Finance Articles

Are you frustrated with all the red tape Banks are now requiring. Are you having difficulties getting a bank to to even look at your application for a Real Estate Investment? Do these excessive Bank loan requirements make you cringe and want to just give your Real estate Investment Career up and go get a JOB again? Sine the Credit Melt Down, Times have gotten tough for anyone wanting to get a loan from the bank. But there is good news. You don’t have to put up with this anymore. Hope is on the horizon. Change comes in form of a new strategy that was designed for this market. But you do need to be willing to change strategies if you want to to not just survive in this economy but thrive beyond your expectations.

In the Real Estate Investing World All real estate entrepreneurs, whether they know it or not, Focus on one or more basic Profit making strategies. All these strategies answer the four basic business questions: Who will you market to and how? - What kind of Sellers are you buying from (and what kind of properties) - How will do you the transaction and buy from them? - What kind of funding will be needed for the transaction? - What is your exit strategy (selling, leasing…)? The answer to all 4 of them is needed to make this business of real estate Investing a Profitable one.

In the Real Estate Investment World there are 4 main strategies the overwhelming majority of investors use. Is yours here?

Ugly Houses (buy, repair and resell or lease) Assuming Mortgages using the Subject to Method (and often selling with Lease Options) Selling at discounts to other investors (Wholesaling) And most recent Bank owned Properties, and Short Sales

All of the mentioned strategies and many other “niche” strategies have worked well for years and even decades and made investor wealthy all over the world. But what many investors are realizing the hard way today is that in today’s market they all have a crucial weakness. Many of them relied on increasing prices and readily available mortgages (for them or when they sold). But Gone are the Liar Loans. No more Sub-prime Mortgages anywhere. the No-Documentation loans, remember those days? Gone. This availability of financing may have helped enrich many sellers, but the buyers that got stuck with these loans have fallen pretty hard. And the lack of it is now putting the Investors out of business.

FHA Loans are still around but they are for sure handouts. You will need to meet ratios now. Plus you are dealing with Increased Lender Requirements. Now you need full documentation and must meet stringent income and debt ratios. Even Bank Loans to Investors (Investor Loans) are all but gone. And if you find a bank willing to give one of these, they are prohibitively expensive. Sp what should we as investors do? Its time to adopt a new, better and more timely strategy.

- One invented and custom fit just for this credit collapse. - A No banks involved strategy. - A Investment Method that requires you to work less and make more profits buying and selling real estate (without banks). (Freeandclearcashflowmachine dot com ) This Briliant strategy created by Master Investor Richard Roop has been proven in over 107 different markets all over the country. And her is the secret. Right now, In this Credit Crunch and market Meltdown the best way to a successful Real Estate business in the houses area is to target houses with high equity (almost paid off) or Free and clear Houses (or land). With this Strategy you offer the seller what they are asking for (or close to it) but you demand your terms, which includes Seller Financing. They get what they desire and you accomplish to buy the property with seller financing, where the seller becomes the bank. And then as your exit strategy you now can either sell the house on a wrap, do a lease with an option to buy or just rent it our for ongoing cash flow. And the absolute beauty here is that the way Richard teaches you to design this, you are able to extract substantial tax-free cash out the day you close on the property (when you buy). That’s correct, you don’t even need to get rid of the property to get your payday. And the best, All the problems with banks are history, because there are no banks allowed! How wonderful is this?

Once you have understood the possibilities here, the world will right away have a very different look to it. In fact because you are avoiding Banks altogether, the worse the economy gets, the better you do once you use this Ultimate Strategy. For more information and free articles and videos on Richard Roop and his Free and Clear Cash Machine please click on the link below at the end of this article

Buying of properties that have been through the foreclosure process can occur in two different ways. First, the properties can be sold at the foreclosure auction with the buyer being someone other than the original lender. Another reason was, if there are no bidders at the auction, the lender will get the home back as the high bidder for $100 over the amount of the final judgment in the court action.

If one decided to buy the property at an auction he/she will be purchasing the property that may have major deficiencies with its title, structural issues, property taxes due, illegal structures on the property, un-permitted work, or other issues that can cause the bidder to be sorry later he bought the home. If you intend to bid on a foreclosure property at auction, I suggest you try and see inside the property before the sale

This does not mean that breaking and entering is the answer, but it is by contacting the homeowner and asking to buy the property from him, would be a better alternative. If he has moved away, try getting permission from the homeowner if you can track him down and go inside with some type of permission letter in your pocket in case the police are called.

One can go through this process by doing their homework in the public records or get an attorney to do it for you. In fact, an attorney can do a complete and thorough title search in a matter of minutes or days. An attorney may also do an open permit and code violation search in about a week depending on the local city or county’s code enforcement department.

Some cities would spend time to do it if you come in and others will make you pay and wait for 30 days or more. While going wit the process, one should hire a home inspector to do the inspection if he can get inside the property, but if he is not allowed to do that then , have him do a visual from the exterior to see if he notices any structural issues.

Another way to purchase a home that has been through foreclosure is to buy an REO. An REO is a “Real Estate Owned” property that has been through the foreclosure process, and has been purchased at the foreclosure auction by the lender. Most of the time the lender is forced to take a property to the auction to eliminate or eradicate liens or taxis against the property, otherwise the lender would have to assume the responsibility off paying of these junior liens if the homeowner gave the lender a “Deed in Lieu of Foreclosure” and walked away.

The difference in the lender getting the REO and reselling it is that the lender must bring any delinquent property taxes current for the buyer. The lender must also provide “fee simple” or “free-and-clear” title to the buyer. The process of clearing title deficiencies can be very expensive and a long process , so buying REO’s eliminates these related issues.

But purchasing an REO property much better than purchasing a property at a foreclosure auction. There are exceptions but the buyer should be very aware that there are hidden or other issues can make the cheap purchase more expensive than a new home. So as always, do your homework and “buyer beware”.

How will you rate with other real estate investors, who started out with the same capital in terms of earnings and competitiveness? Are you one of the successful investors your real estate investment club? Or do you continue to become as a novice investor in your group?

If you are not contented with your real estate gain , then should get out of the game.This year is the best time for ordinary real estate investors to get out form the old ways in investment returns. Real estate investors are presented with tremendous opportunities to acquire investment properties in bank REO’s

But, like all other business opportunities you need to compete effectively. Key areas you need to excel in investing in bank REO properties are ‘networking’ productively with key players in the REO industry, and ‘knowing’ what are deal closers with each respective bank.

You should need to tie up or get closed to with bank asset managers and their REO brokers to get leads ahead of your rivals and to fully learn the requirements and preferences of the bank in selling their REO properties.

How can you be rated as a preferred real estate investor? How fast would they require you to respond to their counteroffers? Do they prefer 100% cash offers or large cash down payments with financing from their own lending department, so they can earn more money? How fast do they want to close?

Continuous follow-ups are also needed to acquire fresh leads fast. But of course, networking also involves learning your contacts’ own priorities and needs in order to have a mutually beneficial relationship.

To sum this up, competition in real estate investing for bank REO properties is also dealt with marketing campaigns (social marketing, direct marketing, e-marketing, free info products, and etc.) How one will increase your brand to bank asset managers and REO brokers as the top investor for buying REO properties?

How do you increase your brand to new home buyers as being the better and stress free alternative to acquiring bank REO’s?

But, the new battleground in real estate investing is battled in the gaining of bank REO’s and giving the consumers a more pleasant home buying experience.

There are certain concepts which form an integral part in the concept of money and among these vital elements is the time value concept of money. This is one controlling factor in any economic deal whatsoever and is subsequently an important issue in the discount buy. Thus if you want to brighten your financial future in these economically bleak times then I would suggest that you make good use of this valuable concept. This ensures your future and guarantees you a safe and sheltered life post retirement as well.

For example, the easiest example of the time value concept is by comparing the present value of a dollar o the future point which can be six months, two years or even twenty years.

The concept bases itself on the idea that the value of a dollar today is much more valuable than the same received at a point of time in the future. It bases itself on the current inflationary trends that dominate the world economic scenario today. In the face of such continued trends the value of the dollar is bound to take a drop. The theory blames the cause of such inflation on the spendthrift tendencies of the government. In the larger picture the issue of inflation gains a larger significance with the increasing amounts of time and money that get involved.

CREATING WEALTH FOR RETIREMENT WITH DISCOUNT BUYING

This chart observes the value of $1000 in certain reference points in the future, taking into account the inflation.

Compound Interest We can use the same principle of the time value of money to work for us to counter inflation. We do this through earning interest on our money at a higher rate than the inflation rate. This principle works the same way when you use it to make your money grow, and is the easiest way to make money.

The concept of growing money is called compounding. You take a certain amount of money, invest it, earn a return on the investment, and then reinvest your initial investment amount and earnings over a period of time. You keep turning the money over and as this base amount grows, so does the amount it earns in interest. This is illustrated in the following chart.

Year Amount Interest Total Value of Invested Earned Investment

1 $1,000.00 $50.00 = $1050.00

2 $1,050.00 $52.50 = $1102.50

3 $1,102.50 $55.13 = $1157.63

4 $1,157.63 $57.88 = $1215.51

5 $1,215.51 $60.78 = $1276.29

Then there is Rule 72 which is basically an easier and faster method to gauge how long it would take for you to double your money. To do this, divide 72 by the current interest rate that you will be receiving. Therefore Suppose you invest $6000 at 6% interest rate. Therefore to double your money, divide 72 by 6, that is, it will take 12 years to double your money.

Another little trick to learn in how long your money will be tripled is by the rule of 112. This is a similar method. Just divide the number 112 by the rate of interest that you are getting to get the number of years. Thus if you take the aforementioned amount and the divide 112 by 12%, it will take approximately 9 years to triple that amount of money.

Thus Time value is an important issue in the discount buying industry and is also helpful in being able to increase your money.

One of the safest havens of investment during this economic crisis is gold bullion. Hence, it is undoubtedly the wisest asset for investment till date.

Do you want to know why you must invest in gold and not anything else now? Well, there are many reasons and some of the most important points are noted herein:

- Investors usually flock to precious metals like gold bullion as one of the safest haven and the only potential way of increasing wealth. With the continuing crisis in the investment banks and the Wall Street turmoil, investors are now in the look out for safe havens, and gold is just that. Historically, gold is known for holding its value and is an experts pick for expanding your portfolio as well as increasing the performance potentially. In fact, the value of gold has increased over 150% since the year 2001.

- The value of gold can never be zero. In place of equities, in which the values are always fluctuating ” from a very high level it can come right down to zero in a very short time, gold can never lose its value to become zero. When other markets are collapsing, gold has actually witnessed great highs in values when you trade gold, which has been a traditional trend of gold and helps people make quick flight to better quality. Gold investment also allows individuals to accumulate more assets which further protect the wealth when the equities and the global market are facing negative territories.

- Gold investments give better opportunities for diversification. Experts usually advocate diversification in investment by including gold to the investment portfolio as a better method to improve the overall performance and to provide stability. You can consider gold bullion coins in a fluctuating market or negative economic environment ” they are known to be rock solid investments that would definitely fetch you good results consistently.

You can buy gold in any market condition ” be it high or low. The value of gold doesnt ever go down dramatically. Even if the value decreases, it would be just of a negligible amount.

You can buy gold whenever you want to, preferably as bullions or coins. You can as well sell gold in smaller quantities when the economic conditions are good ” that would in fact be a wise decision.

Plan your investments carefully and always look for stable retirement plans. There isnt anything more stable than precious metals like gold, to invest in.

Credit cards are no more a luxury, they are almost a necessity. You can’t rent a car without one, you can’t purchase goods over the Internet without one; you can’t make airline reservations without one. Nearly everyone in modern societies have at least one credit card.

Along with the increase in the numbers of people using credit cards, it has been noticed that there is an increase in ‘credit card debt’, a term that is feared not only by those who use credit cards, but also by those who issue them. Credit card debt is better understood once you have a clear understanding on how they are used by the people.

Credit cards are used by people to purchase things on credit, which means one can purchase things without having to pay for them upfront. The credit card represents the credit account that a person holds with the firm issuing the credit card. The more you use your credit card for purchasing items it adds to your credit card account, thus creating your credit card debt.

The credit card debt is the amount that the person holding the credit card owes to the supplier of the credit card. The credit card debt needs to be cleared every month for which statements are issued to the credit card holders every month by the credit card firms. There is a due date within which the payments are to be made, after which one would also need to pay additional late fee and charges for interest.

There is an option of making partial payments for clearing the credit card debt that people can avail. However this proves to be disadvantageous for the people as they would be paying back higher interest rates, thus increasing the amount of their credit card debt. The only advantage is that they will not attract any late fee.

Furthermore, the interest charges added on to your credit card debt each month form the new balance or the new credit card debt amount, and interest is charged on the previous month’s interest. If you continue making partial payments (or no payments) the interest charges (and late fees) are calculated afresh on the new credit card debt. So you end up paying interest on the last month’s interest too.

You will soon find that the credit card debt has become a much larger amount than what it actually had been before. The amount may become so large that you may find it impossible to pay back. The only way you can help yourself is by curbing your spending so that you do not have a very large credit card debt.

Napa County is located just north of the San Francisco Bay area in California. There you will find some of the most beautiful real estate on gods green earth. Napa County Real Estate used to be comprised of mostly farmlands that produced a variety of different crops. Today Napa County Real Estate is home to some of the best vineyards in the world.

Napa County Real Estate, since the 1960’s, when the wind industry in Napa County Sprung up, has at all times presented a 100% return on its investment. In the economic despairs of today’s market, it’s great to know this. Napa County properties are made up of about 788 square miles, 754 of this are all land.

The wine industry in Napa County has blown up over the previous two centuries. At the conclusion of the 1800’s there were no fewer than a hundred and forty wine manufacturing vineyards in the county. Four of the original wineries have been able to continue to exist and thrive in this heralded Napa County Real Estate area. They would be Shramsburg, Beringer, Charles Krug Winery and Chateau Montelena.

Napa County Real Estate took a hit when prohibition was enforced in 1920. With no one to purchase their wine many wineries folded. It was not until after World War II that the wineries once again began to prosper and produce at a new level. As the vineyards prosperity rose so did the value of the counties real estate. The power of the grape swept the county. Napa County was the place to be.

Since the pre-prohibition age, times have altered significantly. The Napa Valley Real Estate now consists of about 300 wineries. The wineries there put out a great diversity of wines. For instance there is Cabarnet Savignon, Merlot, Zinfandel and Chardonnay.

Millions of visitors from around the world visit Napa County wine country each year to taste the wine and explore the wineries. Whereas many other nearby counties have changed direction over the years and have allowed more and more land to be sold for commercial purposed; the Napa County Real Estate is has still managed to hold onto its agriculture roots.

The Williamson Act in California tenders property owners in the state tax relief if they develop their Napa County Real Estate for farming purposes. The landowners in Napa County took benefit of this in order to conserve land for wineries for generations to come.

It is correct that the farming reserve has without doubt intermittent suburban development in Napa County Real Estate but new homes are still being put up around the preserves. There are occasions in Napa County Real Estate even in harsh times. The $8,000 tax credit permitted by the new stimulus package has opened the doors for numerous buyers who were once leasing. The stance in Napa County could not be superior. Loads of new homeowners will readily agree.

Dividends are payments from shares, unit and investment trusts, which, investors hope, are not only regular (usually twice a year) but also rise over time to reflect the companys (or trusts) growing fortunes. Dividends are taxable as income.

The good news is tax on UK share dividends is deducted before you get it. If you are a basic rate taxpayer, you dont have to do anything else. Nontaxpayers and ten per cent taxpayers dont need to do anything either. But theres bad news here: You cant reclaim the deducted tax under any circumstances. Even though its called a tax credit by HMRC, we refer to it as a deduction to save confusion.

Top-rate taxpayers have to declare dividends on their self-assessment form and have the cash ready to pay the gap between the 40 per cent rate and the tax deducted.

Whether you get income from unit trusts, investment trusts, or individual shares, look at the date the dividend was declared and ignore the period for which the dividend applied. A 10p a share dividend for the year ending 31 December 2006 declared on 1 May 2007 and paid on 1 June 2007 counts as part of your 2007 ” 08 return, not the 2006″07 calculation.

If you invest for long-term growth in shares that pay low or no dividends, youll pay less income tax. But dont forget these shares tend to be riskier. And you can get hit for capital gains tax on your profits.

Dont forget if you are near the top of the basic rate ladder ” earning around $36,000 a year ” your dividends can push you into the top tax bracket. For instance, if you earn $36,500 and have $3,500 of dividends youll be over the $39,825 (in 2007″08) basic rate tax limit for a person aged under 65.

Dividends from stocks traded in foreign markets can be tough to deal with. You may have to convert dividend payments into sterling as well as account for them separately.

You need to fill out the foreign income pages of the self assessment form. The UK has double taxation agreements with most foreign countries. The effect of these agreements is to cap the tax due on foreign-sourced income so you are no worse off as a result of possibly being taxed twice.

Many stock market companies have schemes by which shareholders can opt to receive new shares to the value of their dividends rather a dividend cheque. Even if you choose this option, you still have to declare the value of the new shares and any balance carried forward in cash because it is not large enough to buy a share. Youre liable for tax on re-invested dividends in just the same way as a cash dividend.

If you are interested to pursue real estate as a business then you must know how to flip houses. With the economic crisis still happening on a global scale without a definite time when it will all be over, flipping has also become a rampant and profitable venture in real estate. Most experts said that the real estate is one of the industries heavily affected by the amassing financial crisis. But the truth is that all it takes is some smarts and good business networks to continue benefiting from this field.

There are actually lots of different flipping methods being used these days but the process is very popular within property development. In essence, flipping involves buying low cost property or house and then selling it quickly for a much higher price. Some developers fix up the house first or make the necessary repairs before they sell it in the market. There are those who buy at low prices moderately conditioned property and then find a niche market that will get the bait to buy it.

We have already done all the research for you and here are some important tips that you will want to take into consideration when working to find and flip properties which will yield the highest profit reward:

1.) Know your financial limits. A common mistake in a flipper’s first venture is not being able to make their profit goal at the end of the flip. The places the first-time flipper may make their mistake could be either when choosing the property to purchase and investing too much into the buying costs and not leaving enough capital to budget the repairs properly. Another hurdle that the rookie may come across is not properly budgeting for those repairs and leaving some unsightly mistakes in an otherwise rennovated property which will stand out even more than they did before. Remember, doing your homework and calculations may be time consuming, but it will pay off in the long run when you are able to meet your profit goal because of the time you have invested.

2.) Motivated resellers can be a huge asset to you as a house flipper. Their tragedy can become your gain as those who are either recently divorced or suffered a loss will need immediate cash and will be willing to part with their asset at a much more affordable price. You will help these unfortunate people by giving them the liquidity they desperately need and they will give you a bargain on a prime asset.

3.) Avoiding price quotes is a key note on how to flip houses. When you are out scouting for possible properties to be flipped, don’t make the mistake of asking potential sellers for their preferred selling price. This only gives them a strong hold on their property and may be a weak link for you in terms of haggling. It would be best to just go over at the site, let yourself be toured around by the seller and then pick up important stuff along the way such as the damages to be repaired, the feature areas, and so on. Upon full assessment of the property, that would be the only time that it will be best to talk about prices as you have your ammunition ready to defend your preferred price.

Asset protection is like a fire extinguisher. You have one in case there is a fire, but you hope you never have to use it. When you use asset protection as your fire extinguisher, you’re protecting yourself and your family from potential loss. John D. Rockefeller said, “Own nothing but control everything.” That is the key to asset protection, because you can lose all that you own.

Assets that are held in your name are always susceptible to loss or seizure. However, the trick is to keep your assets under the aegis of a legal entity who is not you but is only kept there to serve the purpose of attribution. However, inspite of being held by a legal entity, the assets are actually under your control without you seeming to own them.

It is definitely easier to own nothing nd yet have control of all your things. Basically by assigning this legal entity, you will remain the owner in terms of benefits sans the burden that ownership brings. So basically, you have it all your way.

These are the four plans that are the vital elements in asset protection:

Financial and business plans Retirement plan Estate plan Lawsuit protection plan

This aforementioned plan also incorporates certain other ideas and subsequently structures the plans based on one or more of the below concepts:

Ownership versus control Tax efficiency Financial privacy

Ownership versus Control:You must remember within the scope of the law anyone can file a case against you at any time they want to. Therefore you are not lawsuit-proof or so to speak. But what you can do is change the way your assets are named. If you modify the titles to your assets then remember, the probability of you losing them legally goes down by a great deal.

Tax EfficiencY - Always pay your taxes, there is no point in shirking them as it is only fair that you pay an amount which depends solely on the way you lead your life. But what you can do is, bring down that share. The IRS code 419(e)/83(b) details out all the ways in which you can plan and regulate your taxes. For example a businessman can take a welfare benefit plan which means that you can put as much money you want there and have it deducted as a commercial expense for business.

For example, if you are a business, you can adopt a “welfare benefit plan”. The Welfare Benefit Plan currently under IRS regulations doesn’t have a cap. That means you can put as much money as you can into it and then deduct it as a business expense.

The Welfare Benefit Plan also provides security for your family in the event of your death, because it’s usually funded with a whole life insurance policy. This is in addition to the benefit of taking a deduction for every dollar that goes into it. It also increases in value on a tax-free basis that you can borrow from tax-free

Financial Privacy: With the advent of the Internet, financial privacy and identity theft have become critical issues. You now have to take additional steps to protect yourself in the high tech world we live in today. As technology increases so, will the need for more involved privacy options.

When trial attorneys get ready to file lawsuits, one of the first things they do is search to see if you’re a good candidate. One of the primary things they search for is property and assets held in your name, as well as what kind of car you drive, what your bank account balances are, etc. If you can enhance your personal privacy, it’s going to lower your profile in terms of being at risk for a lawsuit.

Types of Assets - There are four kinds of assets that need to be protected from any litigation whatsoever and they are:

Business entities Real estate Investment holdings such as mutual funds, stocks and bonds, option trading accounts, etc. Retirement accounts and Insurance policies (casualty and liability)