Encyclopaedia - Real Estate

Did you know that 125% loan to value and mortgage refinance are extremely risky for borrowers?

Well, they are! That's why you better think twice before

According to USFDA, a combination product is one composed of any combination of a drug and device; biological product and device; drug and biological product

jumping into an exotic 125% loan to value (LTV) second mortgage that allows you to refinance by borrowing more than your home is worth.

It sounds too

; or drug, device, and biological product and fixed dose combination would include two or more combinations of drug.

Examples of combination products may in

good to be true, and it is. That's why the Federal Trade Commission warns, “Borrowers Beware!”

Too many unscrupulous lenders use 125% loan to value and

lude drug-coated devices, drugs packaged with delivery devices in medical kits, and drugs and devices packaged separately but intended to be used together.

mortgage refinance to prey on vulnerable homeowners. Even though LTVs opens a door for lots of people to borrow, especially young couples with limited

here is enormous increase in the number of combination products entering the market in the recent years. Combination products have proven advantages but fixe

ncome and often shaky credit, this type of loan comes with a high price.

Interest rates are much higher and closing costs often add up to more than 10%

d dose combinations are still in the process of convincing regulatory authority on their advantages over the single ingredient formulations.

Combination pro

of the loan balance. There have actually been stories of interest rates as high as 30% and hidden fees of 20 points or more.

LTVs are costly because,

ucts have become life saving products for the pharmaceutical companies who doesn’t have many innovative molecules in their product pipeline and have been inc

since there's no collateral and no way for the lender to foreclose, LTVs are also risky for lenders. So, they make you pay through the nose for the priv

easingly used in the product life cycle management. Even the companies having product patents are trying to extend their product life cycle through the combi

ilege of borrowing.

This high income potential attracts unscrupulous lenders and debt consolidation "advisors," high pressure home improvement salespeo

nation products and maximize the revenues. But the companies involved in this practice are overlooking that they are burdening the patients both economically

le and so-called foreclosure “rescue” companies willing to take a gamble on the risk of default in return for the huge profits they can make at the borr

and physically. They need to rightly judge the benefits of the combination products and they have to even look at the risks involved when combining the produ

ower's expense.

They persuade vulnerable homeowners, often people with lower income, high credit card debt or poor credit, into believing that 125% loa

ts. Some of the combination products were well accepted by physicians while others suffered. Companies involved in development of combination products are fi

n to value and mortgage refinance are in their best interest. And they make an offer that sounds too good to refuse, with very attractive, extremely low

ding difficulty in defining their combination products and facing various challenges from selecting a combination to marketing it.

Following aspects would a

monthly interest-only payments. But the offer comes with a huge burden.

Somewhere down the line, usually a lot sooner than you anticipate, you're goin

dd to the challenges in developing combination products:

Which markets to tap where the combination products can do fairly well?
Which combination prod

to have to come up with a bundle of money to pay a big balloon payment. By the way, did you know that if you have to move for any reason, you can't sel

cts are meaningful and rational?
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin

l your home without first paying off your balloon loan? And where are you going to raise the money, since you owe more than your home is worth?

Think a

tions increase the patient compliance?
What would be the developing cost?
How to tackle the risks encountered during combination product developmen

bout it! When the balloon comes due, if you can't raise enough quick cash in time or refinance at a cost you can afford, your balloon bursts and you're

t?

As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel

in a lot of trouble with no way out. And balloons are bursting all the time. They're one of the main reasons mortgage defaults and foreclosures are appr

ping new procedures for reviewing their safety, efficacy and quality.

Professional from academic institutions, pharmaceutical industries, health care indust

aching record breaking highs all across the country.

Too many people got themselves suckered into exotic 125% loan to value and mortgage refinance loan

y and representatives from various regulatory agencies are working out to design the regulatory requirements for manufacture and sale of combination products

s with risky balloon payments. And now they're paying the price.

LTVs are not for the desperate already drowning in debt, no matter how seductive they

.

As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de

may seem. So before jumping into one, always do your homework and carefully consider all your alternative options.

And, by all means, work only with re

elopment. They need to be wiser in analyzing the market trends and the regulatory requirements.

Companies that provide selfless information through particip

putable lenders you know you can trust. And never let yourself be conned into some deal that’s only going to get you deeper into debt. It's not worth it

tion in industry events and feedback to regulatory authorities would be able to face the challenges and will be successful in developing combination products

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