Archive for April 2019

Closing the Deal: Can You Back out of a Home Purchase and What Are the Penalties for Doing So?

home buyer

So you decided to purchase a new family home, but on second thought, you want to abandon the deal? Well, this is not the first time someone has decided to take such an action. We have all have at a point in time cancelled a deal for one reason or the other.  Therefore, you can back out of your home purchase deal, as you desire. However, taking such a unilateral decision may come with some consequences.

home buyer

If you are yet to take such a decision, read on as I explore the conditions you need to meet before cancelling your home purchase deal.

Can You Back Out of a Home Purchase?

As already mentioned you can back out of your home purchase deal, but that depends on the;

  • Contract you signed

Most real estate purchase contracts come with an out clause but with conditions. Some agreements provide a specific period within which a buyer can end a deal. We call this period ?a contingency period.? Within the contingency period, the buyer has the opportunity to inspect the property. Since we buy houses with cash, this inspection is needed to ensure value for money.

After the inspection, the buyer can then decide whether to continue with the purchase or not. It is during this period that you can opt out without paying penalties.

But, if you decide to continue with the purchase and the contingency period ends, the real estate contract takes full effect. Any form of contract abrogation after the contingency period may come with penalties.

Why people back out of a home purchase

People back out of home deals for reasons including

  • Not meeting mortgage requirement
  • Found a new property cheaper than what they intend to buy
  • Lost of interest 

Penalties for cancelling a home purchase contract

Penalties for opting out of a purchase agreement vary and mostly depend on the deal. There are times that the real estate agent and buyer reach a compromise position. Here are some penalties for not fulfilling your purchase:

  • Forfeiting all your deposit – In most deals, you are required to make a non-refundable deposit to show your commitment. This is a strategy adopted by real estate dealers to scare people from opting out. With this, you will lose all your deposit if you revoke the contract after the contingency period.
  • Losing a percentage of the deposit ? sometimes, you lose a certain percentage of the deposit you made. Once again, it depends on what the contract says. So let?s say depending on the agreement, you can lose about 20 percent of deposits made.
  • Lawsuit: some homeowners may decide to sue you for damages. You were relying on a mortgage facility, so you made no deposit. Unfortunately, the mortgage was not approved and consequently, you couldn?t finalize the deal. In such a situation, the homeowner can sue you for wasting his time and financial loss.

Bottom line

Purchasing a home is a lifetime investment. Therefore, you must think through before making a move. Do you need that property? Is it worth the value? And does it meet your future desired home? Consider all these before signing on a paper to prevent losing hard-earned cash. You should also try as much as possible to negotiate deals in your favour.

Need to Make Room for More Bills? These Tips Could Be Useful!

4 Reasons You Might Need a Side Hustle

If you budget correctly, your current income should be able to handle additional expenses that may come your way. However, some people still believe that the best way to pay for unexpected bills or a financial crisis is by increasing your total take-home pay. You have an option to work overtime or at a second job. Earning extra money is always an option, but, as with most people, if you make more, you happen to spend more.

4 Reasons You Might Need a Side Hustle

So what do you when your extra time only allows you to work a job for one day? You don?t need any magic wand not to let money burn a hole in your pocket. There are some easy tips to stretch your paycheck so that you can afford a few new bills:

Tip #1 Alter Your Budget

Altering your budget is the most important thing you can do while trying to make the most out of your paycheck. Your current budget could be working well for you until a new bill shows up on your list of regular expenses. To have more money left over at the end of the month, you can design a budget by prioritizing your savings and accommodating all the fixed and variable expenses within the remaining amount.

There is no set rule for budgeting, and that?s the best thing about it. You can make adjustments in your budget every time there?s a new expense or change in your income.

Tip #2 Keep Away from Debt

When you don?t have to pay any interest on your installment loan or your purchases, you have surplus funds. However, with all the alluring offers on credit cards, most of us end up buying things we don’t need. So even if you choose to pay the minimum payment for your credit card, you should know that ultimately you?re spending way more in interest than you think you saved on the credit card offer.

It?s better to make a habit of paying with cash. You can try the envelope budgeting system to help you spend less by making all your transactions in cash. On the other hand, if you are repaying any long-term debt, it?s better to plan and get out of it soon. Paying less interest will help you increase your total take-home pay and save more for new bills that are going to be due from next month. 

Tip #3 Factor out Bonus

The percentage, frequency, and criteria of bonuses vary from firm to firm. Also, you may not be getting your bonus every month, so it is better not to include it in your budget. By not making your bonus as part of your budget, you’ll have a fair amount of money at the end of every financial year. You could either save the money for your retirement or pay off your debts in full. Also, the bonus money can help you to decrease the principal value of your loan if you are planning to make a big purchase, like a car. By doing this, you may not feel the burden of new debt.?

Tip #4 Split and Save

This tip is perfect for those who are single and have just started to earn. Mostly, if you are someone who often goes out with friends, you can save a few dollars on every time you shop or dine together. All you can do is buy things in bulk and split the cost. This way you can get the discount of bulk buying (if any) and won?t have to throw away goods as you couldn?t use them up before they go bad. Hence, splitting your bills can not only save you money but also give you more shelf space.

Tip #5 Check Your Withholdings

Do you see a long list on the deduction side of your paycheck? Though you can claim all those excess deductions made while filing your tax return, your monthly payout is always going to be less. As a solution, you can try to increase the value of your withholding. This will automatically increase the contribution of your employer, and less money will be taken out of your gross monthly salary.

All in all, if you thought you couldn?t manage to accommodate a new bill while living paycheck to paycheck, the above tips could make your life easier, even without going out to search a second job for yourself.  

The Best 4 Credit Dos and Don’ts to Remember

Credit do and don't

It doesn?t matter if you have excellent, bad, or thin credit; it?s a constantly evolving score that improves or deteriorates over time. That?s good news for anyone who?s hoping to establish good credit. With deliberate actions, anyone can improve their score.

Not sure what those actions are? Here are some of the dos and don?ts of creating good credit.

Credit do and don't

? Do pay your bills on time

One of the best ways to build your credit score is by making sure you pay your bills on time every time. Your payment history has the biggest influence on your score, so it?s important you keep track of your due dates.

If you use a money management app, make sure to add regular bills to your digital budget. Most of these apps will send you a notification reminding you of upcoming payments, which can spur you to act before it?s too late.

For fixed expenses, or bills that cost the same every month, you should look into automating your payments. It?s easy to set up with your bank. All you have to do is authorize a payee and approve the payment schedule. Once in place, your bank will send the approved amount every month like clockwork.

? Don?t open new accounts frequently

If you make a habit of checking your spam folder, you may notice how many emails you receive from credit card companies saying you pre-qualify for an account. Even if you don?t take a deep dive into your junk mail, you?ll probably hear about the latest card promising 0% interest with amazing bonuses like rewards points and travel miles.

A low APR and cash back are certainly some of the biggest perks of getting a credit card, and you can take advantage of these to get the most out of a financial product you were planning on using anyway.

Just don?t get carried away ? no matter how good the deal is. Every new account you open leaves a trace behind on your credit history. If you open too many of them within a short period of time, they will lower your score.

Open new accounts sparingly, making sure to space them out to limit their effect on your credit. More importantly, only jump on deals when you can confirm the advertised APR isn?t an introductory rate that will skyrocket after the first year.

? Do look into bad credit lending alternatives

The above tip helps people who already have good or excellent credit. With a prime score, you have the greatest options for credit cards and other products. You?ll have to make sure you limit how many of these products you open to maintain your score.

If you have bad credit, you might have the opposite problem. You may struggle to find a financial company willing to lend you cash.

That doesn?t mean you?re out of luck when you need help paying an unexpected bill or necessary auto repair. Some alternative lenders use other criteria when reviewing applications, giving people with subprime credit a chance at getting a cash advance or installment loan when they need it.

Take some time to research your options, and be sure to read this to see how lending alternatives like installment loans and lines of credit work for people with bad credit.

? Don?t pay just the minimum balance

A credit card is an open-ended financing option that lets you ?revolve? debt from one month to the next. This is convenient when you run into a bit of bad luck that makes it hard to pay off your full balance. Your credit card company will calculate the minimum payment you have to make to avoid a late penalty.

Paying the minimum charge is ideal when the alternative is not paying it at all. However, you shouldn?t make it a habit when you have the cash to spare.

Each purchase you make with your credit card accrues interest at a higher APR than most personal loans. Accounting for the fact that it compounds every month you don?t pay off your balance, you?ll end up paying more for your purchase than its original price.

Paying off the full balance (or as close as you can) each month is one way to establish good credit. But like anything that?s important in life, it?s a little more complicated than that.

To improve your score or maintain good credit, you?ll have to commit to regular positive habits all year round. Make sure you follow every piece of advice on this list to earn a credit score you can be proud about.

Industries you should look Forward to Investing in, to Make a Fortune in the Long Run!

Now when it comes to investing, it can be quite hard to judge which company would be better and which one will not. And often pole tends to judge companies on just one factor and make their decision which at times can be misleading.

Thus if you are someone who is looking forward to investing in the industries, have a look at the list below which some of the top investment companies which have been evaluated by different parameters and will prove to be a wise investment decision.

Hindustan Unilever

It undoubtedly is the largest FMCG Company in India at present. It operates in different sectors like personal care, home care, and the food sector.  Now according to a report that was recently published by JP Morgan, it was stated that this company is going to command premium valuations in terms of better growth of the volume when it was compared to the peers. Also, the margins of the cost efficiencies of this company are going to improve further. Recently its stocks have 19.5% of the year to date returns in the previous year (2018).

Music broadcast

In India, this is the oldest private radio broadcast in today?s date. It operates on nine different frequencies. According to a report presented by the Ambit capital, the after-tax free cash flows from 2017 to 2018 and 2019 to 2020will treble. One of the primary growth driving factor of the company is its improved pricing. At present, its stock is nearly 15%.

Suven life science

It is a biopharmaceutical company, that deals with the manufacturing and the supplying of the drugs intermediates to innovator companies globally.  According to what was stated in a report published by the Emkay, the company is compelling play in terms of spending global R&D. At present, the stocks have delivered 12% year to date returns in the year 2018.

Multi commodity exchange of India

It is a listed commodity derivatives exchange. It deals with online trading. Along with that it also deals with the clearing and the settlement of the derivative transaction.  There is quite a favorable kind of environment to operate. It is because it is expected that the regulatory reforms are likely to increase in the coming future which in turn is due to the expected increase of the intuitional participation in the commodity trading. Also, it is placed in such a manner that it can even defend the liquidity and the market share. Currently, the stock is at 14%.

Mayur Uniquoters

This company deals with the manufacturing of artificial leather or foam leather. According to the reports of the AnandRathi, there can be seen a good growth which is driven mainly by the leadership position. Since January the stock has corrected at 9.5%.

Thus the ones mentioned above are the tops five companies that are best for investing so that you can make a fortune in the long run.