When purchasing something, you can buy in one of the two markets. The first is buying on terms in the retail market and the second is buying in the wholesale money market. This can be illustrated by referring to the biggest purchase us all our lives - Real Estate.
In recent years, if you buy a house is easy to obtain financing the first mortgage and the seller is not required for financing the entire sale. What I have in mind, the seller is not your first mortgage holder; Bank lends money to make money and the seller. It wills probably a number of concessions, unless half trust deed.
Therefore, the seller has no money; you usually better solution than to ask the seller to let you buy a house with a very low down payment, with him back the extensive trust deed. Great savings when you purchase property that will not be easy institutional financing available. Purchase of vacant land can best example. My father was interested in buying parts of the industrial city of Monte Bello, just east of the center of Los Angeles. That was more than 1960 years.
In those days it was generally for the purchaser to 20% and the seller to finance the remaining 80% for 10 years at 8% interest. For example: $ 10,000 lot would cost you $ 2000 with $ 97.06 payment each Monday After 10 years the total amount of principal and interest will be $ 13,647.45. If you want to build on property you must pay based loan first. Sellers will not have to wait the whole 10 years, and then recouped all their money.
Many owners sold their property because they wanted to raise funds and $ 2000 is not much money for them. So, my father would offer $ 5000 all the money to sellers. More than 1 in 5 has a cash advance instead of waiting on payments of more than 10 years. By offering additional $ 3,000 in cash down, my father saved $ 8647.45 on sale ($ 5000 for a price, plus interest on the note). Now that is a wholesale purchase!
Buying a car can be done in the same way. When you pay retail, dealer talks monthly payments. If he lowers the price, he will raise interest rates. If you lease a car, not even tell you the price!
The main focus on renting a car or not, the leasing company of what the monthly payment will be and how much extra will you if you drive more than 12,000 miles per year. Sometimes used car financed by the "no credit check" dealer? You get the 36% share of the balance you borrow, after a 50% deposit from you. So if you have a car payment and the case make the difference. Buy what you can afford and save the cash-rich lenders.
I read a report once said that the average man makes $ 1,500,000 during their lifetime. Of this amount, $ 600,000 is used for the payment of interest on its purchase. Let's take a look at buying a house, a slightly different angle. A man who lives in the $ 1,500,000 will earn on average € 30,000 per year or $ 2,500 per Monday
He can afford to 40% of their income on rent or mortgage payment. This means that you can afford $ 150,000 house. As you may be entitled to 90% loan would owe $ 135,000 at 8% amortized over 30 years. This means that he pays $ 221,609.58 interest plus $ 150,000 of principal to buy this house and paid him more than 30 years. Interest alone is almost 15% of his earnings! Buying on credit can cost slightly more than the selling price, because you need to add interest to the costs.
Buy for cash and negotiate for the best price you can get. If you must borrow, pay it as soon as possible. Never borrow for personal consumption. If you can not afford to wait until you save money, you should not buy. It is simply too expensive. Purchase increases the cost even higher than the cash price, and even more expensive. So if you can not afford the discounted price, you certainly can not afford the price financed. My proposal is to pay cash and buy wholesale. BUY THE BEST, compensation in cash
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