How to obtain a long term loan?

How to obtain a long term loan?

There are some things that money we earn can buy and other things that are out of the reach for an average salaried individual or even an entrepreneur who hasn’t really hit the height as yet. People can often finance their day to day expenses as well as some occasional extravagance. Unfortunately, there are certain expenses such as buying a car, refurnishing your house, etc. that need a sizeable amount of money saved up. Unless you are an avid saver of money, you will find it hard to finance such activities. How then can a person finance their needs? The easiest way to do that is to get Long term loans. These loans are typically spread out over payment schedule of 15 years or more. This makes them easier to get. This article outlines a step by step approach to obtaining a long term loan.

1.     What is the exact amount of money you need

Before you jump on band wagon and apply for a long term loan, it is important that you know how much capital you need. Long term loans can differ in terms and conditions and only when you know the exact amount you need, will you be able to make the right choice.

2.      Choose the right Loan Company

The UK is one of the more competitive markets as far as financial institutions and loan offerings are concerned. As a borrower, you need to pick and choose the right loan company from amongst all of the options that are available. However, there is no one right company. Different companies have different long term loan offerings and the right one for you, will be one that you are most comfortable accepting.

3.     Fill the Loan Application Form

Once you have chosen the right bank, and know the exact amount of loan that you need. You will need to go to a branch of that financial institution and take its loan application form. This loan application form is your formal loan request and needs to be filled in properly and with all information kept up to date. The application form will ask you details about yourself, your finances and about the loan itself, such as its length, the amount required, the payment schedule, use of the loan, etc.

4.     Prove Yourself Credible for the Loan

A long term loan is a sizeable investment by the lender and they need all the assurances that they can get to make sure that they are loaning the amount to the right person. They will take a look at your credit history and ask for you some relevant information about your finances. On your part, as long as the information and questioning does not turn into an uncomfortable interrogation, you need to cooperate with them to get the loan.

5.     Finalize the Scheduled payments

At the final stage of the loan, you need to sit down with the financial institutions representative to finalize the scheduled payments you’ll be making per month. Make sure the payments are kept at a manageable level, even if it means stretching out the loan longer.…
Tax Warning Buy to Let Landlords Should Know

Tax Warning Buy to Let Landlords Should Know

Great Britain, as a nation, is obsessed with mortar and bricks, but financial experts warn investors of unfavorable days ahead.

Why?

This is purely because both, conservative chancellor and the Bank of England tried to eliminate the property bubble market that has been core reason for inflation in the nation. Since April 2016, new tax related forces have been implied, only to bring bad news for landlords. Read along to find out four ways that has led to unfavorable tax changes for buy to let landlords:

There is stamp duty on buying secondary properties

Do you have any property besides your primary home? Well, if so—the stamp duty for any such property has mounted. If you have buy to let properties that is worth more than 40,000 UK pounds, stamp duty applicable on them is an additional 3 percent. So say, if your buy to let property investment is 500,000 UK pounds, your stamp duty will be 6 percent (30,000 pounds!)

There is income tax relief on mortgage interest cut

Up till now, the tax reliefs on mortgage interest for buy to let landlords was around 45 percent (marginal rate of the income tax), it is now only at 20 percent. For basic rate tax payers, this is no change, however, it has increased income tax substantially.

There is tax on buy to let turnover—not on income

This might not be an oblivious change, but it sure is a crafty one. This tax makes sit expensive for buy to let landlords. Let’s look in to an example to comprehend the tax: X is a buy to let landlord who currently rents out a house worth 250,000 pounds and earns a gross rental income of around 4 percent. So, that leaves him with 10,000 pounds in a year from rental income. Before the tax being implied, X could deduct 10 percent for the wear and tear, without being accountable for any bills. However, now he needs to have a proof in order to show any expenses incurred for maintenance. Let’s assume, X did not pay a single penny in maintaining the house since it was new. So now, the 10 percent he could have deducted (before new tax implied) can now not be used. With changes in tax, X is still receiving 10,000 pounds from the rental income but paying out 40 percent (4000 pounds) out of it! At the end of the year, X is badly affected by the new tax laws.

The capital gains tax remains unchanged

While capital gains tax remain unchanged, all other investments are now more lucrative. So, if you own a property/house then it still holds attractiveness as there is no capital gains tax if you sell it off. However, for buy to let landlords it is time to switch for other types of investments to look out for better opportunities in the future.…
What You Need to Know about Dividend Growth Investors?

What You Need to Know about Dividend Growth Investors?

Dividend growth is a simple concept yet most investors do not go through the path of dividend growth. One reason for this may be the fact that it can be boring to be a dividend growth investor because you simply sit on the funds that are planted at a particular organisation and left for a number of years to grow. The overall earnings from a good dividend investment, though can provide you the best results possible from a particular investment. Here are few of the important concepts that you need to know when observing the way dividend growth investors operate to make profits.

Understanding Dividends

Dividends are part of the profits of a company which are shared with its shareholders, according to their share in the company. A public limited company that makes profits has to pay dividends if it has enough money available after planning expansion activities. Companies that pay dividends keep investors interested and do not find much problem in financing their business needs.

Dividend Yield

The concept of dividend yield is consistent with increasing profits, but it is important to understand that sometimes, increased dividend yield may point to a failing company due to low share prices. The yield is defined as the annual dividend for each year divided by the price of the share at the end of the business term. It should not be used as a primary concept to learn about dividend growth because the growth depends more on the quality of the company and its investments towards its expansion and efficient financial working.

The Payout Ratio

The payout ratio refers to the ratio of the shared earnings of the company to the total earnings of the company. Many limited liability companies use the model of a fixed percentage which is distributed to the shareholders. Companies often decide to share a specific percentage, such as sharing 10% or 20% of their annual savings with their shareholders. These savings are then distributed according to the total number of shares of the organisation. Dividend growth investors stay patiently with such an organisation especially the one which is also growing consistently each year. The payout may be a small amount but as the numbers of years pass and the size of the company grows, small payouts add up to create a huge amount of savings that show amazing average growth.

The Use of Rising Stocks

Dividend growth investors around the world have been using growing companies as the best investment options. Companies such as Nestle, Kellogg, Coca Cola and others have grown rapidly over a number of years in size and their shareholders have seen an amazing appreciation in the shares they once bought many years ago.

The Final Word

Dividend growth investors are smart people who find good companies with solid growth and leave a sum invested in them for a long period of time. Ultimately, the return from such companies can be much greater than money invested in other ventures. Dividend growth strategy is also excellent because it builds up a strong market presence as well because of constantly buying more shares of a company with each growth cycle.…