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If you are starting your own business and do not have enough start up cash to do so, a small business loan can be very useful. However, whenever we think of applying for loans we think of banks and financial institutions. It is true that loans taken from these banks have sound legal formalities. But sometimes these small business loan interest rates can be difficult to repay. Most of the time the novice entrepreneur fails to pay the regular monthly installments. This mainly happens because a business that has just started is less likely to be able to generate adequate revenue to be able to afford such high payment rates for these small business loan interest rates. When a business is unable to pay the installments due on these loans, it will results in negative publicity of the company in the market and even bankruptcy in extreme cases. Also, borrowers end up taking more loans in order to pay off these unpaid ones. This gives rise to a vicious cycle of bad debts.

Other than the high interest rates, the security that is sometimes demanded by regular banking companies is hard to meet. Unless you already have immense personal wealth it is possible to provide for collateral that is worthy of securing the business loan. In that case applying for the loan would not have been essential.

Small business loans are useful for initial capital formation of the company. Investments in physical space, infrastructure, stationery, wage payments, and other rents are also taken care of by these loans. Most of the time a new business does not have enough market experience to be able to boast off sufficient success under its name. Therefore, when banks and other financial institutions ask for profit returns and revenue details there is not much that these companies can come up with. However, these lending institutions do base their choice of borrowers based on business history. But for small businesses, this history is mostly very brief and devoid of much glory.

In such cases, you have the option of approaching the unofficial lenders in the market. They are no different from Shakespeare’s Shylock, except maybe the pound of flesh repayment medium! But seriously, these moneylenders usually have reasonable rates of interest and adjustable repayment plans. These loans also most often don’t require any collateral deposit or proof of credit history. You do not have to prove your worth by submitting your tax returns and business plans. Other than a few simple documentation procedures, these loans are much more borrower-friendly.

If you are looking for small business loan interest rates that are the lowest, beware of the terms and conditions that come with them at the same time. Banks do offer easy loans to small businesses, but most of the time they have unreasonable “conditions apply”. These short-term business loans may boast of the lowest interest rates on these loans, but the terms attached to them prove more of a liability to the borrower, which most often tends to overshadow the benefits of the loan itself.

Mortgage Modifications are a good option to stop foreclosure immediately, bring your loan current and give you an affordable monthly payment.

Many are starting to learn about investment in properties. It is easy to understand why. The value of our money is getting smaller, a phenomenon called inflation. During inflation, everything that money can buy becomes more expensive and property is one of them. In addition, property millionaires always made it to Forbes Rich List annually.

To hedge against inflation, majority of people make investment in properties. This is because the price of property increases with time, also known as capital appreciation. However, depending on which country you reside, you will need to pay real property gains tax when you sell the property. Some prefers investment in rental property whereby you receive income on a monthly basis. Regardless of whether you are investing in property for capital appreciation or rental income, it is good to take a look at the investment from the following areas. In this article, I will focus more on rental property.

1. Location, location, location
This has been the mantra of most, if not all, property investors. The location of your property will determine if the property price will increase with time and if tenant is fast to come by. To know if your chosen property location is a good one, make sure it is in close proximity to universities, public transportation, industrial areas and a pretty established town ship. Suffice to say, your tenant will come in the form of students and outstation job seekers in the industrial areas.

2. The profit is in the purchase
It will be helpful if you know and keep track of the prices of property in your chosen location. Look at the classified ads section, foreclosure notice and even at bank auction property list. Compare the asking price to that stored your database. Once you have located one property that is at least 15% lower than the prevailing market rate price, buy it! Buying properties at below market price will ensure better return for your real estate investment.

3. Work Hard
Now that you have determined the location and the best entry price for your first investment property, what is there to do next? Firstly, get it rented out of course. There are many channels to rent out a property. You may post it on the classified ads section, the notice board of nearby convenience store; ask your friends to spread the word around that you have a property to let, and now Facebook is getting popular too. Be creative and innovative.

4. Patience is a virtue
After putting up notices for rent and spreading the news, all we can do now is to wait. And patience is a virtue for property investors, especially Property Millionaires.

5. Keep a network of professionals
As you learn the ropes of being a Property Millionaire, you will come across professionals related in this industry such as Bankers, Conveyance Lawyers, Real Estate Negotiators and also other investors. These are your professional networks who will be your friends. Keep in touch and share information with each other.

As in many countries at the moment, South Africans are struggling to keep their homes. Negative equity has no easy solution, and borrowers can find themselves trapped in a house without the ability to re-bond or extend their current home loans.

Finding yourself with negative equity

No one plans for negative equity but often it is unavoidable. The current recession has sparked off a number of problems in the South African economy and negative equity in property is just one of them. The question is how do you overcome the problem?

The banks tell home owners to stay in touch and advise them of your situation well in advance so that plans can be made and advice given. Unfortunately, some people find this hard to do for a number of reasons.

Getting hold of the right person at the bank is often difficult The homeowner is not able to forward plan due to work constraints The banks response time is too long The banks response options are not viable for the home owner
Handling the situation



There are a few basic rules to apply in this situation.

Put everything in writing Talk to a decision maker Discuss all the options Make an offer Know when to let go
Putting everything in writing



This is the best advice I can give you. From the moment you know you cannot meet your obligations to your bond in full write to your home loans provider and ask for a three month stop on payment. They will allow this as long as your house is on the market and up for sale. Don’t do this on the phone. Phones and home loan officers are not a good combination. Messages don’t get through or become blurred. Most importantly, you have no evidence of having made the approach.

Write to them! Email or snail mail – it doesn’t matter – but have proof that you have been in touch.

Talk to a decision maker



When you call your home loan provider ask for the name of the person on the phone and write it down. Ensure you are speaking to the correct person ie: the person that can best help you. That means a decision maker and not the person who follows up on outstanding balances.

Ask for the name of the person you should be talking to and write that down too. Usually this person will be in the ‘collections’ department of home loans and will be in a position to make a decision about giving you three months off. Ask for a letter confirming the conversation and email the contact to confirm your agreement. After the three months of non payment the home loans division will be hot on your tail reminding you that you are in arrears.

Discuss all the options



Before your three months are up, write to your contact again and ask what happens next. You’ll be advised to make a minimum 70% payment on your arrears. You can then make them an offer eg: R5000 a month or what ever you can really afford. This is only as long as you have the property up for sale though. They will advise you to call their marketing department to put your property on the market.

You will be expected to sign a special power of attorney so that the home loan provider can sell or auction your property to recoup their money. Usually, if you have had your property on the market for a while they will allow you to continue with your estate agent during the next three months as long as you make the agreed payments. If not, the home loan provider will step in and reclaim the property for resale.

You may be able to extend your home loan term. If you have a 20 year home loan and have paid for six years you could apply to re-extend it to 20 years again thus reducing the monthly repayments. Another alternative is to look at better deals and have the home loan taken over by another provider ie: switch home loan providers.

What ever you have agreed, put it in writing and keep a track of names, dates and conversations.

Make an offer



In today’s current market your home loan provider doesn’t want your house. They can’t sell it any earlier than you can. Nor can they get more money for it that you could on the open market. What they really want is for you to settle the outstanding debt as quickly as possible so you need to show willing. Offering them a nominal sum on your monthly repayment assures them of your intention to keep your home. When you write to confirm the nominal repayment, make an assurance that you will endeavour to pay off the outstanding arrears as quickly as possible and outline your plan eg: I am seeking work, the property is up for sale.

Most home loan providers really do not relish the thought of auctioning another property for less than is owed on the home loan.

Knowing when to let go



This is the crunch. When do you let the loan provider repossess your home? In my opinion never, unless you have no choice. If after a three month leeway on payment and a further three months of reduced payments you cannot sell the property and cannot make up the arrears you will lose your property as the loan provider will want their money and will repossess to put it on auction.

Auctions are costly and have no guaranteed result for you the home owner. In fact, in most cases recently cited, auctions are not reaching the reserve applied and home owners are finding that they are left with a large debt after the auction including the costs of the auction itself.

In conclusion



If you simply cannot continue to make the repayments on your home loan sell the property as quickly as you can and make a deal with the home loan provider to settle the outstanding debt. If you cannot sell in the current climate offer to pay a minimal amount of the usual bond repayment to the home loan provider on a monthly basis. Above all, talk to the loan provider constantly and document all conversations with back up emails and paperwork. Don’t let the situation escalate as the loan provider can attach your belongings along with your property to ensure repayment. Keeping up a dialogue is essential.

Trading the stock market can be a very daunting experience, especially if you are not some rich big shot. I can tell you from my own experience that trading stocks was an extremely intimidating experience for me. Then I discovered the real beauty of low priced stocks, otherwise known as penny stocks.

What many new traders don’t realize until they start trading is that the “system” is manipulated so that the rich can get richer, while everybody else has to scrounge for the leftovers. If you don’t believe me, just take a look at most of the stocks that trade in the NASDAQ or the Dow.

Let’s say that you wanted to buy 100 shares of Wal-Mart (arguably the biggest company in the world).

At the current moment, Wal-Mart is currently listed at about $53 a share. What this means is that if you wanted to buy 100 shares of Wal-Mart, it would cost you $5300. Don’t you think that’s a lot for just 100 shares of one stock????

If you’ve got a $100,000 portfolio, maybe it’s not that big of a deal. But let’s be honest, that’s probably not the case for the average Joe who wants to make some money in the market. They don’t have that kind of money.

Also, how much can you realistically expect to make from that? If you are lucky, maybe a 10% return for the year, You are not going to retire off of that, anytime soon.

Also, how diversified are you when you just own 100 shares of Wal-Mart? That’s a rhetorical question. obviously, you are not diversified at all.

Now compare this to low priced stocks, such as penny stocks. With $5300, you can have a massive portfolio of stocks, where you are diversified among different stocks, and different industries, so you have a truly diversified portfolio.

Also, think about the profit potential? With penny stocks, the potential is truly limitless. 10% return for the year on a low priced stock would be considered a pretty low return. These kind of stocks can go up as much as 300% in one day, so you can image what the kind of return you can get for the end of the year.