High street lenders can afford to be choosy in the current lending climate and if you have had a bad credit history during the last 5 years then watch for the computer to say no and your application being declined- Particularly if you are a first time buyer with a minimal deposit.
It's not totally the mortgage providers fault for this harsh criteria as it's more the case that they have now been forced to set the pass mark prohibitively high by the regulators even though it was the Financial Services Authority (the mortgage industry regulator) that were caught sleeping on the job in the run up to the subprime crisis and credit crunch.
Within the late nineties until the onset of the credit crunch, house prices had continuously boomed with double-digit per cent growth rates year on year and funders had to respond to this demand for greater value borrowing by improving the income multiples that they were using and easing lending criteria to enable them to deal with the significant demand created by new borrowers. Hindsight is a wonderful thing but unfortunately also about this time, to make sure that London became one of the foremost financial centres in the world, the Chancellor of the Exchequer, Gordon Brown introduced 'light touch' regulation for Banks and consequently the FSA paid little attention to the scant regard to prudent lending that mortgage providers were undertaking.
In the past, lenders would evaluate the maximum mortgage based on three and a half times the main applicant's gross annual income plus once the second applicants income or alternatively 3 times the joint applicants earnings but after deducting any existing financial debt. However, with property values booming and pay not keeping pace, providers had to react and many adapted to offering income multiple stretches of up to five x the main applicant's salary or to an affordability based lending model where some would assess maximum loan based on financial commitments (mortgage, loans and credit card payments) not exceeding 53% of net take home wage. (This was the equivalent of offering a seven x income multiple)
The poor credit market was also growing and many high street lenders were getting involved in the act and the interest rates offered between prime and near prime mortgages were getting closer and closer as competition raged in this profitable market. Bad credit lending criteria was enhanced and many lenders used a menu based process that put borrowers into categories such as near prime, light, medium, heavy or even unlimited adverse. It was possible to obtain a mortgage to stop repossession even if the borrower hadn't made a mortgage payment for the last 6 months and there was even a product to annul a bankruptcy by remortgaging available capital within a property to buy the mortgagor out of the bankruptcy or Individual Voluntary Arrangement (IVA).
The subprime crisis and credit crunch put a stop to all this as banks and building societies were not able to raise funding for specialist mortgages and the lending tap turned off overnight putting borrowers in the subprime arena with no chance of finding mortgage borrowing. Even though large numbers of the specialist lenders are no longer in existence, luckily as we start to recover and come out of recession there are some funders that are beginning to look at lending to those with a historic poor credit background.
Obviously the bad credit mortgage offering is nothing like it was in the past and if you are a first time buyer then the specialist bad credit lenders will not allow any County Court Judgments or defaults to be recorded within the previous 2 years but assuming you meet this poor credit criteria and the lender's income requirements, it's possible to obtain a loan with only a ten per cent deposit. If you are a homeowner then a small number of defaults and County Court Judgments are accepted during the last 2 years and even up to 3 missed mortgage payments within the last 12 months but watch for loan to value to be significantly restricted with this level of mortgage arrears.
Friday, September 30, 2011
Sunday, September 25, 2011
Learn How to Be a Successful Trader
The forex trade market is one of the largest markets in the world. It is conducted five days a week round the clock and it has attracted many investors who either trade online or offline. There are many seasoned players in the market and each year, the market also welcomes new and small players. This is because the business is quite accommodating to anyone who understands its basics. Those who are interested in online business should learn efficiently what is online trading as well as those interested in offline business. One of most popular ways in which one can about the business is by enrolling in a Forex trading course.
There are many institutions that offer the course online and offline. You will learn several strategies that need to be applied in the business if you are to trade productively. Being a technical market, it can take a long time for one to master all the tactics involved in the business. However, through the course and quality training, you will easily some of the most important aspects of the business including:
• Currencies and currency markets across the globe
• Trading platforms
• Automated trading software especially for those who want to learn what is online trading?
• Candlestick charts and how to use them
• Fundamental analysis of different currencies and their trading grounds
During the course, you will be taught all the technical aspects of the trade and how to venture into an existing market smoothly. There are things that one should do and those that one should avoid when investing in the trade. Basically, no one has to be an expert in order to make it in the field. The rule is to learn and stick to the rules of the business. Your teacher therefore, will take through necessary details that will make you a better trader. Most trainers are former business persons therefore; they understand when certain principles should be applied. In this case, they will ensure you learn how to make wise and informed decisions before your investment.
A Forex trading course provides an exclusive opportunity for everyone to have a better understanding of the business so as to make profits even in unfavorable economic conditions. It is very essential to beware of the risks that you may come across in the business and how to manage them. These are some of essential concepts that you will be taught.
Similarly you will learn all aspects of the business including what is online trading; its history, psychology and effective strategies that will help become a better trader.
There are many institutions that offer the course online and offline. You will learn several strategies that need to be applied in the business if you are to trade productively. Being a technical market, it can take a long time for one to master all the tactics involved in the business. However, through the course and quality training, you will easily some of the most important aspects of the business including:
• Currencies and currency markets across the globe
• Trading platforms
• Automated trading software especially for those who want to learn what is online trading?
• Candlestick charts and how to use them
• Fundamental analysis of different currencies and their trading grounds
During the course, you will be taught all the technical aspects of the trade and how to venture into an existing market smoothly. There are things that one should do and those that one should avoid when investing in the trade. Basically, no one has to be an expert in order to make it in the field. The rule is to learn and stick to the rules of the business. Your teacher therefore, will take through necessary details that will make you a better trader. Most trainers are former business persons therefore; they understand when certain principles should be applied. In this case, they will ensure you learn how to make wise and informed decisions before your investment.
A Forex trading course provides an exclusive opportunity for everyone to have a better understanding of the business so as to make profits even in unfavorable economic conditions. It is very essential to beware of the risks that you may come across in the business and how to manage them. These are some of essential concepts that you will be taught.
Similarly you will learn all aspects of the business including what is online trading; its history, psychology and effective strategies that will help become a better trader.
Wednesday, September 21, 2011
A Secret To Financial Freedom
Even with many types of investments today that provide a lot of options for an individual to pursue and take advantage of its money making potential, you still wonder how are you suppose to know what the best deals are. But with the power of the Internet and some basic research, anyone can become knowledgeable about the different financial opportunities available.
If you are looking for additional resources for your financial freedom or if you just need some extra money to pay for your daily expenses, it is important to take a look at the different investment strategies so as to identify the best one for you. Identifying the strengths and weaknesses will help you decide what type of investment you qualify for.
But after everything, the challenge now is how to have lasting financial success and why is it so difficult to achieve. Setting up business goals is fairly easy but achieving them is a different feat. So learning the magic formula for long term success is quite so easy. According to Forbes.com, there are five secrets to financial success, and these are:
1. Invest the time necessary to develop your values: What you really want and why?
2. Compare your reality to your values: Do adjustments need to be made?
3. Make small changes first. You can only eat the proverbial elephant one bite at a time.
4. Think balance: self deprivation is no way to ease into change.
5. Celebrate and savour your progress.
Depending on how you define the meaning of success, a lasting financial success varies from person to person. Setting and achieving long term goals I believe is the road to financial success. When you have set your goals in realistic terms, you'll see credible results. Such as if you have set your goals in terms of financial achievement, you need to put that plan in action.
Indeed, you can and will achieve financial freedom. If you have the right attitude and take advantage of the financial opportunities coming your way, success is within your reach. What's important is that you learn how to be in control by staying within your budget and live according to your financial capability.
If you feel you have to search the web further about the secrets of having financial freedom I recommend you do so, there's more to the above guidelines. But I believe there is not really an absolute secret to success, the only requirement needed is for you to focus on the process.
If you are looking for additional resources for your financial freedom or if you just need some extra money to pay for your daily expenses, it is important to take a look at the different investment strategies so as to identify the best one for you. Identifying the strengths and weaknesses will help you decide what type of investment you qualify for.
But after everything, the challenge now is how to have lasting financial success and why is it so difficult to achieve. Setting up business goals is fairly easy but achieving them is a different feat. So learning the magic formula for long term success is quite so easy. According to Forbes.com, there are five secrets to financial success, and these are:
1. Invest the time necessary to develop your values: What you really want and why?
2. Compare your reality to your values: Do adjustments need to be made?
3. Make small changes first. You can only eat the proverbial elephant one bite at a time.
4. Think balance: self deprivation is no way to ease into change.
5. Celebrate and savour your progress.
Depending on how you define the meaning of success, a lasting financial success varies from person to person. Setting and achieving long term goals I believe is the road to financial success. When you have set your goals in realistic terms, you'll see credible results. Such as if you have set your goals in terms of financial achievement, you need to put that plan in action.
Indeed, you can and will achieve financial freedom. If you have the right attitude and take advantage of the financial opportunities coming your way, success is within your reach. What's important is that you learn how to be in control by staying within your budget and live according to your financial capability.
If you feel you have to search the web further about the secrets of having financial freedom I recommend you do so, there's more to the above guidelines. But I believe there is not really an absolute secret to success, the only requirement needed is for you to focus on the process.
Sunday, September 18, 2011
Will September 2011 Hold for Investors and How?
Comparison charts. They can be useful or detrimental, all depending on what you are using them for. Recently, the Wall Street Journal published a comparison chart highlighting the time period between June and September for 2008-2011. The chart's purpose is to take a look at the starting point of June and use the information from previous years to determine whether the market is trending downward or set to climb in 2011.
What does the chart tell us? Well, looking at 2008, we can see the market was down slightly at the beginning of summer, then seemed to level off for a period right before plummeting. In 2010 the market was a bit choppy in June and July, but then took off. About the same occurred in 2009. So, what is the moral of the story here?
Looking for Trends
After going through the hindsight information we have from 2008-2010, the Journal made a few interesting points. The ultimate conclusion was that "although a global collapse, as seen in 2008, is unlikely, stocks do not appear to be poised for a big rally either." So, no earth shattering predictions here.
The part of this year-by-year comparison I found most interesting was the fact that the article was using the chart as a way to potentially predict what may happen, due to previous trends, but also noted that the plunge of September 2008 was greatly intensified due to the implosion of Lehman Brothers.
When the 158 year old Lehman Brothers declared itself insolvent, there were no trend charts to predict it would occur, and although CEO Dick Fuld probably saw the writing on the wall for quite some time, average investors like you and me played golf while Fuld met with Bank of America and Barclays, desperate to save his firm from bankruptcy.
Bottom line? If an unpredictable event was a key issue in 2008's financial crisis, than looking at the chart to try to determine future trends is essentially futile. Why? Because, of course, another unforeseeable event could be currently looming on the horizon, or it may not be. That's the thing about unpredictable events...They're unpredictable. Such an event could either send the market into an strong recovery, or pull it into a downward spiral.
What's The Answer? More Information?
Maybe the answer is to break out more charts, because to really get an accurate picture, we'll need to look at the strengths and weaknesses of each current investment possibility. This will make our predictions much more accurate, right? No. This will turn us into crazy people with highly irrational behavior who can't sleep at night because we have to keep up with every news story, not to mention quarterly earnings reports, financial strength calculations, debt ratios, and numerous additional statistics and projections for all our investments. Of course, you realize this is impossible. Even with today's technology and the millions of reports that can be run, no one can predict the future.
The Real Answer to the Investment Strategy Question
Since unforeseen events will always be a huge factor, trying to time the market, even with the best and most up to date information, is unwise. It is, essentially, a form of gambling. The only way to invest prudently is by using the investment strategy that has been proven to outperform any rise or drop in the market, and it's pretty simple; short term volatility is always trumped by long term performance.
In order to perform well over time, smart investors will also do the following:
* Be aware of and cut fees and unnecessary costs.
* Determine your risk potential. The closer you are to retirement age, the less loss you can absorb. Be aware of that and work inside of your set risk parameters.
* Properly diversify your portfolio by spreading investments over a wide enough range to minimize risk as much as possible.
* Do not get in and out of the market based on fear or panic. Investing with the crowd will cause you to put your money in popular, trending investments. It will also set you up to pull out during times of panic when you see others doing the same.
* Return to the basics of buying low and selling high. This involves rebalancing according to a set plan; selling off gains and reinvesting in poor performers to keep your portfolio from becoming improperly weighted in areas that can leave you vulnerable.
What Will This September Bring?
That remains to be seen, but with all the possible scenarios, one thing is certain; trying to time the market or predict the future is not only impossible, but will keep you up at night.
When you understand how the market really works and learn that it will continue to perform over time, you will not have to stress over the news, past performance charts, or even sudden catastrophes or turns of events.
For more practical insights on investment strategies, be sure to take advantage of my resources including my 7 Deadly Investor Traps CD & Workbook. These resources will bring clarity to the most common investment mistakes, such as taking advice from a financial salesperson instead of a fiduciary, and how to discover if you are paying hidden fees and commissions along with your financial advisor's fees. This information can make the difference in thousands of dollars each year that can go directly into your nest egg instead of someone else's pocket.
Bryan's logical approach to investing and his determination to expose corrupt practices in the industry has led him to spearhead his own financial education company and gained him recognition with publications such as the Wall-Street Journal, US Senior News, Investment News, Financial Advisor Magazine, Forbes, Fortune, Kiplinger's, Investment Advisor Magazine. Bryan can also be heard on his weekly radio show, The Financial Coach, which is broadcast in St. Louis, MO, where he resides.
What does the chart tell us? Well, looking at 2008, we can see the market was down slightly at the beginning of summer, then seemed to level off for a period right before plummeting. In 2010 the market was a bit choppy in June and July, but then took off. About the same occurred in 2009. So, what is the moral of the story here?
Looking for Trends
After going through the hindsight information we have from 2008-2010, the Journal made a few interesting points. The ultimate conclusion was that "although a global collapse, as seen in 2008, is unlikely, stocks do not appear to be poised for a big rally either." So, no earth shattering predictions here.
The part of this year-by-year comparison I found most interesting was the fact that the article was using the chart as a way to potentially predict what may happen, due to previous trends, but also noted that the plunge of September 2008 was greatly intensified due to the implosion of Lehman Brothers.
When the 158 year old Lehman Brothers declared itself insolvent, there were no trend charts to predict it would occur, and although CEO Dick Fuld probably saw the writing on the wall for quite some time, average investors like you and me played golf while Fuld met with Bank of America and Barclays, desperate to save his firm from bankruptcy.
Bottom line? If an unpredictable event was a key issue in 2008's financial crisis, than looking at the chart to try to determine future trends is essentially futile. Why? Because, of course, another unforeseeable event could be currently looming on the horizon, or it may not be. That's the thing about unpredictable events...They're unpredictable. Such an event could either send the market into an strong recovery, or pull it into a downward spiral.
What's The Answer? More Information?
Maybe the answer is to break out more charts, because to really get an accurate picture, we'll need to look at the strengths and weaknesses of each current investment possibility. This will make our predictions much more accurate, right? No. This will turn us into crazy people with highly irrational behavior who can't sleep at night because we have to keep up with every news story, not to mention quarterly earnings reports, financial strength calculations, debt ratios, and numerous additional statistics and projections for all our investments. Of course, you realize this is impossible. Even with today's technology and the millions of reports that can be run, no one can predict the future.
The Real Answer to the Investment Strategy Question
Since unforeseen events will always be a huge factor, trying to time the market, even with the best and most up to date information, is unwise. It is, essentially, a form of gambling. The only way to invest prudently is by using the investment strategy that has been proven to outperform any rise or drop in the market, and it's pretty simple; short term volatility is always trumped by long term performance.
In order to perform well over time, smart investors will also do the following:
* Be aware of and cut fees and unnecessary costs.
* Determine your risk potential. The closer you are to retirement age, the less loss you can absorb. Be aware of that and work inside of your set risk parameters.
* Properly diversify your portfolio by spreading investments over a wide enough range to minimize risk as much as possible.
* Do not get in and out of the market based on fear or panic. Investing with the crowd will cause you to put your money in popular, trending investments. It will also set you up to pull out during times of panic when you see others doing the same.
* Return to the basics of buying low and selling high. This involves rebalancing according to a set plan; selling off gains and reinvesting in poor performers to keep your portfolio from becoming improperly weighted in areas that can leave you vulnerable.
What Will This September Bring?
That remains to be seen, but with all the possible scenarios, one thing is certain; trying to time the market or predict the future is not only impossible, but will keep you up at night.
When you understand how the market really works and learn that it will continue to perform over time, you will not have to stress over the news, past performance charts, or even sudden catastrophes or turns of events.
For more practical insights on investment strategies, be sure to take advantage of my resources including my 7 Deadly Investor Traps CD & Workbook. These resources will bring clarity to the most common investment mistakes, such as taking advice from a financial salesperson instead of a fiduciary, and how to discover if you are paying hidden fees and commissions along with your financial advisor's fees. This information can make the difference in thousands of dollars each year that can go directly into your nest egg instead of someone else's pocket.
Bryan's logical approach to investing and his determination to expose corrupt practices in the industry has led him to spearhead his own financial education company and gained him recognition with publications such as the Wall-Street Journal, US Senior News, Investment News, Financial Advisor Magazine, Forbes, Fortune, Kiplinger's, Investment Advisor Magazine. Bryan can also be heard on his weekly radio show, The Financial Coach, which is broadcast in St. Louis, MO, where he resides.
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