Money Rant

By Musa Aykac

 We are heading for a major credit crunch scenario by the time the new year rolls in. We have already spent much more than we did lat year, and with the rocketing prices in oil and food things are set to get a lot worse.

The housing market is at an absolute all time low, and it is near impossible to get yourself a mortgage. But in the depths of the credit crunch, there are a lot of people earning a healthy profit and I will tell you exactly who and why.

The banks are earning a lot more than they have been in the last decade, this is not in every sector, but specifically credit cards and such, are earning the banks a lot more revenue. This is simply because of the fact that where people would usually shop around, they are now sticking with there own bank and being applied the 7%+ rate.

The next on the list is the supermarket chains, an example of how these companies are earning is the way in which they are marketing themselves. The budget supermarkets are now coming out more successful then ever, stores such as Aldi and Lidl are beating there rivals Asda and Tesco in the race to be the number one supermarket. The reason that we have seen an increase in the popularity of these once redundant stores is because people can get shopping at up to 50% the price of other chains. Why would people spend double the amount? For the same quality of food, that they can get elsewhere, it just does not make sense.

At a time when people are struggling with money, people are also spending more on gambling. This is just basic human nature, people gamble to win big amounts and get themselves out of debt. So casinos, online poker rooms and other gambling sites are seeing a great increase, in the amount of people that are playing, and are making a healthy profit themselves.

Finally the biggest winner will have to be the buy to let investors. Although they may well be feeling the credit pinch at the moment, when this market starts to level out again, they will be swimming in a pool of money.

Not everything has to be classed as so negative. The credit crunch may be affecting a lot of people, but if you can sit down calmly and look through the dark cloud, I guarantee you will find a way through.

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Build Your Personal Nest Egg in Today’s Financial Climate With Owner Builder Construction
By Chris Esposito

 Owner builder construction is a creative way to build instant equity in your primary residence, which will jump start a family’s nest egg even in today’s financial climate. The decline of the housing industry leaves the doors wide open for an owner builder to take advantage of decreased land and labor costs and save tens of thousands of dollars in sweat equity in a new home.

Historically, families in the United States have built wealth through equity in their homes. With the recent mortgage crisis and looming recession, many families have seen a huge hit to their savings, leaving their nest eggs cracked or broken.

However, with these new realities in the housing market, there are opportunities for you to boost the equity you have in your home, thereby building or protecting your family’s nest egg. So, how can you build instant equity into your home without putting a lot of cash into the project our of your own pocket? The short answer is owner builder construction.

What is owner builder construction? This term refers to any construction project in which you manage the process yourself. In other words, you cut out the costs of a general contractor and manage the sub-contractors who will do the specific labor to build the home.

Because an owner builder eliminates the cost of a general contractor, he will typically see anywhere from 15% to 30% savings in the cost to build the home. In some areas around the country, the savings can be even more drastic if the costs of builders are artificially inflated. These large savings translate directly into equity that an owner builder has in his home, because the discounted cost of construction does not mean that the value of the home is any lower.

Whereas your neighbor may have built his home for $300,000, you can build the same home for $210,000 as an owner builder. If these two homes are exactly the same, their value will be the same. However, the owner builder will have an extra $90,000 in equity in his home.

If you are unfamiliar with construction, and the idea of managing your own project terrifies you, then there are ways to still be an owner builder. You might want to consider hiring a project manager or site supervisor to provide advice along the way. You can still cut the costs of a general contractor. Your overall savings may not be quite as high, but it will still be construction at a discounted price, which will still be a nice boost to your nest egg.

So, why would anyone want to be an owner builder in today’s housing market? The answer is simply that today’s housing market is just as good as any to build as long as you can eliminate the general contractor overhead. First, an owner builder will find land at prices much lower than the costs were a couple of years ago. And, maybe even more importantly, the sub-contractor labor costs will be much lower.

Two years ago, an owner builder would have had trouble getting a sub-contractor, such as a plumber or electrician, to give them the time of day, let alone an actual, realistic bid to provide services for a construction project. Often, sub-contractors already had construction jobs lined up for the next twelve months.

But, nowadays, there are far fewer construction projects. These sub-contractors need to work, so they will be much more responsive to any owner builder who has a home to build. If they know you are searching for people to bid on specific labor estimates, you will find much lower labor costs today than you did in the middle of the housing boom.

Therefore, an owner builder can save on land and labor. The cost to build the home has been reduced so that there is still the same amount of sweat equity available for owner builders. In other words, an owner builder will still be able to achieve the same instant nest egg, even in today’s market. There aren’t many other ways to build this kind of equity in a home today without spending a lot of cash out of your own pocket. Owner builder construction is the perfect way for many families to build instant equity in their homes, boost their nest egg savings, and right the ship for their personal finances overall in today’s financial climate.

Chris Esposito specializes in financing owner builder construction loans for individuals who wish to eliminate the costs of a general contractor. If you want more information about owner builder construction and financing, visit Owner Builder 101 or call (877) 876-3688.

5 Tips When Choosing a Mortgage Originator
By davidb

 It is wise to seek the services of a mortgage originator to apply for a loan, because that way you can be sure that you will get the best deal of loan at the lowest rate of interest. There are so many people who come in the city with the dream in their eyes that one day they will make it big in life and have their own home in the main city. But many times dreams remain unfulfilled due to the non availability of funds. It is here that mortgage originators come to play a vital role.

Mortgage originators also known as mortgage brokers strive hard to get you the most suitable loan that can best meet your personal requirements. By now, you must have got some basic idea as to how these mortgage originators work and what they do for you. Their sole aim is to ensure that your life becomes smooth and tension free and that you do not face any kind of hurdle as far as securing a loan is concerned. Thus, it is best to go for a mortgage originator. But not each one is good and you need to find the right one for you.

The first and foremost criterion for choosing the mortgage originator is the mortgage offer given by the broker. It is best to look up for the popular mortgage originators on the internet and then take their catalogues to do a systematic analysis of their mortgage offers.

The second important aspect is to check up if the broker has some credibility in the market. You never know when you just might fall into the trap of a fraudulent broker who might try to maximize his/her commission by taking the advantage of your ignorance. Thus, it is important to ensure that the broker you are considering has a reputation in the market and if possible ask for some references for further confirmation. You can also ask your friends and other acquaintances who have just taken a home using the services of mortgage originators. If you are going for an online mortgage broker, you can read a few reviews to find the best one for you.

You need to inquire from the mortgage originator if there is some flexibility of loan options and if he/she can offer you something that can very well meet your personal specifications.

If a mortgage originator, instead of recommending, tries to persuade you to go for a particular loan then you need to become suspicious. Ideally, the broker should provide you with plenty of loan options informing you about the pros and cons of each, but leave the final decision with you. So, if you come across a broker who tells you only about one option and tries to convince you, then it is recommended to go for some other mortgage originator.

Ask for the mortgage originators licenses such as drivers license and broker license. This will tell you if the broker is licensed in the country or state he/she is living in. Lastly, find out what extra benefits the mortgage originator is providing. Ask for his/her specialties.

To conclude, we can say that while choosing the mortgage originator, you need to be very cautious and you need to pay attention to the above mentioned criteria.

About the Author:

The author is a bond originator in South Africa. To read more on Sa home loans, visit http://SecureBonds.co.za

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