Rate tarts will wait until interest free period is about to expire on their current credit card, and then check through lists of providers to find another card they can switch to that has another 0% interest rate introductory period. The growth of financial comparison sites like uSwitch, moneynet ( http://www.moneynet.co.uk/ ) and moneyfacts (http://www.moneyfacts.co.uk/ ) has made this money saving behaviour easy to achieve.

The providers have effectively become victims of their own success. As more and more card companies began offering interest-free balance transfers, card providers found that they had to offer longer and longer interest-free periods to win customers, which in turn meant less profit.

Analysts have recently estimated that rate tarts are currently costing lenders £1 billion a year.

Pricing and Initial Purchase

-Is price negotiable and do you need to purchase through a certain company or representative? Who gets a commission off sale? Some properties have a small percentage of flexibility in price while others are basically set in stone. This will usually be determined by demand, as well as overall policy of developer or management company. Also, if you know who stands to profit from sale and how much, it could help you in your negotiations.

-Is property already completed or is it in pre-construction?

This question is important because answer will likely affect price of unit. Many properties in beginning stages of development will be sold at a discount to attract buyers, but as it becomes a more certain investment or units increase in demand, price will go up.

-If property is in pre-construction, when will it be completed and what will overall property look like?

You may be anxious to get into your unit or have a certain occasion in mind. If completion is two years out, you may not want to wait. Also, a property in early stages may look great to someone who wants a small facility with a low-key, less populated atmosphere. But there may be plans for hundreds or even thousands of additional units and large clubhouses, retail areas or other features that will draw many people. If you plan to keep your property for many years, you want to be sure it will fit your needs when it is finished.

-How many other owners are there?

This question is important for those considering purchases of fractionals. The price and amount of time available each year will depend on number of other ownership opportunities offered in particular unit. More than eight or ten other owners will make competition for primetime more difficult.

-What type of financing is available for this type of property in general and for this specific development?

Both condo hotels and fractionals are considered timeshare properties. Even if they are viewed as a second home, bank considers all three types of properties discussed here as a secondary obligation – one that is less important than your primary home mortgage. As a result, you may have to pay 10 or 20 % down and rate may be higher than a traditional home loan.

Some developers offer financing, which can be helpful, but be sure you understand details. Some may require a smaller amount down, but will ask for a large payment upon taking possession of unit. This arrangement may be fine with you, but you don’t want any surprises.

Another financing option is to take out a second mortgage on equity in your existing home. If you choose this route, be sure interest rate does not make it much more expensive in long run. Also, you need to be aware that if you use a home equity loan to finance your purchase, you have only 90 days to refinance to a regular mortgage.

Information About Management

-Who are developers? Who will manage property?

The first question will be important in determining quality and reputation of property. The second question will help determine if management organization is well-known, professional, and likely to increase your rental income or resale value. These two questions are critical from an investment perspective.

Costs Associated With Ongoing Ownership

-What are ongoing costs and who pays for them? Is there an annual membership fee?

There will typically be costs for insurance, real estate taxes, and improvement of facilities. Although owners generally pay for these items, especially in a condo hotel setting, it is still important to ask. Other expenses to verify include housekeeping, marketing, administrative and general maintenance of property. These are usually paid by facility but one shouldn’t assume this is case.

Rental Plan & Income Generated

-Is there a rental program and is it voluntary?

You will want to know if you can choose whether or not to participate in a rental program. This is true for all properties as some hotel residences and fractionals also offer this option as a means of generating income.

-How is property marketed and does it have a history of success or features that will make it competitive in vacation rental market? If you plan on receiving rental income from your property when you are not there, it is important to find out what management’s experience and approach is. Somebody like Hilton or Four Seasons has a reputation for luxury and good service and will likely attract more renters than an unknown management company. In addition, if property has a popular restaurant, is located near a convention center, shopping area or other facility that will draw people in, you are more likely to find interested renters on a regular basis.