Personal Finance Resources

The holidays are over, but that doesn’t mean they aren’t still going to haunt you for another month or two. In fact, those credit card bills are probably going to be showing up very soon in the mail. However, don’t let the post-holiday bills get you down too much because there are a few strategies you can use to get you through the holiday bill season, such as a simple cash advance.

If you’ve been like most people and swiped the credit card through the holiday shopping season, then you’re probably going to have a hefty bill coming soon, if you haven’t received it already. There are a couple of ways you can insure you get that bill paid off and a budget and cash advance can go a long way.

Subtract your expenses from your income and see where you can pay a little more. If you have a positive number when you’ve subtracted your expenses from your bills then you can figure out how much extra you can afford to spend. If you have a zero or a negative number then you need to take a step back and figure out how you can make more money or spend less.

A cash advance is a tool that you can use to help you through those weeks when you need that extra cash to pay your holiday bills off. A cash advance has simple requirements for you to meet and you may even be able to obtain a cash advance that can pay your entire post-holiday bill off. This makes a cash advance ideal if you will have the money to pay it off, but you need to send the bill off now. Either way, a cash advance can make dealing with the post-holiday bills that much easier.

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Want to get taken to cleaners? Then consider buying a used car from a dealer. Even certified dealers will swipe the last dime from your pocket book. I am not trying to be hateful here, but I have a friend that was a car salesman for a year or two, and he told that they go for every last dime they can. They try to sell you on “Intergalactic Personal Car Protection” and a whole mess of other baloney add-ons that just boost their profits, not adding any real value. They will also go for the highest interest rate possible when providing financing for you. I am going to give you a few tips when looking to buy a used car:

1. If at all possible, use cash.
   This is the most beneficial tip I can provide. If you use cash, you will be able to get the best bottom line price, and can more easily turn down all the baloney add-ons. Be sure to get the title in hand when paying cash.
2. If you are going to finance a car, don’t use the dealer’s financing options.
   Again, the dealer is not your friend, they are trying to milk you for the most money possible. Look at the rate and terms they provide, and compare them to quotations you have already obtained from your bank or other lender. Use the power of “NO” when dealing with a salesman. If they tell you they can’t give you the price you want on the car unless you finance with them, just say no. You will almost always be able to work a better financing deal if you go through your own channels outside of the dealer.
3. Get some kind of guarantee or warranty.
   Get the longest, highest grade warranty possible. Cars break down, especially used cars, and even more so used cars that are sold from a dealer or third party. Getting the longest warranty possible will guard you against major repairs that will eat your budget’s lunch.
4. Have a mechanic friend checkout the vehicle before purchase.
   This is immensely important when buying from an individual seller. This kind of person usually has a reason for selling the car, and that reason is almost always because it breaks down a lot, and they want to dump it, and get a better car that won’t have so many problems. This means many times you will be getting a lemon. Almost every time that I have bought a used car from an individual seller, I have been forced to make substantial repairs, almost immediately after buying. Get the advice from someone who knows about cars, I can’t stress that enough.

Bottom line, use common sense. Get estimates on interest rates, maturities and other terms from several different lenders before making your choice. Avoid dealer financing if possible. If it were me and I had to finance a car, I would not finance it for more than 5 years (60 months). The depreciation on the vehicle will outdo the loan before you are finished paying on maturities that are longer than 5 years. And if you ever needed to sell the car, you definitely don’t want to be in a negative equity position.

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In my latest acquisition, the investor that I represent as a property manager wanted to meet one of the tenants. So I said OK, and we have that scheduled for 11:00 AM this morning. This tenant is a good tenant, but is a little anxious, thinking that his rent may increase substantially with a new owner. This is very understandable, and is why I met with him myself last week just to calm his fears.

But, my investor wanted to meet him before I signed a new contract with the renter, so we will be going over there in a few minutes. I hope to get the lease contract completed and signed today, and get our first month’s rent in as the new landlord. From what I see and what I have been told, this renter is a good one. But as you may know, the old “Put your money where you mouth is” applies here. Once we get a couple of month’s rent on time from this renter, then I will become a believer.

The other new renters that we currently have are still in default. Friday I will be getting with them to collect the rent, and inform them of the contract penalties that will be applied next month if they are late again. I will report in tomorrow on what transpires today…

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I have done several real estate deals now, all involving some type of mortgage or commercial loan. I have only worked a deal once (that I can remember) where I allowed the mortgage broker to charge an origination fee. Origination fees are absolutely garbage and are just additional money that the broker or agent gets to keep.

If you think this is where mortgage agents and brokers make their primary money, you are sore mistaken. They get a spread when they sell the loan to the larger institutions, usually get an application fee, and other minor fees for processing the loan. So if they are charging you an origination fee on top of all of that, get out of Dodge, it is not a company or broker that you want to be dealing with to obtain your mortgage.

The one advantage to some mortgage brokers that charge origination fees are that they should have some pretty good incentive to provide timely, precision service (the one case that I can remember working with one that charged the origination fee provided terrible service, and was the most despicable transaction I have ever been privy to). However, there are many mortgage agents out there that will provide good service without the origination fee. My banker will actually show up in person to a closing, which is unheard of in today’s market, and he didn’t charge an origination fee either. Do your due diligence, and you can find someone local that will provide you this level of service.

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Being a property manager isn’t as easy as you might think. In my most recent deal involving the acquisition of 4 units, the current renters were aware of the change in ownership/management. So one of the renters took the opportunity to be late with their rent payment. Under the existing contract, their rent is due on the 1st, with a grace period until the 3rd. Well, the renter told me that they will not be able to pay rent until Friday of this week, that’s the 11th of the month.

Ridiculous, huh? Yes it is. And they expect to not have any late charges either (I’m just guessing, but I don’t imagine they are going to step up and pay the late charges without me asking or demanding for them). This is the sorry thing about buying into a property that already has renters. If the renters have any clue about what is happening, they may try to use it to their advantage.

I have decided in this situation not to create a first impression of a “tyrannical landlord”. I am going to collect the rent on Friday, inform them of the are penalties outlined in the contract, and if the problem happens again next month, I will enforce all late fees, etc that the contract allows. It just stinks as a new owner that there are people out there that will take advantage of every inkling of an advantage. Anybody else have any good rent stories? (You can post them at the bottom of the page).

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Ok, so now we have the 4 units. But now comes the hard part, getting the repairs done and getting settled in with the new renters, or should I say, getting the existing renters settled in with a new landlord. Today, I got a call from one of my renters, concerned that the rent would increase, and wanting to talk to me about it. I had previously talked with my investor, and he did not want to increase the rent.

However, the previous owner was paying for the gas, and we intend to change the 2 units where this renter lives to all electric. So I informed him today that the rent would not be increasing, but the electricity would probably go up some when we change over to all electric. Our inspectors told us that it is a safety hazard to have a gas water heater in the bedroom closet, and that switching it to an electric water heater would solve the problem.

So for us the advantage will be that we will not have to pay for gas anymore. The renter was fine with that, but requested that we paint the outside of the house. As there are some other repairs that need to be done (and he would be ok with putting them off if we paint the exterior), I think it will be a good idea to comply with his request.

So now I will need to get in contact with my repair guys, and get some firm bids established to complete the work. The original numbers that I put together include some $15,000 in repairs, which I hope will be more than enough to cover the cost of the repairs. I already have a couple of estimates in, and it doesn’t look like it will top the estimated amount.

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Well, on New Year’s Eve, we closed on our 4 unit duplex deal. So now we have the title, and will begin collecting the rent. This was a good deal, but even so, you need to read your closing documents. The lawyer, the banker, the seller and my buyer all missed an important detail - that the cost of the survey should have been paid by the seller. Luckily, I broke off from my family to come back home and be there for the closing.

This error would have cost my investor over $600. Not much money in the long run, but $600 is $600. Unfortunately, the hard work is not over. One of the renters is a section 8, so we will need to push through the paper work to get the transfer of ownership so that we can start collecting the government guaranteed payment. Further, there are some repairs that still have to be done, and the previous owner has to complete the installation of the new water meter, which is scheduled to be completed next week.

Overall, I am pretty happy with how this deal has turned out. If you are diligent, and follow through on your deals, you can make things happen. Get on my RSS list to get free, automatic updates to all the great information here at Personal Finance Resources.

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