More often than not, cash shortages occur while buying a new property. You don't have sufficient fund to strike a new deal and the opportunity seems to slip out of your hand. You also intend to sell an existing property but searching for buyers. Residential bridging loan comes to your rescue in situations when you are short of money.
Residential bridging loan is a secured loans where a valuable like home, land, estate, commercial and residential property has to be kept as collateral. The new property you intend to buy can also act as collateral. The loan amount depends on the equity of the collateral pledged. A property with a very high equity can fetch a very large amount of loan.
The repayment term of residential bridging loan is very short ranging from 1 to 12 months. Within this stipulated time period you have to sell your existing property and pay back the loan.
Two types of residential bridging loan are available depending on the status of the property deal. You can get a close end residential bridging loan if you have already sold your property. In case you are still to sell the existing property, then the residential bridging loan will be an open ended one.
Being a short term loan, residential bridging loan has slightly higher rate of interest. But the best thing about this loan is that it is an interest only loan. You have to pay only the interest during the tenure of the loan and the principle amount can be paid at any convenient time or when the deal is finalized.
To get residential bridging loan at cheap rates you can go online. You can ask for quotes from numerous lenders available and compare them. You can also make use of loan calculators to estimate the cost of the loan at the end of the term. This way you will be able to find rational deals to fulfill your desires.
As all real estate owners know, the cost of owning a home or rental property rises steadily over time, from pesky tax assessment increases, to property insurance premiums shooting up, to property repairs. For landlords, this means their rental income must increase alongside these rising costs, which in turn necessitates raising tenants' rents. While not a fun conversation by any means, here are a few tricks to make it a little smoother, and to reduce the prospect of a vacancy.
Trick 1: Remember the Season
It's much harder to sign a new rental agreement in the fall and winter months than the summer months, as most people prefer to move in warmer weather. This means, quite simply, that you should wait until spring to raise the rents on your tenants, in case they decide to leave and you need to find new tenants.
Trick 2: The Personal Connection
This one is important: broach the conversation in person when you ask your tenants to sign a new, more expensive rental agreement. The reasons are many, but people are far less likely to say "no" or start a confrontation in person than they are through less personal communication. Additionally, you will find your tenants far more amenable if you sit down in person and explain your reasons for raising the rental amount (i.e. rising property taxes, insurance premium going up, etc), than if you simply send them a notice that they have to start paying you an extra $50/month.
Trick 3: Give Your Tenants Notice
Landlords have to give a certain amount of advance, written notice in most states, so make sure you comply with your state's laws. When you sit down with your tenants face-to-face, it's a good time to give them the written notice, and keep in mind that if your tenants decide to leave, you'll have even longer to find a new tenant before your old tenants vacate, the more notice you give them.
Trick 4: Secure a Long Term Rental Agreement
No tenants wants to worry that every twelve months they'll be subject to rental price spikes, so one way you can reassure them is to offer a long term rental agreement of several years. Tell them you're willing to commit, in writing, to this new rent for at least two years, by signing a new rental agreement with them, and you've not only assuaged their fears but secured a good tenant for the next several years.
Trick 5: What Are Other Rental Properties Going For?
Many tenants have misconceptions about what market rents are in the neighborhood, and think they can automatically get a good deal by going elsewhere. Do your homework before approaching tenants, walk through some other available rental properties on your street, and gather some rental market data. When you ask them to sign a new, more expensive rental agreement, you can also provide them with data about other nearby rental units, proving that they're still "getting a good deal" by staying with you.
Trick 6: Are There Other Options?
Sometimes, it doesn't make sense to raise the rent on your tenants, even though market rents are higher than yours. Some tenants are so great that they're worth keeping even if your cash flow reduces as a result, because they pay like clockwork and treat your property well. If they're struggling financially as it is, or if they were thinking about moving sometime in the near future, you may lose them by pushing a hike in their rent. So, consider alternatives when you sit down and discuss the situation with them, including signing a long term rental agreement instead, or phasing in the rent hike slowly over the course of a year or two.
Raising the rent is just one of those things you have to do as a landlord, if you want to stay solvent, as your expenses rise. But, stability in your rental unit is also valuable, so remember that signing a long term rental agreement has its own value, and remember to be fair, honest, and to consider each rental hike on a case by case basis.
Both Eva & G. Brian Davis 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.
Eva has sinced written about articles on various topics from Finances, Hair Care and Buy Rimonabant. Eva Baldwyn aims to inform common men and women of the several issues involved in personal loans and mortgages through her articles. To find. Eva's top article generates over 3600 views. to your Favourites.
G. Brian Davis has sinced written about articles on various topics from Bathroom Remodeling Ideas, Real Estate and Finances. Brian Davis is a traveling landlord and photographer who owns several rental properties. He contributes to online real estate publications such as. G. Brian Davis's top article generates over 8100 views. to your Favourites.