January 6th 2011

No Fee Refinance Schemes Can Save You Thousands!



You can save thousands of dollars by refinancing and taking that into account, the refinancing costs that will undoubtedly be included in the loan installments won’t be a burden.
To lower your monthly installments, a no fee refinance could be an option in which a refinance transaction is carried out without spending extra cash from your pocket. Under the no fee refinance programs, it is the lender who pays for all the closing costs and settlement fees.

Taking Advantage of Better Conditions

Such a scheme has attained significance in mortgage deals. Actually, the refinancing companies do not offer this refinance package for free. There are certain indirect costs, but insignificant. However, these services offered allow you to move to more favorable mortgage rates with minimal up front costs.

Basically, a no fee refinance loan is one that brokers do for borrowers who are not interested in paying extra while signing the mortgage deals in real estate business. There are a few advantages and disadvantages for both parties.

Advantages and Disadvantages

How it becomes appealing for both broker and the borrower is quite interesting. On the face of it, the borrower in a no refinance scheme may not be paying extra cash from his pocket to let the transaction happen. Still the broker receives a great commission as the loan is funded. In order to cover those fees the broker generally sells at a higher interest rate. This he does to receive a rebate from the lender to cover the fees as well as net his commission. This serves the purpose. Moreover, the notion that the borrower paid no money creates a future cliental base.

To cater to the demands there are a plenty of options for the borrower to complete the refinance mortgage. Every borrower must ask the broker for all viable options and should search for the best possibility. Still, a no cost refinance scheme is best suited for the borrowers who do not have a lot of assets, but are willing to pay a little bit of a higher rate to strike the deal. But one should also check out the valuable tips on refinancing a mortgage as these are available almost anywhere.

No Fee Refinancing Not For Everyone

It depends on how much time is at your side. If you are capable enough to repay your debt and can move out of your house within 2 or 3 years, the no-cost loan can be a good deal. But if you want to stick around for longer period, the no-cost loan should be avoided. According to financial experts, there is no logic in choosing a no-cost loan because you are strapped for cash, since it is usually possible to include the costs of refinancing in the new loan.

However, experts consider a no-cost loan might also be a useful in situations where you think you might move shortly but aren’t sure. You can save some money while waiting for the clear scenario. And if you come to a situation where you are going to stay put after all, there is always an option for refinance.

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November 24th 2009

Unresolved Tension: the Quandary of Revenue Management Versus Service Management – Parts 1 & 2

Managing college costs

Chris, from the International College of Management Sydney addresses the challenges of balancing revenue management and service management in a 6 Part Q & A series – in this article, he explains the revenue management strategy and addresses the issue of hotel pricing policies and their associated ethics.

1. What is your opinion on revenue Management in hospitality today?

Revenue Management is a multi-faceted strategic approach to pricing that can be very effective at promoting the bottom line. It works best for the overall sustainability of a hotel when it takes into account existing hotel standards and systems and especially when it can be flexible to loyal customers.

Do you think that all this heavy discounting and yield management really works (more retention of revenue)?

Discounting is a sometimes effective short-term strategy, but it is unsustainable because it can have long term impacts. Look at the recent closure of the Fairmont Resort, Blue Mountains , a hotel with competitive rates, as one example of a good hotel that priced itself under its market. I prefer value-add strategies for luxury products like hotels (keep the price the same but add-on indirect costs like upgrades and valet parking and shoe-shining), because I think customers equate low prices with poor quality and that has a negative brand impact, which does not sustain them.

In support of my discount-wary philosophy, the Observatory Hotel on Kent St, Sydney, has a ‘no discount’ policy that has seen it consistently able to charge high rates and generate revenues which are, by my observation, then invested in its people, these people then produce better service, which in turn adds value and can then be reflected in even higher prices… and so the virtuous cycle continues. It is a phenomenon particular to hotels and airlines and other luxury items.

Do you think that hotel pricing policies are giving fairness and satisfaction to all customers?

No, but the nature of service and hotels is that all customers are different and have different needs so this does not concern me so much. What does concern me is the opposite point of view. A lot of RM strategies rely on shifting market trends and movements that classify all people arriving at a certain time as one particular group. Therefore, I am no longer Mr Smith, regular customer who always gets a suite with a beautiful view for a consistent rate, but now I am Mr Smith arriving on a busy Thursday night and so now I must pay more or less than before because that’s economics. That is economics, but not service. This is not honouring his loyalty nor rewarding it.

What is your opinion on all this cost cutting which is going on at the moment? Do you thing that employees are working in very “tough” environment, understaffed, stressed….?

Cost Cutting is vital but managers need to see themselves and their departments as ‘profit centres’ and emphasise revenue generation as well, as this will empower staff to see themselves as part of the success of the business= more motivation= better service. Furthermore, the old adage, you need to spend money to make money, is as apt as ever.

Stay tuned for parts 3-4 from the International College of Management Sydney

The International College of Management, Sydney (ICMS) is a sydney business college established in 1996. In recent years, ICMS has become a global leader in management education.

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