Soon you will find yourself deeply involved in reaching your marketplace, analyzing customer needs and imagining attention-getting promotional ideas. But first there are a number of basic organizational steps you should complete.

 There are just enough stories in newspapers and magazines about successful new business that were started on a “shoestring” to make you believe you do it also. In fact, several monthly magazines are devoted to presenting low-cost home business ideas that are “guaranteed winners”.

 In our experience, very few viable new businesses ran be started with less than $1000.00. A recent survey by Home Office Computing magazine revealed that the average reader spent around $5,000 to start his business. It should be apparent that shoestring businesses run out of cash fast – often just when the sales start to come in.

 Assessing Your Financial Readiness

 The first step in examining your financial preparedness is to sit down with your family and analyze where the money goes each month. Start with the major expenses first, such as mortgage or rent, car payments, utilities, insurance, food and school expenses. These categories probably represent over 60% of your total family spending each month.

 Next add in important but postponeable expenses, such as new clothing or furniture, a vacation or going to the movies or out to eat. By the time you are done you will probably have 15 to 20 key expenses in the family budget. Put the total by category on one piece of paper and add them for a grand total. Make sure every family member understands where the money has been going each month.

 Lastly, see what you can cut out of the budget. But beware, quitting a job (or losing one) and then starting a business will put your family under tremendous mental stress. Don’t expect them to endure too much further pain in order to cut the family budget.

 Most of us would be lucky to cut 5% out of the budget. Once you have some agreement on a monthly budget, it is time to review what sources of income the family has. The most common are: spouse’s salary and bonus, investment interest and dividends and rental income if you own property. Ask yourself a tough question: How reliable are these streams of income? Has your spouse’s employer announced layoffs? Is the return on your investments likely to go up or down over the next twelve months?

 Subtracting all the family income other than your income (you’ll he quitting remember) from the monthly expenses results in what I call the “business burden”. This is the dollar amount that vour economic activity must eventually create if the family budget is to continue at its agreed-upon level. Every month that your sales are not enough to cover this burden you must borrow – from yourself, your credit cards, your home equity loan or from your relatives. This gets old fast.

 The second area of personal finance you must carefully evaluate is your debt. Who do you owe? How much? What percentage of debt could be paid off in on more than one year? Remember, you won’t be working a regular job. Be realistic; if you credit card debt is $400 per month minimum payment, you will have a very hard time paying your business phone bill and buying gas for your car.

 Examine also what you own that you might turn into cash or use as collateral for a loan. The house is the most commonly used personal collateral, but remember what you are risking when you use a home equity loan.

 Estimating Startup Costs

 Startup costs are one-time expenses for equipment, furniture, computers, rent deposits, stationery; telephone hookup, insurance premiums, office supplies, and initial advertising. Be cautious here, it is very easy to spend a couple of thousand dollars before you realize it. Before you buy anything ask yourself: Can I get it used? Do I already have something that will work? Can I trade something for it? If you are starting with a home office you of course save on rent deposits and moving expenses.

 If you will be opening a retail store, it is critical that you research what inventory you will need, who supplies it and what is the lowest price you can get. You may also be facing a serious investment in renovation construction, fixtures and carpeting and painting. The average startup costs for a retail store, including inventory, run around $75,000.

 If you plan to make a product for sale you will need to buy raw materials. Do the same kind of investigation as the retail business owner does. Calculate the minimum material investment to produce the desired sales for the first few months. In addition, examine what additional tools, equipment or vehicles our business may require. A typical manufacturing startup can cost over $100,000.

 Exploring Business Expenses

 For most small businesses, the owners personal compensation is far and away the largest operating expense for the business. This is your contribution toward the “business burden”. But there are potentially many other business expenses you will face. Among the most common are: Rent, utilities, telephone and telefax charges, supplies, computer software and repair, insurance, bookkeeping fees, auto expenses, dues and subscriptions, travel and entertainment and sales promotion expenses. Some new business need an employee right from the beginning, so you would have to add in wages and withholding taxes.

 You find out what expenses your business will have to pay by talking with owners of similar businesses, through magazine and newspaper articles and from trade associations, just to mention a few. Also apply some common sense: ask yourself what expenses seem normal for my type of business? I suggest that you add 20% to your estimate of monthly business expenses.

 To discover what magnitude of starting capital your business will need, take your “business burden” and multiply by three. Add in the one-time startup costs. Multiply the monthly business expenses by three and add to the other two groups of costs. The total is known as “initial capitalization” — the money you had better have access to before you open the door of your new business, Don’t kid yourself; new businesses are very hungry — for money. Try to starve them and they perish!

 Picking A Business Name

 Up to this point, you have probably only spoken about your new business to your family and yourself. But now it is time to prepare to talk to the outside world. The first step in communicating all the wonderful things your business can provide is to create an identity for it by carefully selecting a business name and address.

 I have long believed that there is no such thing as the perfect name for a new business. After all your customers are largely buying you in the beginning. But a cleverly selected business name goes a long way toward making your new company more memorable. Here are some tips for selecting a business name:

•  Keep it Short – no more than four words
• Make sure It can be easily pronounced
• Use either your own name or one that says what your business does
• Look in the Yellow Pages to avoid a name that is confusingly similar to an existing business
• Make sure that is looks as good on a business card as it does on a piece of letterhead. A way to do this is to use a graphic artist to sketch the name business card size.  

Be aware that some businesses not only legally register their business names but also trademark them. Trademarking is a legal technique made available by states and the federal government to give you the right to a particular name if you can prove you publicly used it before anyone else, To receive national protection you must file for a trademark through the U.S. Trademark Office (part of the Commence Department). This is much more expensive and time consuming. See an attorney before taking this step.

 Selecting a Business Address

 You now need a business address to go along with your legal business name. While you have been researching your startup costs you should have thought about where you will locate your business office. Will it be in your den? In a local office building? A retail store? Or in an industrial building?

 The simplest and least expensive way is to use your home address as your business address also. But before you decide to do this remember the following tips about selecting an address.

•  Analyze who you want to sell. Would they think you are less professional if they see a residential address on your business card?
• Are there potential zoning problems if your city or town finds out about your home business?
• Will your suppliers or customers be corning regularly to your house? is there enough parking space so as to not annoy your neighbors?
• Can you easily receive UPS, Federal Express, etc. at your home?  

If you don’t locate at home, what are your other options? There are three basic alternatives:

 #1 Post office box. I don’t like them because they are used by scam artists, Also, you can’t get to your box 24 hours per day and customer service at the Post Office is less than great.

 #2: Private mail box store: A little more expensive than P.O. boxes but offer many more business services such as shipping of all kinds, telefax, photocopying, passport photos, office supplies, to mention a few. The largest number of stores are the Mail Boxes Etc. outlets springing up all over. Costs start at $12-$16 per month for a mailbox.

 #3: Shared service office suites: Many traditional office buildings are setting up areas with small offices which share services, such as the receptionist, mail room, telefax, photocopy and a conference room. Rents start at $400 per month, but some buildings offer an abbreviated version, known as identity programs where you keep your office at home, but rent their address for your mail, have their receptionist answer your business phone line and meet with clients in their conference room. Costs start at $75 per month.

 Picking A Legal Form of Organization

 When you open a business, your life becomes more formalized because you are now subject to more laws and regulations. One of the first legal requirements you will face is deciding how to organize the business from a legal point of view. There are three major ways to do this:

 #1: Sole Proprietorship — Single owner or husband and wife. All business profit goes on your personal tax return. You are personally liable for all business debts and legal disputes. Very little regulation by the government. Over 70% of all small businesses are proprietorships, often because it is the easiest, fastest and cheapest way to legally organize.

 #2: Partnership — Two or more owners joining together to invest in and to run a small business. Similar legally to a proprietorship in that each partner is personally liable for business debts and disputes. In addition, each partner is bound by the business actions of the other partners, even if they don’t know about them. In our experience it is hard to hold together a partnership because it is rare that two (or more) people share the same values, grow at the same rate or see risk the same way. We strongly urge that you review a written partnership agreement (sold at office supply stores) before you talk seriously about joining together.

 #3: Corporation – A lot of new entrepreneurs think that they need to be a corporation. But in reality, few new businesses need to be incorporated. The first step is to realize that your life becomes more regulated if you incorporate. We also estimate that it will cost you $700-$1000 more per year in accounting and legal bills to be a corporation. However, there are many potential tax savings for corporations. The second step is to decide with whom you will organize the corporation (incorporators). The third step is to decide if you want to operate as “plain vanilla” corporation (“C” corporation) or as a “S” corporation (requires approval of the IRS). For the next steps see “How to Register” which follows.

 No matter what legal form your new business takes, some branch of government (or several) wants to know about it, But note: before you attempt to legally register, you must have selected a business name and address.

 How to Register Your Company

 Proprietorships and Partnerships Most proprietorships and partnerships use a business name other than the name on the owner’s birth certificate. This business name is known legally as a fictitious name, assumed name or as a DBA (Doing Business As). The county in which you live requires you to register this assumed name. The procedure usually goes as follows:

•  Call your County Clerk’s Office and request an Assumed Name Registration form and ask the fee.
• Fill in all forms with the legal name of the business, its official address, your real name arid your home address. One of the forms may have to be notarized, so see the accompanying instructions.
• Usually you send back one form, the longer one, and keep the shorter form. Include a check made our to the County Clerk for the registration fee.
• Take the shorter form to any newspaper in your county (call first to get their rate for an assumed name ad) and place an ad for three consecutive weeks. The newspaper will give you proof that the ad ran.
• Send proof of ad placement back to your County Clerk, right away.
• In three to four weeks you wilt receive a registration certificate.  

Corporations Registering a corporation is more involved than the assumed name registration. Here is the procedure commonly found. It may vary in your state:

•  Call your Secretary of State and ask for Corporate Name Registration.
• Have two or three name choices written down by the phone. Ask if the first name is available. If not, go to the next, and the next. Hopefully one of the three is available.
• While you have them on the phone, request two copies of the registration paperwork known as the Articles of Incorporation (or similar name).
• Use an attorney or one of the Small Business Development Centers for help in filling out the Articles of incorporation. They are pretty easy, but the section on issuing stock can be a little tricky. Check the form for how to calculate the incorporation fee.
• Send two copies of the Articles with a certified check or money order for the incorporation fee made out to the Secretary of State at the address in the instructions.
• In a few weeks you will receive the official notice of incorporation. After this time whenever you use your business name it must be ended by one of four suffixes: “Inc.”, “Corp.”, “LTD”, or “Co.”. Place the certificate in a safe place. You will need it for a number of purposes but most importantly you must show it in order to open a corporate checking account.

<p><b><a href=”http://www.bizstarters.com/pages/ultimate.html”>Learn how to become the master of your own business, in just a few short weeks</a></b></p>

Jeff Williams

Today, we are less hampered by geographical, social or cultural boundaries compared to the people in the past. Capital is becoming more fluid and the market for the borrowing and lending of money is growing at an increasing rate. The needs of customers are varied and the market for lending money is striving to meet such demands.

Selecting a mortgage refinancing company in this context is not a difficult task. When we have issues with money, we can opt for a mortgage refinance. As refinancing mortgages is a common occurrence, we need to consider different options even before taking up such a service. Different companies offer different services and therefore, we have to exercise a little effort in selecting a mortgage refinance company. While we do so, the priority shall be given to the element of attraction towards the financial gain, we could get hold of, on switching over to it from the existing one.

The real estate market is ever changing. And the value of the mortgaged home reflects such changes. Due to these variations, it will prompt companies to offer different rates to customers. Therefore, selecting a mortgage refinancing company is very important before going for the required mortgage refinance.

The first step we have to adopt in selecting a mortgage refinancing company is conducting a bit of research. We have to collect relevant information about various trustworthy mortgage-refinancing companies existing in the money market. Information on this can be acquired from sources like Internet, print and electronic media. While doing so, priority shall be given to the local ones.

With this list we can amass more information about the different mortgage products each company offers. You will also be clear about the company’s background and credentials in the market. Trust is the single most important factor a company must have when we decide on an institution that deals with mortgage refinancing. Patience and persistence are important factors when deciding on a mortgage refinancing institution.

Almost all mortgage-refinancing companies do business campaigns and seminars to enlighten the customers about their financing products at different intervals of time. Therefore, on selecting a mortgage refinancing company we can attend the company’s meetings in order to inter act with the officials of the company for getting a clear cut picture of the terms and conditions to the refinancing mortgage and the interest rate along with the amount of installment of repayment against the mortgage loan.

To identify a reputable mortgage refinancing institution, look for flexibility in dealing with customers and clear terms. Selecting a mortgage refinancing company shall end in selecting the reputable and specialized mortgage refinancing company that is rooted well in the public conscience. If we want to be sure we can still keep our house at the end of it all. After selecting a mortgage refinancing company of our choice by strictly adhering to the above guidelines, we can contact the selected company for a mortgage refinance of our choice.

Moses Wright
http://www.articlesbase.com/finance-articles/tips-and-guide-on-mortgage-refinancing-company-selection-264701.html

Our home is the single biggest asset that most of us will own during our lives; and as everybody knows, it is not cheap – the average cost of a home in the United States is now around $215,000. Once you sign all the papers and prepare to move into your new home, you will incur various costs associated with your mortgage; these are generally known as closing costs. They are paid in addition to any down payment and basically cover the cost of processing and underwriting the mortgage loan.

Closing costs generally fall into three different categories – origination, escrow and final costs. Taken together, they typically include fees for such things as a credit report request, title search and insurance, home appraisal, mortgage insurance as well as various other miscellaneous fees. The total amount depends on the value of the house you are buying – typically, the total is between 2% and 5% of the cost of the house. Closing costs alone total an estimated $110 billion per year in the United States.

If you are taking out a mortgage, it is a good idea to get some sort of estimate of the closing costs, which a lender is required to give to you – in fact, it should be included with the details of your loan. This estimate of costs is sometimes known as a good faith estimate. Closing costs cannot really be completely avoided, although there are some things you can do to lower or eliminate some of them. Some lenders will even cover some closing costs in order to keep your business.

One solution is to have the closing costs rolled into the amount of your loan. You are still paying them, but they are spread out over a period of time. This way you do not have to have a large sum of money up front, although your interest rate may be higher. It is also possible to have the seller pay the closing costs – however, this will almost certainly add on to the purchase price of your new home.

Your mortgage interest rate may also affect the closing costs – a mortgage with a lower interest rate can mean higher closing costs as a result of the various fees and points. (A point is a charge paid ahead of time – one point equals1% of the loan amount) If you are taking out a no-point loan with a higher interest rate, the lender may be willing to pay more of the closing costs. The more points you that buy, the lower your interest rate will be – but you will also need more money when you close.

So what exactly are all these annoying but necessary extra fees? Your lender or broker will probably charge an application fee, typically ranging from $75 to $300. If you are buying a house, you must obtain a homeowner’s insurance policy, which protects you in the event of any kind of natural disaster. Escrow (or reserve) funds for insurance or taxes are another requirement – these can vary based on the price of the home and are normally paid by the buyer although if you are taking out a VA (Veteran’s Administration) loan, the seller pays this amount.

Also required is a tax service fee; usually around $75 and it is paid to verify that the taxes have all been paid on the purchased property. You will probably have to pay for an appraisal of the home – typically costing from $300 to $700 – as well as a land survey, which may cost from $150 to $400. Finally, there are miscellaneous fees, which typically total from $200 to $500 and cover the cost of delivering and signing documents, as well as any notary fees, attorney’s fees etc.

The good news is that some things are paid by the seller and not the buyer – the seller is responsible for paying property taxes up until the last day of ownership; the seller is also usually responsible for paying any liens on the property. Title insurance covers any unrecorded liens and depending on what the laws in your area are, this can be paid by the buyer or seller – it is also possible to split the cost 50/50.

If you are refinancing a mortgage, some of the above costs may be applicable. And it pays to have good credit when it comes to applying for a mortgage – not only will the interest rate on your mortgage be lower, but some closing costs such as homeowner’s insurance, can be higher if you have a poor credit score. Always check your closing costs to make sure you were not overcharged – it is a good idea to ask your lender for a detailed breakdown of what you are paying for. This can ensure that you receive what you need when purchasing a mortgage.

Mike Cole

I’m looking to obtain mortgage insurance/protection on my home in the event either my husband or I lose our jobs. Just something that will pay the monthly bill until a new job is found. I see a lot of sites offering it and a lot more that just offer protection in the event of disability or death. Are there any companies that are recommended for this?

Laura L, Home insurance covers lots of different things. I don’t understand all the fine print of my homeowners policy, but my home insurance agent is always a phone call away. Try calling your agent or a homeowners agent in your town. http://www.goodinternetdeals.com/Home-Insurance.html They will be able to help you.

I ask because i have just used a mortgage calculator online and they have worked out this:

To borrow £100,000.00 over a term of 15 years at a monthly calculated interest rate of 4.89% gives:

Repayment Mortgage Monthly Repayment £785.08

and

Interest Only Monthly Repayment £407.50

Thanks for any help.

You will probably be not too surprised to learn, that in that feather-bedded, backward industry called banking, they are using different formulas to calculate the same things and percentages mean different things to different people.

I have put in 3 equations in my calculator and usually one of them agrees with the figures quoted by lenders.

The chaos is due to the fact that in the days before the introduction of electronic calculators, it was only practical to use approximate formulas which were easier to calculate. Some banks still use them while others have changed to the mathematically correct formulas.

The incorrect formulas survive because the Americans (who as you know are the most backward people on Earth, except in war machines) use them. Also Excel. As you know the Americans still use bushels and gallons and barrels etc.

(I suppose I had better get ready now for a flood of insults from the country of free speech, if it is not an oxymoron)