Building Equity Leading To Bankruptcy

Equity is everyone’s priority to become rich. But one should never build equity at the cost of the liquidity. If we keep doing this, we might end up at bankruptcy. The liquid assets should be properly managed. The liquidity risk should be handled carefully. The risk should be mitigated even if the debt has to be reduced slowly. Owning a property specifically a home is a dream for almost everyone around. In doing so, it the emergency fund should be maintained continuously. In case of an altered financial condition, the existence of no property can help but only the cash in hand it let you survive through the time. Any family emergency at such a time can create a panic in life.

Importance of liquidity
Liquidity is imperative for emergency situation. In case payments are missed the liquid assets can be readily sold and cash is gained from them. In case of too much liquidity, one may indulge in other deals and enhance the sphere of their business. The business should be scrutinized, all its costs and expenses and enough reserves should be there to avoid any risky situation. Cash is required for financing and credit no matter if the business is small or big. If equity is gained on the expense of liquidity, a slightly problematic situation can turn into a financial hazard for the company or the individual buyer. It is better not to mess with the liquidity to achieve equity.

More equity may lead to foreclosure
We all want to each equity and pay the last voucher happily. But what if there is a mishap before we have paid a significant amount. If a payment is missed the bank will put the house on auction to recover their pending payment and the home buyer will lose all that money they could have recovered if the property was listed. The bank also wants to avoid hitting the profit margins.

How to get away from such a situation
The greatest defence against foreclosure from the bank is liquidity. The bank is only concerned with their payments. They will never know if there is a problem unless a payment is missed.  The home buyer should keep this in mind. If enough reserves are there and the payments are made there is no issue. If the situation gets worse and cannot be solved one can easily put the house in the market and try to get rid of the financial crisis heading their way. One of the issues in maintaining the liquidity is that if the cash in the reserves is spent while maintaining the debt. In such a case, the buyer is losing the reserves and not reaching the equity as well. To avoid this situation, the best way is to discipline yourself. Reserves should be spent with due knowledge of future payments to the bank as well as the expenses that has to be paid from the reserves and cannot be paid from the regular income. There is one more dangerous situation created by the buyers that is to invest the reserves in a risky asset.

The investor has fair chances of losing the reserves in the risky investment. Investing in a low risk asset is comparatively less risky for maintaining the liquidity. In case of any issue with the payment, there is a time span given by the bank to clear the periodic payment in some terms and conditions. The liquid asset should be such that it can be sold in the given time and the payment is made timely so that the does not gets involved in recovering the payment.

The Real Estate Short Sale Process Step-by-Step

A short sale is a process in which lender agrees to sale his property at fair market value. No matter the outstanding mortgage against the property is more or not.When the lender goes through the sales he usually forgives any balance due on loan. The borrower is not on the edge of the remaining mortgage balance. However, this is not in every case.

Short sale of property does not approve always. Short sales may fall if the more than one lien is there against the property. In short sale all lien holders must stand under the same terms.

Following are the steps you should know to make your short sale property successful.

Step #1.Get a Property Valuation Analysis

A lender is not likely to approve a short sale of the property. The reason is, there is enough equity in the property to allow it to sell and break even if it foreclosed instead. The homeowner must be upside-down on the loan. The owner owes more on the mortgage than the home’s fair market value.

The first step may be little crucial. The value of the property must be known at the start.

It is not tough to come to a price agreement with the lender. It is when the home’s value is close to the outstanding mortgage balance. Success is yours when the home is worth more. The lender will always demand the proof pf the value. You can hire a real estate agent for Comparative Market Analysis or Broker’s Price Analysis. You can ask for a professional appraisal as well.

Step #2. Get a Hardship Letter

Keep in mind you need to know why the homeowner is selling. Why he did not choose to live there. Because lender will demand more than a value to a short sale. This is the point where seller should prepare the hardship letter that covers all the answers of your questions. The hardship letter should show all the details why the seller is not continuing living up there. It should clearly mention the details that cover reasons why he is unable to continue making mortgage payment. For the success of the short sale this hardship letter is essential. The letter should be complete and convincing too. After this letter the lender understands that the seller is in position of short sale or bankruptcy. The hardship the lender is experiencing is not likely to be solvein the near future.

Step#3. Contact the Lender for a Short Sale Application

Lenders usually do not talk to investors, potential buyers, or real estate agents. They do so when they are instructed to do this by the borrowers or homeowners.Lender needs the approval of all the necessary parties in advance. The approval must be in writing. These approvals with the application must submit to the lenders.

Do not expect a warm welcome from lenders when you submit application to initiate the process. As a matter of fact, lenders never excited about short sales.

Step#4.Prepare the Sales Contract

The next step is to prepare the sales contract. The lender wants something solid to approve or reject your application. You have to offer a singed purchased agreement or sales contract between buyer and seller. From this you can win the bona fide offer.

This contract clearly shows that the deal is contingent upon the lender’s approval. You must provide the copy of listing agreement that shows the commission. In the documentation the important thing is Affidavit. You must provide this. This shows the fair market value.

Step #5.Now You are Ready to Put the Short Sale Package Together.

Make your short sale package more comprehensive. It is better for you. Collect and make Xerox copy of all the documents and information you have gathered and submit it to lender. Make full support documents that clearly indicates that short sale is a good solution for the lender. Prepare all the necessary documents. Loan statements, death certificates, credit card details, assets details, tax return statements should be available.

Step#6. Lender and the Short Sale Package.

You have to prepare a thorough short sale package for lender. Your evaluation numbers depend on this. The lender will mitigate your number if the package is not for his profit. His goal is to gather maximum and save from this short sale package. He wants ensure that no other liens are present against this property. So, the consent letters are important for lender.

Step#7.Negotiating and closing.

After all of the information you provide the lender will accept or reject the offer. It is now how you prepared short sale package. Whether you are going to land it up or lose it. Lender will go through the applications and if he wants to make some negotiation he does. If it is accepted you crack the deal otherwise rejected.

Make the Child Feel Your Presence by Slowing Down

It has become a norm that children answer “fine” when the parents ask how their day was. And, it is a concern for the parents because they feel that their children are not sharing anything with them.

On the other hand, when you ask the children, they would say that parents wouldn’t have much time for them, or they overreact, or they just simply don’t understand.

Above all, and most probably the main reason for everything in this scenario is that the parents are too busy and they move too fast in every aspect of their lives.

The thing is; you need to listen slowly and calmly to your child in order to understand what he/she has to say. You can play with them sometimes like by ride on cars with remote control. It’s a skill that definitely makes a person faster than an individual who has the habit of doing everything in haste. Here, you can consider Zen Master Thich Nhat Hanh as a role model who is known to move slowly and listen deeply to everything. This is the big reason that he is often considered pretty close to a snail, a cloud, and heavy machinery.

Now, you don’t need to be slowest like a snail because we need to keep up with the things around us. However, moving around in a pace and feeling the urgency to get everything done is the attributes which can make a person do some mistakes that can ruin a familial life. So, you need to slow down and give priority to the familial matters by keeping in mind that family is above your business.

Along with slowing down, you also need to be like a cloud and the heavy machinery. A cloud is softer. Hence, you can approach things with a lighter mood. However, you will need to make others feel your presence. They should know that you are physically available like heavy machinery.

With that said, you can refer to the still point in your inner self. That will help you to slow down in listening and thinking about your children. This way, you will not only find it easy to have longer sessions of listening to the children but you will also be able to understand what they want to say.

Here, you can ask a few questions to yourself.

  • Can I really get into the depth of everything including listening by slowing down?
  • Am I capable of taking a pause and bring my deepest attention in order to effectively interact with my family?
  • What is it that I can do to slow down and interact with my child?
  • Does it really work for me to just sit for a few minutes to have a feeling of peace of mind?
  • What is or could be the behavioral change that my child reflects when I slow down?

Slowing down helps you listen

Slowing down is for the purpose of finding a time slot to take any action. So, there are a few things that you can do.

  • While you have slowed down yourself, try to reach your inner self to find silence and peace.
  • Feel the sensations which are running through your body.
  • Ensure proper eye contact with your child while he/she speaks
  • You should be able to notice the upset tone of your child; that would be a request to be heard.
  • Try to reach the meanings of every word from your child.

How to make your Vacation Rental Property Attractive for the Guests

Are you somebody who owns a vacation rental house or if you are someone who has the rental property but does not know how to make it profitable? If yes, following tips will help you in making the property seem appealing to the guests.

Make Correspondence Template

If you own a vacation rental home, you probably receive emails from the guests asking for availability of your house on specific dates. In order to confirm the availability of the house, you may write an email every time; however, if you want to save your time, it is better to formulate one template that would make the correspondence between the owner and the guests faster and convenient.

Confirmation Emails

Confirmation emails not only confirm the booking of the guests, but it is also a very thoughtful gesture. Hence, if you make one sample that reflects the sentiments of the owner in welcoming the guests, it would help to send a personalized vibe to the guests. Similarly, instructions related to the weather and surroundings of your property could also be added for the convenience of the guests.

Getting the feedback from the Guests

In order to run any business successfully, particularly that involves the role of people, getting the feedback of your guests could play a big role in not only improving the quality of the service you are providing , but it could also be used as the testimony of the good services to attract more guests.

Instruction Manual

If you want to make the stay of your guests comfortable at your rental vacation home, instruction manual could be compiled for the guests to help them with the use of dishwashers and other appliances. Moreover, you could ensure that the manuals are easy to understand for the guests in addition to adding the emergency numbers to the manuals.

City Guide Book

Even though it sound like hard work, however, if the information related to the public transportation, tourist sites, significant buildings and best restaurants is added to the city guide, it could help your guests in touring the city like the indigenous or locals and this would ultimately promote your rental house for their next vacation.

Marketing Strategies

Innovative marketing strategies are the key to generating more business opportunities for your rental home. For instance, poINt breeze real EState could be offered in order to promote the best features of your rental home. Similarly, social media sites also advertise your property in terms of highlighting the strong attributes and appealing to the larger audience.

Guests Posts

As the massive reach of the internet provides one with the opportunity to tap into untapped market and niches, the online domains could help you promote the issues and benefits related to your property business. Similarly, the posts of the guests would provide all the views with in-depth and insightful views on your house and the quality of the service.

Meet the Needs of your Guests

Focus on anticipating the needs of the guests or your clients, as it would directly guide you in meeting the expectations and making the stay comfortable than before. Likewise, look for the things that are not offered by your competitor rental homes to cater new target audiences.

Risk Factor

If you want to manage the finances of your business well, it is important that you carefully analyze all the risks attached to your rental property. The second step is to make a list of that preventative measure that would decrease the chances of loss for the profitability of your rental house.


in the business of hospitality, the safety of the customers also comes first. Despite the negligence of various owners and landlords, the role of security cannot be denied in terms of building the trust and name of your rental property. Moreover, the secure your rental house is, the more convenient and pleasant it will become for your guests.

Cleanliness Services

Good hygienic conditions of the rental house are another plus that would enhance the significance of your property. Therefore, it is important to take care of the maintenance of the house as well. In order to enhance the quality of the hygiene, a house help could also be hired to ensure that the hygiene is up to the mark. However, if you want to save money, the help could be hired on the weekly basis rather than regular basis, especially if the house doesn’t require cleaning every day.

Maintaining the Success

Although achieving success in the business is not an easy job, however, the maintenance of the success is another task that requires more hard work than the process of reaching a successful point, and one way of maintaining that success is to keep track of all the latest market trends. Likewise, reviews of the competing property business may help in addressing the shortcoming of the existing rental property market.

Collaborative Ventures

If you are looking for opportunities to expand your business, contact the surrounding eating spots, tourist resorts to include their discounted packages into your rental house program. In terms of making your business seem attractive to the potential partners, share your achievements with the other small businesses of the city.

Regular Inspections

If you are an owner of the rental property who has a busy schedule or who has to travel frequently, then, it is necessary to plan your inspection for the purpose of maintaining the living conditions of the rental property. Likewise, the inspections would help to narrow down the problematic areas or issues and this way they would be resolved as well. Furthermore, the preventive measure could also be taken to mitigate the potential flaws of your business.

Reasonable Prices

If you are new at the rental property business and if you want to establish a good name for your property, going for lower prices than the market rate is a strategy that would help you in appealing to those who prefers to spend the vacations at slightly cheaper rates. Likewise, it would give your business the boost that is required to enter the price range of the market in the longer run.