Self-employment can be a viable option for all those who have lost their jobs due to the recent economic crisis. The best part of being self employed is that you will be your own boss and you will be able to take your own decisions. However, there are certain dis-advantages of being self employed. Self-employment becomes a huge problem when you apply for a mortgage.

What are the main problems faced by self employed while getting a loan?
The 2 main problems faced by the self-employed people while getting qualified for a mortgage are:

Proving income: It is quite important to prove your income with your tax returns when you apply for a mortgage.  Self-employed people won’t be able to provide this proof.

Declining income: Due to the severe economic crisis, income has declined for everyone. The self-employed people have been badly affected due to this. Though now some of them have stabilized income, the lender will take into consideration the average of two years of tax returns. It will show reduced income for the self employed.

Are stated income loans making a comeback?
Stated income loans are making a comeback in the secondary market. But not all can qualify for this loan.

Who will be eligible for stated income loans?
It will be available for only those borrowers who have credit scores above 720, a down payment of 30% or more and around 6 months of cash reserves to cover all monthly obligations. They’ll have to somehow prove that they’ll be able to pay the loan.

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A rebate credit card or a cash back credit card can be considered as a type of rewards card. However, it is a bit different from any other types of reward cards. In case of reward credit cards, your payments to the card issuer is refunded in kind. In case of other reward cards, the consumer will be rewarded through specific merchandise, points, miles, gift certificates, etc.

While choosing between a rebate credit card and a rewards credit card, here are few things which you should keep in mind:

• Requirements for cards: In order to reach the higher tier, you will have to make more purchases using your rebate cards. It is same with rewards card as well. In order to get to the next increment of points or miles, you will need to use it more. This will lead to unnecessary spending at times. If you don’t plan your purchases properly, it will lead to a financial crisis.

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The housing market as well as mortgage lending rules have gone through lot of changes in the recent times. Though certain traditional mortgage advice will still remain the same, buyers have to be savvy enough when they want to buy a property and take out a mortgage for the first time.

Here are 4 tips which might be of great help to first time buyers when they plan to buy a property:

1. Loan type: Though conventional and FHA loans, both are available, FHA loans which are insured by the Federal Housing Administration is a common choice for first time homebuyers. FHA loans have reasonable rules and guidelines and require low credit score and down payment. Such loans are available at a down payment of 3.5%. However, in the recent times, FHA has increased the annual premium for mortgage insurance. Conventional loans with PMI (private mortgage insurance) can be a cheaper choice for first time homebuyers.
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A large number of people are planning to shift abroad due to slow-moving job market. There are different countries which offer good lifestyle and better job market compared to one’s own country and thus there is no harm in moving abroad. However, before leaving the home country, it’s better to take a stock of the financial implications that it will bring.

Here are 5 financial tips which you can take into consideration before you plan to live abroad:

1. Save money: When you decide to move abroad, never underestimate the importance of saving money. It is better to save money which will last you for at least the initial 7 - 9 months after you move abroad. The amount may vary depending upon a person’s family status, job, lifestyle, etc. This initial finance will actually help you build your life in abroad. In case, you get an opportunity to move abroad immediately, make sure you have funds to at least cover your immediate housing costs, emergency healthcare and repatriation expenses.

2. Plan a budget: Unless you’ve a proper knowledge of the cost of living abroad, you may face problems in building up your life there. Thus, you should research about the costs of housing, food, transportation, entertainment, utilities and insurance in the country where you’re planning to move. You should also figure the costs of going back to the old country in case of any emergency. Depending upon that you should plan a budget. You will find expat blogs and online cost-of-living calculators which will help you in planning a budget.
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Selling a house can be a gruelling task in the present market. Things can be more difficult for first-time sellers who have never been through the process before. They should keep few things in mind when they are planning to sell off their property.

Here are 5 tips which may help first time home sellers to sell off their property easily:

1. Promote the property: In order to reach the interested buyers, you will have to promote the property. When you place an ad for selling off the property in your local newspaper or a website, never forget to mention your phone number. When an interested buyer gives you a call, be ready to provide details and answer their queries. Also, when you list your property for sale, provide lots of photos. Clear and professional-quality pictures of your house will make it easier for you to sell off the property.

2. Price the house competitively: If you price your property realistically, it will make things easier for you. Once you list your property in the market, you’ll find that most of the buyers will come and visit your property within the first 2-3 weeks. You should ask your real estate agent to give you a comprehensive list of initial asking prices of nearby homes. Depending upon that, you will be able to price your house competitively. A competitive price can provide you with a winning offer.
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As per a recent survey by Trulia Inc. and RealtyTrac Inc., the real estate/housing market won’t recover until 2014. The survey took place in the month of April and the respondents were the homeowners and renters based at different states.

Why won’t the market improve?
The housing market is still quite weak. The demand for a home loan still remains low and it has become quite difficult to qualify for a loan. Though the rates and home prices are at record low, still it’s failing to boost the demand for properties. The expiration of Federal Tax Credit last year has also added to this. Moreover, a large number of properties are facing foreclosure which will further have a negative affect on the property values.
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In a recent development, some of the top US mortgage servicers, including JP Morgan and Bank of America, have decided to pay $5 billion so that they can settle the ongoing foreclosure probe by the state and the federal government against them.

Why was this probe initiated?
The probe was initiated in all the 50 states due to the faulty foreclosure practices after the collapse in the real estate market. Most of the lenders and mortgage servicers violated state laws while foreclosing properties.

What is the new proposal all about?
In the proposal, a fund will be established, which will, in part pay for principal write downs. This fund will be administered by state and federal officials. This fund could help repay the borrowers whose homes were improperly foreclosed by the banks.

Why was this proposal made?
The State Attorney Generals and the Federal officials, during a settlement talk, offered to revise settlement terms and proposed this option to the banks so that they could fund principal write-downs for homeowners.

Florida launched a billion-dollar mortgage bailout program during mid-April, 2011. It was the last state slated to get the Hardest Hit Funds. This bail-out program is mainly aimed for the unemployed homeowners. It is solely based on the hope that those who get this help will find jobs within the next six months.

Whom to contact for this bail-out program?
The Florida Housing Finance Corp. has already stated taking applications from struggling homeowners for assistance from the federal government’s Hardest Hit funds. The state-owned corporation will be providing around $35,000 over 18 months to each qualified homeowner.
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Credit card debts can create havoc in our lives and may ultimately lead to bankruptcy filing. In order to avoid such a situation, balance transfer method can be very effective. In this process, the balance amount in all the credit cards are transferred to a card which has a low interest rate. However, there are certain things that you should remember about balance transfers. Let’s take a look at them:

1. Good credit is a must to qualify: In order to qualify for a zero interest balance transfer cards you should have good or excellent credit. Unless you have excellent credit scores, none of the creditors will be ready to give you such a card. If they do so, it will become riskier for them.

2. Fees are unavoidable: In order to transfer a balance from a high interest credit card to a low interest one, you’ll always be charged a balance transfer fee. This balance transfer fee is determined as a percentage of the total amount that you’re transferring. These days, there are no caps on the fees charged for balance transfers. For example, on a transfer of $10,000 debt to a balance transfer card, you might have to pay a fee of around $300.

3. Introductory rates will expire: Normally, a balance transfer card will offer you an extra-low APR between 0-5%. However, this rate won’t last forever. After around 9 months – 1 year, the interest rates may change between 8-18%. If you make late payments, then your great rate will disappear even sooner.

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Home equity is the difference between the property value and what you owe on your mortgage. For example, if your property value is $2,50,000 and your mortgage balance is $1,50,000, then it means that you’ve a equity of $1,00,000 in your property. As you pay off the mortgage every month, your home equity will get increased.

Why is home equity tapped?
Home equity loans as well as home equity lines of credit have been used by the borrowers to fund property improvements. Such improvements include remodels and additions. A large number of people also tap their home equity in order to pay off their bills or consolidate their unsecured debts.

How can tapping equity affect the borrower?
Most of us find it very appealing to tap the equity in our homes to pay off other debts. Such loans are available at a lower interest rate compared to a credit card. Moreover, unlike credit cards, home equity loans are tax deductible. However, tapping home equity loans may have a negative impact on the borrower. It won’t help you in eliminating your debt. Rather, you’re jeopardizing your home for paying off the unsecured debts. Unlike credit card debts, a home equity loan will put your house at risk as it is a secured loan.

Thus, you should only go for a home equity loan to pay off your unsecured debts when you’re sure that you’ll be able to pay off your equity loan. If you’re unable to do so, your property will be foreclosed which will have greater negative impact on your credit report compared to credit card debts.