Private Mortgage Insurance (PMI) is an insurance policy that you pay for that could help you finance your home if you have not saved enoguh for your down payment. This much is true; however, Private Mortgage Insurance does nothing more for you the homeowner, except drain your wallet. First, the insurance policy does not protect you at all. This policy you are paying for only protects the lender from certain losses if you default on the mortgage. Lenders like this; however, Private Mortgage Insurance is expensive and you could be required to keep it for a number of years. This insurance alone could raise your monthly payments by as much as $200.

A simple “piggy back” mortgage can help you avoid this monthly drain on your wallet. If you have at least 10% of the loan amount required for a down payment a “piggy back” mortgage can supply the remaining 10%. These loans are called “piggy back” mortgages because they are simply piggybacked on your primary mortgage. You may be able to find lenders willing to piggyback as much as 15% or even 20% of the loan amount for your down payment. Interest rates on these “piggy back” loans vary from lender to lender. You may end up paying a point or two more for this loan; however, the savings compared to what you would pay in Private Mortgage Insurance premiums make this well worth your while.

Private Mortgage Insurance is a trap many homeowners fall into because they don’t take the time to explore other options available to them. Don’t let this happen to you.

Louie Latour has twenty years of experience in the mortgage industry as a mortgage broker. He is the owner of Mortgage Refinance Advisor, a mortgage resource site devoted to saving homeowners money with a free guidebook “Five Things You Need to Know Before Refinancing a Mortgage.” http://www.refiadvisor.com

A mortgage is a method of using property as security for the repayment of a loan. It is a long-term loan which is obtained from financial institution and if the borrower cannot make repayments as agreed, the property is taken by the lender as full repayment of the loan. The loan amount therefore will only be as much as the property is worth.

The UK mortgage and remortgage market has become incredibly competitive and mortgage providers often offer special deals as an incentive for borrowers to take out a mortgage or remortgage their property with them. These deals are usually in the form of short-term introductory benefits such as a discounted interest rate, a fixed interest rate or a capped rate for a certain period of time. Lenders want borrowers to stay with them for as long as possible and so enforce penalties if they want to pay off their mortgage early or switch to another lender after the discounted period.

The two main types of mortgage are repayment and interest-only. With a repayment mortgage the lender is repaid gradually during the term of the mortgage, whereas with an interest-only mortgage the borrower only pays the monthly interest of the mortgage and puts the rest into a repayment vehicle when can be used to pay off the outstanding debt when it matures.

There are five types of interest rate which a borrower can choose from; fixed-rate, variable-rate, capped-rate, tracker and discounted.
With a fixed-rate the interest rate is set for a certain length of time, usually 1 to 5 years. After this set period the rate usually reverts to the variable rate. The advantage of this type of rate is that a borrower will know exactly what he owes each time and so can budget accordingly. The disadvantage is that if interest rates in general drop then the borrower could end up paying a lot more than he/she needs to.

A variable-rate is where the Bank of England sets a standard interest rate and the mortgage lender sets their rate at just above this rate, usually about 1 or 2%. This is where lenders get competitive to offer the lowest rate. If the base rate goes up so does the variable rate and vice versa.
Capped-rate mortgages are said to offer the best of both variable and fixed rate deals. They are therefore very competitive and not offered by every lender. A limit is agreed on the maximum amount of interest the borrower will pay in a certain period of time. At the same time the rate will drop if the variable rate drops. The borrower will benefit if interest rates falling and will also know the maximum they are likely to pay.

A discounted rate is one method used by lenders to attract new borrowers. The lender will offer a discount on the standard variable rate for a set period of time. After this the rate will revert back to the standard variable rate. Lenders prevent borrowers from switching to new plans with other lenders by charging penalties for early repayment etc.

Accepted.co.uk is one of the UK’s leading lenders and their specialised team, can search from over 100 mortgage plans from 12 different lenders to find the best type of mortgage to suit your circumstances. They can even offer mortgages and remortgages to people who are self-employed, have poor credit history, CCJs, arrears or defaults.

Accepted.co.uk are specialists in bad credit mortgages and remortgages and through a quick and easy form they can obtain the right quote from the information provided by the customer. Loan amounts from £25,000 to £1million and terms of up to 40 years on referral are just some of the benefits of an Accepted mortgage or remortgage.

As a lending introducer rather than an in-house provider, Accepted.co.uk is in a unique position insofar as they are not motivated by the same sorts of lending pressures as a direct lender is. Consequently, customers are more likely to get the product that serves them best, rather than the product which drives the greatest profit for the lender.

You may freely reprint this article provided the following author’s biography (including the live URL link) remains intact:

About the Author

Jenny Wilkie works for Luke Ashworth who is the founder of Accepted.co.uk which helps people search for mortgages or remortgages via the website http://www.accepted.co.uk/mortgages.

Real estate commission is the way in which real estate agents are paid for the services they provide. They receive a percentage of the price received for the property. Effectively, the real estate agent requires the seller of a property (the vendor) to sign over to the real estate agent a part of the property being sold.

Another way of looking at it is to say that the real estate agent, through the wording of the listing contract, effectively has his name added to the title deed of the vendor’s property, so that the real estate agent becomes a part-owner of the property. When the property sells, the real estate agent receives a payment that represents his share in the vendor’s property.

Most readers will be aware of the arguments in favour of real estate sale commissions, so I won’t discuss those here. My focus is on the ways in which the sale process can be skewed against all parties involved, when the motivation to win a commission takes precedence over more important considerations.

Commission is a “winner-takes-all, loser gets nothing” situation. This increases the pressure on the real estate agent to secure a sale. Time is also a problem. If the real estate agent cannot secure a sale within a time acceptable to the vendor, the vendor may take the property off the market, or away from the real estate agent’s agency. This will result in a total loss for the real estate agent.

Finally, the vendor becomes an obstacle between the real estate agent and his commission goal. In order to receive payment for his share of the vendor’s property, the real estate agent must receive an offer to purchase within the available time, but the offer must be accepted by the vendor. If the vendor decides that the offer is not acceptable, then the real estate agent loses.

In order to win the gambling game that is real estate sales, the real estate agent may decide to tip the odds in his favour - and there are numerous ways in which this can be done.

At the listing stage the real estate agent may use improper means to win the listing contract. These include over-quoting on valuation, and offering dodgy sales figures.

During the sale process the real estate agent may be tempted to tell potential purchasers things that are untrue. I have seen many sale contracts with clauses designed to protect real estate agents against the consequences of false statements. Known as “porkies clauses”, they invariably state that the purchaser acknowledges that any information provided to the purchaser by the real estate agent is provided on the understanding that the purchaser will not be relying on it for any purpose.

When a purchaser has submitted an offer, and the purchaser cannot be convinced to increase her offer, the real estate agent may be tempted to pressure the vendor into accepting what would otherwise be unacceptable. Observations, such as “the market has softened” or “the market has spoken to us” are used by real estate agents to convince vendors that the real estate agent’s high estimation of value can no longer be relied upon, and that the vendor should now accept what the vendor believes is an unacceptably low offer.

For some years now, I have been arguing that real estate services should be provided on a fee-for-service basis.

I will explore the replacement of real estate sale commissions with a fee-for-service structure further in future articles.

Melbourne Lawyer Peter Mericka B.A., LL.B is a real estate lawyer and consumer advocate. He is a former police detective, with experience in areas of criminal investigation and police internal investigations. Peter is the Director of Lawyers Real Estate, a law firm that sells real estate and offers conveyancing services. He also instructs in real estate conveyancing at the Leo Cussen Institute, Melbourne, and edits the http://www.AustralianRealEstateBlog.com.au.