Tuesday, April 2, 2013

Know the Type of Lenders Available



It may be time for you to buying a house, condominium or co-op.  Look carefully at lenders and shop around before you commit. Don’t just talk to one because they are not all the same.

Lenders vs. brokers 


Contact several lenders to make sure you’re getting the best price since different lenders may quote you different prices. You have options; you can get a home loan through a bank, mortgage company, credit union or mortgage broker.
Brokers arrange transactions rather than lending money directly, which means they find a lender for you. They might have a wider selection of loan products and terms. But that is not always in your favor.

Watch for brokers’ fees

If you’ll be dealing with a broker, investigate how that broker will be paid and any associated fees you’ll have to pay. Always negotiate with the brokers and the lenders to get the best possible deal. If you have a top credit score, you have leverage.

Get a breakdown of costs

Ask the lender or broker to itemize all associated loan costs. Then ask them to waive or reduce one or more of their fees or agree to a lower rate or fewer points. Make certain the lender or broker isn’t reducing one fee only to increase some other one.

When you’ve negotiated terms you like, ask the lender or broker for a written lock-in. The lock-in should mention the agreed-upon interest rate, the duration of the lock-in and the number of points to be paid. A fee may be charged that is sometimes refundable.  


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The Dow Jones Averages is Beating my Individual Bond Portfolio!



Make Men Cry the Most”.

 Let me get out my crying towel.  
The Dow is beating me. I am so unhappy!


March 31, 2013 is the end of the first quarter. This is the first quarter that the Dow has beaten my Junk bond portfolio since before the year 2008. Stocks are moving up in value. Year to date, the Dow Jones Averages are up 11.25% while my Junk Bond Portfolio is only up 3.471% or 1.157% per month for the last three months.

If you decide to invest in stocks or mutual funds, keep in mind that stocks and mutual funds go up as well as down. When the bear market comes, they do not make an announcement on TV or ring a bell on the stock exchange. When it comes, it comes and you usually find out after your investments have fallen substantially in value.  You usually get involved in the market after everyone else bought in and made the individual stock prices increase in value. You usually get out after the markets crash and your investment is only worth a fraction of what you put into it.
Here is the reason why I buy individual Junk bonds. They usually mature on a future date. They give interest on future dates and I can calculate how much money I will make on each investment.
Stocks are riskier because they go up and down. Bond holders are in line to be paid before stockholders. Plus I have a better idea of when I will have my money as oppose to the stockholder.

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