Choosing a Commercial Property

Commercial property

When you are investing for the purposes of capital growth, there are certain kinds of retail, commercial or industrial properties that can be a very superior option. It is important to know that not all kinds of properties will perform the same. There will always be differences.

When you start to analyze the great potential of a physical property, location and position need to be considered and should actually be the key elements in the process of making a decision. In property, the capital growth of an asset comes from the increase of the land value and the location influences the demand and supply for the land and this then determines the value. A good example is a central business district where the value of land is very high and this actually drives the capital growth.

When the land value goes up, then the value of all the improvements or even the building itself will depreciate with time. This means that the land appreciation should be sufficient enough to counter the building depreciation and also to grow the asset value with time.

Position means how easy it is to access the property. You should ensure that the location matches with the kind of business that you are planning to operate in the area or premises. A good example is a distribution center that needs to receive shipping on a regular basis and needs to dispatch as well. It should have a great space and road access that isn’t hindered. This may be a good match for a city fringe or a place that is near to the port. Arterial roads make it even easier to access.

Lease

It doesn’t really matter if you are looking for a capital growth or for rent return. The leasing strategy is very important to the performance of the assets in the long run. A leasing strategy should allow regular reviews on rent so as to be competitive and viable at all times. This should include things like the provision for maintenance of the property as well as fit outs that will make sure that improvements are kept at a standard that is suitable.

The layout and size of the premises

This is a very important consideration. You should find premises that can actually handle your kind of business in a very efficient manner. You need to consider the structure and its appearance both externally and internally. Consider the height of ceilings depending on what activities you plan to carry out and all the facilities that visitors and employees will be able to enjoy.

Reverse Mortgage

The eligibility qualifications for the HECM are very simple. The homeowner must be at least 62 years old and have an acceptable equity position in their primary residence. The primary residence includes any FHA approved property: single family residence, multi-family 2 to 4 unit dwelling (one unit occupied by home owner), HUD approved condominiums, or manufactured homes. There are no income or credit requirements for this mortgage program. Eligible homeowners must also complete counseling with a HUD approved and accredited reverse mortgage counselor. The counselor would review all aspects of the reverse mortgage program and how this mortgage type will specifically help the homeowner(s) based on their equity position. The mortgage typically does not have to be repaid until the last surviving homeowner moves out of the property. If the homeowner does not maintain the property as their primary residence for a 12 month period, the mortgage will be due.

The maximum mortgaged amount is calculated from the appraised value of the property, homeowner(s) age (youngest homeowner), interest rate (fixed or variable), equity position, and FHA lending limit for the county the home is located in. These factors will determine how much equity is available to the homeowner(s) to receive in a lump sum, equal monthly payments for as long as the homeowner lives in the home, line of credit, or monthly payments over a set period of time.

Homeowners retain ownership of their property and are not required to make any monthly payments. Even if the value of the home decreases, the homeowner is not held liable because a reverse mortgage has a non-recourse provision. This means that HUD and the lender share the risk on the future value of the house, not the homeowner. Although, HUD does require the home to be maintained in acceptable condition to retain its value.

Hiring A Mortgage Broker

Mortgage is one of the things that must not be done with DIY tips. Even with the fact that its inherent conditions are not that complicated, most especially for the eager to learn and those who are financially savvy, there are a lot of beneficial inside details regarding mortgages that are not just accessible to anyone who is not a member of the industry.

Reasons For Getting The Services Of A Broker

  • This professional can streamline the process – It will be a lot easier for you to make the best decision when it comes to protecting as well as managing your finances. You can rely on them since they can be able to suggest the best mortgage that suits you. Also, they can design a personalized program that will consider your other financial accountabilities so that mortgage payments will be less burdensome, and will provide you with loads of excellent mortgage advice.
  • Access to inside info regarding the mortgage industry – You can always be updated regarding the possible changes that will directly affect you like new mortgage criteria or policies that will be implemented in your community. With the help of a professional mortgage broker, you will be able to get this important information. Most homeowners say that the main benefit here is that it will allow you to make efficient preparations in order to accommodate or perhaps comply with these changes.
  • Simplify the process of mortgage applications – These professionals will easily take care of this process for you. With their experience and connections within the industry, you will be led to lenders who will process your application faster and easier. Thus, you can begin on payments right away as well as work on the completion of such particular financial responsibility a lot faster.

Buy Overseas Property Safely

Hire an independent lawyer

Many people seek the help of real estate agents, which is not a very good start. No matter how smart, experienced, informative and well-mannered an agent tends to be, never fall for it. Always get an independent lawyer, who will represent you throughout the whole buying process. If you are represented by the lawyer, it means you are well-protected from making any expensive mistakes down the road.

Get help from a financial specialist

Sort out your financial preferences that would help you allot a suitable budget to purchase the property. Get a provisional mortgage if you have plans to borrow money apart from what you plan to pay from your pocket. Ask your financial specialist to suggest a long term repayment plan that would be feasible for you as the lending criteria and the borrowing costs may change during those years.

Hire a foreign exchange specialist

If you borrow money overseas, but earn at home, you have to make sure that the rate fluctuations would not affect the value of your property. The difference in the value of currencies could take the property out of your hands as it goes beyond your budget. Discuss with a foreign exchange specialist and understand your risks and have a proper contingency plan to handle unpleasant situations.

Double-check the agent credentials

Apart from hiring an independent lawyer, choose a professional overseas real estate agent to assist you through the process. Place your focus on the agency rather than the property you want to buy. Question them in all possible ways to make sure the company or the agent is potentially the right person to do business. No matter what they claim, make sure everything is true, to the last bit. Don’t trust reel reviews, read real client testimonials. Ask them to offer their “Terms of business” on paper prior to signing a formal contract with them.

Learn to get the most out of your investment

When you purchase a property overseas as an investment, you must understand that you can have big returns only with risks. Make a thorough inventory of the risk to reward ratio to help you cope up with the risks and to reap better rewards out of your investment when everything goes well.

Mortgages For First Timers

Buying the first home is not just a very exciting experience but it is undoubtedly the most challenging experience. Now, what is the biggest challenge when you are planning to buy your first house? It is choosing the right mortgage for yourself. Well, there are so many mortgages available in the market. These days the lenders have all the specifications mentioned in their offers and so there is hardly anything that you will not know before you make the decision to choose the best mortgage for yourself. Yes, you will have to do some comparisons before coming to a conclusion. One thing that you must never let skip out of your mind is the practical financial target that you have in mind. All the lenders will do the calculation based on your income, your expenses, your savings, your records, the current interest rates and the possible fluctuations of the rates in the future. Of course, these factors are taken into account roughly.

Be informed that 100% mortgages are not available these days. So that means, you will have to make an initial deposit of the total mortgage amount decided and the remaining amount will be financed by the lender. A bigger initial deposit will fetch you more benefits.

There are different types of mortgages but broadly they are categorized as Variable Rate Mortgage and Fixed Rate Mortgage. You will have to choose between the two and one thing that should be clear in your mind before you make the choice is the time span for which you want to keep the mortgage. The main reason that you have to be mindful about the time span is because early surrendering or repayment of the mortgage amount will let you be penalized by the lender.

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