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Why now might be a good time to get a mortgage

Deciding if getting on the property ladder is the right thing to do in these confusing economic circumstances can be a stressful time, particularly if you are a first time buyer.

Lenders have been reluctant to give out mortgages to the extent they did during the housing boom, making it difficult to obtain finance to get started on the property ladder.

The housing market has stalled, yet house prices are still predicted to fall further during 2011, making this year an appealing time to try and make those first steps.

If you are unsure what you are able to borrow given your personal circumstances, a mortgage calculator will help you work out what you can afford to borrow and comfortably pay off.

Deciding to buy is always a risk and you will have to make the decision to buy now and risk further price falls, although if you plan to live in the house for a long time, falling prices will pose less of a risk.

Predicting the right time to buy is only part of the equation. You still need to find out if you will be able to secure a mortgage and this will depend on both the current market and your personal financial circumstances.

Before you start contacting lenders, check out a mortgage calculator to help you decide what size and type of mortgage is affordable for you and then what type of house you can purchase for that price.

Mortgage lending has been at an all time low in the last year as lenders have become much more conservative and risk adverse, but if you are able to meet some strict criteria, you may be able to secure a mortgage.

A good credit history and a substantial deposit, of at least 10%, but ideally up to 25%, will go along way to making you more attractive to mortgage lenders.

The tricky decisions don’t stop there. If you are fortunate enough to secure a mortgage with a combination of a good deposit and positive credit history, you then need to decide whether a fixed rate or tracker mortgage is right for you. A mortgage calculator will help you compare repayments.

There may be costs that are not mortgage related, but that you may have to pay up front. While the typical borrower may rely on their their standby cash in their checking or savings account, using a pay day loan service may be useful, but only if you intend to pay off the loan very quickly.

Even though the base rate is currently at an all time low of 0.5%, making a tracker mortgage seem attractive, these low rates are not likely to remain forever. You will need to consider at what point a rising interest rate make it a struggle for you to pay off your mortgage.

It may be a more financially comfortable option for you to opt for a fixed rate mortgage and be certain of what your monthly repayments are going to be.

You will pay more, but it may be the difference between being able to keep up repayments, or defaulting on your mortgage should interest rates soar in the future.

The credit crunch has made mortgage lenders much more conservative than during boom times when you could get a mortgage with no deposit.

Criteria are much stricter, but if you are in a good financial position, it should not be impossible to find a good deal on today’s market.

Of course everyone’s circumstances are different, so good independent financial advice is crucial to ensuring you embark on a mortgage you can realistically afford.

A Quick Guide to Planning your Wedding Abroad

For some people the ideal mental image of the happiest day of their life involves a flowing white dress, an English country village and a traditional church filled with family and friends. For others it involves golden sands, palm trees and guests in bikinis. If you find yourself leaning more towards the latter fantasy wedding, then perhaps a wedding abroad is for you.

Newlyweds at sunset

So why choose a wedding abroad over a traditional wedding in the UK? There are a multitude of reasons – including weather, novelty and most surprisingly, cost.

Many a British wedding has been rained out to the utter dismay of the (slightly less) happy couple, so the attraction of hosting a wedding in a tropical paradise – where blazing sunshine and temperate climate are almost guaranteed – is easy to see. Obviously it is important to avoid the rainy seasons, but in general the weather for your big day will be assured compared to the unpredictable UK weather.

The novelty factor of having your wedding abroad cannot be underestimated. Whilst your friends will look back in years to come at the same ‘cookie-cutter’ wedding photos that are indistinguishable from every other wedding – you will be able to look back at photos of you enjoying the happiest day of your life on an exotic beach, the top of Niagara falls or wherever else your imagination can conjure up.

Your unique wedding abroad will also never be forgotten by your guests – but if you are planning a wedding abroad make sure to send your invitations out considerably earlier than you would for a wedding closer to home, to allow your guests to make travel arrangements.

Surprisingly the difference in cost between a wedding abroad and a wedding in the UK can often not be as extreme as you might think and this can be for a number of reasons. The average spend on a wedding in the UK is usually between £20,000 and £30,000. If you are planning to hold your wedding on an island in the Caribbean, where the local currency is generally dollars, when you take into account the exchange rate you can certainly get a lot more bang for your buck. As you will be spending a considerable sum on the arrangement of the wedding, it is also worth looking into international money transfer as a secure way of paying for the venue.

Finally it pays not to forget that the marriage ceremony is a legal procedure as well as celebration of your union, so be sure to research the relevant legal considerations of the country you are planning to be married in, as this can vary from country to country.

How much can you afford to pay for a house?

Today’s housing market may not be going well for those looking to sell, but buyers have an opportunity to find all kinds of deals that make home-ownership affordable. There are several different factors that you should take into consideration when you attempt to make a home purchase.

The House Payment
The amount that you are going to pay every month for your home is the most critical number when it comes to finding out how much you can afford to pay for a house. This number comes from several other figures all working together to give you the monthly payment. As you work with mortgage calculators, take a close look at this figure to determine whether or not home-ownership is a possibility.

The Cost of the House
Whether you have retained the services of a realtor or plan to look around yourself, the overall amount that a home costs will figure into whether or not you can afford it. The more you research, the more you will find that there is a range in price that you can afford.

The Down Payment Amount
Do you have money set aside for a down payment? The down payment will reduce the amount of money that you need to finance for home-ownership. You will need at least a part of the down payment to be used as interest money when you place an offer on a home.

The Loan Terms
Financing a home is a critical part to the ownership process. Think about whether or not you are going to set up a loan for fifteen or thirty years. The payment will be higher with a fifteen year loan, but you will be able to pay it off sooner. Most people choose to finance for thirty years in order to be able to afford a bigger home.

Private Mortgage Insurance
If you don’t have at least twenty percent of the cost of the home as a down payment, you typically need to pay private mortgage insurance. This is something that will be added into your mortgage payment, so be sure to take it into consideration when planning.

Other Loans
Do you have other loans that you are currently paying on? When you decide how much you can afford to pay for a house, you want take into consideration the other amounts that you owe and how much you pay for them each month. Over committing when it comes to a house payment can put you in a difficult situation, so be aware of other expenses.

Projected Utilities
Remember that a home purchase comes with the cost of maintaining the residence. This includes electricity, gas, taxes, homeowner’s association fees and even the cost of garbage collection. Each of these payments needs to be included in how much you can afford when it comes to a home. You don’t want to be able to afford the payment but not be able to live there because of the overall cost of running the home.
Take all of these expenses and numbers into consideration when you begin the search for a home that you can afford. This is usually a lengthy process, but the final results are well worth the effort!

Savings stop as the economy slows

Since the global economic recession of 2008 began, life has been difficult for the everyday American. The cost of living has increased and it has become tough to manage competing priorities.

Wage freezes, unemployment levels of 9.1%, a struggling real estate market and an increase in day-to-day living expenses have all combined to make it harder to survive, let alone prosper!

Yet most Americans do not have a safety net to help overcome these financially tough times. Statistics suggest that one in four citizens do not have any savings at all.

This is a worrying situation, as a lack of savings means there is no emergency fund for when the going gets tough. A range of financial products can help with savings, such as those offered by short-term loan companies.

The recommended amount of savings suggested by industry experts is the figure you would need to cover a minimum of six months without an income. Yet only around 25% of all Americans have such financial security and these tend to be higher wage earners in the 50-60 years age bracket.

In today’s economic climate, it can on the surface seem hard, if not impossible, to find the money to save. Many households are experiencing increasing levels of debt instead.

According to published statistics, Americans have just under £118,000 dollars of debt per household. The combined personal debt of all Americans reaches a staggering $2 trillion dollars.

Savings are essentially an emergency fund for when the unthinkable happens. We all like to imagine we live in a certain world, but illness and unemployment can affect anyone.

Warnings and forecasts of a ‘double dip’ recession are hopefully nothing more than a worst case scenario, but those with savings have a greater piece of mind.

How would you cope in such challenging circumstances? For many people, that can be a frightening thought. However, it does not have to be, because you can easily take action to create a safety net.

Take a long, hard look at your income and outgoings. What could you honestly live without each month? A treat meal or night on the town, or perhaps the latest gadget or game?

If you can save even a small amount each month, the dollars will quickly add up. $50 dollars per month multiplied by twelve months is $600 dollars per year to invest.

It may not sound much but once you start saving, you will find that the great feelings it creates become addictive! Soon you will be happily contributing more each month to your emergency fund.

After all, this is the basis of the American Dream, to rise up against adversity and carve out your own road to freedom and success.

There is no greater freedom than financial freedom that comes from you yourself making the effort necessary, as the odds of winning the lottery are narrower than getting struck by lightning!

People who create better financial circumstances for themselves and their families gain much more than an emergency money fund. They gain a peace of mind and feeling of accomplishment too. Create your destiny now.