hi. this blog have move to a new site.
http://blog2freedom.com/
Saturday, November 27, 2010
Tuesday, November 16, 2010
Financial objectives 2011
Most if not all project management will use SMART criteria when setting project objective. The first known uses of the term occur in the November 1981 issue of Management Review. In order to make my objectives more organized, I will use the same concept as well. So what are they:
S-Specific
M-Measurable
A-Attainable
R-Relevant
T-Time-bound
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So there you go. Any objective set would need to be specific, measurable, attainable, relevant and time bound for it to be meaningful.
So here are my objectives. I hope by writing it here, it will help me boost my moral towards achieving financial freedom.
Save at least 10% of my total salary each month for next 12 months in 2011.
- At the moment that is what im doing now, so I just have to continue what im doing.
Get a government loan for housing
- Have to check first whether im eligible or not. If not, then I have to scrap this plan
Increase monthly income. Sorry, I can’t specify how much-err maybe increase by at least 20%.
- Find other source of income-part time job, start buying share, blogging?
Buy 1 property (with the condition of achieving my first 3 goals)
So that’s it. Maybe some of the objectives are not specific enough, but I will go through it again later.
Leapfrogging
Let me share with you a concept introduced by Peter Spann in his book ‘From broke to multimillionaire in just 7 years’. If you remember this is the book that ive introduced a few days ago.
Basically leapfrogging allows you to buy properties continuously without deposits, as long as you can continue to service the loans (that means if you can get positive cash flow). The more your equity and rents grow, the more properties you can acquire.
Now this how its been done:
1. Use equity or cash as the first deposit
2. Rejuvenate to add value (cosmetic renovations only)
3. Increase the rent (it’s important to do this before the revaluation because the increase in the rent helps justify the new higher valuation you are going to ask for the property)
4. Have the property revalued
5. Refinance to draw down equity for your next deposit
6. Buy your next property and rejuvenate
Oh did i forgot to mention that this can be done in Australia...i don’t think we can do exactly the same thing in Malaysia. Why? In Australia the valuer value the property based on rent using the concept of straight return. For example, if the property is rented for 100 dollar a week, then the value of the property would be 100000 dollar.
Anyway, we can actually play with the concept and make slight changes to suit our current situation in Malaysia. How? We have to find a below market value properties.
Now.. here’s the process
1. Find a below market value property in secondary market (why secondary market? Unless if you can get developer to give you extra money, or bank that give you market value financing by buying at auction, then you can go for the other two)
2. Ask for a mark up in SnP
3. Use the extra money to buy another property
If you can’t get a super below market value property, then we just have to wait until the market price increased (which will take a longer time), unless if you can get more untung by refinancing straight away (some banks have no lock in period). If you want to refinance straight away, then you can use this method for auction properties.
Now let me show you the power of cash in buying properties. If you are super rich and have a lot of cash, then you can use this method. Ill point out the advantages as well for you.
1. Again, start by finding a below market value property. But this time, you can find it in secondary/auction market (advantage: higher chance of getting below market property as you have larger market). If you cant find any, try and create one by telling them that you want to buy cash.
2. Now after that, go to any bank and remorgage at current market value.. what will you get, an extra money. For you to buy another property, but this time, even at higher price (therefore enlarged your market even more).
3. Repeat the process until you make mistake and buy the wrong property/ you use your money for something else.... hehehee....
4. By doing this, you don’t have to worry that you deposit will burn, especially if you are buy auction as you are paying first. Its easier to get the bank to finance a fully paid property.
Any comments about it? Or maybe its just my imagination....
Basically leapfrogging allows you to buy properties continuously without deposits, as long as you can continue to service the loans (that means if you can get positive cash flow). The more your equity and rents grow, the more properties you can acquire.
Now this how its been done:
1. Use equity or cash as the first deposit
2. Rejuvenate to add value (cosmetic renovations only)
3. Increase the rent (it’s important to do this before the revaluation because the increase in the rent helps justify the new higher valuation you are going to ask for the property)
4. Have the property revalued
5. Refinance to draw down equity for your next deposit
6. Buy your next property and rejuvenate
Oh did i forgot to mention that this can be done in Australia...i don’t think we can do exactly the same thing in Malaysia. Why? In Australia the valuer value the property based on rent using the concept of straight return. For example, if the property is rented for 100 dollar a week, then the value of the property would be 100000 dollar.
Anyway, we can actually play with the concept and make slight changes to suit our current situation in Malaysia. How? We have to find a below market value properties.
Now.. here’s the process
1. Find a below market value property in secondary market (why secondary market? Unless if you can get developer to give you extra money, or bank that give you market value financing by buying at auction, then you can go for the other two)
2. Ask for a mark up in SnP
3. Use the extra money to buy another property
If you can’t get a super below market value property, then we just have to wait until the market price increased (which will take a longer time), unless if you can get more untung by refinancing straight away (some banks have no lock in period). If you want to refinance straight away, then you can use this method for auction properties.
Now let me show you the power of cash in buying properties. If you are super rich and have a lot of cash, then you can use this method. Ill point out the advantages as well for you.
1. Again, start by finding a below market value property. But this time, you can find it in secondary/auction market (advantage: higher chance of getting below market property as you have larger market). If you cant find any, try and create one by telling them that you want to buy cash.
2. Now after that, go to any bank and remorgage at current market value.. what will you get, an extra money. For you to buy another property, but this time, even at higher price (therefore enlarged your market even more).
3. Repeat the process until you make mistake and buy the wrong property/ you use your money for something else.... hehehee....
4. By doing this, you don’t have to worry that you deposit will burn, especially if you are buy auction as you are paying first. Its easier to get the bank to finance a fully paid property.
Any comments about it? Or maybe its just my imagination....
Back to Basic
Currently i'm stuck with my loan applications for my housing loan. They said that ive borrowed more than i should. My first application was rejected, but im still waiting for a few more now. Banker told me that in my CCRIS, there is one loan that i have to pay for approx 2k/month. I really wonder how can that happen as the highest loan that i have to pay for my loans are around 1k. Is it related to me borrowing from islamic institutions/banking?. ill check that later....for the moment, i have to start asking my beloved government to loan my investment. hehehe..70% margin of finance?.. no effect to me as i cant borrow anymore. At the moment it's time for me to plan back my portfolio.. its time to get back to basic!
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