Corporate Finance

Corporate Finance
The field of corporate finance deals with the decisions of
finance taken by corporations along with the analysis and
the tools required for taking such decisions. The principle
aim of corporate finance is enhancing the corporate value
and at the same time reducing the financial risks of the
company. In addition to this, corporate finance also deals
in getting the maximum returns on the invested capital of
the company. The major concepts of corporate finance are
applied to the problems of finance encountered by all type
of firms.

The discipline of corporate finance can be split into the
short term and the long term techniques of decisions. The
investments of capital are the long term decisions relating
to the projects and the methods required to finance them.
On the other hand, the capital management for working is
considered as a short term decision that deals with the
short term current liabilities and asset balance. The main
focus here rests on the management of inventories, cash
and, the lending and borrowing on a short term basis.

Corporate finance is also associated with the field of
investment banking. Here, the role of the investment banker
is the evaluation of the various projects coming to the
bank and making proper investment decisions regarding them.

The Capital Structure:

A proper finance structure is required for achieving the
set goals of corporate finance. The management has to
therefore design a proper structure that has an optimal mix
of the different finance options that are available.

Generally, the sources of finance will comprise of a mix of
equity as well as debt. If a project is financed through
debt, it results in causing a liability to the concerned
company. Hence in such cases, the flow of cash has various
implications regardless of the success of the project. The
financing done by equity carries a lower risk regarding the
commitments of the flow of cash, but the result of this is
the dilution of the earnings and the ownership. The cost
involved in equity finance is also higher in the case of
debt finance. Hence, it is understood that the finance done
through equity, offsets the reduction in the risk of cash
flow. The management has to hence have a mix of both the
options.

The Decisions of Capital Investments:

The decisions of capital investments are the long term
decisions of corporate finance that are related to the
capital structure and the fixed assets. These decisions are
based of several criteria that are inter-related. The
management of corporate finance attempts to maximize the
firm's value by making investments in the projects that
have a positive yield. The finance options for such
projects have to be done in a proper manner.

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My name is Tom Husnik. I live in Minnesota. My web site is
at http://www.bestfixitfinancial.com

7 Dishonest Home Refinance Tactics - To be forewarned is to be forearmed....

7 Dishonest Home Refinance Tactics - To be forewarned is to be forearmed....
Are you planning on refinancing your mortgage in the near
future? If so, keep reading because in this article I'm
going to expose seven different "insider" tactics used by
dishonest lenders and mortgage brokers that could cost you
thousands!

While the majority of lenders and mortgage brokers are
honest and often provide a positive experience, it's very
important that you be aware of some of the dishonest
tactics you may encounter when you refinance your home
loan. By avoiding these tactics you can save yourself
thousands of dollars over the course of your mortgage loan.
To be forewarned is to be forearmed....

1. Mortgage Penalties - If your current mortgage loan has a
prepayment penalty, some lenders or mortgage brokers will
promise you that they'll "handle" any penalties when you
refinance, just to keep your deal. What they fail to
mention is that you're actually paying them anyway.
They'll typically figure those penalty fees into the
interest rate that they offer you. So not only are you
actually paying them, you'll pay interest on it to boot.

2. Legal Fees - Refinancing often requires legal fees for a
variety of required expenses. In order to secure your
business, some mortgage brokers will tell you that they
will pay your legal fees when you refinance your mortgage
with them. Again, they'll more than make up for it by
giving you a higher interest rate.

3. Tied Selling - Unscrupulous refinancing tactics are one
thing; this crosses the line into being illegal. Up
selling and cross-selling frequently occur in business
today. So if you have a mortgage loan with a particular
lender, chances are you may have credit card accounts or
unsecured lines of credit with that same lender. When a
lender learns that you may be refinancing your loan with a
different financial institution, you may be told that your
credit card account or credit lines may be closed if you
refinance your mortgage loan with someone else. This is
called "Tied Selling" and is considered illegal.

4. Denigration of Funding Sources - In an effort to keep
you from refinancing, some lenders have also been known to
insinuate that your mortgage broker is funding your loan
with an unreliable or even illegal source of funds.
Sometimes they'll do anything to preserve their cash cow.
Their primary interest is in keeping you where you are,
overpaying on your loan.

5. Monthly Compounding - Some lenders will compound the
interest on your refinance mortgage loan monthly instead of
twice a year, while offering you a slightly lower interest
rate. This results in you paying much more interest in the
long run.

6. Come Again - If an institutional lender or mortgage
broker lacks the knowledge or product base to put you into
a refinancing vehicle that fits you and your situation,
sometimes they'll tell you that another lender or broker
won't be able to help you either and will suggest you come
back in a year or so. Not only does this keep you from
getting your refinancing needs met, it preserves you as a
potential future client.

7. Double Dipping - This last tactic is only dishonest if
the lender or mortgage broker does not fully disclose
additional service fees. Some mortgage brokers will charge
you an out-of-pocket fee as a means of compensating them
for obtaining your home refinance loan. I consider this an
unnecessary expense on your part because they are already
being compensated by the lender, so they are essentially
double charging for the loan - once by you and once by the
lender. You may want to consider avoiding mortgage brokers
that charge you an up-front fee to refinance your mortgage.

----------------------------------------------------
Darrin Roseborsky is a Refinance Specialist with OMAC
Mortgages, seminar speaker and president of
CanadianHomeRefinance.com. Darrin shows people how to
MAXIMIZE their equity PROPERLY and how to choose options
that make the MOST SENSE for their situation! An example of
exactly how this works, is at:
http://www.canadianhomerefinance.com

HELP - I Want My 401(k) Retirement Money Back!

HELP - I Want My 401(k) Retirement Money Back!
Here's the Internal Revenue Service's definition of a
401(k): "a tax-qualified deferred compensation plan in
which an employee can elect to have the employer contribute
a portion of his or her cash wages to the plan on a pre-tax
basis."

So, let's say you've got a nice 401(k) savings. What
happens if you need to withdraw that money?

Early distributions are those that are received before age
59 ½. To discourage them, early distributions are
subject to normal income tax plus a penalty of 10%
additional tax unless one of the following occurs:

1. You die or become disabled

2. Your employment ends and you roll over the
money directly to another qualified retirement plan

3. The plan ends for any reason including an IRS
levy and no other plan is established or continued
in its place

4. You need to pay for medical care up to the
amount allowable as a medical expense deduction

5. The distributions are part of a series of
substantially equal periodic payments over your
life expectancy after you no longer work for the
employer

Without one of these five conditions prior to reaching age
59 ½, the only way to withdraw money from your 401(k)
without having to pay it back is to qualify for a Hardship
Distribution.

So what qualifies as a financial hardship under the IRS's
rules? First of all, individual plans can vary greatly
from employer to employer.

If you own a business or manage a retirement account for
employees, you need to become familiar with your plan.
Many companies may have a 401(k) plan without really
understanding all the details.

So if you think you might qualify for a Hardship
Distribution from your 401(k), ask your employer if the
plan allows for these distributions at all.

Employers must adhere to the strict guidelines of their
plan documents and can not make loans or Hardship
Distributions if the plan doesn't allow for them.

If your employer doesn't know the answer or seems unwilling
to research this for you, ask them for a copy of the plan.
All participants are entitled to receive the plan document
in writing.

If your 401(k) plan does provide for Hardship
Distributions, here are the requirements:

(1) the withdrawal must be due to an immediate and heavy
financial need; (2) the withdrawal must be necessary to
satisfy that need (i.e. you have no other funds or way to
meet the need); (3) the withdrawal must not exceed the
amount needed by you; (4) you must have first obtained all
distribution or nontaxable loans available under the 401(k)
plan; and (5) you can't contribute to the 401(k) plan for
six months following the withdrawal.

The amount you can withdraw is usually limited to the
amount of your elective deferrals only. This would not
include any income earned on the deferred amounts or money
matched by the employer.

The following items are considered by the IRS as acceptable
reasons for a Hardship Distribution:

1. Medical expenses for you, your spouse, or dependents

2. Purchase of a primary residence or repair of a primary
residence

3. College tuition and related educational costs such as
room and board for the next 12 months for you, your spouse,
dependents, or children who are no longer dependents

4. Payments necessary to prevent eviction from your home,
or foreclosure on the mortgage of your principal residence.

5. Funeral or burial expenses for immediate family members.

You do not have to pay the withdrawal amount back to the
401(k) account. However, as I mentioned previously, you
can't contribute to the 401(k) plan for six months
following the withdrawal.

So when investing in a retirement account don't think of it
as a regular savings account. You won't be able to get
that money back into your hands before age 59 ½
without a significant penalty or hardship that you can
prove.

----------------------------------------------------
Laura Adams is the host of the popular MBA Working Girl
Podcast. The content combines brainy business school theory
with real-world business practice from her career as a
business owner, manager, consultant and trainer. Subscribe
for FREE to this top-rated show and get the useful MBA
Essential Tip at
http://www.mbaworkinggirl.com