CHAPTER-9
Additional Ways To Get Out Of Debt
Synopsis
One strategy for reducing charge card debt suggested by financial planners is to freeze your cards in blocks of ice, helping you avoid the enticement of inessential purchases.
Find a way to bring in some extra money.
In the domain of personal finance, the “big red button”, the atomic option, is taking bankruptcy.
Dig Out
A long time ago, a financial planner told customers to freeze their charge cards in blocks of ice. When they were enticed to spend, they would be forced to dissolve the ice, giving them time to take a second thought about an impulse purchase.
An even more beneficial answer is to cut up your cards totally so that you can not charge anything else to them. What good does it do to stop up holes in your boat in you are perpetually drilling fresh ones in the side?
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Some people may be thinking...But I can not pay my bills without a charge card! That means that I do not get to eat.
This might sound cruel, but I have news for you: you are not paying your bills really. The charge card is simply allowing you to put off the crack of doom and helps to guarantee that when it does come, it will be much worse than you ever thought.
If you are correct, you will almost sure as shooting qualify for free food assistance in your state (if you do not, move to a state where you do – I'm being serious). In a few states, you are able to get up to three hundred or four hundred dollars per month in tax-exempt food money on a debit card. If you do not qualify, then you have a spending issue and you are still making justifications (go back to chapter 1).
If you still state you can not make due, you are full of it. Once again, my apologies, but it’s straight up.
When I was in my younger years, I moved to another state so I could pay one hundred eighty dollars for half of the monthly rent for an apartment I split with my best friend. At the time, I was bringing in a six-figure investment portfolio income and nearly no debt. My goal was to build up my wealth at that point in my life. Was it pleasurable? Not totally. However, I wanted something very few individuals to accomplish – complete and total financial independence.
I had a family member who slept on an air mattress for a year and a half so that he could save more than $40,000 by the time he left the Marine Corps at 25 years old. If I can do it, and he can do it, then there is utterly no reason
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you should not be able to do it. Get determined and reach for what you want and keep the credit cards out of reach.
I knew someone else who decided she would like to get herself out of debt. She decided that in one year, she was going to have paid back totally everything in her life, down to the spick-and-span new car she had bought recently.
She went and got a job as a bartender on top of her day job, pitting away every cent after taxes and utilizing it to pay down the outstanding balances on her accounts. She temporarily put all investments on hold, including retirement shares, to accomplish the goal she had determined she would accomplish.
What she has accomplished in short order has been absolutely astonishing. With six months to go, it appears that she is going to easily get to her goal. By bringing more money into the equation, she was able to blend cost savings from her regular job (she as well did away with her cellular phone, cable, and a lot of other unneeded items) to have double the effect.
Once this self-imposed financial diet is all over, her monthly revenue will go up by as much as several thousand dollars without a single supplementary hour of work. In effect, she gave herself a pay raise. In spite of raising her youngsters and working two jobs, she likewise recently enrolled in college to go back and acquire her degree.
The point of this story is a mighty one. There is absolutely nothing you cannot achieve if you center yourself and are willing to take on the sacrifice necessary to accomplish it. In her case, that’s going to mean a year of around-the-clock work to give herself a fresh balance sheet and more
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beneficial job opportunities. A long time from now, I am willing to bet that she will look back and recognize that this twelve-month period was what allowed her to go after her bigger goals and dreams, which include establishing her very own business.
As the old saying goes, till the pain of staying the same surpasses the pain of change, you’re unlikely to move. I hope it doesn’t take that for you to get empowered and free yourself from financial slavery.
Charge card companies, many of which are possessed by banks, have a lot of priorities. The first, naturally, is to yield profit for the parent company and its shareowners (you might actually be a shareholder through the mutual funds you hold in a 401(k) account without even recognizing it).
When it becomes evident that somebody might be unable to pay his or her balance, there's a priority shift that happens that may work to your advantage. The bank or charge card company becomes concerned with one matter and one matter only: Getting as much of the balance back from you as conceivable and closing or restricting your account. How come? This lets them avoid charging off the amount on their earnings report, which would cause their stock to fall, management to get lower bonuses, and maybe even dividend payments to stockholders to be reduced.
If you declare bankruptcy, it's possible that the entire credit balance will be annihilated because charge card debt is called unsecured in most all cases. That means that it isn’t backed up by any specific collateral, just your promise to repay. This would be the worst-case scenario for the charge card company.
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If you've missed a lot of payments already and your credit score has been hit, all it takes is a series of calls to the company explaining that you are earnestly considering bankruptcy but you want to avoid that. You would like to make good on as much debt as you are able to but, frankly, you don’t know if it’s conceivable. Then, offer to pay off 25% of your charge card debt balance over the next few months in exchange for the company freezing interest costs and closing the account.
You might have to spend several hours, or even days, on the phone working your way up the system. The point is, you need to drive home one concept: you're on the brink of declaring bankruptcy but you prefer to avoid it at all costs. Tell them you're taking a loan from your in-laws, or cashing in your 401(k), or whatever other tale you need to think up to get them to believe that you're coming up with everything you potentially can and this is the best they can hope for as the alternative is likely nothing following a discharge of the debt in bankruptcy court. If you are able to convince them of that, you have a very good chance of reaching a charge card debt settlement agreement.
There are hearty costs to a charge card debt settlement agreement and it comes in the form of exceedingly bad marks on your credit score. If you're already missing payments, however, this is unlikely to do any extra damage in a practical sense as you aren’t going to find individuals that are willing to loan you money with past due accounts – at least not at a fair interest rate, anyhow.
The bottom line is that a charge card debt settlement agreement may be an effective way for you to avoid bankruptcy court, for the charge card company to regain some of their money, and for both parties to start rebuilding the damage done to their balance sheet and earnings report from the fiasco. Likely, the
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biggest thing stopping you from considering it, if you're truly desperate to get in control of your finances, is pride. It’s not worth it. Suck it up, take the temporary pain, and start getting your fiscal life back on track. There's a large minority of Americans that live free from charge card debt – there's no reason you can’t be among them.
As a last resort… there is bankruptcy:
In a lot of cases, it is possible to totally blot out charge card debt with a bankruptcy filing, or at the very least have a court-ordered restructuring of debt that gives you breathing space to repay your balances and get your life back in order. The opportunity price of such a move is that your credit will be totally destroyed for up to 10 years with most of the legal injury taken away after 7 years.
For a few, bankruptcy truly is the best and most efficient alternative for getting rid of charge card debt. It allows you to begin over, almost like hitting “reset” on a computer game. One of the drawbacks to think about is that the bankruptcy rules that were put in place by the charge card lobby during the Bush administration may force a lot of middle or working-class workers to file Chapter 13 (reorganization where you pay off the debt from future net income) rather than Chapter 7 (liquidation where the debts are wiped out totally). United States Congress is currently working on laws to alter this and there have been some changes already.
Intelligent charge card companies understand this. That’s why it is sometimes possible to get them to drastically lower your rate of interest merely by explaining to them that you would like to repay your debt but unless the current terms are altered, you see no choice but to declare
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bankruptcy. You might have to stay on the telephone for 3 or 4 hours and keep escalating from supervisor to supervisor, but at the close of the day, you have a really, very good chance of breaking down from thirty percent interest to thirteen percent interest.
If you are emotionally depleted, want to begin over, and are willing to go through the process of bankruptcy, look for a highly regarded, specified bankruptcy attorney in your area. They are able to explain all the drawbacks, expenditures, advantages, and procedures to you. In a lot of cases, it’s better to just begin over and start reconstructing your life.
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Chapter 10:
Real Estate
Synopsis
Making money in real estate is forever a topic for those who would like to invest. This includes many of the different types of real estate investments. Land, apartment buildings, houses, and commercial buildings are all part of a real estate investment.
Real Property
Assignment of contract: Assignment of contract is more generally called “wholesaling” in realty circles. Consider how other huge companies wholesale products to bring in earnings. For example, Walmart wholesales products by buying them in big amounts. They're able to buy products well beneath current market value due to their over-the-top purchasing influence. Walmart then swings around and sells those products to their end purchaser at retail prices. Walmart is capable of generating a net profit by collecting on the difference between what the merchandise sells for and what they buy it for.
There are actually only three chief steps in this procedure.
1. Talk terms for a discount on the product.
2. Sell that product for retail costs.
3. Accomplish this in an effective time frame to minimize stock.
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Wholesaling real property has a few laws of similarity and a few differences. In wholesaling real property, you're likewise negotiating a price reduction on the product and you're also selling that product (the property) for retail costs. The chief deviations are that you're not carrying any stock and you're not negotiating your price reduction by buying big amounts.
Equity: You might or might not already be acquainted with the term. Equity is the deviation in the value of a property less than what is owed on the property. A seller owes seventy-five thousand on a first mortgage and twenty-five thousand on a second mortgage for a home that's appraised at about one hundred thirty thousand. How much equity is in the house? Equity = Value - owing Debts = $130,000 - $75,000 - $25,000 = Example$30,000 of equity in the house.
How is equity amassed? For anybody who owns a house, they might commonly amass equity in any of the accompanying ways.
1) Down payment.
2) Paying down their mortgage over time.
3) Property value goes up.
4) Home betterments or repairs.
Why Does Equity count? It's exceedingly uncommon for a property to sell for significantly more than the market price. Real property has a largely standardized worth within its local market anyplace around the world. If the house next door to you sells for $100,000 it's exceedingly improbable for that house to sell for $200,000 without any alterations in the market or the property itself. There is a measure of originative ways to get paid big amounts of money in real property. All the same, they all center on this easy
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and most importantly fundamental precept. You negotiate for equity and then you sell your equity.
Alternately, in some other originative investment strategies, you negotiate a low monthly payment and then sell your monthly payment for market price.
So what precisely is wholesaling a real property? Wholesaling real property is talking terms about a discount on a piece of property with an escapable contract and then at the same time selling that piece of property for closer to the market price to another investor. As you're at the same time selling the property, it's ultimately the end purchaser who will furnish the needed capital and credit required to close the deal. Moreover, as the contract is escapable, you are able to withdraw from your purchase contract if you can't locate a qualified end purchaser who will buy your equity. You'll only be buying a property that you've already sold for a net profit.
It shouldn't surprise you that real property has produced more millionaires than any other type of business. There are dozens of infomercials that teach about “no money down” real property investing. Is there truly such a thing as “no money down” real property investing? Can individuals truly make a fortune without any skill or experience in real estate?
In brief, yes but it counts a lot on you. I mean, how may I really frankly make a promise about you without knowing your skill set, drive, and aspiration? What I'll show you are the strategies shown to work to produce a high-income living. What you do with those strategies is your option.
Believe it or not, this material is what most individuals learn in other guru's $5000 beginner’s real property investing seminars.
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So can a bucket-load of money be made in real property? The fact is if you're willing to work it then yeah it may be done. Where the haywire thinking comes in is when individuals think it’s a “get rich quick” strategy. Truly, a lot of revenue can be made fast but it takes intelligently directed moves utilizing tested strategies. I'd be lying if I stated it didn't take work. No money down real property investing is more of a “get rich [fairly] slowly” type of theme. It may work fast if you apply the correct strategies and techniques. You’re likewise going to need to maximize your efficiency to accomplish it in a short time period but it isn’t inconceivable. If you believe you’re going to do very little and make a fortune with no work, this isn’t for you. I just don’t prefer to leave you with hollow expectations of what may actually be done in real life. If your project is to do nothing to get loaded, I’d advocate the lottery. Otherwise, acquire repeatable systems that may be automated over time to yield consistent earnings that make you a good living.
All the same, having said all that, there’s a way it may be done and the great news is that I’m going to show you how. After all, it is no chance event that studies repeatedly resolve that over 9 in 10 millionaires may directly attribute their riches to real property.
Assignment of contract is the most uncomplicated way for a newbie to get moving in investing. Because it doesn’t take any capital to invest, even crafty real property vets often still utilize this technique. I know a couple of vet investors who are doing all right for themselves and they entirely utilize this strategy to yield their wealth. If you are able to purchase without cash, hey why would you quit right?
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How come everybody doesn’t do this? Because so many gurus have allowed false promises and testimonials.
You need realistic expectations of what is called for on your part in the real world. The strategies truly work if you're diligent in your efforts. Let’s consider question number 1 that I always hear. After individuals see the logic behind the strategies they inescapably enquire “why doesn’t everybody do this then?” If you’re like most individuals you’re going to believe the same thing at some point if you haven't already. Most individuals doubt themselves and are too afraid to try. They’ll even tell you that it won’t work for you. Many individuals even mentally block themselves from bringing in big amounts of money as they see themselves as poor in their minds and consequently they have a hard time acting out actions that lead to big sums of wealth. They may even psych themselves out to the point where they're totally fearful of acting. If that’s not the case, they anticipate it to be truly simple just because they know a couple of strategies.
Frequently, they don’t have any clear goals or direction from the strategies to guarantee they’ll be a winner. But the greatest reason though is forever and has always been the concern of rejection. They can't shake the thought that the other individual may say no so they'll carry on to lead a life based on what other people tell them to do.
The fact is that if you thought of it, you already recognized that. It’s a pitiful truth that most individuals spend more time planning their holiday than they spend working at taking charge of their own financial position. There's no rejection in real property. In real estate, you'll forever be contacting individuals who have a prior interest in selling their house to you so are never "turned away" like that. "Rejection" in reality sounds something like,
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"Oh well, we're not looking to do anything like that now" from the seller. You'd respond something like, “alright thanks, and good luck, and feel free to call me should your conditions change.” Still, though, Knowing the fear of rejection will still command many individuals.
This is among the most crucial life lessons I may give you. Acquiring sound investment advice is to always be heedful of who you take advice from. The individuals in the past who have talked you out of great ideas most often are the ones who recognized the least about them. It’s regrettable because they're frequently your friends or parents. They've great advice on many matters but not always on thoughts that pertain to yielding wealth. If you need investment advice, discover a good investor. Investment advice should only come from a successful investor. If a successful investor tells you not to do something then you ought to listen. Otherwise, learn to tune out the batches who understand nothing about what you do. In brief, never take advice on something complicated from somebody who isn’t knowledgeable in that arena.
The simple nature of doing something different will make you not understood by most individuals, even several whom you deeply care about. As long as you're "different" or at any rate doing something different, humans will have to ridicule you. It's easier for them to draw you down to being "normal" than accepting to themselves why they've never gone for what they truly desired and more significantly, why they themselves have never done anything to be affluent. Don’t fret though, if that's been your mindset to this point in your life, remember that you're always free to change it and pick a fresh path.
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While you probably don’t see how this all goes together just yet, in order to allow a contract, you'll require an investor already queued up. Stay with this and you’ll discover how it all pieces together just fine. Bearing investors at your fingertips means some upfront work is called for. If you get the deal first and then seek the investor later, the risks are that it will be too late. Begin looking at once. Pick your own brain to discover what else you are able to come up with. There’s always more means than just what’s shown here. If you muster up your own originative way before anybody else does then you’ll have no rivalry and get a huge leg up on everybody else so don’t block off your brain just yet.
There’s always a good deal out there so it’s crucial to keep looking. If less than 1% of properties will meet our standards (again the current economy will be much better for you), be fixed to handle a lot of reversals. It’s just part of the game. You’ll be grateful it's this tough or everybody would do it. If it were just that simple, you’d have too much rivalry to even get involved with it. Discovering a motivated seller is a lot like discovering a cash buyer. You do things to draw them with strong marketing precepts. You don’t expend hours chasing your tail going after them. I’ll say it again, these are only some of the ideas we use to discover sellers. Pick your own brain to discover some fresh ways and you’ll tap into a promotion stream that no one else is utilizing.
You're only going thru with your dealer if the investor goes through with theirs. At this point, you may realize that any and all risks perceived in this type of real property are imagined. You're only buying something that's already sold to someone else. The only thing you are able to lose is any money you’ve put into advertising and if you used free classified sites, you didn’t even lose that.
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You can’t possibly get stuck with the full purchase price of a home you can’t afford because you’re going to void your contract before that happens.
You're creating a win-win. Your seller will profit by not having their credit ruined. Your investor will profit by generating a profit. They will benefit by in most cases, avoiding foreclosure. And you? Well, you’ll get paid also.
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Wrapping Up
Success falls short when there are no good habits formed. Affirmation helps the individual support himself towards achieving the goal because of the good habits it promotes along the way to keep the goal “alive”. Creating and keeping good habits through daily affirmation empowers the individual's success and goal.
Falling short several times is not unusual when pursuing a goal. However, without proper positive affirmation, it is unlikely the individual would be able to rise to the occasion by tapping into the unknown reserve powers every individual has.
