Friday, January 30, 2009

How to read a balance sheet?

Hi Friends...

Now that the times are really bad, the one thing everyone has to do before he plans to go for a change in job is to assess the financial condition of the company he/she wants to join before taking steps towards accepting the offer. This would need one to know to read the balance sheet of the company... & here is a nice article published on rediff.. which can be handy for all us.. 
A balance sheet, also known as a "statement of financial position", reveals a company's assets, liabilities and owners' equity (net worth). The balance sheet, together with the income statement and cash flow statement, make up the cornerstone of any company's financial statements.

If you are a shareholder of a company, it is important that you understand how the balance sheet is structured, how to analyse it and how to read it. 

How the balance sheet works

The balance sheet is divided into two parts that, based on the following equation, must equal (or balance out) each other. The main formula behind balance sheets is:

assets = liabilities + shareholders' equity

This means that assets, or the means used to operate the company, are balanced by a company's financial obligations along with the equity investment brought into the company and its retained earnings.

Assets are what a company uses to operate its business, while its liabilities and equity are two sources that support these assets. Owners' equity, referred to as shareholders' equity in a publicly traded company, is the amount of money initially invested into the company plus any retained earnings, and it represents a source of funding for the business.

It is important to note, that a balance sheet is a snapshot of the company's financial position at a single point in time.

Know the types of assets

Current assets
Current assets have a life span of one year or less, meaning they can be converted easily into cash. Such assets classes are: cash and cash equivalents, accounts receivable and inventory. Cash, the most fundamental of current assets, also includes non-restricted bank accounts and checks.

Cash equivalents are very safe assets that can be are readily converted into cash such as US Treasuries. Accounts receivable consists of the short-term obligations owed to the company by its clients. Companies often sell products or services to customers on credit, which then are held in this account until they are paid off by the clients.

Lastly, inventory represents the raw materials, work-in-progress goods and the company's finished goods. Depending on the company, the exact makeup of the inventory account will differ. For example, a manufacturing firm will carry a large amount of raw materials, while a retail firm caries none. The makeup of a retailers inventory typically consists of goods purchased from manufacturers and wholesalers.

Non-current assets
Non-current assets, are those assets that are not turned into cash easily, expected to be turned into cash within a year and/or have a life-span of over a year. They can refer to tangible assets such as machinery, computers, buildings and land.

Non-current assets also can be intangible assets, such as goodwill, patents or copyright. While these assets are not physical in nature, they are often the resources that can make or break a company - the value of a brand name, for instance, should not be underestimated.

Depreciation is calculated and deducted from most of these assets, which represents the economic cost of the asset over its useful life.

Learn the different liabilities

On the other side of the balance sheet are the liabilities. These are the financial obligations a company owes to outside parties. Like assets, they can be both current and long-term. Long-term liabilities are debts and other non-debt financial obligations, which are due after a period of at least one year from the date of the balance sheet.

Current liabilities are the company's liabilities which will come due, or must be paid, within one year. This is comprised of both shorter term borrowings, such as accounts payables, along with the current portion of longer term borrowing, such as the latest interest payment on a 10-year loan.

Shareholders' equity

Shareholders' equity is the initial amount of money invested into a business. If, at the end of the fiscal year, a company decides to reinvest its net earnings into the company (after taxes), these retained earnings will be transferred from the income statement onto the balance sheet into the shareholder's equity account.

This account represents a company's total net worth. In order for the balance sheet to balance, total assets on one side have to equal total liabilities plus shareholders' equity on the other.

Read the Balance Sheet
Below is an example of a balance sheet:


As you can see from the balance sheet above, it is broken into two sides. Assets are on the left side and the right side contains the company's liabilities and shareholders' equity. It also can be seen that this balance sheet is in balance where the value of the assets equals the combined value of the liabilities and shareholders' equity.

Another interesting aspect of the balance sheet is how it is organized. The assets and liabilities sections of the balance sheet are organised by how current the account is. So for the asset side, the accounts are classified typically from most liquid to least liquid. For the liabilities side, the accounts are organized from short to long-term borrowings and other obligations.

Analyse the balance sheet with ratios

With a greater understanding of the balance sheet and how it is constructed, we can look now at some techniques used to analyze the information contained within the balance sheet. The main way this is done is through financial ratio analysis.

Financial ratio analysis uses formulas to gain insight into the company and its operations. For the balance sheet, using financial ratios (like the debt-to-equity ratio) can show you a better idea of the company's financial condition along with its operational efficiency. It is important to note that some ratios will need information from more than one financial statement, such as from the balance sheet and the income statement.

The main types of ratios that use information from the balance sheet are financial strength ratios and activity ratios. Financial strength ratios, such as the working capital and debt-to-equity ratios, provide information on how well the company can meet its obligations and how they are leveraged.

This can give investors an idea of how financially stable the company is and how the company finances itself. Activity ratios focus mainly on current accounts to show how well the company manages its operating cycle (which include receivables, inventory and payables). These ratios can provide insight into the operational efficiency of the company.

There are a wide range of individual financial ratios that investors use to learn more about a company.


The balance sheet, along with the income and cash flow statements, is an important tool for investors to gain insight into a company and its operations. The balance sheet is a snapshot at a single point in time of the company's accounts - covering its assets, liabilities and shareholders' equity.

The purpose of the balance sheet is to give users an idea of the company's financial position along with displaying what the company owns and owes. It is important that all investors know how to use, analyse and read one & same applies for the prospective employees who can review the same if available on the company website to get a feel of the company's health...

Sunday, January 25, 2009

Taking a Home Loan!!!!!!!!!!!!

One would be tempted today to buy property & house. During these times since the interest rates are falling the real estate industry agents are wooing the prospective buyers by offering discounts and pre-approved loan offers. Its better for all the prospective buyers to be specially careful of the hard-earned money they plan to invest into getting their dream come true. Here is something helpful which I found on Hope it helps.

A Pune based mechanical engineer, thought he had made a "prudent decision" by opting for a fixed rate, home loan five years ago from a reputed national bank.

Three years after the date of disbursement, Sameer received a letter, which said it was time for renewal of his loan and that the interest on his fixed home loan had been increased by 0.5 per cent. On checking with the bank, he learned that there was a clause in the agreement that said the fixed rate was only for a period of three years and not for the entire tenure!

This letter brought endless, sleepless nights to Sameer and his family� now, they had to recalculate and replan all their income sources and planned expenses because the "fixed EMIs (Equated Monthly Instalments)" will increase!

What is a loan agreement?

A loan agreement is a 'contract' entered into between the borrower and the lender (banks and financial institutions) that regulates the terms of a loan. The loan agreement comes into picture immediately after the bank appraises your credit and the property that you have identified.

The agreement and the fine prints...

In the euphoria to acquire that dream house, various clauses in the loan agreement are often overlooked. However, these clauses have a significant bearing on areas ranging from interest rates to repayment schedules. Reading home loan agreements is generally viewed as a sheer formality and one always tends to ignore points that the agreement mentions. Moreover, the legal language used in the document often seems more alien than human!

In any case, not reading a loan agreement thoroughly can land you in a soup. Here are some clauses, which should be searched for inside a loan agreement and be clarified with your HFC (Housing Finance Company):

Reset Clause on Fixed Rates: Banks have introduced the reset clause in their fixed rate, home loan agreements so that they can increase interest rates in case the market rates increase in future. This effectively makes fixed rate loans equivalent to floating rate ones. This gives the banks an escape from interest rate surges but is a disadvantage for the borrower who is mostly unaware about such content in their agreement. Typically, the period for such reset clause varies from two to five years depending on the bank or housing finance company you borrow from. So read this clause in your loan agreement carefully.

Force Majeure Clause: There may be certain loopholes in your home loan agreement that allows the bank or home loan company to unfix and raise the fixed interest rate under exceptional circumstances. This will be mentioned under the 'force majeure' clause of your agreement. However, the differentiation between 'exceptional circumstances' and normal circumstances is always a tough task.

For e.g. A cut in banks' prime lending rate is not automatically translating into reduction of all PLR-linked loan rates. The reason being cited is that the bank's margins are under severe stress due to lending rate cuts. They feel interest rates on some existing sub-PLR loans do not even cover their cost of funds and any further fall in those sub-PLR loans will worsen the matter. Therefore, some public sector banks have revised the existing loan contracts in case of select sub-PLR borrowers, by using the 'force majeure' clause, meaning a 'situation beyond control'.

Defining a Fault: A 'fault' for a layman often means a non-payment of an EMI during the loan tenure. However, your bank or HFC may have a different meaning for this term. The home loan agreement of few banks defines fault as a case when the borrower expires, the borrower is divorced (in case of more than a single borrower), or the borrower is/are involved in any civil litigation or criminal offence. Therefore, you must be clear what your lender means by the term 'fault'.

Security cover at times of falling property rates: This clause states that a bank is eligible to demand additional security when property prices fall. Even if you are loyal on your EMI payments, this clause demands a security cover in addition to your loan amount and if a borrower fails to provide such a security then he/ she may be declared a defaulter by the lender.

Floating is Fixed and vice versa: Floating rate as well as fixed rate home loans are linked to the Benchmark Prime Lending Rate of a bank or the HFC from which you take a home loan. Hence, if the BPLR is 13.5 per cent and floating rate home loans are at a discount of 1.5 per cent to the BPLR, then the interest rate on a floating rate home loan is 12 per cent. So whenever the BPLR is raised, then the interest to be paid on the floating rate home loan goes up. The vice versa also holds true.

However, banks and HFCs do not show the same alacrity to reduce the interest rates, which they might have shown when increasing it. When interest rates come down, banks and HFCs offer lower rates to new customers but existing customer continue paying the higher interest rates. Check with the bank or HFC regarding the details about such clauses.

These clauses are overlooked by most home loan borrowers and some of them eventually end up paying interest rates, fees, or hidden charges completely out of the blue. It is imperative that you have a thorough understanding of such clauses with your bank or HFC.

Saturday, January 24, 2009

How to evaluate a company's financial health?

In today's time with large giants like Lehman Brothers going down the drain... one will have to be cautious in going for the right firms to continue with their careers.. here is something once can make use of.......
For companies, being able to meet short-term financial obligations is an integral part of maintaining operations and growing in the future. After all, if it's not able to meet today's debts, a company might not live to see another day! That's why it's essential for investors to know how to evaluate a company's short-term financial health. Here we take you through a few of the ratios that are the foremost tools for doing so.

The basics of liquidity
A large factor determining a company's short-term financial health is liquidity, the definition of which depends on context. In stock trading, liquidity is the degree to which the market is willing to buy a particular stock. As a characteristic of an asset, liquidity refers to the ease with which an asset can be converted into cash. This is the definition of liquidity we are interested in.

Let's compare two different kinds of assets: a building and a money market account. Even if these two assets are valued at $100,000 on a company's financial statement, their liquidities have different implications for the company's short-term health.

The money market account, an asset referred to as a cash equivalent, can be converted into cash within a day or two, if not immediately. The building, however, is very illiquid. For the company to get its cash, it must sell the building, which could take months, if not years.

Essentially, a company's short-term liquidity determines how well it can make its necessary payments (cash outflows) - which include employee wages, interest and supplier costs - given the revenue it generates (cash inflows). If a company has no cash equivalents, its inflows need to match or exceed cash outflows. So, if a company has a bad month and it has no supply of liquid assets like a money market account, it will be unable to make its necessary payments.

The current ratio:

The first ratio we will look at is the current ratio, which compares all of a company's current assets to all of its current liabilities. In general, the term "current" means less than one year. So, current assets include cash, accounts receivable, inventory, prepaid expenses and other assets that can be converted to cash within one year. Current liabilities include short-term debt, interest, accounts payable and any other outstanding liabilities that are due within a year's time.

When calculating this ratio, you are essentially trying to determine whether a company can meet its short-term obligations. It will likely be able to do so if the ratio is above 1; if the ratio is less than 1, the company is likely to fall short. We say "likely" because although a ratio of 1 or greater indicates that the company has more current assets than current liabilities, it may be inappropriate to judge certain industries by a rigid standard.

For industries that generally have a large portion of current assets tied up in inventory, a ratio of 1.5 or even 2 might be a better standard. When analyzing the current ratio, as when looking at any ratio, an investor should make comparisons between companies that operate in the same industry. Different industries have different business needs, so investors must modify their analyses accordingly.

Finally, bigger is not necessarily better in the case of the current ratio. A really high ratio, 10 for example, should probably sound some alarm bells, because it indicates that the company has a large amount of current assets that could - and probably should - be invested back into the company. Although a company with a very high current ratio may be stable in the short term, it probably has no means of sustaining its long-term growth and performance.

The acid test or quick ratio:

The acid test is a more rigorous version of the current ratio. It indicates whether a firm, without selling inventory, has enough short-term assets to cover its immediate liabilities. Companies with ratios of less than 1 cannot pay their current liabilities without selling inventories and should be viewed with extreme care. An acid test that is much lower than the current ratio signals that current assets are highly dependent on inventory - retail is a type of business in which this would occur. In general, a ratio of 1 is considered satisfactory, although, as with the current ratio, the acid test should be compared only within a similar industry.

Interest coverage:

Interest coverage indicates what portion of debt interest is covered by a company's cash flow. A ratio of less than 1 means the company is having problems generating enough cash flow to pay its interest expenses. Ideally, you want the ratio to be over 1.5.

A company with no long-term debt doesn't have any interest expense; this situation causes the current ratio to give enviable results. Companies with a poor interest coverage ratio can improve it by improving cash flow and/or lowering interest expenses by paying off debt.

This ratio is popular not only among investors, but also with creditors, who want to see that a company's short-term health is strong and that the company has sufficient cash flow to make principal and interest payments.

Another notable fact about the ratio is that sometimes different numerators will be used. For example, some analysts or creditors will use EBITDA in place of EBIT.

Activity ratios
There are a few different activity ratios, but essentially, their main function is to help determine the company's cash flow cycle, giving a picture of how efficiently assets are being used. Almost any current account can be analyzed in terms of this cycle, but the three most common activity ratios each measure one of the following:

  • How long a company takes to collect receivables
  • How long a company takes to sell inventory
  • How long it takes to pay suppliers

The calculation of activity ratios is a little complex, but to give you an idea of how these ratios work, we'll look at the activity ratio dedicated to accounts receivable. Suppose that a company has total credit sales of $22 million. At the beginning of the year, accounts receivable is at $4.5 million, and at the end it's $1.5 million. By using the accounts receivable turnover ratio we can determine that the company's receivables turn over at a rate of approximately 7.3 times per year. This means receivables remain outstanding for an average of 50 days. Here the calculations are represented mathematically:

Although we only demonstrate one activity ratio calculation here, the others are calculated in a similar fashion. All it takes is some research into the company and some number crunching.

Let's look at an example to put this all into context. Suppose that the above company has to pay suppliers within 90 days of purchase and suppose that, by calculating another activity ratio, we find the company holds inventory for 80 days.

As the company's accounts receivable remain outstanding for 50 days, we find it has a cash cycle of 130 days (80+50). In other words, from the time it purchases its product from the supplier, the company takes approximately 130 days to collect payment from the customer.

The supplier, however, requires a payment within 90 days of the purchase. This 40-day discrepancy may create short-term liquidity problems for the company. This means investors should conduct more research to determine whether there is justification for this difference, and whether it is likely to cause hardship for the company.

Examining activity ratios and determining a company's cash flow cycle are important elements of determining a company's short-term health and should be analyzed in conjunction with the other short-term liquidity ratios.

By honing in on crucial aspects of a company's financial health, ratios shed light on how well a company will do in the short term. More importantly, they help investors determine whether a company has the stability to get through unexpected problems today. If a company cannot maintain operations in the short term, it will not have the ability to provide investors with any benefits in the long term.

Monday, January 19, 2009

4 tips for hiring contractors (and 10 ways to avoid scammers)

To protect yourself — and your money — here are 4 tips to ensure that your next remodeling project goes smoothly.

By Popular Mechanics

We love building for ourselves, but some jobs just need to be subbed out. Unfortunately, a competent, honest remodeling contractor is no easy find. There are thousands of reliable, trustworthy contractors out there — but there are quite a few toolbox-wielding knuckleheads, too. Here’s what you should keep your eye on:

1. Avoid sleazy or shady tactics.
The first thing to do is make sure you're not being scammed. Beware these 10 red flags:

The contractor ...

  1. Provides credentials or references that can't be verified.
  2. Offers a special price, but only if you sign a contract today.
  3. Accepts only cash, requires large deposits or wants the entire cost up front.
  4. Asks you to write a check in his name (not to the business).
  5. Won't provide a written contract or complete bid.
  6. Refuses to apply for building permits, and asks you to get them.
  7. Offers exceptionally long warranties.
  8. Proposes to do most or all of the work on weekends and after-hours.
  9. Gives you a low-ball offer that sounds too good to be true.
  10. Has "Will work for beer" painted on the side of his trucks.

2. Check the construction work.
When you meet with contractors, ask each to bring photos or drawings of completed jobs that are similar to yours. When possible, ask to visit a completed project. Get in touch with the homeowners involved, says construction manager Amy Johnston, author of “
What the Experts May Not Tell You about Building or Renovating Your Home.” Ask pointed, pertinent questions such as:

  • What was the original construction budget?
  • What was the final construction budget?
  • How would you describe the quality of the work?
  • Was the job site kept clean and organized?
  • Was the project completed on time?
  • Were any liens filed on your property?
  • Would you work with this contractor again?

Vetting a contractor through customers works both ways — word-of-mouth recommendations have long been one of the most reliable means of finding competent contractors. Seek references from neighbors, friends, architects, colleagues and real-estate agents. You can also find local contractors, along with ratings and reviews, from online sources, such as Angie's List.

3. Check the paperwork.
Check to make sure contractors are licensed and insured. A good pro should volunteer documentation. If you have doubts, contact the Better Business Bureau and check for complaints. When comparing competitors' bids, make sure everything is spelled out. This includes the scope of the work, materials specified, warranties, references, time frames, cost overruns, payment schedule and price.

Once you have chosen a contractor, obtain a written contract that includes the items specified in the original bid, plus the final price, payment terms, sales tax, permit fees, the specific work to be performed, materials to be used, warranties, start and end date, change-order processes, final review and sign-off procedures and debris removal. Once the job is under way, make sure the necessary building permits are on display.

4. Check the bills.
When advancing money for materials, ask the contractor if you can pay the supplier directly. Always pay with a check, never by cash. Take a carrot-and-stick approach to completed work — pay incrementally as each significant phase of work is completed. Be careful about paying for work that hasn't been finished. Before making the final payment, do a visual inspection of the entire project and make a punch list of any repairs or uncompleted work. Put all change orders in writing; avoid verbal contracts.

A small but important technicality: Request signed lien releases from all major subcontractors and suppliers before making final payments. A lien release guarantees that the contractor has fully paid his materials suppliers. Former contractor Tom Philbin, author of "How to Hire a Home-Improvement Contractor Without Getting Chiseled," tells the story of a Memphis, Tenn., homeowner who had some work done on his house. "The job went smoothly and he paid the general contractor all the money for the job. But the contractor hadn't paid his supplier, who slapped a lien on the homeowner. The homeowner ultimately had to pay an additional $20,000, even though he had paid the contractor in full." Get those lien releases.

By Joseph Truini, Popular Mechanics

10 weekend projects to improve your home's value

You don't have to shell out big bucks to get a better price for your home. These easy, inexpensive fixes will add value to your home without breaking the bank.

By Melinda Fulmer of MSN Real Estate

Fetching top dollar for your home in today's tough market doesn't require an $80,000 kitchen remodel or an expensive landscape redesign.

Real-estate experts say your best bet is to invest a little sweat equity into a series of small weekend jobs — $300 or less — that boost your home's appeal and eliminate buyers' biggest objections.

Here are 10 quick ways to add value to your home without breaking the bank

1. The de-clutter weekend
De-cluttering should be the first job sellers cross off their list before starting any other project, agents and real-estate investors say.

Most people, says Atlanta house flipper Brian Trow, get used to their clutter and don't realize what a distraction it is for buyers. "You want to give a buyer the chance to see their stuff in your house," says Trow, whose firm Foundations Investment Group is featured on A&E's "Flip This House." Moreover, he says, it gives the illusion of space.

Get a friend, colleague or casual acquaintance (who won't mind offending you) to walk through your house and give it to you straight. What is distracting? What needs to go?

Figure out a way to get your clothes, books, appliances, papers, toys, art and photos under control. Shoving everything into cabinets, closets and the garage is not the answer, says Toronto-based home staging expert Debra Gould, owner of The Staging Diva.  People will look there and think, "If they can't fit everything in there, neither can I."

Pack things away in boxes and put them in the attic or put them in storage. Gould recommends coming up with a system of folders for bills, mail and important papers. Clean out a junk drawer or drawer in your entertainment center to hold these folders, so they can be cleared off counters easily. Likewise, clear the decks of a lot of your kids' toys, putting only 15 or 20 in rotation at a time. Donate some and store the rest in boxes in the attic or garage.

"You have to think, 'What can I live without?' for the next few months," Gould says.

2. Make over your cabinets
The kitchen is the most important room in the house to get right, says Timothy Dahl, editor and founder of home-renovation blog 
Charles & Hudson. And cabinets are often one of the biggest problems, he says.

You don't need to get your cabinets refaced or replaced to make them look presentable. If they're scratched or look dated, just spring for a couple of cans of paint and put a new finish on them.

White and other light neutral colors work best for most kitchens and bathrooms. If you have a larger kitchen that gets a lot of natural light, you could even try a dark chocolate brown or black, Trow adds.

Once you're done painting, don't neglect the finishing touch: the hardware. "It's an accent that people notice," Dahl says.

Choose something simple and relatively modern for the pulls, preferably in a brushed nickel. Steer clear of brass, brightly colored glass or anything decorated with pictures of birds or flowers.

3. Patch and paint
A fresh coat of paint in the living room, kitchen and master bathroom — the most important rooms in the house — will pay big dividends, says Elizabeth Blakeslee, an agent with Coldwell Banker in Washington, D.C. "Paint is one of the easiest and cheapest things you can do to freshen up your home and add zip to it."

Just don't try to jazz things up with bright colors, experts say. The most universally appealing shades are neutrals: yellow-based tones such as off-white, mushroom, medium brown or taupe, Trow says. And stay away from anything too dark. It will make the room look small.

A few more paint don'ts from the pros:

  • Don't try to experiment with accent colors or walls. (Most people don't get this right.)
  • Don't choose four or five different colors in the house. A satin wash of one color or a couple of related colors should flow smoothly from room to room.
  • Don't leave those wallpaper borders up when you paint. Their time has come and gone.
  • Once you're done painting, don't ruin the fresh look by re-hanging too many of your family photos or pieces of art, Trow says.

4. Spiff up your home's curb appeal
One quick way to entice more buyers into your house is to spruce up what
 they see from the street. Spend a weekend cleaning or replacing your mailbox, putting up new street numbers thatmatch the style of your house, cleaning your storm door and windows and touching up chipped paint on your front door, Blakeslee says. "You want their first reaction to be, 'Isn’t that cute; doesn't that look nice,'" she adds.

Take a good hard look at your landscaping and trim back any shrubs around the front that are unruly. Get rid of lawn ornaments, toys, leaves and other debris from the yard, as well as those tools or construction materials propped against a fence.

If you see bald spots, plant a few flowering shrubs. A pot of flowers by the front door, or flowering plants along the walk is a nice touch, too, agents say. Power-wash your driveway and walk (and the house, if you have vinyl siding). A tidy front yard makes buyers more willing to come inside for a look.

5. Fix your lighting
You don't have to go crazy here, agents say. Just replace anything damaged, dated or

Get rid of that Hollywood dressing-room-style lighting that frames your bathroom mirror, or at the very least, replace all of the bulbs.

Ditch that tacky, low-hanging chandelier over the dining table and replace it with a simple pendant lamp hung a little higher — at least four feet from the top of the table, Gould says.

Ditto for that energy-efficient, but oh-so-ugly fluorescent tube in your kitchen. "Nothing looks good under them," Dahl says.

You don't have to spend a lot on new fixtures — $100 or less — unless your house is priced in the upper tier of the market, experts say.

And consider replacing the light bulbs you have in your darker rooms with a higher wattage, just for the time you'll be showing your house, Gould adds. "You want lots of light in that house."

6. Get fabulously clean floors
Flooring is one area where none of our experts seemed to agree. So your safest
 bet is to spend very little and leave that choice to the buyer. "You don't want to invest in something that someoneis not going to like," Dahl says.

Settle for a floor that looks spic and span. If you have very dirty carpet, rent a steam machine and get out the stains. If you have hardwoods, buff and polish them, agents say.

And if you have a vinyl floor that is horrendously loud or damaged, consider putting down some vinyl stick-on squares in a light color to keep it from becoming a distraction, Dahl says.

If you are very handy and can find a bargain at your local big-box store, you might be able to afford a Pergo or cork replacement for a small kitchen.

7. 'Dress' your house
Once your house has been cleaned, patched and painted, it's time to think about the best
 way to show it off. Home stagers and flippers say it pays to spend a little time on new "clothes" for your house.

In the bathroom, that means replacing your old shower curtain with a new model that is lined and made of fabric. Buy a new bath mat that is simple and not too bright — one like the type found in hotels is great, Gould says.

In fact, the look of an upscale hotel bathroom is what you are going for, because it looks peaceful and doesn't make you think too much about the people who have used it. Adding fresh rolls of toilet paper before you show the house helps with that effect, Blakeslee says.

Buy a set of towels that actually match and hang them from a nice-looking towel bar. Gould says you'd be amazed at how many high-end houses she stages where the owners leave out threadbare towels that detract from a $100,000 renovation.

Clear the counters and make sure accessories such as the toothbrush holder or soap dish are coordinated and look elegant.

In the bedroom, consider your comforter. Is it stained, ripped or dated? If so, consider buying a new duvet cover or spread to keep the focus on the room, not your questionable taste.

And take a good hard look at your window treatments. Keep it light, bright and simple.  Tie back dark or flouncy curtains, or replace them with pre-made panels. If you're handy with a sewing machine, whip up some simple solid-color panels on your own.

8. Create an impression of extra rooms
Most people are willing to pay a premium for a little more breathing
 room. But no one is going to add on just to sell his or her home. One way you can give buyers more livable area is to spruce up your garage or basement, Dahl says.

Organize the tools, sporting goods and other items in your garage and get them off the floor, as much as possible. Make sure there's adequate lighting and clean or polish the floors. You want it to be a space where people canimagine spending hours tinkering on some craft or woodworking project.

Likewise, if you have a basement, Dahl says, spend some time clearing and cleaning the floor, installing adequate lighting and shelving, and sprucing up the stairs and entrance. You could even try out a sealant for concrete floors, he says. "People see these as extra rooms they want to finish," Dahl says.

If you don't have a basement, Trow suggests creating a sitting area in the backyard, with some pavers, outdoor seating and a few large potted plants, a flower bed or water feature.

9. Tackle the small stuff all at once
Instead of spreading out those annoying minor repairs over several months
 or a year, why not take care of them all at one time?

When you show your house, little problems such as a leaky faucet or a cabinet that sticks can be distracting, Gould says. "You don't want to put up doubts in people's minds about whether they are buying a good solid house,” Gould says.

You want the attention to be on your home's potential, not its problems.

So make a list and invest a not-so-fun 48 hours in fixing those broken drawer slides, replacing moldy caulking around the bathtub and fixing that cracked tile or broken step leading down to the basement.

10. The finishing touches
Lastly, before you open your house to buyers, make sure you've got the details down,
 Trow says.  Replace old, yellowing or brass switch-plate covers with new ones made of brushed metal.

Likewise, swap out old brass doorknobs and hinges and replace them with something more up-to-date.

How to hit up your landlord for cheaper rent, perks

Just saw this article on the msn.. yesterday and thought it should be useful for any future reference and maybe useful for anyone visiting my blog.. 

It's both a tough time and a great time to be a renter out there.

Across the country, the recession is putting the squeeze on people's pocketbooks, making every expense painful. And yet the downturn has given renters more power: Apartment vacancy rates nationwide rose to their highest level in more than three years — to more than 6% — in the third quarter of 2008, according to real-estate research firm Reis. (Third-quarter data is the latest available.)

That makes this potentially a great time to save on your rent with your next lease. And if your market has been particularly hard-hit, you may even trim your costs midlease, or score that desired parking spot or new energy-efficient fridge.

Whatever perk you're after, you need a plan. Landlords are business people and you need a solid business case for why they should sweeten your deal. In the following 15 tips, more than a half-dozen people who toil daily in the renting field help you build your case.

Midlease tactics
If you're in the middle of a lease and have just run aground on tough times — say, lost a job or taken a huge cut in hours — there's no easy way to knock down the size of that looming rent bill, experts say. After all, you signed a contract. And even some sympathetic landlords may be reluctant to give a brief cut in the rent because of possible accusations of unfair housing practices if they don't extend the same relief to others, says Katie Bencken of, who also manages a blog about apartment living.

The key to having any luck in reducing your rent, midlease, is communication, says Don Conrad, a property owner and author of "How to Find That Quality Tenant: The Five Simple Steps of Tenant Selection."

Tip No. 1: Pick up the phone. "If (your rent) is going to be late, give me a call," Conrad says. "It matters, big-time." Late rent payments often amount to late mortgage payments for the landlord. And that makes a landlord very unhappy.

"They're probably not going to negotiate a lower rent," Conrad says of tenants, "but they might be able to negotiate time."

Conrad cites an example of a tenant of his who got about a month behind in her rent while she was sick. "She would call me: 'Don, I get paid on this Friday. ... Is that OK?'" he recalls. "It's not that we were friends, but I could tell that she was really trying, and the lines of communication were open."

But, importantly, Conrad knew the woman was a good bet, and "I could see the catching up coming."

How do you earn that trust? How do you exude reliability — just in case you need to fall back on your reputation?

Tip No. 2: Burnish that history. Two words, more than any others: good credit. "Keep your credit record clean as a whistle, because it will be checked out — except by an idiot, and who wants an idiot landlord come January when the heating fails?" says Lesley Henderson, author of "The Tenant Survival Guide: Essential Reading for Prospective Tenants and Those Already in Rented Accommodation."

Tip No. 3: Barter. "Think about what you can do and what they need, so you're asking for a break, but they're getting something in return, too," Bencken says. Are you a graphic designer who could design fliers or a professional-looking logo for their business? Would it be a simple enough task to shovel snow for the landlord each winter, in exchange for a cut on the rent or an upgrade to your dated kitchen?

One writer on Bencken's blog said his landlord needed Internet access, so the renter gave him his password to his Wi-Fi connection in exchange for a rental reduction.

A caution: As with so many things, get it in writing, so there's no confusion later about the agreement and the amount, Bencken says.

Tip No. 4: Make nice and learn names. Before you need to rely on it, "Carry on an ongoing contact and relationship with the folks who run the building — the maintenance guys, the folks in the office, otherwise the owner," says Ed Sacks, the "Apartment Watch" columnist for the Chicago Sun-Times and author of the book "The Savvy Renter's Kit." "You are establishing rapport and trust - and rapport and trust are noneconomic values beyond words."

When you do that, Sacks says, you're not just the guy in 2C — "you're Joe Smith, or Mr. Smith or Joey."

Drop off cookies over the holidays, he suggests — things like that. "Suck up, yes. Absolutely. I suggest that it will reap benefits the tenant has no idea about."

Savings before renewal
When vacancies are up — the power has shifted to you, the renter. When thinking about renewing, you just need to know how to use that power.

Tip No. 5: Show early that you're serious. The best way to get your landlord's attention is to show — early — that you're ready and willing to move somewhere else if the renewal process doesn't work to your satisfaction.

"Start well in advance," advises Dale Willerton, founder of the commercial-oriented firm The Lease Coach, who shared some general lessons on scoring a good rent. If you wait, "you will lose the advantage of being able to move," Willerton says.

Landlords know this, and can tell when you're not so serious. "Creating competition for your tenancy is the most important thing a tenant can do."

Tip No. 6: Be a sleuth. You need to do your homework. Call up and find out what the vacancy rate is in your building, and in other buildings owned by your landlord. How much did that guy pay who just rented a similar place above you? What are the discounts down the street for similar-sized apartments?

"To get the management companies' information, you can literally look inside the building's entryway and there is always a plaque with their information on there. Call them — usually you are talking to a secretary or assistant who has their listings," she says. Also, peruse their Web sites, along with the sites of companies like Schwartz's.

If you are bold, go to the building and talk to the superintendant and/or doorman if there is one. They are knowledgeable about what units are currently going for, Schwartz says.

Remember: Prices of properties owned by the same company even within the same neighborhood can vary widely, so be sure you're comparing apples to apples.

Tip No. 7: Make your case. Go in and meet with the landlord, present him with the information, and tell him that as a good tenant, this is what you need in order to stay. Many landlords will respect that. "Have an argument for your landlord," Schwartz says.

Tip No. 8: Ask for too much. OK, don't go overboard. But "make sure you ask for more than you expect to get," says Willerton, who says he once was able to get 12 months of free rent on a five-year lease for a commercial client. How? "I asked for 18 months," Willerton says. Remember, it's a negotiation. Start bigger and settle for a little less, but for what you actually want.

"Tenants have to have a mind-set of negotiating to win," Willerton says. "You don't go to your landlord and say, 'As a favor, can you do this for me?' Be prepared to win."

Tip No. 9: Go long. Landlords want stability and certainty. Turnover is unstable and painful for them — particularly in high-rent places such as New York City. "If you are a good, desirable person, they do not want to lose you. It is very hard to find someone that makes 45 times the rent (the usual requirement to sign the lease in New York City) and has good credit," Schwartz says.

"Sign a two-year lease, with a three-month notification for ending the lease, suggests Mike Piepsny, executive director of the Cleveland (Ohio) Tenants Organization. In exchange for giving that security, demand an appropriate rent cut for the area, Piepsny says. 

Tip No. 10: Pay up front. "Cash up front for several months' rent will usually negotiate a nice reduction — but check out that the landlord really owns the building (not, say, his identical twin brother) before you pay up in cash," says author Henderson. But first, check whether your credit-card company has buyer protection, and use a credit card if possible, Henderson says. Why? Say the roof leaks and you have to move out for a few months that you've already paid for - a credit-card company can help you recover your money from a balky landlord.

Tip No. 11: Pay early — every month. "A landlord has got to pay bills, so they need cash flow," says John Fisher, director of TenantNet, an advice site for New York-based renters. Suggest paying the rent two weeks early each month in exchange for a discount. "Maybe they'd be willing to take a couple of (percentage) points off," Fisher says. "It all depends on the market, that's what it really boils down to."

Tip No. 12: Go easy on the repairs. Landlords will do repairs and upgrades — sometimes minor, sometimes major — to apartments. State laws even mandate how often some improvements have to be made. (Find some links here, or check with your state's tenants' rights group.) One way to shave some money on rent is to tell the landlord that that lime-green shag carpet still looks fine to you, and you'd be happy to live with it for another year if he'd knock, oh, 50 bucks from the monthly rent, Bencken says.

Tip No. 13: Take aim at pet rent. Some apartment complexes charge an additional rent for owners of pets, on the assumption that the unit will undergo more damage. If you've lived there for a year, have an exceedingly mellow and clean pet and are hoping to renew, that could be negotiable, Bencken says. Ask the manager to do a walk-through of the apartment with you, to show the manager that Fluffy isn't doing anything that would require additional rent. This isn't foolproof, but "it would be worth a try," Bencken says.

Tip No. 14: Lobby for an upgrade. "If nothing else works," Bencken says, "ask for a new appliance or a larger repair" for your apartment. This doesn't always work, because some complexes replace appliances on a fixed schedule. But it would at least improve your living situation. "They want you to stay, and if they can give you something — if not lowered rent, then something else — most managers will try to do that," she says. Another idea: Ask for an EnergyStar appliance — those high-efficiency appliances that will save you money on your energy bill.

Tip No. 15: Make a list; check it twice for savings. Make a list of all the ways you spend your money around the apartment complex: Parking. Bundled cable TV. Other services. Maybe an in-house gym. Ask yourself what you really want and use, and ask to have the others removed from your monthly bill. Get creative with your savings strategies: Some auto insurers offer discounts for covered parking; if you're parking in an open-air lot and you know there are spaces available in the underground lot, ask to be upgraded there, free, as part of your lease renewal.

When you incorporate several of these tips, don't be surprised if you save at least a hundred bucks a month — and maybe much more.