Posts tagged with "finance"

Impacts of Bitcoin on Small-Scale Businesses

By now, you have heard a lot about cryptocurrencies and mainly about bitcoin. It is the most popular cryptocurrency that is present in blockchain technology. All the transactions that are made with bitcoin are stored into a ledger in different blocks into the blockchain. The majority of the people only heard about bitcoin, but they don’t know about it in detail. Also, there are plenty of aspects present that related to BTC, which must know and then go ahead with making a deal with it. 

On the other side, the most trending topic about which the majority of the people discussed right now is bitcoin trading. It’s an act of buying bitcoin at a low rate and then sell them at a high to make good profits via the margin. Everyone needs to that for performing BTC trade; it’s crucial to choose a reputable platform. There are numerous platforms present, and among them, all the best one is the https://bitcointrader2.com. It’s well known for the purpose of ETH trade but also facilities trade of other cryptocurrencies. Making a deal with it, everyone becomes able to trade BTC and get many chances to earn a lot. 

Major impacts of BTC on small businesses

Here you are going to introduce the main impacts that the particular cryptocurrency has on small businesses. So, you simply have to go through these impacts to understand what makes bitcoin so important. On the other side, these are the advantages of making a deal with bitcoin. 

  1. Reduce the risk of transaction fraud – one of the major impacts of bitcoin on small businesses is that after accepting it as payments, the risk of fraud or cyber threats totally reduces. Its because the entire payment process is based on blockchain technology, and it provides high-level security. Also, as it is a digital payment system, so there’s no risk of losing money like when you have cash in your pocket.
  2. Transactions speed is fast, and fees are low – here comes another major impact to know. When small businesses invest in bitcoin, then they simply are provided with a great facility that is a requirement of low fees on all transactions. Whether the transactions are huge, the amount of fees remains low, and also, there is no tax required. Not only is this, but the transactions made with BTC are also completed fast. They require only 2-3 seconds, unlike in the case of other currencies that require a few days.
  3. Acquisition of new customers – yes, it’s obvious that when any small business once start accepting bitcoin payments, then the same business gains more and more customers. It’s because the number of people who are investing and trading cryptocurrencies are increasing day by day, so they are in search of the best platform for investing or making a purchase. 
  4. Negligence of paperwork of all kinds – once any small business engages in bitcoin payments, then there is no need to make a deal with any kind of paperwork which they have to pay with other currencies in the bank, etc. Its because it is a digital payment system, so users only have to require their wallet and the right address at which they have to make payments. 
  5. Easy access to the world market – the best impact is that once you started accepting bitcoin payments in any business, it becomes able to get access to the word market easily. As bitcoin helps them in saving a lot of time and money on transactions, so businesses can simply use that time or money for growth.

All these are the major impacts of bitcoin on small businesses, and in the same way, they can easily improve or grow. 

Fewer possible words

Moreover, individuals need to know some classic tips or strategies to get successful in bitcoin trading. Trading bitcoin is really a daunting task, so it’s important for people to learn everything about its basics and then get top-notch results accordingly. 

The only thing for beginners to pay attention to is selecting the most reputed exchange for buying BTC and then choosing the best trading platform. You need to look for the reputed and reliable one in which you are getting top-notch services. In the same way, you don’t only make good profits but easily improve your business quickly. 

Real Estate article illustration by Rita Azar for 360 magazine

Break into the Housing Market

In the mid-2000s, observers expected millennial homeowners to be few and far in between. This new generation faced stagnant wages, crippling debt issues, and an unfavorable market. Flash forward more than a decade later, and we see a different picture.

The Wall Street Journal notes, a wellspring of new buyers from the millennial market has carried the housing industry this year. Last year, this demographic represented more than half the new mortgages. By July 2019, they also made up 38% of homebuyers. Home ownership aspirations among millennials continue to grow even in 2020, thanks to low interest rates. The COVID-19 pandemic, however, also led to massive unemployment. Its impact on millennials’ finances will no doubt slow down demand from this market.

If you’ve a stable job and need a little more elbow room, now could be the best time to buy a home. But let’s not get ahead of ourselves. And even if you had to put your house-hunting aspirations on hold, don’t fret. The first steps often begin long before you even look at the listings.

The Advantages of Home Ownership

There is no real answer to the classic rent or own debate. What works best for your situation will depend on your finances and lifestyle. Some people prefer the mobility offered by renting. Others love the stability provided by an owned home. When it comes to price, it’s a different ball game.

The longer you live somewhere, the more it makes financial sense to own the property. Fixed-rate mortgage payments have one big advantage over rent. You pay the same amount for the entirety of the mortgage. Rents, meanwhile, can rise over time. If rents rise too high, it might be cheaper to buy a house!

As a general rule, you can compare the costs of renting vs. owning by multiplying your rent by 200. This is the equivalent of staying in place for 16 years and three months. For instance, let’s assume your rent costs $1,500 a month. In 200 months’ time, you could’ve paid for a modest home worth $300,000. And this is already assuming that your rent stays the same.

Complicating factors include the median home price in your neighborhood. Renting might be justified if the houses in your neighborhood are too pricey. If you have the option of moving, then a cheaper home somewhere else might be more practical.

Refining Your Budget

Whoa, there. Close that tab and stop looking at house listings. Before you fall down that rabbit hole, let’s examine your budget. This much-needed reality check can help you make the right financial decisions. The last thing you want is repeat the same mistakes people made two decades before.

Your budget will play a key role in deciding when you can buy a home. How much mortgage can you fit into your regular budget today? Will your budget have room for savings afterward? Examine the costs of home ownership and compare them to your current needs. In the meantime, focus on pressing financial matters like emergency funds and debts. You must make these considerations before deciding to buy a home. While you wait, set aside as much money as you can for a down payment.

Defining Your Down

The down payment is among the most important expenses you’ll make in the homebuying process. It lowers your starting loan-to-value (LTV) ratio. Your LTV is the percentage of the home paid for by the mortgage and thus owned by your lender. For instance, if you paid a 10 percent down payment, your LTV ratio is 90 percent. The remaining 10 percent is your home equity, the amount you do own. The greater your starting home equity, the smaller the sum you need to borrow.

A sizeable down payment cuts down your expenses in other ways. You’ll also avoid private mortgage insurance (PMI). This is an extraneous fee slapped onto your mortgage payment to protect lenders from the risks of default. It does nothing to help you build equity!

By law, PMI payments stop after your LTV ratio reaches 78 percent. But why waste your money until then? Instead, avoid paying PMI altogether by having a down payment worth at least 20 percent of your home’s price. You can save more money by removing that one unnecessary cost.

Remember, prices are not static. Real estate markets often follow an upward curve. Be aggressive when saving and adjust your down payment goals. If you expect real estate to climb by 3 percent each year, plan accordingly. If your savings goal is 5 years away, aim to make 16 percent more than your target amount.

Analyzing Your Home Needs

It’s easy to get carried away with a dream home. But don’t buy into it easily. Choose a home based on meeting your immediate and anticipated needs.

The ideal home will vary from person to person. If you like to keep things simple and manageable, then a small home might be right for you. A standard, four-bedroom family home is good for the average nuclear family with two kids. Even if you don’t expect another child, the extra bedroom could serve a variety of purposes. It can be a guest bedroom, a room for your parents, or a home office. If you have or expect a big family, a bigger home is in order. If you love the countryside, a rural property might be the thing you’re looking for.

Home offices in particular have become important considerations for homebuyers. Thanks to the advent of telecommuting, millennials needn’t live close to the city center to work. Companies, including tech giants like Twitter, now recognize the advantages of remote work. This trend grew further in the wake of COVID-19 and may likely continue into the future. A home office keeps your professional and personal lives distinct when telecommuting.

While you can always go to cheaper suburban or rural areas to buy a bigger home, this isn’t always advisable. A long stressful commute to work can have adverse effects on both your health and your daily budget. And don’t think having “more house for your money” is a bargain. One UCLA study has found that most rooms in a standard American house were underused.

Mortgage Options

How much and how long you must pay for a house will vary. It’s natural for you to veer toward the smallest monthly payment option. You want a mortgage that fits snugly into your budget. But this choice comes with its own drawbacks. Loans calculate interest fees from the money you borrowed based on the rate and the term. The longer the term and the higher the rate, the greater the interest costs.

According to Freddie Mac, the most popular mortgage option has been the 30-year fixed-rate mortgage. These have low, regular payments that are easy to fit into the regular budget. It has been around for nearly a century. But is the 30-year fixed mortgage all that it’s cracked up to be? Critics have claimed that this loan product has failed as a wealth building tool for working-class Americans. This is because the interest costs of a 30-year mortgage will always be high. Besides their long terms, they often have steeper rates.

Thus, aim for as short a term as you can afford. Although pricier each month, a 15-year mortgage can help you save more money in the long run.

Let’s look at one example. Suppose you bought a house worth $300,000 and are willing to pay a 20 percent ($60,000) down payment. You have two options for your $240,000 mortgage. One mortgage offered a 15-year term and 2.5 percent annual percentage rate (APR). The other offers a 30-year term but comes with 3.3 percent APR. The examples below do not include escrow payments like taxes and home insurance.Mortgage DetailsMortgage 1Mortgage 2Term15 Years30 YearsRate (APR)2.5%3.3%Monthly Principal & Interest$1,600.29$1,051.09Total Interest Paid$48,052.94$138,393.31

Although you saved $549.20 each month, you still spent $90,340.37 more on your mortgage’s interest.

Some low monthly payment options come with dire financial consequences. Adjustable-rate mortgages may have low minimum payments at first. But that payment does not reduce your mortgage’s principal. Because their rates change with the market, you’ll likely end up paying more in the future.

Other Ways to Save

There’s more than one way to save money on your mortgage. Because of the way mortgage interest is calculated, you can pay extra toward your principal to save money. This is an excellent and flexible way to reduce your lifetime interest costs if you cannot afford a higher monthly payment up front.

Here’s how it works. In the early days of a mortgage, most of your payments go toward paying interest. On your first payment, only a small part goes toward paying your principal balance. With each payment, your balance shrinks. This means less of your payment goes toward interest and more toward your principal. The cycle continues until your mortgage matures. Paying extra to your principal speeds up this process. 

Let’s return to our 30-year example. Suppose, in the 3rd year, you begin paying an extra $100 per month. For this example, we used this extra payment calculator from MortgageCalculators.info.Mortgage DetailsOriginal PaymentExtra $100/ month on the 3rd yearMonthly Principal & Interest$1,051.09$1,151.09Pay-off Time30 years26 years 3 monthsTime Saved03 years 9 monthsTotal Interest$138,393.31$120,129.89Total Interest Savings0$18,263.42

In that span of time, you shaved off 3 years and 9 months from your loan term and saved about $18,263.42 in total interest charges. That’s money you can set aside for emergency funds, retirement, or other important expenses.

Another way you can save is through biweekly payments. This method takes advantage of a quirk in the calendar. There are about 52 weeks in a year and 26 biweekly periods. In effect, you’ve added an extra month to your payment plan. There are several ways to set up biweekly payments. You can discuss the matter with your lender or have a third party do it on your behalf. Both options come with pricey maintenance fees. The alternative is to pay the equivalent of one month’s payment at the end of the year.

Finally, you can refinance your mortgage. This involves paying down your existing mortgage balance with a new one that has more favorable payment terms. Refinancing to a shorter term or lower rate has the potential to save you even more money in the long run. CBS reports that U.S. homeowners can save $160 each month if they refinanced their mortgages. Indeed, many homeowners refinance when rates drop low enough.

Returning to our previous example, let’s look at how much you can save by refinancing. In this example, we’ll assume you’ve paid off 3 years’ worth of mortgage payments. From there, you refinanced to a 15-year term at the cost of $3,200. Your new APR is 2.7 percent. Here’s how much you can save:Mortgage DetailsCurrent PaymentRefinanced PaymentRemaining Mortgage Balance$225,221.50$225,221.50Rate/APR3.3%2.7%Monthly Principal and Interest$1,051.09$1,523.05Interest Due$115,332.99$48,927.27

By refinancing, you can save $63,205.16 in interest minus your closing costs. But to recoup the costs, you must stay in your current home for at least two years and two months. The up-front costs of refinancing make it an unwieldy option for many homeowners. Thus, refinancing is ideal for established homeowners who intend to stay in their homes long-term.

The Bottom Line

If you want to settle down, don’t wait until your rent goes up. While you save up for your down payment, it’s time to review your spending. Look for expenses you can remove to bolster your cash flow. Start by paying extra toward debt. Clearing your credit card bills and other debts serves a dual purpose. By paying extra toward your debts, you save money and increase your cash flow. Making regular, punctual debt payments also improves your credit rating. This will help you qualify for better interest rates when you look for a mortgage deal.

Look out for caveats like prepayment penalties in your mortgage contract. These punitive clauses punish home buyers for paying extra too early. If a prospective lender won’t remove these clauses, take your business elsewhere. If you’ve already signed on, don’t worry. Since 2014, prepayment penalties must only last three years by law.

As with all things worth doing, if you can afford to wait it out, do so. Great savings come to those who wait.

VMware’s SaaS and Subscription Revenue Spikes in Oct. 2020

VMware’s SaaS and Subscription Revenue Spikes by 44% to $676 Million in October 2020

SaaS and subscription revenue of its VMware surpassed its on-premises license revenue for the first time in its Q3 fiscal year 2021 which ended in October 2020.

According to the research data analyzed and published by Comprar Acciones, VMware’s SaaS and subscription revenue for Q3 FY21 totaled $676 million. That marked an increase of 44% year-over-year (YoY) and accounted for 24% of the company’s total revenue. It is $37 million higher than the $639 million revenue of its on-premises license segment.

Global IT Spending to Shed $300 Billion in 2020 as Cloud Spending Surges 6.3%

Global spending on data center systems is expected to drop 10% to $188 billion in 2020 according to Gartner. At the same time, cloud system infrastructure services are estimated to grow from $41 billion in 2019 to $63 billion in 2020.

Gartner also projects that SaaS solutions will generate $104.7 billion in 2020. The figure was $102.1 billion in 2019 and is set to grow to $121.0 billion in 2021, and further to $140.6 billion in 2022.

According to a study by IDC, In Q1 2020, on-premises IT spending sank by 16.3% YoY, while cloud spending grew by 2.2%. Similarly, in Q2 2020, traditional IT spending fell by 8.7% YoY while cloud spending soared by 34.4% YoY.

Q3 2020 saw a 33% YoY upsurge in global cloud spending to reach $36.5 billion according to a forecast by Canalys. That was $2 billion higher than Q2 2020 and $9 billion higher than Q3 2019.

Moreover, Gartner projects that global IT spending will decline by 8% YoY in 2020 to $3.5 trillion, down from $3.8 trillion in 2019, which means that the drop will be a massive $300 billion. However, cloud spending will grow by 6.3% during the same period.

The full story, statistics and information can be found here.

Ethereum Accounted for 96% DeFi Transactions in Q3 2020

Ethereum Accounted for 96% DeFi Transactions in Q3 2020 as ETH Miner Fees Double Bitcoin’s

According to the research data analyzed and published by StockApps.com, Ethereum’s transaction volume soared to $119.5 billion in Q3 2020. In comparison to the $10.2 billion volume posted in Q2 2020, that was a 1,200% increase.

Based on Coinmetrics’ data, Ethereum fees shot up during the same period, eclipsing Bitcoin’s fees for the first time on August 13, 2020. As of September 2020, ETH fees stood at $276 million, nearly double Bitcoin’s $146 million.

Ethereum Miners Made $113 Million from Fees in August, 38x Increase from April

The surge in transaction volume and fees on the Ethereum blockchain was linked to the recent Decentralized Finance (DeFi) hype. DApp Radar reveals that during the period, DeFi apps accounted for 99% of all transactions on the network.

The total DApp transaction volumes on all platforms in Q3 2020 reached $125 billion. There was an increase of $113 billion quarter-over-quarter (QoQ). Most of the activities took place on Ethereum, TRON and EOS. From the total value created, Ethereum accounted for 96%. With 1,956 apps, it was the top DApp blockchain during the period.

Coinmetrics’ data reveals that Ethereum transaction fees surged from $21.98 million on June 1, 2020 to $77.77 million on July 31, 2020. In August, Ethereum miners made $113 million from transaction fees according to Glassnode. That marked a 38x increase from the $3 million recorded in April and a 1.8x increase from the January 2018 all-time high. In September, miners for the first time earned more from fees ($172M) than they did from block rewards ($150M).

According to Glassnode, Ethereum miners made a record on September 1, earning $500,000 in one hour. Daily earnings on that day doubled to $16.5 million from $8.1 million the previous day. On September 2, they made a new record with the average hourly revenue surging to $800,000. They broke this record on September 17, reaching $938,000.

The full story, statistics and information can be found here.

360 Magazine, Business

COVID-19 Shifted Modern Business

COVID-19 and the global pandemic has presented a significant and unforeseen challenge to many businesses. The government and public health restrictions have meant closures for some, and the economic impacts have meant customers are more nervous than ever before. As a business, managing through this pandemic means shifting the fundamental way you see your business. To better understand how COVID-19 has shifted the perspective of modern business, consider these points.

Managing the books

Prior to the pandemic, businesses could be excused for not being across the minutia of detail when it came to their day to day finances. Managing inventories, purchasing and other key accounting tasks may have been considered handled in a lot of circumstances. With the pandemic taking force, it’s been crucial to shift that perspective and consider online accounting software. As businesses shift operations away from bricks and mortar style offices, to working from home, online software is key. Businesses need to be able to manage and keep an eye on all finances in real-time. Making critical accounting decisions remotely could make or break the business, so your business needs to be agile in the way it operates. Traditional businesses could get away with quarterly reporting or even monthly, but the modern business will need to be much more focused on the numbers week to week or even day-to-day. Online software can keep you up-to-date with the accounting details you need to make smarter decisions.

Smart tooling

Previously, businesses considered tools which would allow their employees, customers and competitors to connect a nice service to have. Since COVID took hold, it’s been crucial for the modern business to adapt and offer a range of tools to help create those connections. In lieu of seeing people face-to-face, businesses needed to find ways to create virtual collaboration and avoid an over-reliance on traditional communication methods, like email. 

The modern business has shifted its perspective on these tools and some are now even seeking to find ways to create these virtual connections, similar to the water cooler type conversations you’d see in a physical office. This pandemic has created a divide in project teams, product teams and many other teams where close collaboration was a key to success. Modern businesses, rather than abandoning these ways of working, have adapted and found tools that help them connect better in a separated world.

Productive home workers

Prior to the pandemic taking hold, a lot of traditional business managers held the belief that working from home was unproductive. With public health advice all but demanding businesses have employees work from home, this perspective has certainly changed. Many businesses experienced a changing of the guard, albeit through a transition period. But as time goes by, the modern business is realising that expensive leases and large tenancy are simply not necessary. Employees have proven that productivity will go on, and that business output doesn’t suffer simply because staff are at home. 

Without commutes, some staff even prefer to work longer hours. The pandemic has offered the modern business an advantage to be taken. Allowing staff to become flexible with work arrangements both now and into the future can help build a more engaged and focused workforce. The caveat to this is ensuring staff have the appropriate setups and systems access to do their jobs effectively.

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COVID-19 has challenged many widely held beliefs about the way a traditional business needs to run. From managing the day to day to allowing staff the freedom to work from wherever they are most productive. Modern business perspectives have changed and a lot of managers would argue it’s about time too.

The Millennial’s Financial Guide to Homebuying

Around 4.8 million millennials are turning 30 in 2020. This is the largest age bracket among millennials, according to CNBC. Many of them have families and are looking to buy their first home.

Compared to older generations, saving for a house hasn’t been easy for millennials. In 2017, millennials who bought homes paid around 39 percent more than baby boomers who bought houses in the 80s. With higher costs of living and rising student debt, it takes millennials longer to afford a home. Now, considering the economic impact of COVID-19, it’s tougher for people to make major life purchases.

But don’t fret. Knowing your mortgage options and proper financial planning will make a difference. If you commit to a budget now and work on your savings, it’s possible to purchase a house in the near future. Here are essential financial tips you need to know before buying a home.

When to Consider Buying a House

Before taking a mortgage, improve your credit score. Give yourself time to improve your credit. Make sure to pay your loans and credit card on time. If you have large outstanding debts, be sure to pay them down. Check your credit report and see if there’s any inaccurate information. Disputing errors like unrecorded payments can help improve your credit score.

Most conventional lenders usually approve a credit score of 680 and above, and some may approve 620. Conventional loans are offered by lenders that are not sponsored by the government. You can get them from banks, credit unions, and non-bank mortgage companies.

If you have an excellent credit rating, you’re eligible for lower interest rates. This makes your monthly mortgage more affordable. It will help you save on total interest costs throughout the life of your loan. Make sure to shop around for loans and choose the lowest interest rate.

Know how much house you can afford.

Compare real estate listings to know what price range you can manage. As a rule of thumb, you shouldn’t buy property beyond your means. How do you know if your dream home fits your budget? You must understand your debt-to-income (DTI) ratio.

DTI ratio compares your gross income with how much debt you owe. If your DTI ratio is too high, your loan will not be granted. A low DTI ratio makes it more manageable to make monthly mortgage payments. This decreases your risk of defaulting on your loan and losing your house to foreclosure. Once you’re perceived as a low-risk borrower, lenders are more likely to approve your mortgage.

Lenders check these two important DTI ratios before approving a loan:

  • Front-end DTI ratio – The percentage of your income that pays for mortgage-related costs. It includes monthly mortgage payments, property insurance, and association dues. Your front-end DTI must not exceed 28 percent. This is the standard requirement for conventional mortgages which are not federally backed by the government.
  • Back-end DTI ratio – The percentage of your income that pays for your mortgage-related costs along with your other debts. This includes auto loans, credit cards, student loans, etc. Your back-end DTI ratio must not exceed 36 percent. But for federally backed government mortgages such as Federal Housing Administration (FHA) loans, the DTI limit is 43 percent.

Know how much you can borrow.

To know this, get pre-approved for a mortgage. Speaking to a lender determines the specific amount you can borrow. It’s one of the best ways to know how much home you can afford. To do this, you must authorize your lender to review your credit report. Getting pre-approval does not require you to borrow from the lender. But once you’re ready to make an offer, you can choose one with the best rates and terms. Lowermybills.com mentions that “Like all things connected to home buying and mortgage rates, do your research.” Furthermore, they state that “If you find a rate you are comfortable with, and it gets you the mortgage payment in your price range, it might be a good idea to decide to lock in the interest rate.”

Know when and where house prices are low.

A year before buying, research local market conditions in your preferred area. Check common house prices and pay attention to big price shifts. There are periods when real estate prices are depressed or generally low. In other times, they can be awfully expensive. It also pays to check houses in low-cost locations such as less crowded suburbs. Homes in busy metropolitan areas and coastal states usually have expensive price tags.

How Much Down Payment Should You Save?

Ideally, homebuyers should make a down payment that’s 20 percent of the home’s value. For instance, if you’re buying a $250,000 house, your down payment should be $50,000. These days, you might notice buyers making a smaller down payment. This has its drawbacks, which come in the form of mortgage insurance costs.

Conventional loans come with an annual private mortgage insurance (PMI) policy, which is 0.25 percent to 2 percent of your loan amount. It’s typically required if your down payment is less than 20 percent. PMI is usually rolled into your monthly payments and is canceled once your mortgage balance reaches 78 percent.

Meanwhile, federally backed mortgages such as FHA loans come with mortgage insurance premiums (MIP). If your down payment is less than 20 percent, MIP is required. It’s paid both as an upfront fee (1.75 percent of the loan amount) and an annual insurance fee (0.85 percent of the loan amount). MIP is usually paid for the entire life of the loan, which makes it a lot costlier in the long run.

How do you save for your down payment?

Start gathering funds as early as you can. Saving your tax refund is a great source. As of 2020, the average tax refund is $3,100, which is a large amount that can bolster your down payment. You can also use work and holiday bonuses you get from your employer. Save cash gifts during birthdays, as well as windfall inheritance funds from relatives. To earn extra income, work overtime hours or get a freelance job on the side. This will take time. So the earlier you save, the better.

Low Down Payment Options for First-Time Homebuyers

More often, people do not usually have enough time to save for a higher down payment. They need to relocate because of a new job or a growing family. When this happens, you can opt for low-cost mortgages options. If you need a loan with low down payment and relaxed credit requirements, consider government-sponsored mortgages. These are loans meant for low to moderate income families who need assistance in buying a home.

FHA Loans
You can qualify for an FHA loan if your credit score is between 500 to 580. Your down payment can be as low as 3.5 percent if your credit score is 580 and above. If your credit score is below 580, your down payment must be at least 10 percent. All FHA loans require MIP regardless of your down payment amount.

USDA Loan
The U.S. Department of Agricultural approves home loans if your credit score is 640. Down payment is not required but is definitely an option. To get a USDA loan, you must purchase a house in a USDA-approved rural area. This includes many suburbs and around 97 percent of land mass in the U.S. Moreover, your household income must not be over 115 percent of the median income of your area. USDA loans come with a guarantee fee, which is paid as an upfront fee and an annual fee rolled into your monthly payments.

VA Loans
The U.S. Department of Veterans Affairs offers special loans to active military members, veterans, and qualified military spouses. VA loans are flexible with credit scores, but it’s better if your credit score is at least 620. Down payment is also not required but is an option. However, instead of a mortgage insurance premium or guarantee fee, VA loans require a VA funding fee. Paying at least 5 percent down payment helps reduced this added cost.

Worried about poor credit? There are local housing agencies per state that can help you. Your state agency can assist you in looking for housing options that can accommodate your low credit score. They can also provide down payment assistance for mortgages. Just get in touch with your state housing agency soon.

The Importance of Saving a 20 Percent Down Payment

Making a 20 percent down payments eliminates private mortgage insurance costs. This reduces the amount you need to borrow, which effectively lowers your monthly mortgage payment. The higher payment also decreases your loan-to-value ratio, which is the amount of your loan compared to your home’s value. It also allows you to secure a much lower mortgage rate.

To give you a better idea how it affects your mortgage payments, let’s see the table below. It compares the same mortgage. One made an 8 percent down payment, while the other made a 20 percent down payment.

30-year Fixed-Rate Mortgage
Home price: $350,000
Interest rate: 3% APR
Mortgage5% Down Payment20% Down PaymentDown payment$17,500$70,000Borrowed amount$332,500$280,000Monthly payment$1,401.83$1,180.49Total interest paid$172,160.03$144,976.87Loan-to-value ratio95%80%Total PMI cost$18,038.130

In the example above, making a 20 percent down payment reduces your borrowed amount to $280,000, while 5 percent only reduces it to $332,500. Your monthly mortgage payment will be $221.34 lower with a 20 percent down payment. As for interest cost, you save $27,183.16 more in total interest with a 20 percent down payment. Meanwhile, with a 5 percent down payment, you still need to pay $18,038.13 on top of interest charges. Basically, you’ll gain more saving in the long term if you make a higher down payment.

Need help with your mortgage budget? Use this mortgage payment calculator to estimate your monthly mortgage payment, total interest, and PMI costs.

Here’s a tip: If you take an FHA loan for the low down payment, there is a way to remove MIP. If your credit score is at least 620, you have the option to refinance into a conventional mortgage after a few years. Refinancing is basically taking out a new loan to replace your existing one. You can refinance to a conventional loan with a lower rate. You may consider this option to get rid of costly MIP charges.

The Bottom Line

Now that you know your housing options and requirements, you can better prepare your finances. As early as now, start improving your credit score to qualify for a loan. Borrowers are offered lower interest rates when their credit score is high. It’s also ideal to save up for a 20 percent down payment.

Next, keep track of your debt-to-income ratio. As long as you don’t accumulate large debts, you should be eligible for a mortgage. Moreover, start checking home prices at low-cost areas. If you time your purchase when house prices are generally low, you can score a better deal.

If you can’t make the 20 percent down payment, there are low-cost mortgage options to choose from. Check out FHA loans and USDA loans. If you’re a veteran or military member, you’re qualified for VA loans. Just take note that government-backed loans come with extra costs, such as mortgage insurance premium for FHA loans. If you take advantage of these options and plan your finances, soon you can purchase your own house.

Digital illustration for 360 Magazine

Brand Building In A Recession

Building Your Brand During A Recession

By Lauren Howe and Teri Uyovbievbo, co-founders of up-and-coming South Bay marketing start-up, The Social Block

The onset of COVID-19 has ultimately ended a decade-long trend of economic growth in the United States. In it’s place, we now have the highest rates of unemployment since the Great Depression. The unprecedented economic downturn has also ushered in the swift demise of formerly successful corporations.

Although COVID-19 has brought difficulty to many businesses, the high rate of unemployment has left many to focus on what was previously their side-hustle or freelance work. A small percentage of job prospects has left us with gig work, using our marketable skills and furthering our educations.

While this is a difficult time to build a brand, it isn’t impossible. In lieu of attending meetings, speaking on panels and networking in the community, placing the focus instead on the company’s current messaging, graphics, website, public relations, social media and marketing efforts is essential. In order to get your brand in the spotlight, you’ll need to create a memorable logo so that people recognize your brand as soon as they see your awesome logo. COVID has thrust the world into a work-from-home, online shopping, and food delivery reality. Building your brand during this time is not only the smartest move for your start-up or business – it is the only move that will keep you competitive in a post-COVID world. The following steps are what we at The Social Block do for ourselves to build our brand, as well as what we would always suggest to clients.

Take relationship building digital

We know that nothing can replace face-to-face interactions and networking, but in a digital world, it’s not enough to just do one. Looking out for media opportunities, offering discounted services to local non-profits to support your community, participating in roundtables, panel discussions and curating a well-managed social media presence are all essential ways to build your brand online.

Social media has been, and is continuing to be, a method of providing customer service and increasing brand loyalty. Although the recession may be limiting those buying or product or using your service, communicating with your target audience, asking for their success stories or feedback, and showing that you listen, care and are engaged, will keep your business top of mind and keep business flowing when the economy stabilizes.

Don’t stop marketing

Depending on your product or service, you can choose from email or mail campaigns, utilizing ad space in relevant publications, or targeting your audience directly through Facebook, Instagram, Twitter or LinkedIn ads. It’s not enough to leave your growth to organic views, shares and customer/client reviews. Getting new traffic in the door and fresh eyes on your business will increase your brand awareness.

Even if COVID may cause a delay in conversions or results, you want to be one of the services or products on your target audience’s list to try after your area has reopened and the economy begins to repair itself.

Assess where your brand is at currently

It may be time to take a hard look at what branding you had going on before COVID, and determine if it is time to make a change. Is your website difficult to navigate wit outdated items? Is your social media active, and is it used to build relationships with potential clients or customers, or is it used almost as a “personal” account, full of successes and company outings? Are you participating in speaking engagements and interacting in you community? Are your graphics, presentations, business cards and logo truly representative of what you do?

Take a hard look at where each area stands, and be honest about what could change. At first glance, are you truly giving off the impression you want?

Times are tough, but it’s an opportunity to pause, reflect and rethink the way you do business.

Cash and wallet illustration for 360 Magazine

The Business Comeback After COVID-19

Business Turnaround Expert Cites Keys to a COVID-19 Comeback

By Merilee Kern, MBA ‘The Luxe List’ Executive Editor

The September 11th attacks. The Great Recession. The COVID-19 pandemic.

All three of these seismic and tragic events have resulted in heartbreak to humanity, including loss of life and our emotional well-being – both individually and collectively. Of course, accompanying these global crises were monetary meltdowns reminiscent of the Great Depression that commenced in 1929 and lingered until the late 1930s.

After a “relatively” calm 70 years, the United States economy has suffered three devastating developments inside the last two decades, alone. There have been wars fought throughout the world and inflation escalations along the way, to be sure, but the start to the 21st century has suffered escalating and unusually concentrated economic calamities – some that have profoundly altered the very fabric of our lives, both personally and professionally.

Indeed, on the business front, such periods have been among the most – perhaps the unequivocal most – trying of times. Amid current circumstances as the coronavirus rages on around the globe, I recently connected with internationally-renowned business restructuring executive James “Jim” Martin, founder of ACM Capital Partners with offices in Charlotte, Denver and Miami. Having spent the last three decades leading international middle-market companies through periods of distress and transition to actualize stability and growth, Martin is uniquely well-positioned to share insights on how business can rally to best assure a “COVID comeback.” Here’s what he had to say.

MK: First, before addressing the current coronavirus situation, what can you tell us about how you’ve helped companies navigate previous “rough waters?”

JM: Relative to the September 11th attacks back in 2001, I’ll share a representative example of a strategic pivot that didn’t just help a company survive, but actually drove profit. After that horrendous event, I stepped in to assist a large aviation maintenance repair-and-overhaul facility whose revenue had been cut fully in half immediately following the attacks – the result of many carriers permanently parking older aircraft (including the 727 fleet). The sizable challenge presented was to maintain a 1000-person labor force while allowing the industry the necessary time to recover. To do so, we created a captive subcontracting company to which we transferred one-third of our labor force. During our troughs, we contracted this labor to our competitors and, during peak periods, we utilized this labor for ourselves. Thus, not only were we able to retain our skilled, well-oriented labor force during the recovery, but that very staff actually provided additional, supplemental profit. The end result was that we sold the business for $138 million, which provided our new investors with a 33 percent internal rate of return (IRR).

Less than a decade after 9/11, amid The Great Recession in 2008, I entered another industry that proved to be among the most brutalized by a global economic downturn: automotive supply. My client was a key supplier to the “Big 3” U.S. auto manufacturers.

At the start of 2008, the industry forecast was the production of 18 million vehicles in North America. Come summer, however, it was clear the automakers would not come near reaching that forecast due to the financial crisis. This did not come as a complete surprise to us, though, because – amid our firm’s protocols – we had had already fully immersed ourselves in our client’s industry and employed forecasting tools alerting us of trends … this one in the wrong direction. So, we were privy to the situation well before management and others within the industry. By late June 2008, we instituted cost-cutting maneuvers and furloughs that enabled the company to withstand the industry’s brutal second half of ’08 that would result in two of the “Big 3” automakers filing for Chapter 11. Despite the industry producing less than half – as much as eight million – of its original vehicle-production forecast, our client not only survived, but ultimately grew and prospered.

MK: Turning attentions to COVID-19, what do you feel is integral for businesses to survive and recover?

JM: For businesses to recover from the coronavirus shutdown, it’s going to take a two-pronged approach: both financial and human capital. Starting with the financial, it will be a “loan-ly” world for those not well-versed in the intricacies of SBA, PPP and other “economic disaster” lending. Consider how expeditiously those programs were rolled out. Then consider how even more quickly they were scooped up. Did anyone really read those loan documents in full, or even halfway through, initially – or even to this day?

My guess is at least half of the companies receiving COVID-related loans took a very “CliffsNotes” approach to these agreements. The result is there’s a solid chance funds were used incorrectly, which is going to make a lot of the loans, shall we say, less “forgivable.” For example, if your company’s payroll roster is shorter today than it was pre-virus, the portion of the loans forgiven is likely to be less.

And while your mind may rush to claiming ignorance and throwing yourself upon the mercy of the government to which you already pay taxes, realize that third-party capital is likely to participate in this market through securitization. This means that thousands of SBA loans could be bought, then packaged to be sold to the secondary market, at a discounted rate, no less. If this happens, understand that the purchasers will have the full intention of holding their borrowers (i.e. small business owners) to paying back 100 cents on the dollar.

So, those companies who received loans and are required, but unable, to pay them back in full may be exposed to either foreclosure or, worse, a “loan to own” scenario. In other words, much like the agreement that comes with your big-tech user agreements, like those prompting users to “click agree,” the fine print matters.

What this means to recovery is that, once again, cash is king: gather it, preserve it, cease lines of credit, liquidate what you can, negotiate costs down with suppliers. If you’re struggling to pay you suppliers, you can look into purchase order financing options in order to improve your cash flow. And if your company had a healthy bottom line pre-COVID, than a professional familiar with these trenches can help you look to refinance or bring in equity.

With all of that said, the key to a COVID-19 recovery is going to be adhering to the rules of a lender’s road, as well as the ability to navigate the red tape when you veer off that road. If you have read all the fine print and properly managed your loan, congratulations! You’ve acquired some really cheap capital. For those who didn’t do their research, however, this road to recovery likely will need some paving.

MK: What about the human capital you mentioned?

JM: Yes, and then we arrive at the human capital. Lots of companies today are excessively top-heavy. Remember the part about removing emotions from this process? Companies that quickly recognize cuts need to be made will be better positioned to recover than those who dawdle. Again, compiling and preserving cash is going to best position a business for recovery.

This is an instance where it’s especially beneficial to know when to pull triggers (best if earlier than others) and to make decisions that are not based on emotions—a tall order for many CEOs, which is why many turn to turnaround experts. However it’s undertaken, what’s certain is that reducing human capital is painful, but it is also often necessary and almost always beneficial.

The upside is that, when the virus no longer exits, businesses can already be well-positioned for a fairly quick recovery. Maybe not v-shaped sans a vaccine, but quick relatively speaking due to the downturn having been so specific to one singular causing factor.

MK: Tell us a bit about your role as – and general value of – a turnaround expert when turmoil strikes a business.

JM: During times of difficulty, owners and executives can greatly benefit from specialized knowledge that’ll help them best navigate those unchartered waters that are often entangled in a lot of red tape. So, turnaround experts bring to the table a litany of tried-and-true “been there, weathered that” experience and expertise. There’s simply no substitute for engaging with a partner whose entire mandate is ensuring your company’s survival and success during some of the most grim and challenging times it might experience – those professionals who are willing to spend sleepless nights figuring out how to ensure the company meets payroll; who’ll work around the clock to keep the company’s doors open; and who can tackle challenges without being hindered by emotions that understandably weigh on a business owner or manager. It takes this kind of specialized expertise, experience and grit to lead companies through periods of distress and transition, to stability and growth.

No stranger to corporate chaos, during Martin’s own three decades as a globally-regarded turnaround expert, he has reportedly created and restored nearly $1.5 billion in value to lower middle-market companies; raised an additional $1 billion in capital; and managed mergers and acquisitions in excess of $500 million – all collectively representing his company restructuring portfolio valuation in excess of $3 billion.

Today, as the coronavirus continues to wreak havoc on business operations far and wide, take heed that there are various key strategic and creative tactics that can help businesses not only weather the storm, but even emerge stronger and more financially secure on the other side.

About Merilee Kern:

Forbes Business Council Member Merilee Kern, MBA is an internationally-regarded brand analyst, strategist and futurist who reports on noteworthy industry change makers, movers, shakers and innovators across all categories, both B2C and B2B. This includes field experts and thought leaders, brands, products, services, destinations and events. Merilee is Founder, Executive Editor and Producer of “The Luxe List” as well as Host of the nationally-syndicated “Savvy Living” TV show. As a prolific consumer and business trends, lifestyle and leisure industry voice of authority and tastemaker, she keeps her finger on the pulse of the marketplace in search of new and innovative must-haves and exemplary experiences at all price points, from the affordable to the extreme. Her work reaches multi-millions worldwide via broadcast TV (her own shows and copious others on which she appears) as well as a myriad of print and online publications. You can connect with Merilee at www.TheLuxeList.com and www.SavvyLiving.tv

Follow Merilee Kern:  Instagram | Twitter | Facebook | LinkedIN

Lebanon illustration by Rita Azar

Lebanon Currency Crisis

By Rita Azar

The Lebanese currency has severely depleted in value during the last few months. Although many politicians claim that the lira will stabilize at 3000 to a dollar, the currency crisis continues to rock the finances of Lebanon. Ever since 1990, 1500 liras have always equaled a dollar. Although this is a far cry from 1980 when three liras equaled one dollar, the instability of the lira from 1990 on is treacherous to the economy. The worst the conversion rate has ever been was when the dollar reached a staggering 12000 liras.

One must grasp the country’s financial decisions to understand what led to the economic collapse. Lebanon’s broken electricity, water, and waste collection systems has cost the country billions of liras of debt. Before the early 2000s, most of Lebanon’s debt was local; this means that, theoretically, the debt could be paid off by simply printing more lira, which the central bank has the power to do. But after the former prime minister, Fouad Siniora, took billions of dollars worth of foreign loans in 2007, Lebanon needed to collect foreign currency to pay for the debt debt. On top of this, Lebanon’s economy damaged by an immense decrease in tourism and foreign investments. Due to this, Lebanon has used the little foreign money that still exists in the central bank to pay off its foreign debts which leaves the citizens and companies of Lebanon unable to withdraw dollars from their bank accounts.

Due to foreign currencies being rare to find in Lebanon’s economy, they have become far more expensive. In addition, because of the abundance of Lebanese liras, the lira has fallen dramatically in value. This has led to massive gouging by all types of businesses that need to import with foreign currencies that are no longer accessible. In response, the government and central bank have taken measures to stop the massive inflation of the lira. One method is keeping the official rate, 1500 lira to one dollar, from small scale transactions and being a little more lenient with larger transactions by offering a rate of about 4000 lira to a dollar.

But, this means that the Lebanese people are losing money when exchanging foreign currency into lira. This has led many people living in the country to go to the black market to exchange money with rates other than the governmental regulations. While the black market approach has allowed many Lebanese people to get their money’s worth, it has caused the government to enforce stricter exchange rates to control inflation and ban the black market. 

 

https://www.france24.com/en/20200612-lebanon-pound-economic-crisis-protests-imf-aid-bailout-hassan-diab

https://aawsat.com/home/article/2356311/ذعر-في-لبنان-بسبب-تدهور-الليرة

https://www.alhurra.com/lebanon/2020/04/23/يسقط-حكم-المصرف-تدهور-الليرة-اللبنانية-يشعل-الاحتجاجات-مستقبل-مجهول

https://www.tayyar.org/News/Lebanon/358134/دياب–سلامة-مسؤول-عن-أزمة-الدولار

 

Vaughn lowery, 360 magazine, nyc

You need personal injury attorneys when filing personal injury claims

When another party’s negligence injures a person, the injured individual should strongly consider speaking with a lawyer who specializes in personal injury. Personal Injury Attorneys Houston are available to assist their clients who have been injured by another person’s negligence in the city.

When can you claim personal injury?

These claims often include car accidents, slip and fall, medical malpractice, workplace injuries, and assaults. They can also be filed when the consumer product is defective and causes bodily injury. In a personal injury claim, a person may seek monetary damages, either physical or mental, depending on the extent of the injury. Personal injury claims include other factors, such as loss of wages or loss of work due to injury.

Specialized personal injury lawyer

Not every lawyer is specialized in personal injury litigation. It is necessary to find a lawyer who is experienced with not only personal injury litigation but also with your specific injury. During litigation, insurance companies have lawyers who have full knowledge of personal injury laws. Therefore, it is also important for the consumer or the injured party to have an equally knowledgeable lawyer. Specialist attorneys who specialize in a particular injury can use this knowledge and their resources to handle litigation.

Reduce the waiting burden

These attorneys have access to medical professionals who can help strengthen the case. They should also have access to legal matters similar to yours. Personal injury case preparation takes time. You need an attorney to reduce the waiting burden by filing appropriate moves, collecting witness statements, and managing the discovery process.

Skilled lawyer

There are specialized advocates for managing every sort of injury. The Medical Misuse Act is a perfect example of why these lawyers exist. This type of law is very complex and very specific. Therefore, it is necessary to find a lawyer who specializes in a specific injury and knows this law. Spinal cord and brain injury are very sensitive areas, and these types of injuries require only a skilled lawyer. When a person suffers a significant injury in the form of a brain or spinal cord injury, they are often unable to function again and require lifelong medical care. Sometimes, these injuries can cause paralysis. The lawyer representing these cases must be able to identify the cause with medical professionals’ help to prove the case. Lack of the right lawyer with the right expert means your case will prove a waste of time and significant money.

Some lawyers are specialized in all types of accidents, such as slip and fall, car accidents, and construction accidents. There are also those who specialize in litigation involving defective products. When talking to lawyers, ask questions such as: What are the areas of litigation? Have they worked on cases like yours before, and, if so, how many? What was the result of those cases?

Expertise and knowledge of lawyer

You cannot win a personal injury case without a qualified and experienced lawyer. Personal injury attorneys provide expertise and knowledge about the law that a typical person does not have. They will ensure that you are treated appropriately and that your claim is filed properly. Hiring a lawyer who is specialized in your particular injury will reduce the burden of preparing for a claim so that you can recover from your injury.