Thursday, October 31, 2013

Good To Know: Selling As A Rent To Own

Why would we consider selling a house as a Rent-To-Own instead of a regular straight sell? As with everything, there are pros and cons. Of course to most people selling their home, a straight forward sell with the use of a realtor is the ideal solutions. They get the lump sum of their money up front ready to use towards their next home. But sometimes that scenario is not so picture perfect. Sometimes their are no buyers interested. The only way realtors know to sell your house is to lower the price, cutting into your potential profit and hard earn equity.

Or sometime you get in the situation where due to a drop in the housing market there is no equity in your house. In fact you owe more then the house is worth. This as happened to a lot of people, not only in the US but right here in Alberta and across Canada. Your options are now drastically lowered. You can no longer rely on the help of a realtor as there will not be enough room for their commission. As long as you do not have to move and sell your house you'll be okay. But if the situation change, then there is trouble.

Or there are also the new builders. Building the house of their dreams while living in their current home. When the new house is ready, the plan is to sell the old one. The problem arise when the old house is not selling making you support two mortgages. Ouch.

In all of these situation a Rent To Own can help. First lets discuss what a Rent To Own really is. It is renting a house then to sell it at the end of an agreed term.

The pros:

  • You are dealing with tenant-buyers instead of renters; they have an owners mentality and since they intend to purchase the house, they treat it as their own. Also they are responsible for maintenance and minor repairs.
  • Get top value: Tenant-Buyers are people who don't quite qualify for their own mortgage may it be a credit issue or lack of full down payment. However they have been qualified by a mortgage broker to ensure they are able to handle the payments. Rent To Own gives them a few years to fix their situation. You can then require fair market value for your house.
  • End up getting more for your property: By having you mortgage payments taken care of for the terms of a few years, it is lowering you mortgage balance forcing appreciation for your property.

The cons:
  • There is a delay in getting paid. Although you will get monthly payment covering the expenses of the house you will not cash in the full payment of the sale.
In this real example the owner had a mortgage exceeding the value of the house. Unfortunately do to new employment they also had to move and sell the property. Since there was no equity into the property a realtor was unable to sell their property. As you can see it would not have been in their benefit to do so anyways. In this case it did not put the sell into a positive solution but it did dramatically lower their loss.

Rent To Own may not be the best solutions for everyone but in many cases, it can increase you return on the sell of your property and facilitate a sell.

Wednesday, October 30, 2013

What Are You Reading? Why "A" Students Works For "C" Students - Part 1, Chapter 5

The "Action Step For Parents" in this chapter is to discuss your child's dreams and the different ways success is defined outside of the school system.

When I'm working an event, we always ask out student what are their "Why" or their "Dream". Most of the time, they do not have an answer ready. If we were to go into a kindergarten classroom instead and ask the same question, we would be bombarded with answers. When did we loose our capability to have dreams and goal for ourselves? 

It's important to nurture those dreams and goal in our children. Not only that, but we should also develop them by activity planning on them. Discuss how to make it a reality the different and best way to learn.

Saturday, October 12, 2013

Rich Dad Radio: Are You A Born Loser?

This week, on Rich Dad Radio, Kim and Robert have Dr. Alexander Elder author of "Trading For A Living" and "Come To My Trading Room". Do you want to find out if you have what it takes to win?

This radio show holds a special place in my heart, because it talks about technical trading in the stock market. Especially in technical trading, you need to develop the right psychology. When we started learning on trading stocks, our mind set was the biggest hurdle we had to overcome. It's something we needed to overcome again and again as we grew bigger and as we became complacent. Some of us may never get to control our emotions enough to develop the right psychology to become successful. Dr Elder discuss risk control and money management for successful stock trading. Great stuff!!

Friday, October 11, 2013

Inspirational Corner: In Time

Have you seen the movie In Time?

In this movie, people have discovered a way to live for eternity. All they need is to have time. In fact TIME as become the new currency.

There is still a big gap between the poor and the rich. The poor live day by day hoping they will find, earn or steal more time in order to survive the next day. Every expenses is closely monitored as a simple bus ride could make you run out of time. The poor do everything quickly since time is everything and they are in short supply. The rich have a distinct relax pace since they have a few life times worth of time.

I found it interesting, the importance we place on money is very much as the importance the movie placed on time. The only people constantly concern with money are those who are always on the brink of running out. Closely keeping track of pay dates and account balance. For those who money is not an issue, they concentrate their energy on the relationship in their life instead.

Wouldn't you want to not have to worry about running out of time? We all have the same ability to educate ourselves in money matters. Learn to become financially independent and take control of your time.

Thursday, October 10, 2013

Good To Know: What's Your Colour?

Are you Blue, Red, Green or Yellow? Well in fact you are a combination of all of those colours.

The colours are part of a personality test from Marc Accetta that can be taken here.

My score on this test was:

  • Yellow: 69
  • Blue: 62
  • Green: 52
  • Red: 36

My personality as always been the same. I'm a people pleaser who tries to keep the peace in all situation. What I like about this test is that it describes your personality as well as your personality flaws and ways to overcome them. In my situation, being a people pleaser, I have the tendencies to let people walk all over me. With self awareness and growing up, this is something I've been able to control. Before you can find ways to improve your personality flaws, you need to be made aware of them. The personality test is great for accomplishing just that.

It is also very useful to identify the personality of the people around you, may they be your kids, your spouse, family members, colleagues and your customers. Understanding how they response to certain situations means that you can adjust your communication to have the best possible results. Telling someone who as a Red personality what to do, will only cause them to put their guards up and want to fight you on the issue. No matter what that is.

Wouldn't you find it helpful to know the best way to inspire, teach or persuade people in your business dealings, no matter their personality. Be sure to take the personality test to first better understand yourself, then broaden your understanding of others.