Saturday, December 27, 2008

What Do Personal Finances Include

All of the various financial parts of your life are gathered together under the umbrella term of personal finance.The personal finance umbrella term covers not only the various avenues you traverse to acquire the funds you need for your personal use; it can also cover the ways you spend these funds through savings, budgeting and normal expenses.

We, first of all, must take a glance at the different ways we choose to borrow money. The cash you can have access to on credit cards is yours instantly, however it is only borrowed and has to be paid back with interest later.Although credit cards are being used for everything now, you must be careful in considering how you will include them in your personal financial plan.The interest rates on credit cards can be excessive and when you are ready to make the payments on the balances, you may see where you probably have overspent as this is something that is easily done.

Personal loans are borrowed for a particular reason and this type of loan will give you only the amount required to meet that commitment, so you will reduce your chances of overspending. You may use a personal loan for many different purposes, like home loans, auto loans, debt consolidation loans and also to do cosmetic surgery.

Interest will be charged on a personal loan and it is essential to make repayment according to the terms of the loan.If you get your loan through the offering of collateral, there is a possibility of losing your assets if you do not make the required payments.

If you are wondering what to do to be able to get the best results with these financial opportunities, the answer could be a simple one to arrive at, none the less, it begins with you. You must have the useful habits of being economical and prudent and be willing to thoroughly research the loan market.

Knowing your financial limitations and your repayment capabilities will help to create a workable budget and develop the habit of living within its boundaries. By recording your expenditures you will be allowed to understand your spending habits and change what needs to be changed and you will be enlightened on your spending with credit cards.

Before you finalize any type of loan deal, you have to be aware of all of the offers and trends in the loan market. Make a request for loan quotes because they give you an idea of how much your loan deal may cost. By requesting and receiving loan quotes you will know if you can afford the loan with comfort, but you should carefully search for hidden fees and costs in the fine print.

Personal finance is a total knowledge of the circumstances of your life and how you are equipped to handle the economics of it. When handled well, your finances will take care of the other parts of your life, but when mishandled, your finances will cause you nothing but anxiety and concern.

If you gather as much information as you can on personal finances and learn how to handle your own, you will be able to live a relatively safe and stress free life.Every one of us has our own particular financial puzzle pieces to arrange into the perfect financial picture for us.

Building A Cash Cushion

Building Cash Reserves

Building up a financial savings for your business is never easy. Many experts will tell you that you should have at least six to nine months worth of income put away in a bank. For businesses grossing $250,000 per month, the thought of saving over $1.5 million in a savings account, will either have you collapsing from fits of laughter or from the paralyzing panic that has just set in. If you are just barely making payroll each month, you may need to consider getting rid of any former advice you were following, even if it seemed to have been well advised. So how is a small business owner to even begin a prudent savings program for long-term success?

You must realize that your business will need a savings plan, and this is the first step toward better management. By doing this your business has a much better chance of being successful. Building up a savings will allow you to plan for the future in your business, this way you will have the investment capital necessary to complete your plans. Having a source of back-up income can often carry a business through a rough time.

When there are market fluctuations, such as the dramatic increase in gasoline and oil prices, start to affect your business, you may need to dip into your savings to keep operations running smoothly until the difficulties pass. Savings can also support seasonal times for businesses, with the ability to purchase inventory and cover payroll until the flush of new cash arrives. Try to remember that you did not build your business overnight and you cannot build a business savings account instantly either.

Review your books monthly and see where you can trim expenses, then reroute the savings to a separate account. This will help to keep you on track with cash flow and other financial issues. Even though it can be quite alarming to see your cash flowing outward with no end in sight, it is better for it to happen sooner, so you can put corrective measures in place, rather than waiting months to discover your losses, because then it will be difficult to recover.

Should You Buy

The slump that the housing market has seen in the past several months has created a lot of confusion concerning whether the current real estate environment presents a great opportunity to purchase homes or is better left alone until it picks up economic momentum. Expert investors are very contested on the issue, with groups forming sides that correspond to both sides of the question, "Is now the right time to buy?"

The issue revolves around the recent mortgage crisis that has caused a surge of foreclosures which have managed to flood the market with new homes. With a swelling number of homes available for sale, property values have dropped significantly and continue to do so while more people struggle with meeting their mortgage payments. Despite the negative elements and provided you have access to various mortgages, this situation is like a cloud with silver lining; the dropping prices of homes means that, for a lot of people -- especially those new to the real estate scene or young couples looking to possess their first home -- buying a home now is cheaper than it has been in years.

However, with the loan businesses wary during these troubling times, securing a loan to afford a home now can be a very tricky or outright difficult effort, especially if you don't have the greatest credit. So, with these conflicting aspects of the real estate landscape, when would be a good time to finally go out and buy that new home?

The optimistic experts believe that the current circumstances present a great opportunity to find outstanding property at rock-bottom prices. If you possess good credit and you plan to stay in a home for a few years, then purchasing a home now is a wonderful way to take advantage of the low costs of ownership while maintaining a solid investment that will pay off for years to come. Although the prices may drop lower in the future, they believe that, over time, the differences in price won't make much of a difference when you consider just how much you are saving already. Furthermore, if you can manage to find and establish a low interest rate right now, then you'll be able to save a considerable amount of money when house values climb again.

The more skeptical experts don't agree with that assessment, however. Many of them believe that the current circumstances are only the beginning of the slump that has defined real estate for 2008, and that these financially downtrodden times will only continue to lower the value of homes, a possibility that will make buying a home in the future a remarkably better deal.

In fact, they believe that home prices are still relatively high. The housing boom of the past several years has contributed to doubling or even tripling the value of homes, creating an environment of extremely expensive, valuable properties that can stand to lose plenty of value before becoming a truly good deal.

Prices are also still adjusted to what people expect their homes to sell for based on the values given a couple of years ago. As these people realize that their homes aren't going to sell for their initial estimates, they'll be more willing to drop the prices even further and present an even remarkable opportunity to find a home at a fantastic deal.

Whatever the differences may be between the experts, one thing they all agree on is that while homes are cheaper than they've been in years, loans are harder to obtain and there are stricter requirement for getting a mortgage. Buying a home now may be cheap, but it may not be easy.

*Article Written with the US Real Estate Market as it's Basis - Canadian Real Estate Prices have decreased, but not to levels being experienced in the United States*

Tuesday, December 16, 2008

How To Profit In Today's Real Estate Market

Worried about the future of the current real estate market? This actually the best time to make money for investors who understand what is happening today.

Real estate is cyclical and always has been. There was a large national article published that stated Las Vegas real estate had completely capped out and there was no place for it to go but down. Ironically, that article was published nearly half a century ago! Has real estate gone up in value in Las Vegas in the last 50 years? You bet, and not just a little! Does this mean real estate markets are going to continue to increase like the past several years? Don't plan on it, however I'll explain the benefit of this type of media coverage and how it is invaluable.

  1. Fear scares people from investing thereby, creating more opportunity for you.
  2. It eliminates aggressive scam investments (as we saw rampant with builders in Florida and Las Vegas the last few years).
  3. It makes people question the value of their properties (creating more flexible sellers).

Think about this: there are very few successful real estate investors who are afraid of declining or flat house prices? Quite to the contrary, knowledgeable investors understand when markets are flat or down it just weeds out beginning investors, makes people panic and means more opportunity.

What's important to understand is just as real estate is cyclical, so are the amount of buyers and sellers in a given market.

You just don't buy houses and hope the value will increase in the future. That’s not investing, that’s speculating! Your completely dependent on future growth that is entirely out of your control. In a flat or declining real estate market, that kind of conventional mindset will not work especially in the short term. Like every business, you need to make well calculated business decisions. The real estate market today must include setting up your exits correctly and making risk free, creative offers that fit your specific investing circumstances.

There are also better creative real estate strategies for down and soft markets like wholesaling, flipping/assignments, lease options, foreclosures, short sales, and "subject to" investing. But even when doing rehabs or fixer uppers (which are not usually recommended in down markets) there are still good ways to make a good profit with the right system and proper planning, such as factoring in depreciation and extended selling possibilities.

This is why faster, lower risk, more creative real estate investing strategies like wholesaling houses are an option in the USA real estate market during market declines. The point is market conditions should not determine whether or not you make money; it’s how you approach it and what is appropriate for the circumstances. Real estate market conditions will never be the determining factor for success when you structure risk free deals and make calculated decisions.

*Note: Applicable to USA Real Estate Market*

What Is A Real Estate Short Sale

"Real estate short selling" is a popular phrase among many these days. Real estate short sales serve as an alternative to foreclosures in an increasingly declining real estate market. Real estate prices are lower now than they have been in a long time and the amount of time it takes to sell a piece of real estate is rising.

It is completely valid to say that some regions - such as Detroit, for example - are experiencing a market meltdown. These declining real estate markets are the main reason for the rise in short sale real estate.

A bank allows a real estate short sale to occur when the bank consents to letting their property be sold for an amount smaller than the amount owed on it. In order for this to occur, two conditions must be met.

Firstly: Market values are such that the property's sale price cannot cover the outstanding mortgage balance(s). An inability to make additional payments on the property is the second requirement.

You might have someone who bought a property five years ago for the price of 217,000 dollars using an adjustable rate mortgage. Let's say that two years after purchasing the property the owners took out an additional 10,000 dollars second mortgage, which means that today the owners owe 227,000 dollars on the property.

Also, we have to remember that in five years, the amount of time that the mortgages have been paid off is negligible. We'll also imagine that the property value has decreased to 215,000 dollars while the mortgage interest rate has increased from seven to eleven percent. If we toss in the fact that one of the owners has just lost her job, we should realize that a real estate short sale is on the horizon.

For a bank, a foreclosure can mean a lot of time and money spent that a short sale would not. Banks do this because it allows them to accept a definite amount of money and because it allows them to get the property off their books. In general, this is how the real estate short sale works, though of course, complications through stubborn owners and lenders can arise.

Admittedly, many owners may find the real estate short sale a very painful experience, but things could be much worse for them. Having to go through the experience is awful, but it is a lot better than having a foreclosure on your credit report.

Real estate investors should understand that the short sales give them a wonderful opportunity to purchase property.

*Note: This is a Term Related to the USA Real Estate Market*

Real Estate Strategies For The Investor

A great way to diversify your portfolio and make some extra money is to invest in real estate. It is always good to have some real estate investment strategies in mind before you dive into your first investment property. Looking for and discovering properties below market value is what most savvy investors do. A good way to find these is to look at buildings that are foreclosures. Some properties are ready to rent or resell for a profit immediately after they have been foreclosed on. Some properties may need updates or renovations in order to sell them. The best way to come out ahead is to work with a realtor you can trust and who knows what kind of investment properties you are looking for and also specializes in foreclosures.

It is wise to learn the different investment strategies before you begin investing in real estate. Most real estate investors use this common strategy but it also leads to the most problems as well. That real estate investing strategy consists of buying properties which the investor believes will soon increase in value due to market-wide appreciation. Although this strategy can be used successfully, it is based on pure speculation and can fail. Three investment strategies that are based on fact and not speculation are listed as follows. The first is known as the bargain purchase. Many investors will often buy a property at twenty percent below market value by using the bargain purchase method. This allows them to make up to a twenty percent profit using this real estate investing strategy and is a great strategy to use when purchasing foreclosures.

The second strategy is known as the increase value strategy. Using this strategy the building would be purchased at current market value. There must be some improvements that could be done within a six month time period that would increase the value of the building by twenty percent for this strategy to be successful. Lastly, using the double digit cap rate is the one many real estate investors use most. The double digit cap rate strategy is used for buildings that have a capitalization rate of ten percent or more. You get the capitalization rate by taking the net operating income for the property and dividing it by the purchase price. These are harder to find unless the market is depressed or you are looking into small market niches. It is always wise to have a real estate agent on your side to help you make the right decisions, tell you of any new listings and include some foreclosures you may be interested in no matter what kind of investment strategy you want to use..

In the USA, Homezonedirect.net is an example of one organization dedicated to providing the most up to date and relevant information available to help people make the wisest choices regarding their home and financial future.

Note: Appropriate for the USA Real Estate Market

Thursday, December 11, 2008

Timeline for Foreclosure-Knowledge is Power

If you are interested in discovering what it will take to halt foreclosure proceedings you will have to receive the knowledge that will be needed in order to do so. Actually, the timeline for foreclosure varies from state to state, but there are similarities. If you are a property owner it would be wise to completely understand and know the complete foreclosure process, not only the timeline for foreclosure. Many homeowners lack knowledge or are generally uninformed, or even misinformed. This unfortunate lack of knowledge can wind up being devastating.

As you have no doubt realized, any undertaking without the required knowledge will usually end up being a bad deal. Many borrowers do not understand or want to admit that there are sharks out there disguised as mortgage brokers, real estate investors and attorneys that will steal you blind. Your misfortune, likely caused by lack of knowledge can bring them large financial growth.

The timeline for foreclosure will usually follow this outline. The foreclosure timeline is initiated when you are just one day late in sending your mortgage payment. Yes, one day late. Usually, at this point no additional fees have been added yet. If you do not send your whole payment within 16-30 days a penalty or a late charge will be added on to the total amount due. About this time you will surely hear from the mortgage lender. They will inquire about why you haven’t sent your house payment. If your mortgage payment goes more that 30 days past due, you will be labeled as in default of your mortgage loan agreement.

Being in default in the simplest terms, at this point, means you are behind on your house payments. If you have not sent a mortgage payment after thirty days, the lender may decide to exercise their rights and repossess of your home. Whatever you do, do not panic. Remain calm and remain in contact with your mortgage lender during this foreclosure process. These days the majority of lenders really do not want to take possession of the property. They will most likely be willing to help you if they are able. Do not be afraid to ask about� any plans they have available to you.

Between the 60th and 90th days or non-payment, an official notice of default will be delivered to the homeowner. At this point during the timeline for foreclosure, collection costs will be added on and the mortgage company's legal department will put together and deliver the required documents to a local attorney. This is the start the actual foreclosure proceedings.

The last leg of the foreclosure timeline occurs somewhere between day 150 and day 415. The borrowers home will be scheduled for quick sale at a foreclosure sale or a foreclosure auction after the Notice of Trustee Sale is filed. There are certain guidelines and points that must be followed and adhered to during a foreclosure process. Keep in mind that a foreclosure is a legal event. The impending foreclosure will likely advertised in the local paper, once the case is referred to local lawyers.

The borrower still has the right to halt the process leading up to the foreclosure of the property. Most states have laws regarding that. During the pre-foreclosure period, the borrower may be able to purchase the property back from the lender if they have come up with the money. Sadly a great many of homeowners will be removed from their home by the local law enforcement agency. This situation could be prevented if the borrower processes the information about what is available to them when they are looking at foreclosure.

*Note: This applies to the USA* *Canadian Rules Differ*

Sellers Advantages and Property Auctions

Property tax lien auctions are advancing more with the highest status in the industry of real estate. Could the reason be that the economy is not at its greatest and the rate of home foreclosures has never been so high? When houses are foreclosed upon and then repossessed, the homes are then sold during a Property tax lien auction to the highest bidder so the mortgage company can recoup its loss. Prior to foreclosure, some owners will go to auction with their homes to avoid credit problems. Over the next ten years according to some authorities, more than 35% of homes for sale will be purchased at Property tax lien auctions.

Some benefits sellers have when they decide to use Property tax lien auctions to sell their houses is the sale is quick and you don't have to wait for 'pending financing' rules set by the buyer. The money from the purchaser will be present at auction time

A Homeowner who intends to sell his house at action should ensure the participation of enough buyers who are either capable to pay from their source or who have got concluded financing commitment from financial institutions of repute.

You can purchase homes on auction in their current condition. This means that the bidders know that there are some things that need to be repaired and they have to take care of the aesthetic needs. The purchaser won't be worried with paying a lot for a new paint or carpet or even appliances before putting their home up for auction. The buyer will be legally responsible for replacing the water heater if it is about to malfunction. Buyers understand when buying Property tax lien auctions they usually have a tiny amount of time to check out the property before bidding. The fault lies with them, not with the seller, if something doesn't work because they were unable to bring along a professional home inspector.

In addition to many other advantages to Property tax lien auctions for the sellers is that they are not obligated to show the house according to someone else's schedule. Pets, lives, family -- sellers have these things too. The risk of getting a call at any time of day or night from an agent who would like to show the home is more than likely the hardest part about putting a house on the traditional market. Can they not accept this? Yes, certainly they can, but they are probably not going to sell their homes without looking at it first.

A number of homeowners are unaware of the potential benefits of using property tax lien auctions to sell their homes. For homeowners needing to sell their house temporarily, for whatever reason, property tax lien auctions is an easy option. Some homeowners think the advantages of property tax lien auctions outweigh the possible risk of a lower retailing price.

Get more information about Pre Foreclosure Property such as purchasing tax liens where you'll find all you need to know about the Buy Tax Lien Laws and much more.

Friday, December 5, 2008

The Debt Consolidation Fable

The Debt Consolidation Fable

Debt management in Canada has become a general method of handling debt but may not be the right method for individuals to administer their debt. In a lot of cases clients will look for debt consolidation loans to pay off their credit card debt and begin with a new slate, even though this takes care of the momentary problem it often creates much larger problems later on in life. There are two reasons why this happens.

First off, individuals are creatures of habit. By getting a consolidation loan you're only masking the primary problem, your habits. Although a consolidation loan will pay back your original debt it won't deal with your spending habits. Usually individuals applying for debt consolidation loans to pay off their debt end up in twice the debt they began with.

This being the second reason consolidation loans will not help. After people pay off their debts it allows them freedom to revolve more credit, causing the trap to repeat itself again. Usually people wind up with their unsecured debt maxed again, as well as, the consolidation loan that they took out to eliminate their debt. The most familiar phrases I hear as a financial counsellor is "I need to obtain a consolidation loan to repay my debt", "I don't want to use credit cards again". In theory this is fine but usually this does not happen

Unless an individual is prepared to tackle their overall problem (i.e. their spending habits) they will not succeed with a debt consolidation loan. In actual fact this is one of the main reasons that the banks have stopped issuing debt consolidation loans. They have, for the most part, stopped this because they recognize that this is only feeding the problem and not solving the problem. If you truly want to deal with your debt, cut up your credit cards, stop access to any revolving credit, make your monthly payments to pay the debt down and track your spending. It is only through the tracking of your spending habits that you will truly understand the fundamental issues of your debt. In order to deal with your debt problems, you must first understand how you got there in the first place.

If you want to live debt free you must recognize your unnecessary spending habits and make changes to eliminate them from your life. If you were to ask me what lesson I teach my clients the most, it’s how to track their spending and identify unnecessary spending.

Greg Martin
Credit Counsellor
Phoenix Credit and Debt Counsellors

Debt Consolidation Canada

Thursday, December 4, 2008

Moving Overseas - is it for You?

Moving overseas seems to be a growing trend. It seems like entire populations are taken by the idea that the grass is greener and heading to further shores. What's driving this trend?

Work and career opportunities seems to be the most common answer when people are asked why the are considering immigrating abroad? There is great demand for skilled immigrants in countries like Canada, Australia, Middle East and East Asia. Pay rates appear better away from their own country seems much higher than what they are used to getting on their own nation. For them, moving abroad is a dream that comes true.

Canada and Australia nowadays has a very large demand for nurses and caregivers. There are many British, American and Filipino Nationals who have decided working professionally overseas is as a worthwhile career move. There is also a huge demand for laborers in the construction industry. Many semi-skilled occupations including brick layers and metal workers as well as skilled professionals have moved to greener pastures.

In the Middle East, hospitality services are big in the market for job seekers today. Hotel staff like bellboys, chambermaid, receptionists and restaurant workers are very much needed in Dubai, Qatar and Saudi Arabia. Of course, let us also not forget the ever continuing demand for Engineers and Architects in these oil-rich countries.

On the other hand, East Asia is now open for English Language Teachers. There is a great numbers of Chinese, Koreans and Japanese students now leaving their countries to learn English and for those who can't afford it create the demand for English Instructors in their own countries.

Moving overseas causes families to be split. Migration may create a better life for your family and yourself. Bring your families with you when you decide to move overseas for employment. You will find that it will be less lonely and more meaningful to see them grow with you.

*All Articles pertaining to Financial Matters are Offered by a third party unrelated to my services. Please ensure you seek-out the advice of your own financial expert. The rule of thumb is to get the advice and rates of three separate companies or professionals*