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[H363]High Yield Certificates Of Deposit

by Nick Dowlatshahi, Nic

For many investors buying leaseback property in France the key attractions are the guaranteed yields, stable economy, low deposits and low interest rates. For most leasebacks though even if you managed to get 100% finance for the ex VAT price you still have had to find the VAT as your deposit which you do not get back until 3-6 months after completion. This can often slow down an investor's momentum as they are waiting to receive back the VAT before using that money as the deposit for their next investment. Because off-plan properties are usually released for sale 18 months to 2 years before completion you could be waiting over 2 years to get your VAT deposit back.

The next thing people often have trouble with is finding 100% interest only mortgages as up till now really only 80% has been possible. Investors often like the idea of interest only mortgages as it reduces their monthly mortgage payments and therefore improves their cash-flow. However interest rates for interest only products have up till now been rather uncompetitive with the classic "interest and capital" mortgage interest rates which have put people off taking them.

The third thing that for some investors has prevented them from taking the plunge and investing in France is that they have felt the yields are not high enough on leasebacks which have usually been around 4-5% NET (equivalent to around 6-7% gross). Even though they are guaranteed and paid NET some investors prefer to take the gamble and purchase something in the emerging markets that they "think" will have a higher rental return.

These issues have now been overcome and you can now get the ultimate leaseback investment. Let's take an example of one to three bedroom apartments from 106,917 Euros in a stunning high quality residence at Mers Les Bains, Picardy, just 300m from the sea and right in the town centre, walking distance from all amenities. The guaranteed NET yield is 5.27% and you can secure 100% interest only finance (subject to status) at a fixed rate of just 5.1% (correct at time of writing).

What this means is that you can invest in and excellent location in France that pays for itself and all you need to find are your bank and mortgage setup fees plus your legal fees (notaire fees). If you add all these together they add up to roughly 7% of the property price. For better understanding we have provided a simulation below of an investment in a 1 bedroom apartment:

Property Price: 106,917 Euros
VAT@ 19.6%: 20,956 Euros
Mortgage: 106,917 Euros

Deposit: 0 Euros
Notaire fees: 5115 Euros
Bank & mortgage fees:2302 Euros

TOTAL personal contribution: 7,417 Euros

This is just one of the highly attractive investments currently available in France and with the new French tax reforms great things are expected for French property in the coming years.

First of all, the main question you must ask yourself before investing in any HYIP is: "Do you plan on investing money that you will definitely need in the future?" In other words, is your life going to be made worse off if you lose the money that you plan to invest? Unlike secure Stocks, Bonds, and other financial investments, HYIP's differ in that they are more like a game of poker than a true investment. As an HYIP investor you must be able to tell if the Program admin is bluffing or telling the truth. Are there signs of a bluff, such as; massive advertising campaigns, cheap hosting of the site, warnings from other investors, or extremely high payout claims? If so then you can avoid that particular program. The problem is that not everyone is a poker (HYIP) expert. It's often hard to distinguish between a bluffer or an honest admin.

Also just like poker, you shouldn't go in expecting to play one hand and leave a winner. You must bring enough money to the table to play a while and use your skills to outsmart your opponent. People often email us asking where they should invest their $5. We usually respond telling them to put it in the bank instead. In our opinion you should not be investing in HYIP's with under $50. Why do we say this? Well usually the less money you have to invest, the more of a return you want to earn. With only $5, investing in a program that pays 5% per week (even though it's probably more stable) would not be appelaing since you would only earn 25 cents per week. Instead, most people with low amounts of money tend to go for the big quick payers, ie. programs that offer 10% per day or more. Usually these programs are scams right from the start. If however, you have $1000 to invest you can easily put it in several low paying secure programs (perhaps 5 programs each paying between 4-10% per week). This way you are earning a noticable amount while also being safe and secure.

The best advice we can give you is to learn a strategy. Just like in Poker, a smart player can outsmart his/her opponents and walk away a winner.

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Both Nick Dowlatshahi & Brian Kay are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.

Nick Dowlatshahi has sinced written about articles on various topics from French Vacation, Finances and French Vacation. Leapfrog Properties is a French Property agency specialising in sales across France and Niclas Dowlatshahi is the Managing Director. Visit