Month : October 2013

Home Ownership

How NOT to Apply for a Home Loan

Home loan

Here’s the scenario: you’ve just watched a home improvement show, and you’re not only feeling confident about your DIY skills (even though you’ve not touched a power tool in years), butyou’re ready to march out and buy a home. You’ve cruised the listings that Google provided you, and already have a home just around the corner picked out.

That’s a great start – we applaud your determination. Now, let’s work on getting you a home loan, since you probably don’t have all the cash available under the mattress.  Here are 5 things not to do to get started.

Have no deposit

Most lenders require you to have at least 20 per cent deposit for a first home approval, and depending on your credit history or the home price, some require a deposit of up to 30 per cent. Home loans with a deposit below 20 per cent, normally requires you to pay Lenders Mortgage Insurance (LMI), which just adds to what will already be a large mortgage payment each month.

Have lots of outstanding debt

Lenders like to see that you can make your repayments. This means you should not have outstanding debts, like credit cards or personal loans that can affect your borrow-ability. Be prepared to supply bank details and income information that proves you are not trying to live beyond your means.

Don’t check your credit history

If you don’t know your credit history, it can’t hurt you – right?  Wrong: your credit will be one of the first things a lender checks, and if you don’t know what you’re up against, how can you defend yourself?  It is always a good idea to do a history check and look for any mistakes or items that you can fix.

Quit your job

You’re probably thinking about quitting your job, since you’ll have all those DIY projects to work on. That isn’t the best idea, if you want the bank to give you a loan; banks want to see a consistent and steady income level, and if you have no proof of how you’ll support yourself without a salary, then you will not be going home with a cheque.

Don’t worry about the responsibilities of homeownership

Home ownership looks glorious on TV, so there is nothing to worry about, right?  Not exactly. Owning a home is not just a major lifestyle change – it is also quite a major responsibility, because you could end up in court or bankrupt if you can’t keep up with your payments.

For more information on how you can maximize your chances of securing a home loan, speak to a mortgage broker, such a Mortgage Choice, to help you find the right loan for your personal circumstances.

More on USDA home loans can be learned here.

Money Management

The Path To Financial Freedom: Start Counting

the year

Be sure to check out the first part of this series Get Your Mind In The Game

In order to become financially free you need to know where you are right now. You need to know how much money you are spending each month and on what you are spending it. If more is going out than coming in then you need to do a 180 to become financially healthy.

You can’t possibly know how much money you have going out unless you count it. It’s like those contests that ask you how many M&M’s are in the jar. Sure you can estimate it but you’re probably going to be off by 20-30% if not more. That’s a lot that you don’t know about. And how can you find out where you can cut back if you don’t know where it’s going? Then the answer is obviously that you have to count it. It’s not as bad as you think and it will have a major impact on how you view spending once you become aware of it.

These are a couple of ways to keep track of your spending:

Carry A Pad

Writing down in a small paper pad after you purchase is a not so great way of keeping up with your purchases because I’m sure you’ll be in a hurry after some of those purchases and forget to write them down. However if you can remember to write it down after each purchase you will have a very accurate picture of your spending.

Update From Online Balance

When you use a debit card your purchases usually show up the same day. At a point in time(end of the day/week/month) sit down and view your purchases from your online account and write them down and place them in a category.

This is the way I do it because most of my purchases are with my card. If I do pay with cash I can see where I took the money out at an ATM and can assign it because I took that money out for a purpose.

Automatic Tracking (Almost)

You can use an online program like or a desktop program like Quicken to automatically keep track of your expenses. This is a great way to do it if you don’t have any time available to do it the other ways. The down side is that it doesn’t always categorize things the way you want to so you’ll have to take the time to categorize some of your expenses. But overall it does do a great job of keeping track.

As you can see there are several different ways to keep track of your money. If you don’t like any of these ways then make something up or mix and match. As long as you work towards seeing where your money goes it doesn’t matter how you do it.

Personal finance isn’t a one size fits all thing. Every one is different so find out what works for you. In this case find out what works best for you to keep track of your spending.

I just want to emphasize that actually being aware of how much you spend each month will change your life. Just think about what it would be like find out the world was always round when you thought it was flat. Imagine what knowing that information would allow you to do. It would make you expand your horizons and do things you never thought you could do.

Being aware of your money will allow you to control it so you can do things you’ve always wanted like a long awaited vacation.

If you don’t do anything else at least do this step of tracking your spending because it will make a world of difference.

What was it like when you first started to become aware of your spending?

Check out part 3 of this series Boundries



Change Now And Change Often

As I go through the journey of life, I’ve learned a lot of lessons. One of my most recent lesson is that change is good and it is ALWAYS for the better. Maybe not the near future, but eventually you’ll look back and see it as a good change.

Let me just tell you a little story about how I learned this lesson.

Changed was forced upon me a little while ago when I was let go from my day job. Previous to that, all I was thinking about was 1 thing. That one thing was turning this blog into a full-time gig.

At the time, I wanted to do this because I was tired of what I was doing in my day job and I wanted more in life. So as I said before, I wanted to change this blog from personal finance to personal passion. I wanted to help people find their passion and learn to make a living from it.

I’ve broken away from wanting to teach people how to budget, to teaching people how to fish (metaphorically speaking).

So that change was for the better because it’s something I’ve decided I’m more passionate about.

Then I was let go from my job, which was an unexpected change, but once again a change none the less.

From that change my ultimate goal is to not work a 9-5 again. Yes it’s not something I have a lot of support on and it does stress my fiancé out a little bit. But this is something I want for my life and I know I can do it.

The whole time I’ve been working on this blog, I’ve been learning new things about creating and designing website, how to get them to #1 in Google, and making money off of them. That’s my passion now. I love this stuff, and I’m getting really good at it.

Just recently I’ve entered a whole new world of SEO(Search Engine Optimization) and I love every minute of it. I’ve delved deep and I’ve changed my outlook on this blog.

Financially Poor isn’t going to be my money maker, or my full time job. It’s going to be where I let out my passion. As my passions change, so shall Financially Poor.

My money makers are going to be a  bunch of blogs that aren’t going to have any relationships what so ever, that make me money with only a little maintenance. But I love making them and they’re going to make me money so that I can do more of what I want.

A few weeks ago, I decided to start a coaching program because I was desperate for money since I just lost my job. But Just recently I’ve realized that I don’t want to coach people to find their passion.

So I’ve canceled that and I’ve changed my focus of coaching on helping people get into creating a website and making money from it. I’m a better technical person than a motivator. I know how to do stuff and get it done. I don’t know how to get you motivated to do it other than pointing a gun at your head. So now I’m an SEO/Website creating/Money making coach, Hire Me :)

Is Financially Poor going to be another making money on the internet blog?

Yes and no. I’m not going to regurgitate the same stuff that you can find on the other blogs. Everything I post here is going to be from my experience and isn’t going to be about “how to make a post go viral” and stuff like that. That can be read anywhere and I hate having 20 posts in my feed reader about how to do that.

I’m going to talk about stuff without the hype. I’ve never been good with hype and it’s not really my passion, so I’ll leave that on the sideline.

Is Financially Poor going to be all about making money?

No, it’s going to be about doing what you want in life…and making money.

How often am I going to post?

I’m going to go for Mon, Wed, Fri, and Sat, With Mon and Friday being new posts from me, Wed being a guest post, and sat being my Kick-Ass Reads. There will be posts in between every now and then but not on a schedule.

It’s not being lazy to do what you want, it’s being happy. Like I’ve said many times before, life is too short to not be happy.

Do what you want and do it now. Eventually you’ll be doing it anyway (retirement), so why wait? You’ll have less time and energy to realize your passion and enjoy it when you’re old. And if you are old now, there’s no better time to start because by the time you’ll be ready again, you’ll probably be dead.

I did kinda forget to tie everything into the title, but my point is that your passion will change as you explore your current passion. So you will Change Now and you will Change often

So stay up to date with all of my knowledge and passion by subscribing by RSS or Email. I’ve already started spreading my knowledge of “building websites to spread your passion and make money” in my free Do What You Want eCourse. Be sure to sign up for that and start becoming a Free Bird.

And if you want coaching about how to Start up, Make better, Make more, or anything else about a website(s)/SEO, just shoot me an email in the contact me section and we’ll see if we can work something out. I never hold back.

So I hope you enjoy what Financially Poor is going to bring you and I hope you learn a lot.

Always remember to Live Your Passion

What do you think about That?

Let other people know that passion does change by tweeting and Facebook sharing this post.


Extra Income

How to Make Money Buying Tax Liens

Learn more about tax laws and becoming a professional in the field with a masters in taxation.

Investment through tax liens is a fairly new idea, but it has yielded rich dividends for a number of investors. In fact, the phenomenon is hardly a decade old. It shouldn’t be seen as a “get rich quick” scheme but rather a sound investment with some risks. You should do your research before you get into this market because there isn’t a lot of knowledge available about tax liens, since they are fairly new.

How it works

The way tax liens work is that you, as an investor, will pay the property tax of someone else, who will need to repay you with interest. As everyone is aware, every homeowner will need to pay property tax. However, sometimes owners are unable to pay it. There is a fixed penalty that needs to be paid by the homeowner if they fail to pay on time. However, the government would rather get the money on time, in which case it will simply sell a tax lien to an investor. The investor will pay the government the full amount and he will get, over a period of time, the whole property tax paid by the homeowner along with the interest. This simple arrangement can give you up to 10% interest on your money.

As you can see, this is a simple win-win-win situation. The government gets the tax on time, the homeowner gets more time to pay the tax and the investor gets the additional interest on the amount that he has invested.

How you win

Up to this point, the concept of tax liens seems pretty straightforward. It works like the homeowner has borrowed from the investor at a fixed rate of interest with the government as the middleman. Now, what happens if the person is unable to pay the lien off? Some homeowners who have multiple properties and have seen the values of their property plummet may not really like to pay the property tax. Instead, they might decide to let go of the property.

In such cases, you will become the property owner. This can be both very good and bad for individual investors. On the plus side, you now have a property for which you paid just a few thousand dollars. If you can sell this off, you can make a very healthy profit. Very high percentages of up to 1000% are not unheard of in these cases. On the negative side, you will need to know about real estate and how to sell properties and you may not really prefer to do this.

The truth is, getting a property that will not be paid for by the owner is actually considered good in tax lien investment options. This is because investors find it very profitable to sell off distressed properties that they bought at just a few thousands of dollars. However, these are generally the exception and not the rule, so you shouldn’t invest in tax liens simply because you are looking to get lucky with some cheap property. Tax liens are held in an auction and you might just get lucky, but don’t make it your investment strategy.

Have you had any experience in tax liens?

Would you consider trying this?