Homeowners Insurance Lowdown:

Greetings! Welcome to the 4th edition of the Carnival of Homeowners. We have received 16 entries for this edition. Here are the posts in the order they were received.

ISPF presents Why Do Some People Prefer to Pre-Pay Mortgage, while Others Prefer to Invest the Money Instead? posted at Grad Money Matters. Rationally, it makes more financial sense to stash the additional money we have in a well-chosen index fund. But month after month, we apply the money to the principal of our mortgage loan.

Edithyeung presents Think and Grow Rich posted at Stewart Hsu. If you are *serious* about creating more wealth for yourself and you have limited time to study only 1 book, “Think and Grow Rich” is it. This book, authored by Napoleon Hill and published in 1937, is a perennial classic.

Joshua Dorkin presents Top 5 Mistakes Made By Real Estate Investors During the Housing Bubble posted at Real Estate Investing For Real | A BiggerPockets Investment Property Blog. It is hard to ignore all the hype and buy a property based on proper evaluation when you see every property in the country rising at an astronomical rate.

Tushar presents No Fee Mortgage from Bank of America ! posted at Life of a Resident Alien.... Bank of America has expanded its fee-free mortgage offering nationwide. Not only do B of A home loans come without fees, but they don't require mortgage insurance, either.

Manos Peglis presents Homeowners Insurance Statistics Guide posted at Home Insurance Free Articles. Homeowners insurance is the ideal way to protect one of your lifetime investments, your house and also the pricey things kept in it.

Toby Boyce presents Nobody Likes Foreclosure in Delaware Ohio posted at Sadie's Take on Delaware Ohio. From a macroeconomic level the mortgage industry has received a huge black eye from this increase in foreclosures.

Mark Cutler presents Top 5 Things for a Powder Room posted at Mark Cutler Design. You might enjoy this article about tips for improving your Powder Room.

George Courtney, jr. presents How to Save Thousands of Dollars on your Mortgage posted at The Authentic Bartender Blog. The dream of owning a home is becoming very elusive these days. Although everyone would like to have a home that is paid for free and clear, many people are forced to assume mortgages that will be paid over 25 or 30 years into the future.

Eric Stanley presents How to Create a Household Budget posted at Personal Finance Blog Articles. Every successful business or person has a money plan. This is what a budget is, a plan for your money, telling it what to do instead of it telling you what to do. With a budget you can set and achieve your financial goals. You can also get a better view of what your money can do for you now and in the future.

KRG presents Tax Advantages of a Home Equity Loan posted at FIL-AM WORDS. The tax advantage of owning a home is that homeowners can deduct the interest that they pay on their tax returns.

Madeleine Begun Kane presents Dog Days Of Roofing posted at Mad Kane's Humor Blog. Our roofers must enter your yard, but their access is blocked by your guard.

Kristen presents Decorating small spaces posted at Shakhammer. 3 great tips on decorating a small space.

Erik presents Breaking Down Homeowner's Insurance Coverage posted at Money Crashers. When buying homeowner’s insurance, you are buying a package. You cannot break this package. You either take all of it or none of it at all. There are six parts to the insurance package.

Steve Faber presents Bad Credit Mortgage Options posted at Debt Free. If you want to leap into the ranks of the homeowners but are a wee bit credit challenged, all is not lost. There are mortgage options available to you, even with your bad credit. Be advised, however that due to the recent problems in the sub-prime mortgage market, lenders are tightening their requirements for mortgage lending.

Joshua Dorkin presents What’s the difference between ROI and CAP Rate? posted at Real Estate Investing For Real | A BiggerPockets Investment Property Blog. ROI is your return on investment factoring in your financing. Its your annual cash flow after all expenses divided by your initial investment (out of pocket expense). ROI depicts the true percentage that you will make on your money in the first year.

George Courtney jr. presents Debt Consolidation and Your Home Equity posted at The Authentic Bartender Blog. In today’s fast pace economy, it’s easy to outspend your means and run into a large amount of debt on credit cards. When this becomes a habit, it’s hard to get out of. The goal is to become debt free, improve your credit rating by eliminating bad credit and stop collection agencies.

That concludes the fourth edition of the Carnival of Homeowners. Keep submitting your posts to the future editions of this carnival. Thank you for your contribution.

A demerit of flipping house is if you buy a house and prices fall you can lose money in a deal. Flipping requires you to be a good investor. It can be a great fun. When you are thinking about starting a real estate investment, don’t trust on flipping show that are running on television. Those one hour shows won’t give you enough information and knowledge of investing. Rather they spit out sixty minutes of fun and profit, hiding the down and dirty facts of investing.

Don’t hope to earn profit on what you see on television. Market trends vary from region to region, and community to community. Those witty advertisers have creative skills to create a big profit in front of your eyes. Investing is not a game; it’s a business and need lot of first hand information to make lots of money.

Let us discuss some demerits of flipping a house.

Hard to Convince Sellers: You will have more difficulty convincing sellers to give you a good deal in flipping. Cash and credit give you credibility with sellers. They are more likely to give you a good deal if they believe you can deliver. Most experienced sellers will laugh at you if you offer $10 to bind a contract. They will also question your assignment clause and why you need it. So, be prepared to lose deals to people with demonstrable buying power. You will need to find sellers that are especially motivated and unable to find any other buyers besides you. Tough job indeed!
Finding a Buyer: You will have to rush to find a buyer. The typical closing period for a contract is 30 days. Therefore, in less than a month, might need to find a buyer for your contract. You have to give them enough time for due diligence and allow them to arrange financing. All this you have to do in 30 days. Usually, you'll need a buyer that can close in cash, eliminating costly delays with conventional financing. In either case, you'll limit your pool of buyers to those that can act quickly.
Impacts of Bad Service: Suppose that you are a used auto dealership. You find people that are ready to unload their autos for a discounted price. After buying the auto, you put it on your lot with a slight markup. You take out ads on the newspaper convincing buyers that they can get a great deal at your auto lot because you're selling them much below the market trends. Here, you are acting as a middleman. You collect a fee for that service from people. Similarly, when you are flipping houses, you will use a similar formula. You will buy houses from motivated sellers and mark them up. Next you resell to investors looking for a good deal. In other words, you are in the business of making other people money. No one particularly cares how much time you invested or how much money you make from the resale. They are paying you to find them excellent investments. You are providing a service. When your service is not good, all your hard work will be fruitless.
Foreclosures Trouble: You will be unable to buy foreclosures. Most banks have stopped accepting assignable contracts. Not all flippers are always able to assign their contract in time to close, so they have to admit to the bank that they are unable to buy the property. During the contract period, the bank might remove the property from the market. That is to say, they have to start marketing from scratch. As a result, most banks in the US have created policies that prevent any buyer from using an assignable contract. They have gotten burned too many times.
Lost in Flipping: Remember, you make your money from the markup. You need to look for properties that are better than your investors require. Otherwise, you won't make any money. For instance, if your investors are willing to pay $60,000 for a house that is worth $80,000, then you need to pay less than $60,000 for the house. You might buy it for $50,000 and resell it to one of your investors for $60,000, making a quick $10,000. If you are unable to perform such profits, flipping is a lost game for you.
Time Consuming Job: Of course, it's easier to talk about it than actually do it. Unless you're in an especially poor market, it's difficult to convince anyone to take 20% below market value for their home. Most professional house flippers take several months to build up their database and find a few deals before they start making money. It's a business that takes time and a lot of hard work. Still, if you're willing to do what it takes, there are countless investors who are willing to pay you for the service.
Lowering Price is Dead: After your home has been on the market for quite sometime, there is nothing you can do but lower the asking price. Once it has been long enough and you are eager to move into or put an offer on a house that you were interested in. Next thing you know, someone comes along and gives you a lower offer than you hoped for, and you feel determined to sell your home therefore end up letting it go for less. Here is where you lose more money.
30 Seconds Syndrome: Since real estate is expensive these days, when buying a house most buyers want something they fall in love with immediately. When first walking into anyone’s house you know, you can tell right away whether you like the set up. It usually takes people looking at your house thirty seconds to decide whether or not they like it when they first walk in. That means your entrance has thirty seconds only to impress your buyers! If you fail to do so, then you are a dead house flipper.
Hard to Survive : Real investment plan assumes that you have the knowledge and skills, time to work on your fixer, and that you will sell the house as soon as it is finished to a qualified buyer. Home improvement centers help you with various know-how tips, brochures and advice. You need to give up your free time--television, parties, leisure activities and work on your fixer. You could hire workers, but contractors and laborers work slowly and eat up your profits. You have to compete with several other flippers in the real estate market. Only the best will survive!
A Long Wait: Selling your house quickly to a qualified buyer requires you to do selling homework in broad way. Many investors seek free help from a loan officer to price the house right and to qualify their buyers. These investors earn the sales commission by selling their houses by owner. You will have to wait for many days to find the buyers. Spending time on decision making will often lead to the house being left unsold for many days. Such flipping policy is a real dead indeed!