Unsecured Credit

I just finished a book called "The No-Nonsense Real Estate Investor's Kit" by Thomas J. Lucier. The book became increasingly more interesting as I neared the end, with part 3, "The Fundamentals of Real Estate Investing" and part 4, "Nine-Step Process for Buying and Selling Real Estate". At the close of part 4, Lucier talked about using low interest credit cards to finance short term real-estate investing. He goes on to say...

In this business, access to readily available sources of cash allows investors to take advantage of opportunities to buy properties at below market prices the moment they are known. I've found that low-interest lines of unsecured credit are the most cost-effective source of short-term financing available today.

In the past I always immediately dismissed and shredded those 0% APR cash advance checks and snarled at the cc companies for their ever creative ways of ensnaring people into cc debt, but after seeing the interest rate charged to me on my Zecco margin account, I would happily take their 0% for a year and earn interest on their money.

But BEWARE. The cc companies still have ways of making their money. They charge fees for cash advances which may out way the benefit of the cash advance. Look for a capped fee of $30-$99, which is a good deal if your withdrawing large amounts. The majority of offers I'm seeing today for 0% cash advances come with a 3% fee, so if you with withdraw $10,000 your already down $300. Look for a capped fee and make sure the interest rate remains 0% after a cash advance is requested.

Taking advantage of your revolving credit and paying on time should increase your "credibility" with your creditors. With time, they will probably increase your limits (which you should request every six months) allowing you to use this new unsecured credit to quickly finance properties with the characteristics of a great investment.

401(k) Adjustment

Today I went ahead and adjusted my 401(k) to 1% over my employers match down from 22%. I added 1% to the match because I want to ashore I meet the requirements for the company match. If I were to allocate less then the company match, I wouldn't meet the requirements and the company wouldn't add any money.
The reason I did this is to donate more money to investments I can take advantage of right now! The money in retirement accounts can only be tapped (I'm not including things like home purchase, sickness, ect.) after the much later years of 59 and 1/2. This age is unacceptable.
So why don't I just reduce my 401(k) contribution to 0%, you may ask. Well, my momma didn't raise no fool and if you want to give me free money I'll take it.
p.s. check out this website which explains government subsidized loans as well as other benefits to take advantage of for first time home buyers.

Decreasing Costs

One of my largest expenses is gasoline. I'm sure it's not a mystery to anyone that fuel costs are increasing and now I'm spending almost $80 to fill my tank. This is a problem because like many young American men I enjoy a love affair with driving and consider it a necessity to be able to drive myself anywhere on a moments notice without a second thought (the same reason I used to own an AWD sedan for northeast winters).

In an effort to rediscover my driving freedom I have decided to sell my 95' 530i BMW (20 mpg avg.) and purchase a 97'-98' Honda Civic HX (34 mpg avg.). The Honda is a less expensive car and I expect to have around $1000 left over after selling my Bimmer. This will go directly to my Zecco account to be invested; turning liabilities into assets, that's what it's all about.

In order to receive the best possible price for my current vehicle here are a few things I do to prepare.

1. Make it look pretty.

Get out the wax, Windex, and leather cleaner and give the car a good detail.

2. Make calculated judgements

If there are items that need replacing, determine whether it is worth fixing before selling it. In my own situation, the front bumper needed new trim and a left fog light; I got both for $40 off Craigslist. Something cheap and easy to replace can boost the value enough to warrant a replacement. The other side of the spectrum would be for example the drivers seat which is showing excessive ware. To replace that seat, with a used one in better condition would cost well over $300 and I wouldn't even expect to get that back after selling the car.

3. Sell at the right time

BMW's and generally all rear-wheel drive cars sell better during spring and are harder to sell during fall and winter when most drivers have an AWD or 4X4 in mind. Kinda like buying and selling a motorcycle.

4. The test drive

During test drives with potential buyers, be mindful of where you go. If your cars suspension is on the way out, take them on nice smooth roads where that feature won't stand out. But this doesn't mean to not be...

5. HONEST

An honest person always comes off as genuine which is the most important ingredient when selling anything.