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How Mortgage Rate Changes Affect You

If you are tuned in to the news, you know that interest rate changes frequently. Do you know how it impacts your finances? 

To understand why and how the rates are changing, it’s important that we discuss short-term and long-term rate. In general, the Central Bank lends a short-term interest rate to other commercial banks at the end of one business day and the start of the next to balance their finances. But in other cases, some banks can borrow money for a longer period of time. 

People who opted for a fixed-rate mortgage will have longer-term interest rates, usually tied up from two to seven years. Whatever happens to the short-term interest rates, borrowers need to pay the same fixed rate until the end of the agreed period. 

In general, long-term rate is usually higher than short-term rates. The idea is it will be riskier to lend someone with money which will be paid within a 30-year span rather than lending the same amount to be paid for a few days. This means that the higher interest rate in a long-term loan is to offset the risk involved. 

If the Central Bank has an increase in interest rate, it can immediately affect the variable rate mortgages. The short-term interest rates have a direct impact on the interest payable on variable rate mortgages. This means that when the short-term rates rise, the variable mortgage rate shoots up as well. A rise in short-term interest rates can also effect on discounted loans. 

On the other hand, fixed rate mortgage is not affected by the rise or fall of the short-term interest rate because the rate remains as is until the end of the fixed period. 

However, if the short-term rate continues to rise this could be a sign that the long-term interest-rate can also escalate over time.  This could mean that when you renew your fixed-rate mortgage, you will receive a higher interest rate than your previous term. 

Again, perfect timing is the key to avail of a lower interest rate to lock in your fixed rate mortgage. Purchase a hillsborough ca homes for sale and get approved for a fixed-rate mortgage while the interest rate is still low and before the market begins to favor an upward trend in the interest rate. 

Opting for a fixed-rate is not for everyone and its benefits may not favor all who chose it over adjustable rate. Talk to your financial adviser to help you decide the best mortgage to suit your needs. 


How to Choose the Right Housing Loan

Only a select few can really afford to buy a house in cash. Most people buy their homes by taking on a mortgage. They do so by getting pre-approved and only need to pay for the down payment. Choosing the right mortgage is very important as it helps you in the buying process and it greatly affects your family’s financial future. For starters, there are four kinds of housing loan you can choose from. Here’s how to choose the right housing loan. 

Government-backed Loans 

Federal Housing Administration (FHA)  

The FHA is not a lending institution, rather, it is an agency within the U.S. Department of Housing and Urban Development. They only guarantee the mortgages taken out by people looking to buy a home with low credit scores. That’s why FHA-backed loans are very popular with most mortgage borrowers. Its requirements are less stringent and the minimum down payment required is only 3.5%. People are advised to shop around though as the FHA-approved lenders have different rates. 

Department of Veterans Affairs (VA) 

They work the same as FHA-backed loans. Only this time, it is the U.S. Department of Veterans Affairs who guarantees the loans taken out by Military members still in active duty, Reservists, Veterans, or some select surviving Spouses based on the condition that they don’t remarry. VA loans allow the eligible and qualified members to buy a house with no down payment, no private mortgage insurance and with low-interest rates. That’s just one of the rewards for serving in the US Military. 

U.S. Department of Agriculture (USDA) 

They are loans for people who are looking to buy properties in rural areas and must meet the income requirements. This type of loan is designed to help foster countryside development. USDA loans, however, are not so popular with many people. 

Conventional Loans 

Housing loans provided by conventional lenders 

These are the private institutions – banks, credit unions, private lenders or lending institutions that lend money for people to buy their homes. Borrowers need good credit scores to qualify as the risk is greater for lenders. They typically require a minimum of 5% down payment. They have cheaper rates as compared to government-backed loans. 

Choose the type of loan that you can afford to pay that helps you buy a home for you and your family. Each has its own set of advantages and disadvantages. Think about all the options you have and identify which one will best suit your needs in the long run. 

 


Tips on Buying Luxury Real Estate

If perhaps you are looking at buying luxury property, you probably have got a lot of questions regarding the choices that are open to you. After attempting to make a conclusion about what alternatives are actually offered to you right now, you may even have worries about how precisely the unpredictability of the real-estate current market may well affect your desire for acquiring a luxury real estate. By means of this informative article, you’re given a review of both of them that is open to you with regards to luxury real estate and also the way the present condition of the housing market typically is actually affecting the luxury market.

While checking out the luxury property market, the epitome of the particular market place can include water view houses. Lots of people travel the world- so that they can get hold of luxury real estate available as water view homes. The bottom line is, individuals are attracted towards the sunlit states to acquire this kind of homes having water views.

Generally, the price tag placed on water view homes is going to be at the much higher end on the real estate asset valuation scale. Certainly, residential properties having water views have been in great demand – furthermore at such times when the actual housing market on some other points as well as in various other locations tend to be going through dips. Nevertheless, by incorporating effort and hard work, the new buyer just might uncover some cost savings on these types of properties.

Over and above water view houses, additionally, there are luxury homes and also condo properties that do not effectively have a water view however they are situated on prime areas. These kinds of luxurious estate alternatives permit a variety of property options. For instance, the Snow Bird who would like a stylish and idyllic condominium will get this kind of a choice within the state of Quebec.


Costa Rica Luxury Real Estate

Buying luxury real estate in Costa Rica is an excellent option for affluent people. Costa Rica luxury real estate includes luxury homes, resorts, hotels, estates, mansions, castles, farms, and other investment opportunities. Mountain properties, beach properties, and vacation rentals are other options. Costa Rica luxury real estate properties can be taken for sale or rent.

Most of the luxury real estate agencies and companies provide top class service to their clients. These firms list, market and sell high-end residential real estates. Costa Rica luxury real estate covers Costa Rican properties located in prime locations such as San Jose, Santa Ana, Escazu, Heredia, Santo Domingo, Atenas, Alajuela, Cartago, and the scenic beach locations. Costa Rica luxury real estate properties are attractive with their wonderful weather, good facilities, friendly neighborhoods, and charming farms and homes. The agencies dealing with luxury real estates in Costa Rica also see to it that the customers get their property at the best prices.

The Internet is the best option for purchasing luxury real estate in Costa Rica. Many real estate agency websites provide details of available properties, which help you to invest in the most lucrative ones. These sites showcase a spectacular selection of Costa Rica luxury real estates. Some sites offer forums for both purchasers and vendors. You also have the facility to clarify doubts regarding the prospects of investment in Costa Rica.

There are online directories that provide details of the complete network of all luxury real estate specialists and agencies throughout Costa Rica. These information sources are the best way to locate Costa Rica real estate agencies and agents. Very often property owners personally advertise their lands for sale, without involving any middleman or organization. In such cases, you can approach the owner directly and fix a sale, which might be more profitable.