|
 Estate Agent talk - what does this mean? |
An Estate Agent has emailed me about a flat I'm viewing tonight - what does this mean?
'The property is in a conversion, its a duplex flat set out over 2 floors'... |
|
 Where can we be approved for home loan with bankruptcy on file and almost to none credit history? |
| Does anyone know if we can be accepted for home loan of under 50000$. One does not have credit history and is slowly building it by getting credit cards and some services like cell phone and the ... |
|
 They raised my rent without telling me, do I have to pay back rent? |
| When I signed my lease, I was informed I would be gettting $100 off my rent for six months. Im just starting my first job, and with that stress, I didn't realize when my six months were up. I ... |
|
 I have clogged sink. If I notify my landlord in writing can I repair it and deduct it from the rent? |
| I have notified him verbally. Is there a specific number of times I must notify him before I get it repaired, deduct it from the rent and provide him with the reciept for the repair?... |
|
 I NEEEED help....please!? |
| My boyfriend and I just moved to a new city, we've been staying with my mom for a month or two while we tried finding an apartment.......so we found one but the problem is neither of us has a SIN... |
|
 I want an apartment cause I live with my BFs fam and I cant stand them, is there some kind of loan I can get? |
| I live with his family and I can NOT stand them his sister is a nosy snitch, but anyways I'm 18 and I want an apartment but I don't have a job, is there anyway I can get a loan or something,... |
|
 What can someone do if realtor will not submit offer? |
| My friends wants to submit a full price offer on a foreclosure and the listing agent is basically saying that there is no point because he has a "good cash offer" already....Well so is her ... |
|
 What are the legal consequences of eviction if there is no monies owed to landlord? |
| I believe my property manager is trying to evict me & my fiancee because she has a personal problem with me. they gave us 2 prior notices about "junk" on the balcony (2 bikes 1st time, 2... |
|
 How many people can live in a one bedroom apartment? |
I would like to know where I can find out how many people can live in a one bedroom apartment in Oklahoma City, OK.
Additional Details
I am asking because of my neighbors who have a TON ... |
|
 What's a decent offer to make on a house that's asking $189k? |
| I am thinking of making a full cash offer on a home in Boise that is currently listed at $189,000. In this slow market, what is a reasonable offer to make without offending them?... |
|
 My mother wants to buy a house......? |
| she currently has bad credit, but she makes about 50,000 per year. She has come into some money and she is going to pay off all of her pass debts to clear her credit, she also has enough money for a ... |
|
 Where can I get a great new purchase mortgage loan without PMI? |
| I have a low credit score, but my wife has a better one. I make more money than her. I've been given an offer from a bank but not a good one in my opinion.... |
|
|  |
KeLLy! | Isn't having an interest-only mortgage just like renting? |
I mean, you're not gaining equity unless the value of the home is rising extremely rapidly (which is uncommon these days…)
What long-term benefits come from an interest-only loan?
Additional Details
thanks. good answers. that's what i was thinkging. |
 |
 
cknoce
 |
Two sides here: For the buyer of their own home, there is no benefit. It's what caused a lot of the housing mess we are in right now. Many people used it thinking the low rates would stick around and/or go lower so they bought a bigger house than they could afford. When rates went up, BAM...can't afford the house and they can't sell...so foreclosure comes.
The other side is if you are an investor. You can buy a house that needs work, have a lower payment while fixing up the house, and then when it's flipped you make a little extra money since your holding costs were less. |
|
mvpwarner13
|
In a normal market, housing prices rise on average 3-5% per year. So, if you bought your home for $200,000, you could have about $31,000 in equity in 3 years paying only interest. With an interest only loan, your payments are considerably lower, allowing you to get into a more expensive home. In this market, it doesn't make much sense. |
|
The Cat thinks he's GOD
|
It is NOT like renting at all. you get nothing but a roof over your head while renting. When you buy a home even on an interest only loan, you HAVE property. You have assets. It increases in value and you probably CAN make principal payments. Also, interest is usually a great tax deduction. Rent is NOT a tax deduction and you have no assets. The long term benefits from an interest only loan, or any mortgage loan is that you get the interest tax deduction and if you are in a decent area, the value of your home will increase by at least 3 to 5 percent a year. My home increased in value over 15 percent this year. utah has a very healthy market and so does Nevada, colorado and a few more states. So when you sell it, if you want to, you'll have extra money. When you rent and get out of the place, you still have nothing. Does this make sense? it's a great idea to buy real estate, but do your research. With areas that have taken a hit, yeah, buy there because prices will only go up at the normal rate after next year. |
|
Sue
 |
No you're not quite understanding the mortgage. You pay interest only for a specified number of years, but eventually you have to start paying back the principal. It is the same as any other kind of mortgage in that you own the home while you're paying the loan off. The benefits are really for specific people. I work in finance so two big reasons that people who work in this field take IO mortgages are:
1) Fluctuations in income: most financial professionals see a large lump sum in the form of a bonus, this means it makes sense to only pay one lump sum towards the principal once that bonus is paid out
2) High returns on investments: the cash flow that would have gone towards principal payments goes toward a portfolio or investments that will bring you higher return than the interest
These are two lines of reasoning I see most often. Check out the link for more details. |
|
Tim
|
We have an interest only loan. For us it makes perfect sense, here is why.
We took equity of our our home and purchase a couple of rentals. We plan to sell our home in a couple of years and move out of the area.
We refinanced and took an interest only. The interest rate is fixed for 10 years, the goes to adjustable. We won;t be here more than two years but that gives us a safety net.
When the rentals are occupied, we can pay the interest plus put money towards the principal. If both homes were sitting vacant, we could afford to pay the interest only payment and not be strapped for cash.
In our case makes sense. In a rising real estate market, it allows someone to purchase a more expensive home than they could afford using convential financing.
It is not for every situation, but makes sense for some. |
|
Veritas et Aequitas ()
|
If you get one of those, it's best to pay the interest and principal at the same time. The only reason that would be good is if you plan on moving within one to two years or if it's a property being flipped. If you are going to be there for the longterm it only makes since to pay P&I, in my opinion. |
|
dabears
 |
only use interest only loans if you are going to sell the house within the first 2 yrs. Interest only is a short term instrument only!!! If you plan on staying in your home long term you need to restructure your loan. These type of loans are why there are so many defaults. Good luck!!!! |
|
paul w
 |
interest only loans are dangerous in the long term, and because of that you will find fewer lenders doing them
but
if you want a particular house but cannot qualify for a standard mortgage, then the int only will allow you to live beyond the means that the standard mortgage underwriter feels that you need to live
you will probably pay a premium in either points or rate too, because they know only beyond meanseres will do this kind of thing
but face it, almost all loans are paid off in 7 years or less, either by refinance or sale, so this will allow you to build credit while living in a more expensive home
adjustable rates are much more dangerous than int only
as for equity, well that is much more complicated, remember you make your money on a house going in, not coming out
just because every other house selling at 300K does not mean they are actually worth 300K
the housing bubble was caused by the artificially low interest rate established to keep the economy from tanking, and has burst because interest rate has risen.
the old rule of thumb, (wisdom from my grandaddy), was that if you make 24K per year then you should be looking at owning a 2000 car and a 48K house
when the housing bubble hit, people making only 100K were buying houses worth 500K because the interest rate was so low and banks were eager to make the loan fees, points, and other costs of the loan
that house was never worth 500K, and it will not ever be worth 500K unless your income and the community wide income level rises to meet the house value
if this fails to happen, then the house values will plummet to meet the underlying values of the borrowers income
invest in yourself, pay cash for your car, do not use credit cards to fund a lifestyle beyond your means, they should only be used as a cash management tool
this will improve your credit rating and allow you to get a int only loan on a house that you have purchased at the right price |
|
keith_housand
|
These are very good, technical answers but I think they gloss over the central difference: who assumes the risk. In a rental situation, you can walk away without any financial risk (discounting relatively minor lease penalties). With a loan, you have ALL the risk. If your property decreases in value, you can easily find yourself upside-down...owing more than your property is worth, a situation from which you may never recover.
The recent real estate boom was just a bubble and lots of people are going to lose their shirts before we reach an equilibrium point four-five years from now. As to what defines that equilibrium point, do some research on current and historic price-to-rent ratios. |
|
| |
|
| | |
| Questions List |
Answers | Last Post
| | | |
9 | 35 minutes(s) ago
| | | |
9 | 2 hour(s) ago
| | | |
9 | 6 hour(s) ago
| | | |
9 | 8 hour(s) ago
| | | |
9 | 1 day(s) ago
| | | |
9 | 4 day(s) ago
| | | |
9 | 2 week(s) ago
| | | |
9 | 2 month(s) ago
| | | |
9 | 6 month(s) ago
| | | |
9 | 10 month(s) ago
| |
|
Homepage 
Financial
Forum 
Renting & Real Estate 
No Spam
Adult 
Gambling
Unfinished
Deception
Plagiarism
Not English
