Budgeting

Factors that Leave an Impact on the Borrowing Capacity

A few key factors tend to influence your borrowing capacity under all circumstances. It’s actually a single important factor that helps in determining whether you can own a home or not. Gaining a fair idea of how much you can borrow is of great help when you’re considering multiple properties simultaneously.

Once you gain a fair idea of your actually borrowing capacity, you’ll be able to adjust your property search accordingly. You may even achieve a few options that fall within your budget once you do your research. Many of you may simply be wondering about the factors that can prevent you from achieving the desired loan amount and the maximum amount that you can borrow.

Find out ways to enhance your chance of borrowing more:

Financial Commitments:

Prior to issuing a home loan, a lender has to determine the extent of mortgage repayment that you can afford. Apart from your income, the lender is bound to check out the commitments you have towards other outstanding debts.

A greater repayment capacity will enhance your power to borrow, more so, when you co-own a property with a relative. Your financial commitments may include vehicle financing, credit card repayment, repaying loans and other debts.

Loan Repayments:

The amount that you can borrow may be easily determined by the interest rate and the loan term that you sign up for. As the rate of interest falls, your repayment amount also gets lower. By opting for a short-term loan, you’ll end up saving much of the loan interest. You must accept a loan repayment term that matches your financial situation.

Living Costs:

Your loan application only gets approved when your lender does through your living costs. School fees and cost of child care are among charges that increase your living cost. Once the lender is able to identify your borrowing capacity, it becomes much easier for you to sort out these expenses. Even after maintaining a certain living standard, you’ll need to work towards repaying the mortgage.

Credit Rating:

Your credit rating is certainly an important factor that determines your borrowing capacity. By proving your worth as a reliable borrower, you’ll be able to convince the lender for a much higher loan amount. However, you’ll also need to repay the loan amount within the specified time-frame. Your loan application may be rejected after you’ve defaulted on repaying your utility bills and credit card bills in the recent past. Before even visiting a lender, you must check out free copies of your credit report for free from each of the 3 credit reporting agencies. All of the red flags appearing in your credit reports need to be compared and the discrepancies need to be resolved in any.



Asset Evaluation:

In an attempt to identify your actual loan requirement, a lender can run a credit check on the assets owned by you. All of the vehicles that you own as well as your investment options might affect a lender’s decision. These factors hold considerable ground in determining your loan requirement.

Keeping these factors in mind, you’ll need to work on all areas of opportunity just to enhance your borrowing capacity. This way, you’ll have more options of comparing loan and fresh job offers that come your way.


House Flipping – Another Way to Make Money

Image source Pixabay

We’re always looking for ways to bring in more cash. Whether you need to pay off a few more bills or to increase your retirement fund, the more money you can bring in, typically the better off you will be. Besides your monthly income, do you have other ways you bring in cash?

Many individuals, business partners, and even couples will test their skills of flipping a house. When done correctly, you could walk away with a hefty lump sum of money. However, done poorly and you’re looking at a considerable loss.

Does that mean you shouldn’t try it? Not necessarily. Although house flipping is not for everyone, it could be the other source of income you were looking for to pay off your last credit card. If this is something you’ve thought of doing, here are a few tips to make your first house flip successful.

Are You Ready?

First of all, you want to understand that flipping a house is not a simple task. It tends to require a lot of skill in renovations, or a decent amount of money up front to hire someone to do the upgrades. If you are uncertain if you’ll be able to complete the flip on your own, or can’t afford to hire contractors to help, you may want to take another look at if house flipping is for you.

Find the Right Partner

If you’re looking to partner with someone to flip a house, don’t choose just anyone. You’ll be working closely with this person most likely seven days a week for as long as it takes to complete the renovations. Will you be able to stay civil with each other, or do you expect your relationship to fizzle out?

Do Some Reading First

So, you’ve decided you’re ready to flip a house and have found the right partner, is it time to dive in? Before you do that, consider reading up on house flipping from those who are successful in the business. They’ll be able to give you the ins and outs for you to make your first flip a successful, and profitable one.

Find a Property Fit For Your Level

If this is your first house flip, do you want to dive into one that will require basically a rebuild? Alternatively, would it be better to find a house already in decent shape that only needs a few upgrades? Biting off more than you can chew at the start could set you up for a disastrous flip and ultimately cost you more money in the end.

Finding the right property also should include the location of your potential flip. You want to find a balance of property value with how much you’re spending. A beautiful house in a rundown end of town may not sell for as much money as you want. Purchasing a home in a high valued neighborhood could sell high, but it may cost you way more than budgeted to fix and meet the neighborhood standards.



Fix Quickly, Sell Quickly

Part of the art of flipping a house is to fix it up as quickly as possible (while maintaining quality), and then turning around and selling it right away. You could put in a ton of work to make the house look beautiful, but it won’t make you much money if you don’t sell it right away. The longer you hold on to the house, the more money it costs you.
When the time comes to sell the house,every small detail matters. From how you stage the home to even the smell of it, every detail can influence someone’s decision to make an offer. So, by setting it up in a way that allows potential clients to picture their family in the home, the better chances you have of closing a deal.

About the writer: Jeremy Biberdorf is the owner & founder of the popular investing blog modestmoney.com. Check out his site for latest investing news and tips


Tips to Earn More Than What You’re Doing Right Now

Image source Pixabay

Financial crunches may appear all of a sudden. Certain unforeseen circumstances may compel you to land up in a financial crisis. You might need to pay off a utility bill, buy a gift for a loved one or pay off your debt all of a sudden. You may choose to pull out of debt and feel comfortable financially even after putting in a minimum effort from your side. But for this, you’ll need to do an extensive research and gather quality information.

1. Secure a Temporary Job

There are a few temporary agencies that hire and place skilled workers with client organizations that seek short-term assistance. Apart from offering a good pay package, these jobs tend to explore the full potential of an employee who’s prepared to work for full-time.

2. Start Selling All Unused Things

There are a number of channels that enable you to sell off your appliances, electronics, toys, and clothes without any apprehension. You may even consider checking out the local flea market for renting out a hand-picked space and hosting any garage sale if you really wish to remain traditional. You may even check out your opportunities online if you’re going to use your desktop. These days, you’re bound to come across a number of e-commerce sites like Amazon that have categories to get your products listed over the internet.

3. Opt for Babysitting Services

You may opt for babysitting and pet-sitting jobs whenever you’re free. You might be surprised to find some opportunities coming up near your residence. There are a few good websites that will help you catch up with such opportunities from time to time.

4. Work from your Desktop Computer

There are a number of jobs that you may do from home in this digital age. Apart from being a developer, you can work as a professional blogger, tax consultant, online tutor, and virtual assistant. There are also a few survey sites and data entry websites that offer you cash.

5. Choose Any Seasonal Job

A number of swimming pools and amusement parks tend to offer fresh opportunities to summer jobseekers during the warm summer months. A fun-filled environment with flexible working hours is what you get in return. On the contrary, if you’re looking to earn quick cash, you may choose to explore the retail stores during the winter holidays. You may certainly be able to enjoy flexible working hours with a few seasonal positions.



6. Rent out Your Car

This is for those of you that haven’t been using their cars too often. You have this option of renting out your car. You must acquire more knowledge on how much coverage you ought to seek for your vehicle when it’s not going to be used more frequently. You must protect yourself from landing up in situations wherein you need to spend more towards repairs.

7. Participate in Market Surveys

There are a few organizations that pay more to know your opinion. You’ll certainly be able to earn more by participating in their market research programs. Once you start accumulating cash, it will be easier for you to spend more money in a beneficial way. You may check out options like that of the free-rewards account to keep your money. This way, you’ll gain more chances of acquiring extra funds in the future.


Students and their investment goals – Are there any apps to help the lot?

Image source Pixabay

You can’t deny the fact that the world is a harsh place and there are numerous people who could possibly sell you magic cat dung and nail clippings if they could easily get away with that. Sadly enough, the financial industry is full of such opportunists who are more interested to dupe you into accepting something that is of no use to you. They can disguise their feline faces to look and smell sweeter than a bunch of spring flowers.

As far as students are concerned, they’re more vulnerable to such shady tactics and hence they are the best target for the financial companies. You have to be sceptical about almost everything that a person tells you whenever they’re offering you monetary advice. Read on to know more on students and investment.

Things to do to jumpstart your career as an investor

? If you’re starting off with small capital, you should get a broker who will agree to accept that amount. Later on, you may increase the total capital by investing more funds on a daily basis.

? Calculate and be sure about the total amount of money which you’re willing enough to risk. Don’t forget that investment will always involve risk and hence you should know your risk tolerance ability.

? There are financial vehicles which guarantee profits and provide students with minimum risks. CDs, Federal savings bonds, and even the student savings accounts which are approved by FDIC are all there. You should be smart about deciding.

? In case you’re able to take on risk and invest for a longer period, you can choose mutual funds of ETFs. Mutual fund companies collect the money and manage them for people for purposes related to investment.

? Perform a background research of the company. Research on the past performances and you can take a better decision about the company you choose to invest in.
The top 3 investment apps to help a student

1. M1 Finance

Over the last few years, M1 has become one of the most favorite platforms as they offer commission free investing, the capability to invest in several shares and they also offer you automatic deposits. All these make M1 Finance one of the best apps for students.



2. Fidelity

This is yet another popular and famous app which lets you invest for free. Fidelity is an app which provides you with a wide array of commission-free ETFs which allows majority of the investor to build an investment portfolio which is perfectly balances. You don’t require any minimum amount to open a Fidelity IRA.

3. Robinhood

Robinhood is an investment app which allows you to purchase and sell off stocks for fee. Users are allowed to purchase or sell stocks at the market price and this app makes limited orders and also stop-loss orders. If you’re not an active trader, then this app will have too much functionality for you.

Therefore, being a student, you have to be careful about the investment steps that you take. Your savings is limited and hence you can’t afford to incur losses. So, take into account the above mentioned tips and apps.

 


How to Become Filthy Rich

 

Saving money is about a number of other things than just negotiating at the top of your voice. You must check out your attitude towards saving money. You may certainly be one of those people who doesn’t fit into the category of filthy rich. Apart from money, personal finance has something to do with your traits. Frugal ways have already been adopted by a number of millionaires, few of who’re celebrities. Understanding the ways in which your financial situation gets affected by your personal traits is your key to accumulating wealth.

Check Out a Few Important Traits:

Discipline

You must prove to be a disciplined investor if you really wish to save money for meeting your end objectives. Personal finance has to be studied in details if you really wish to turn rich in the long run. Actually, it’s all about executing the life plans in a disciplined manner.

Patience

When it comes to saving money, you must have more patience. Exercising a bit of patience holds you from landing into debt and helps you save more. You’ll achieve the cornerstone of great finances once you have the much-needed patience of identifying a great deal.

Risk-Taking Ability

You’ll need to take certain risks if you really wish to acquire wealth. However, you shouldn’t take uncalculated risks. You must consider all the options that you may fall back on and take risks after doing your homework.
The risk element is there to be dealt with by those that participate in the stock market. But if you invest your savings in a wise manner, you’re bound to catch up with great returns in the long run. If you’re among those that fear the overall risk, you may end up saving money in accounts that are bound to be affected by inflation.

Creativity

All of our expectations aren’t matched by our income and our economy. Our financial plans are often disrupted by certain unexpected developments. You must prepare yourself to deal with fresh circumstances. A lot of creativity is needed to ensure financial stability instead of procuring things in haste.

Result-Oriented Action

It’s truly important for you to set a goal and work towards it. It’s truly difficult for you to reach your destination when you aren’t aware of where you’re heading to. For those of you that have financial goals, you may achieve an immense personal finance boost. It will even help you stay motivated and achieve all the goals that you’ve set on your own. It won’t be possible for you to reach your financial destinations very easily if you lack goals and lack a vivid roadmap.



Combining Smart work with hard work

A lot of hard work gets in stake when you’re attempting to steer clear of debt and generate wealth. Some of you may simply start believing that by acquiring a lottery, you might get rid of some financial problems. However, the right path to accumulating wealth is through working hard and acquiring advanced skill sets.

Your knowledge is likely to get reflected in your growth and success. You may not possess some of the traits that the others do, but you must adapt to changes. Once you nurture a few inherent qualities, you’ll soon find out ways to identify your areas of opportunity and acquire all necessary skills that aren’t present in you. Most of the skill sets that you acquire will assist you in managing your finances more efficiently and also acquire more wealth.


Retirement moves which you should start taking during your 20s and 30s

Retirement moves

Image source: pixabay

Though you might be decades away from quitting your job forever, planning your retirement is everything about taking the proper start. During each stage of your journey towards retirement, you will require knowing about the most vital money moves that you should make, the target for savings that you should set an aim for and the ideal way in which you can mix and create the best investment portfolio.

These change when you reach your peak years of earning and when you reach the pre-retirement red zone. If you’re someone who is all set to take the best money moves while you’re in your 20s and 30s, we will offer you some of the best techniques that you should follow in order to stay debt free post retirement. Check them out.

#1: Collect the entire company match for you 401(k)

In case you’re beginning to save money at the age of 35, you will require putting aside 17% of the income for 30 years so that you can retire properly at the age of 65, as per researches done by the American College. You start at the age of 30 and then your target will decrease by 12%. If you begin at 25, the target will drop to 8.8% in a year till you reach the age of 65. Usually, you should save 6% to earn the entire amount. If you think that’s too much, you can start with 3%.

#2: Demand $5000 more in your salary

The amount that you earn during the initial 10 years of your job will always have a long-lasting impact on the wealth that you accumulate. As per studies done by the Federal Reserve Bank of New York, the typical wage of the worker grows between the age of 25 and 35. So, if you can get a boost in your pay of $5000 when you are of the age of 25, this can sum up to $635,000 more in the earnings that you make over the lifetime. You should negotiate irrespective of whether you’re grabbing a job offer or you’re looking for a raise. It is sad enough to note that just 35% of the millennials have ever asked for a raise.

#3: Be smart about paying low investment costs

It is always a smart and a wise decision to keep investing costs down. When you’re still young, you should lock in on the low-fund expenses and this is also a rewarding experience. In case you invest $1000 in a month in a retirement fund for long 30 years, you will end up having $762,000 keeping in mind the average annual returns and mutual fund fees.



#4: Try to know yourself in the future

You should picture yourself in the future and this will give you a clear idea of your savings mindset. There are several kiosks which allow workers to get an idea of how you can look when you’re 65, the number of people who enrolled in a retirement plan rose to 65% as compared to the previous year.

Therefore, whenever you’re worried about the ways in which you can systematically save for your retirement, you can take into account the above mentioned strategies and techniques.


The rise in Bridging Finance to help get your Offspring on the First Rung of the UK Property Ladder

Image via Pixabay

In years gone by it used to be a lot easier for young parents to get finance to obtain a mortgage for their very first venture buying a family home. So long as they had a good credit rating and a good relationship with the bank manager, they stood a good chance with a decent deposit on their side. Their family would normally help with additional things like buying furniture, solicitor fees, paying or helping to pay stamp duty or towards a small deposit and alike if needed.

These days, however, first-time buyers and young families are under much higher pressure to obtain all of these traditional requirements in order to purchase the first family home. Currently, with the economic downturn and together with today’s housing market increase. it has been much harder so there is now a tendency for getting help from the “bank of mum and dad” so to speak.

In general, today’s young people trying to get on the property ladder need (for the most part) funding in the region of some £20,000 to £30,000 to purchase their first‘ basic’ property. This is a substantial amount for most people today and many are not able to afford this from the off so they are needing the help of family members where this is possible. Parents, in general, are the ones to give them a “leg up” if they can to help their children purchase their first property.

Some first-time buyers are increasingly looking to family support in the form of bridging loans (here is a great calculator) to both purchase and in most cases help renovate houses in order to climb up this expensive slippery pole. A lot of these first-time homes are in need of renovation which makes it even harder as the banks deem the property “unsuitable security” so if the family can help with this there is more of a chance of getting over the hurdles. If this can be organised, some of the money can be put into play with a bridging loan secured against their own property to increase the value of the purchase it suitable security for mortgage purposes. Once completed the property is remortgaged using the funds raised repaid to the family member who lent them the money, who in turn repays their bridging loan.



In these situations, family members are helping to make this possible for their children to get onto the property ladder and set up a stable home for their grandchildren in the future in the bargain. In some cases, there is potential for “mom and dad” to have some return on their investment to boot but there is, of course an element of risk, and before entering into something like this all parties need to research all aspects and be prepared to do some work and perhaps even roll up their sleeves to chip in on the renovation itself. All in all this option is coming into play more and more these days and is generally a good solution to the issues in this field today.

 


Finding A Career That Gives You Financial Stability And Happines

Financial Stability

The trickiest part of career-hunting is finding a job that gives you the perfect balance between financial stability and happiness. Of course, many people think that you have to settle for one or the other, but there are often more options out there for you than you might realize. You might just need to widen your job search a little further. You need to consider your personality, interests, academic abilities, and general skillset. Once you’ve done that, you’ll have an idea of the perfect career for you. If you need some assistance then here are some ideas for careers that will give you both financial stability and happiness (depending on your preferences in terms of industries and types of jobs).

Careers for organized and analytical people.

If you find joy in a structured and organized life then you should search for a job that lets you channel this mindset. After all, you won’t be able to function in a job if you feel like it’s a messy and unstructured role. Luckily, there are plenty of careers out there for organized people that come with a decent salary. If you’re technologically-minded then you might want to look at job opportunities in web development. They’re well-paid careers that offer you the opportunity to analyze information and work in a structured environment. Coding is very analytical, structured, and straightforward (of course, it can be a bit of a headache to learn).

You could also look into career paths as an assistant or a secretary for companies. They often come with fair salaries and decent company perks. You’d have the chance to schedule appointments, make travel arrangements for your employer or their clients, and deal with all manner of people on the phone. It’s the perfect type of job for somebody who thrives on organizing things. You might even want to consider a career as a virtual assistant if you’d want to do the same kind of work from home. Whether you’re an introverted or extroverted individual, there are plenty of job opportunities out there for people with an organized mindset. In all industries, there are businesses that need professional help to keep their information and appointments well-organized and structured.

Careers for sociable and outgoing people.

If you’re an outgoing person then you probably want a career that lets you get out there, meet people, and do things in the real world. You probably don’t want to be cooped up in an office cubicle with very little human interaction. Fortunately, there are many sociable career opportunities out there that come with a stable income. You might want to consider a job as a recruiter for a company. That heavily involves socializing with candidates who might be able to potentially fill a role for a business. It also comes with a very nice wage.

Perhaps you’re an avid traveler, so you might have found yourself looking for jobs that offer a lot of paid leave (that gives you time to travel). But you could simply look for a job that involves traveling. There are plenty of well-paid careers that fit this description. You could work on a cruise ship and have fun sailing around the world and stopping at different destinations. It might not be the biggest salary in the world, but it pays in the fact that you’re visiting different destinations as part of the job (it’s technically “free travel”). Of course, there are other career options in the travel industry. You could work for an airline, as an example. You might even want to look into different aviation colleges if you’d consider working as a pilot. It requires real studying, but it’s worth the hard work. It’s a career that pays very well, and it’ll perfectly suit somebody who wants to see the world.

Careers for ambitious people.

If you’re a business-driven individual then you should be searching for a career that allows you to progress through the ranks of a company, depending on the type of industry that interests you. Of course, there are many career paths for ambitious individuals that apply to all industries. If you like charming clients then you might want to consider pursuing a career as a client success director. Again, you might have to climb the ranks to reach that point, but it’s a job role that provides a decent salary. A career in sales is another option that suits ambitious people. Career progression all depends on your ability to live up to expectations to sell goods and services. If you’re ambitious then you’ll quickly progress, and it can be a very well-paid career when you account for bonuses such as commission.

Picture Source


5 Simple Actions that Can Raise Your Credit Rating Much Faster

Credit rating

Are you wondering how to improve your credit rating? Are you thinking of improving it for obtaining a higher loan, reducing your present interest rate, or to apply for a fresh credit-line? Your accounts ought to be paid on time for a considerable period of time if you really wish to maintain a good credit score. By doing this, you’ll certainly be able to make various financial institutions understand that you’re actually looking forward to repaying the borrowed amount. However, you may resort to a few quicker means of improving your credit rating.

Check out a few key steps to raise your rating without any hiccups:

1. Pay all past dues and keep your accounts updated

If you’re defaulting on your loan repayment for a period of about 60 to 90 days, then your credit score might take a serious hit. You might even have to witness a fall in score worth hundred points even after maintaining a good financial history. Not being able to pay off your dues can have a critical effect especially when you’re going to apply for a new credit card. Clearing off past dues may require you to pay off debt on time and adjust all accounts. If you’re late on your payments, then it will be hard for the banks to issue a loan for you.

2. Resolve issues pertaining to collection accounts

Credit Bureaus keep a record of your collection account for a long period of time. You’ll hardly be able to identify the source of their information. You must get rid of your collection accounts as they often leave a negative impact on your credit score. You must get in touch with a credit bureau and the parties with whom you have an issue. Your credit score is bound to be improved once you resolve your collection issues.

3. Bring down your credit line and balance to under 30% of the overall limit

Your credit score faces a negative impact once you max out on your credit limit. There’s no point in requesting your bank to lower your credit limit. Instead, you must attempt in lowering the revolving credit balance and request your lender to raise your credit limit. This way, you can prove to them that you aren’t maxing out your overall balance. Your credit score gets increased when you succeed in lowering your credit balance by about 30%. However, in order to maintain a high credit score, you must keep a check on your purchases and maintain that extra room on your credit.

4. Make sure the old accounts aren’t closed

Your credit score is bound to achieve a positive impact if your account is much older. However, you’ll need to keep it active. The credit score algorithm may not consider it if you aren’t using it for long. It needs to be brought back on track if you really wish to increase your credit rating. You may consider using this old credit card for any of your forthcoming purchases and then pay off the balance immediately.



5. Don’t apply for a fresh credit-line

Your credit history keeps a track of all new credits that you apply for. Your score gets lowered as a result of this. You must steer clear of all fresh credit applications. Consider avoiding this for a certain period although you must increase your credit score. Keep an eye on the facts mentioned in the other four tips.
Banking and financial institutions can actually lend you money and help you create borrowing opportunities and maintain your credit score. You may even be considered for loans without actually running a check on your credit. You might even find a way to achieve lower rates with those lenders that maintain an automated credit response.

 


Five Personal Finance Habits That Everyone Should Follow

personal finance habits

 

To begin, let’s figure out what a financial habit really means. To put it simply, it’s your attitude towards your own money and how you spend it. Every day we decide whether to spend or save. Not everything we splurge our money on is really necessary. If after a purchase you ask yourself why you need this thing at all, it was probably a bad financial decision. With this being said, a good financial habit is a custom that helps add more money to your bank account every month.

It’s not that difficult to develop good financial habits. The very first thing you need to do is admit that you have bad spending tendencies that will hurt you financially in the long run. These include the inability to control your income and expenses, impulse buying, and delaying payments on bills and credit card until the last minute.

Want to get your finances in order? Here are five useful financial habits that will help save your budget.

1. Keep track of your finances

You need to have a clear idea of how much you earn, taking into account all sources: salary, bonuses, deposit interests, etc. and how much you spend: loans, utilities, food, entertainment, etc. You’re not required any expensive software or special skills to keep such account. All you need is an aspiration to take your life under financial control and a notebook with a pen.

2. Learn new things

As they say, you’re never too old to learn! And what’s really important to your daily life is that you learn about things that help you become financially independent. This can be getting a new profession or developing skills for your current job that will aid in boosting your salary. Be sure to allocate at least 5% of your income for this purpose. Perhaps you will need to take some courses or classes, but in the long run, it will be totally worth it.

3. Don’t make impulsive purchases

Under the influence of flashy advertisement on TV or on the internet, or if we see a sale in a store, sometimes we succumb to the temptation to buy things that we don’t really need. It’s best to wait a few days before parting with your hard-earned money. Sometimes even two days are enough to understand that you can easily do without such a purchase. However, if after a week or two you still crave for this thing, then you may actually need it.

4. Put some money in a saving bank account

It’s a very useful habit to deduct 10-15% from your salary and put it in an interest-bearing deposit. It’s better to do this on a day when you receive your salary, so it’s easier to part with the money. You can also set up an auto transfer from your regular to saving account. If you’re looking for a bank to accommodate your money but don’t have time to visit financial institutions in person, you can easily open bank account online.



5. Pay utility and credit card bills on time.

When you don’t put your financial obligations on the shelf, you will be able to avoid fines and interest. It’s better to pay bills on the payday or set up auto payments on your credit card. If you follow these simple rules, you will easier understand how much money you can spend for the next month.

Financial discipline is a pipe dream for many people. However, there are lots of easy-to-follow financial tips out that that can help you save the big bucks. Try out some of these tips and you’ll see how effortlessly you can boost your bank account.

 


%d bloggers like this: