Make Some Money

Northern Rock Plc, the U.K.’s worst performing bank stock, will receive emergency funds from the Bank of England. this is to ease a credit shortage sparked by U.S. subprime mortgage defaults.

since the funding has been agreed its customers have been rushing to branches to withdraw money in a panic. they fear the worst for the bank and have withdrawn at least 2 billion pounds, about 8 percent of its retail deposits. the branches are too busy to serve most of the queuing customers, the website has also experienced problems as people rush to withdraw money.

northern rock lending
rising credit costs due to the US credit crunch left Northern Rock unable to make new loans, sparking the first rescue of a U.K. lender by the central bank in 34 years. The bailout stoked concern among investors and depositors that other financial firms relying on short-term money market credit rather than deposits from customers may be vulnerable because the rate they borrow at exceeds the amount they earn from lending.

bank of england
i think people are overly worried when they shouldn’t be. the bank of england would not lend money if they felt the northern rock would collapse. they must be sure that the funds they lend will be sufficient and WILL enable the bank to get back onto its feet.

the first £35,000 of savings you have with any bank are protected by the official Financial Services Compensation Scheme. so if you are overly worried and you have more than £35′000 of savings with northern rock, then take out the excess. i’m not sure if the thosuands of people withdrawing money are aware of this. unless they ALL have over £35′000 in their northern rock accounts!

back in may i wrote about my bad tenants situation in this post http://www.daveso.com/property-investment/watch-out-bad-tennants/
since visiting them 2 of the 3 bad payers are slowly paying of their arrears by paying more every month. I have 1 tenant though that just does not play ball. I have changed her payments to weekly payments to make it easier for her to pay. she assured me that she would never be late on her payments again.

it’s the banks fault - i’ve paid you

after going to see her she paid for about 4 weeks in a row, then its back to her old tricks with only 2 payments the next month. in July she paid on the 10th and then no other payments were made. so much for her promises. “it’s the banks fault - i’ve paid you” she keeps telling me. looking at her bank statements i can see that she has paid the bank £35 each time for cancelled standing order. her bank Natwest are charging her £35 each week as she has insufficient funds to pay me. this is appalling that her bank should keep doing this to her and i believe she can claim these charges back. this shouldn’t really be my problem though as whilst she isn’t paying rent i am paying it for her. she is living in my property for free! this wouldn’t be so bad if i didn’t have to pay anything, but i have a mortgage on the property and without her rent i’m paying hundreds in mortgage payments that should be covered by her rent.

no other choice

i have to do everything legally and i have already given her every chance to pay on time. regretably i have decided to evict her unless she pays most of her arrears and starts apying on time. unless she does this i don’t think the situation will improve and i will be paying for more of HER rent. i don’t actually think she can afford this as she is not working her partner only works part time and she has 2 teenage kids. i feel really bad about this, but i’m not prepared to pay for her to live in my property.

Do it right, within the law

there are 2 main ways to do the eviction right. you must serve one of the following notices and then apply to court after 14 days.

section 21 notice

a section 21 notice can be served if they are out of contract (the 6 or 12 months signed for has elapsed), no reason needs to be given for a section 21 notice to be served. some landlords ask the tenants to sign this as part of the tenancy agreement, thus making it easier to get the tenant out. i need to consider doing this.

section 8 notice

a section 8 notice can be served if the tenant has broken the terms of the tenancy agreement. this is usually due to non payment of rent, but can also be due to disturbance or damage etc.
if using the section 8 notice for non payment of rent you can use grounds 8, 10, 11 depending on the situation. here is a brief explaination of each ground:
ground 8 at the time of the notice at least 2 months or 8 weeks of rent is unpaid
ground 10 at the time of the notice some rent is unpaid
ground 11 at the time of the notice payment of rent has been persistently delayed.
i have used all 3 grounds as if you only use ground 8 the tenant can pay you £10 to bring the arrears to less than 2 months and the courts may not evict. not that i really want to evict, all i would like is some of my rent please.

i served notice on 31st August so i’ll report back on how it all goes. i really don’t want this to go through, but i also don’t want to be a mug anymore by paying someone elses rent for them. i guess its all part and parcel of the proffession i have chosen..

my car insurance with elephant insurance was due to run out in a few days and the renewal price was £1030.00 or thereabouts so i thought i would set about trying to get a cheaper quote. my car insurance only cost me £700.00 last year but i guess will have gone up as i had a slight prang earlier this year. you can read about my repair with lookers honda nottingham

my honda s2000 after a little prang

i only went to 2 other compaies so not really an exhaustive search. the first other company i went to was DirectLine who quoted £1160.00 for the same cover. this was no better so i thought i would try another company.

Tesco Value

i thought Tesco should be quite competitive as they like to promote their value range of food and services. the online quote system they use was very similar to DirectLine’s too similar infact. DirectLine actually run the Tesco car insurance.

As the country’s leading partnership provider of insurance and motoring assistance, UKI Partnerships teams up with brand leaders such as Tesco Personal Finance, BMW, and Barclaycard to manage and develop bespoke insurance and breakdown packages. UKI Partnerships also markets the Green Flag Motoring Assistance brand

Thats why Tescos quote was the same at £1160.00 Tescos do however have an extra button on their quote system marked “get value quote”, interesting i thought and proceeded to click. the “value” quote was £896.00 !! amazing!! but what must be the small print? i had a brief look and found the main difference being an excess of £600 rather than the standard £250. still not bad i thought as i don’t intend to have another accident.

in summary:
elephant insurance - £1030.00
DirectLine - £1160.00
Tescos Value - £896.00

over £100 saved. it pays to shop around!!

as a keen BTL investor I have used many different mortgage companies and here is my current list of best and worst lenders. they are rated by a mixture of speed to offer, speed to complete, rate of their products.

The Good

1. BMS - Birmingham Midshires.

speed to offer is excellent and no problems with completions either. i’ve had valuations booked the same day as my broker has instructed them. They products are amongst the best out there. the only thing that lets them down is they only offer 85% of purchase price for their instant remortgages.

2. MX - Mortgage Express.

Speed to offer is good, but they sometimes have delays, no problems with completions. Product wise they are quite competitive and used to offer a really good five year deal. They are one of the only lenders who do instant remortgaging to 85% Value of property.

3. TMW - The Mortgage works.

Speed to offer is ok, overall speed is consistent. They have good products for limited co’s but require you to use their solicitors to check everything out. no instant remortgage.

4. Bristol and West Mortgages.

Speed to offer is average, overall speed is consistent. Some of their products allow the rental to be 100% of the mortgage payments, which makes it easier for some deals to stack. no instant remortgage.

5. TMB - The Mortgage Business.

Speed to offer is slow, overall speed is consistent. They have a product that has NO rental calculation allowing you to purchase by using 15% deposit. The rates are not brilliant and you can only have one of these at any one time. Perfect if you are buying a property to sell on ASAP as their is no rental calculation which means you can buy more expensive properties.

The Bad
I only have one at the moment read: http://www.daveso.com/property-investment/gmac-cannot-meet-completion-dates-rubbish/

GMAC - RFC

Speed to offer is quick. speed to completion is terrible, they have not managed to meet 1 completion date in 3 mortgages with them. The rates are average, but they offer a high LTV of 89% and also have a 100% rental calculation making this company useful for deals that are hard to stack.
even though i keep going on about them and their bad punctuality with completions i may use them again as they have a useful product.

House price increase

ok so i usually take newspaper headlines with a pinch of salt. however most of them were reporting that that UK house prices are set to rise 40% over the next 5 years. this is not a figure plucked out of thin air either. figures have been taken from a report from the National Housing Federation. the report features new projections commissioned from Oxford Economics which also show that the average price in London will nearly hit half a million pounds in time for the 2012 London Olympics.

Home Truths

the report is titled Home Truths reveals that a housing market crash is ‘unlikely’ and that home ownership will move even further out of the reach of many first time buyers as the average house price is now nearly 11 times average earning.
housing supply has dropped even further behind housing demand with over 1.6m households (equating to almost 4m people) are on waiting lists for a social home

Federation Chief Executive David Orr said:

“Our report shows that continuing house price rises and the resulting housing crisis are set to stay with us for a long time.

“Each year that we fail to build enough homes to meet newly arising housing need we increase the shortfall, making it harder to catch up.”

“For those key workers and low-income families looking for a decent home, it is critical that ministers invest sufficiently in social housing. This will enable housing associations, and others, to build the desperately needed 70,000 new social homes a year.”

National Housing Federation - who??

i had never actually herd of the national housing federation before this report came out. who are they?

The National Housing Federation represents 1300 independent, not-for-profit housing associations in England and is the voice of affordable housing. Our members provide two million affordable homes for five million people.

i like the idea of a non profit organisation and i think that social housing is very important.

their report can be found here: Home truths report

this is the second mortgage that i’m trying to complete on with GMAC RFC.
they have been an absolute nightmare according to my solicitor.
both times GMAC have not been able to meet the completion date and requested more information such as asking for mining reports at the last minute when there have been no problems with subsidence. these kinds of questions should have been made way before the completion date, NOT last minute.
i have a third application going through with them and they have messed that up already. needing me to confirm if i am a first time buyer or not??

i guess i can say that they are being consistent at least. consistently appalling

benefits of using GMAC RFC

GMAC are currently one of the only BTL Lenders who will allow a 89% LTV, only requiring you to put down an 11% deposit.
the rental coverage they require is only 100% of the monthly mortgage payments which means that its easier to get deals to “stack” using this lender.

is 100% rental coverage enough?

mortgage payments £520 per month, rental income £520 per month, is this enough to cover all bases?
well no not really as buildings insurance usually amounts to £15 per month and the safety checks are about £40 annually. 100% coverage is not usually enough as you may have maintenance and void periods to consider.

what we need to remember is that the rental figure the lenders use to consider your application is the figure provided by the valuation surveyor. this figure is usually not the same as the actual figure that you are receiving. the actual rent received is usually slightly more which will help with the maintenance and void periods.

As the interest rates go up do property investors still buy more investment properties or do they hold off?

As an investor myself I have to ask myself the question “should I still buy more?”. Well my answer is “Yes, of Course!” but i have to be more cautious as less deals stack up with higher interest rates.

most all the mortgage lenders have strict criteria about monthly rents needing to be about 120% of the mortgage payments. this is to protect them from over lending making sure the rent you recieve is enough to cover the mortgage and some more. when rates were lower this criteria was easily met. as rates increase this is harder to achieve on most properties.

advantages of high interest rates

there are of course always some advantages to higher rates:
more homeowners will be overstretched and may struggle with payments.
investors in a good position will be able to help these homeowners out with sell and rent back arrangements
confidence in the market may also be affected as less people can afford to buy.
this only leaves more room for cheeky offers from investors.

keep buying, speculate to accumulate!

I will definitely still be buying more properties, but i will be more careful with picking bargains.
this week i have completed on 2 purchases further adding to my portfolio and my passive income from property.

i use google adwords on one of my property sites and some of my other sites that i run. it has been getting more and more expensive to bid for the keywords that i want a year ago it would have cost £.50 for the keywords “sell my house quickly”, whereas now it costs around £4.00. thats for one click, ouch!

poor performing adverts

i’ve been a bit disappointed with the results this month as even though the budget of £40 per day is being used up we do not seem to be getting any conversions. conversions for my sites would mean people are submitting their details. so we still get about 6-10 clicks a day which drains the budget, but no conversions. this IS quite strange as normally the ratio is about 3 clicks to one conversion.

one malicious IP address

i downloaded this months log files for my site just to see if it would show me what what happening. after looking through the logs for a few minutes it became apparent that alot of the visits were coming from one IP address. so i double checked how they were reaching my site and each visit was the same. they came via google with the same search string each time, sometimes up to 5 times a day.

its not difficult to realise that “sponsored listings” cost money. so why unless they were malicious why would someone go to google type in the same search string and then click on your advert to access your site 5 times a day, everyday of the week? hell if you really liked the site you would bookmark it or even make it your homepage on Internet Explorer.

people don’t realise that the internet is not THAT anonymous and that most of your actions can be traced. i am first and foremost an IT geek so this is no mean feat for me. i must have some pretty malicious and unscrupulous competition in the property world to have some one go as far as to devote time everyday to use up my marketing budget. this is not the route any honorable business person would take.

google responds to adwords click fraud

i emailed google giving them details of what had happened and asked for a refund of the credits used as this is definitely fraud. I didn’t even know that they would allow this sort of thing to happen. this is there long and detailed (most of it is cut and pasted) response.

Hello Dave,

Thank you for your email. I understand you are concerned that you have received multiple clicks from the same IP address and as a consequence have excluded this IP address as these clicks have been using up a lot of your budget. I understand you would like compensation for these clicks.

Each click on an AdWords ad is examined by our system. Google looks at numerous data points for each click, including the IP address, the time of the click, any duplicate clicks and various other click patterns. Our system then analyses these factors to isolate and filter out invalid clicks that fit a pattern of use intended to artificially drive up an advertiser’s clicks or impressions or a publisher’s earnings. It is not in Google’s interest to allow invalid clicks in order to generate revenue since this would not accord with the interests of our advertisers.

are you sure its not in your interest? you still get paid for it don’t you?

If you notice click activity that does not fit your usual patterns, please keep the following factors in mind:

- Return visits: Individual users may legitimately click on your ad more than once when comparison shopping or returning to your site for more information.

yes i often visit sites, forget the name of them so have to search the same keywords to get search results. but after doing this a couple of times i’ll either remember the URL or save it to favourites. My site was visited through my adwords ppc by the same IP 36 times in 18 days, they just clicked and left, thats got to be foul play.

- Shared IPs: Multiple clicks from a single source may be due to an Internet Service Provider (ISP) assigning identical IP addresses to multiple users. Certain ISPs, such as AOL, distribute a relatively small number of shared, rotating IP addresses to a large number of users. As a result, multiple visitors may access your site from identical IP addresses, giving the impression of repeated clicks from a single visitor.

hardly ANY ISP’s still do this, but i’ve confirmed this with the ISP that owns the IP that they DO NOT share IP addresses

- Web server logs: Your site’s web server logs include data for all visitors to your site, not just those who arrived after clicking on an AdWords ad. You may also see ‘Google.co.uk’ referrers from users who reached your site via the Google search results. Please be assured that your account would only be charged for clicks that your ads received.

yes but the IP log data tallys up with the dates the adwords adverts were clicked.

No direct logging of IP’s in google analytics

is this the reason why google analytics does not directly log IP addresses, so that this kind of fraud normally goes undetected and google carries on making revenue on these clicks?
maybe the amount of business generated from adwords click fraud is too great to lose.

I can’t believe the ammount of spam i get in my mailbox just the other day though one particular email caught my eye. a mr Chen Minyong of the Singapore United Overseas bank wants to give someone over $3 million dollars and he has chosen me!!
there must be a catch i thought as there is never such thing as a free lunch. well in this instance the catch is that he wants to put $15 million into my bank account first. hmmm well i guess that would be ok.

Good Day,

This mail might come to you as a surprise and the temptation to ignore it
as serious could come into your mind but please consider it a divine wish
and accept it with a deep sense of humility.

My name is Mr.Chen Minyong, an external auditor for the United Overseas
Bank,Singapore,working as part of a bigger team that covers the entire
Asian region.

An investor died without naming a next of kin to his fund in my bank.The
amount is $15.7M and banking regulation/legislation in Singapore demand
that i notify the fiscal authorities after three years.The above set of
facts underscores my reason to seek your permission to have you stand as
the next of kin to the deceased investor.This funds will be approve and
release in your favour as the next of kin if only you will adhere to my
instruction and cooperate with me in one accord.

I have all the legal and Banking details of my deceased client that will
facilitate our putting you forward as the claimant/beneficiary of the
funds and ultimately transfer of the $15.7M plus interest to any
bank account nominated by you.I am prepared to compensate you with a 20%
share of the total funds for your efforts.The final details will be given
upon receipt an affirmation of your desire to participate.

Please contact me through my email address as time is of the essence in
this business.Also endeavor to forward the under listed details below to
my email address.

I wait in anticipation of your fullest co-operation.

Full Name
Date Of Birth
Occupation
Telephone Number
Fax Number
Email Address
Postal Address

Thank you,

Mr. Chen Minyong

honest and reliable is me

he must have heard that i am an honest and reliable individual who will definitely give him back the $12 million or so and only keep $3 million to myself. yes that must be why he has contacted me.

the real catch

i’m guessing that at a later stage he will either ask for money or more banking details so that “he may make his transfer”. the money you send him will never be seen again or he will use your details maliciously. i’m sure these types of scams must have been around for ages. does anybody ever fall for these emails? i thought they evolved into complicated phishing sites/emails. this email seems like the scammers have gone back to the basic free money scam. these scams only exist due to greed as too many want to make quick money and end up becoming victims of scams.

I’ve had a reply from facebook regarding my being banned from the site. they have let me off and allowed me back in, but i’m not to send multiple messages again..

here is the reply from facebook:

Hi Dave,

Your account was disabled because you took repeated actions that could be construed as spam. For instance, it is a violation of Facebook’s Terms of Use to repeatedly send the same message or to make the same post.
Facebook prides itself in protecting users from spam, and we take this standard very seriously.

However, after reviewing your situation, we have reconfirmed your account and you should now be able to access it again. Please do not send or post any more form
messages. Further violations of our Terms will result in
the termination of your account.

Finally, please be aware that when a warning message appears on your homepage, it will generally be displayed for 24 hours. It can be displayed for longer, however, if you continue performing these abusive actions. We appreciate your cooperation going forward.

Thanks,

Sam
Customer Support Representative
Facebook

how nice of them. see i told you facebook was good.

oh btw one other dave so has joined my facebook group “my name is dave so” yeah!!