You may not be aware but you may be eligible for a council house mortgage. A council house mortgage may be granted to tenants who are currently renting a home from a local authority. There are certain qualification criteria, which we shall soon discuss. First, let’s discuss what are council house mortgages.

When a tenant applies for a council house mortgage, a valuer will be sent to assess the house and give it a market value. This process usually takes around 3 months. If the tenant fulfills all the criteria, and the council house mortgage is approved, the tenant can buy the house at a heavily discounted rate. For example, a house valued at $100,000 may be bought for $50,000.

A tenant can borrow up to 100% of the council’s valuation. In the above example, that means the tenant has excess cash of $50,000. The money can be used for various purposes such as renovations, buying furniture, or for business. Or the tenant can use the money to pay off some debt. Whatever the case, the council house mortgage will leave the tenant in a stronger financial position.

In addition, the tenant is now officially a homeowner instead of a tenant. There are several qualifying criteria for council house mortgages.

Firstly, tenants must have stayed in the council house for at least 2 years. If the tenancy began after 18 January 2005, then the minimum period is 5 years.

Secondly, the house must be a district council house, a London Borough Council House, or a house belonging to a Housing Action Trust. You can apply for the right even if you have bad credit ratings. For instance, you may be a discharged bankrupt, and still qualify for the scheme. All you have to do is to consult a professional mortgage firm that specializes in applying for the right to buy.

Similar to other home mortgages, you are required to pay interest on the loan. In other words, the more you borrow, the more you have to pay back. For this reason, it is best to apply common sense when it comes to deciding on the loan amount to borrow. Obviously, you should not take out the maximum amount that you are eligible for if you do not need that amount of money.

Borrow what you need, and what is necessary to enable you to achieve your own goals. For instance, if you have the intention of using the money for a business start-up, make careful calculations of how much you need and borrow that amount. If you borrow in excess, your monthly payments will naturally be higher, putting more pressure on you to pay off the monthly installments.

And if you find yourself not being able to pay off the monthly payments, you home may be re-possessed. Therefore, always seek professional advice when in doubt. Borrow prudently and you will never have to worry about losing your home.

The problem that many modern day consumer has to face is that there are just so many different types of loans in the market! If a consumer is not careful, he may find himself borrowing more and more and getting deeper and deeper into debt. Expenditure exceeding income is certainly not a wise habit to cultivate.

The different types of loans include mortgage loans, student loans, credit card loans, travel loans, car loans and more. Every time a loan is taken out, the lender charges an interest. The interest rate is by no means a small figure. Many consumers underestimate the effects of compound interest and allow the interest to snowball. Soon, the consumer finds himself in a very uncomfortable position - he is unable to pay off his debts.

Now is the time to seek help. Professional debt consolidation service providers are always willing to lend a helping hand. For example, to save money, you may wish to consider taking up a debt consolidation mortgage. Here are 5 reasons why debt consolidation mortgage will save you money.

1) Paying lower interest rate.

When you consolidate your mortgage, you will be able to pay off mortgage in a single loan. While doing so, the objective here is to negotiate for a lower interest rate. That is how mortgages work. The more you hold on to your money, the more interest you pay. So it’s in your best interest to consolidate your loans and pay them off as soon as possible.

2) Reduction in risk means lower payments.

When you borrow money, lenders always look at the risk they undertake when they make a loan to you. The more risk they undertake, the more interest you have to pay. By consolidating your mortgage, you are expressing a desire to pay off the loan. When risk is reduced, you have a higher chance of paying less.

3) Able to borrow more economically.

With an improved credit rating, you will be more likely to get economical loans in future. Many lenders are hesitant to make loans to borrowers with bad credit ratings. Even when successful, the borrowers may have to be prepared to pay a higher interest rate.

4) Improved cash flow.

When you consolidate your mortgage, your cash flow actually becomes healthier. This puts you in a better position to strengthen your cash flow. Having more money for expenses mean that you have less need to use your credit cards. In the long run, it means more money in the pocket for you.

5) Reduced opportunity cost.

Having more money in the pocket also means that you can put the money to better use, like starting a side business or making an investment. You are actually acquiring more assets, and in the process, earn more money.

There are many reasons as to why you should consider a re-mortgage. You may be overwhelmed with the great number of advertisements in recent times, all prompting you to re-mortgage your home. Ultimately, the decision to re-mortgage depends on your own financial status, and your financial plan. Here are some common reasons why homeowners decide to apply for a re-mortgage.

1) Lower mortgage payments.

You may have a change of jobs recently and your salary is not as much as before. Or your business is suffering due to the current economic downturn. As a result, you find that cash flow has been tight, and you may no longer be able to afford your current mortgage payments. In this case, you can apply for a re-mortgage to lower your mortgage payments. Of course, your payment period may be longer, and you may be required to pay more interest in the long run. But at least you get to keep your home.

2) Shorten the length of the mortgage.

This is the opposite of the first scenario. You now find yourself in a much better financial position, and would like to pay off as much of your mortgage loan as possible. Homeowners sometimes do that so that they can save on paying hefty interest on their current mortgage loans. Shortening the length of the mortgage usually means higher monthly payments.

3) Exchange home equity for cash.

This is a very common reason. You have been paying mortgage payments for years now, and there is equity available. For cash flow reasons, you may wish to exchange part of the equity for a lump sum. The sum of money can be used for business or for a family emergency.

4) Retirement purposes.

You have decided to go into full or semi-retirement. Releasing equity from your mortgage can help fund your retirement. You can start a side business with your funds, work less hours per day, and enjoy more leisure time.

5) Invest in a second home.

Perhaps the time is right for investing in a second home. In order to pay for the down payment, you need a lump sum of money. Releasing equity is one such option. The cash can be used to buy another property for investment purposes, or for retirement purposes.

The whole idea of re-mortgage is to release equity for cash, or to reduce the interest payable. Your decision to go for a re-mortgage depends on how you are going to use the re-mortgage to advance your own interest. Different people have different needs. Some may need the money to pay off credit card debts, while others just want a second property by the seaside for leisure purposes. Whatever your reason, always speak to a professional re-mortgage advisor to find out more about more re-mortgages can help you.

Homeowner secured loans are dubbed as second charge loans or second charge lending. Tracing the roots, a charge was registered on land registry each time a credit is secured on the property. Mortgage lenders get the honor of possessing the first charge. Secured loans have the second charge. This explains the coinage.

Secured loans are repaid on a monthly basis. This is the general practice but one can vacillate from the payment structure. Sometimes the lender comes to a consensus with the borrower over other methods of payments. These can be over payments and lump sum payments. In few cases it gets even better. A borrower can withdraw funds from the account; this can be done on a rolling basis given that one stays within the credit limit.

Secured loan lenders serve generous offerings. This is only apparent generosity because at the end, it does not make much difference. The bounty can come in the form of payment holidays or payment interruptions. This allows a borrower the opportunity to defer payments. This implies taking a structuring break. A borrower can also opt for a payment holiday at an intermediate stage of the loan. Interest though, invariably keeps mounting and hence we get larger payment figures when we opt to pay again.

The point as to how much one can borrow largely depends upon one’s credit rating and calculations pertaining to payment-power. A person can end up borrowing higher than what he initially imagines owing to the lack of conventional income multiples. With a stable credit rating, borrowing a sum that is 125% of the value of a property is not unheard of. Poor credit rating can still let one amass 90% of the property value. The largesse includes existing mortgage plus the secured loan and must be underwritten. Secured loan can be made available anywhere between 5000 pounds and 250000 pounds.

Though the loans are lucratively placed and highly luring, they also ask of reasonable credit history and rating. So in the event of one’s frequently changing address or lacking credit history, the loans become difficult to be procured. Further, self-employed people find it comparatively harder to avail such loans.

Lenders are also known to indulge in mercy-calling. They thus help people with poor circumstances attain the benefit of secured loans. This is on a high interest rate though.

Processing and approval are generally done expeditiously and bend towards being consumer-friendly. Datasheets reject or approve of loans immediately. This is because the credit report of each citizen is available at a small click of the mouse. Furthermore, the processing bit is completed through subtle verifications. People failing in such verifications can still avail off the loans given that they can attest to their mode of repayment. Such people can face severe financial problems in the event of default.

Average price of a house is assuming an ascending slope in UK. Moreover UK is witnessing a tangible hike in demand of tenants. Lenders understand the virtue of this time. They have fathomed that there are people with the right kind of money or at least the right kind of will needed to buy a property. Later group of people are the target-base of lenders who are offering many fresh buy to let remortgage schemes. Lenders are verily minimizing the rental eligibility criteria and have also let the Loan to value ratio feasible come down from 85% to 65%.

The incentives go a long way in determining product flexibility. Such non-rigid dimensions help a buyer think seductively towards an offer of buy to let remortgages.

What then is buy to let remortgage? – It is simple. People buy property and then put it on rent. It is an easy way to realize rental revenue apart from being continuously ensured by the rising prices of the property. A lot of money would have flowed in as rent by the time an owner actually makes up his mind to sell the property.

How does it fare against selling a property? - There are times when property escalation seems to have touched the summit. In such cases, an owner feels like settling the issue for good and begins to look for buyers. Is it the right time? Let us argue. Let’s assume an initial interest only mortgage at 85% of worth of property. Even when the property doubles in price, the mortgage debt remains the same.

While selling the property, we will have to clear the mortgage debt, subtract the initial investment to the tune of 15% and further minimize the Capital Gains Tax. Mathematically our net gain would be in the realms of 35% of the price at which we sell the property. At the same time, we would be completely deprived of any further profit owing to future escalation of property prices.

Let’s now judge the other side of the coin. With increase in rate of property with time, the rent levels also take a sharp upward turn. Owing to the beneficial rent clause, we do not have to pay any Capital Gains Tax. The property remains with us and any lay man can confirm that amassing the 85% mortgage debt is quite feasible through accumulated rent. In fact the rent each month can help with paying the mortgage EMI.

While venturing into buy to let remortgage, it is important to understand that the current variable interest rates prescribed by the government are too high and we must abstain from them.

A quick tip - We can work further towards consolidated remortgage and consolidate our other lending commitments to the mortgage.