Which Is Better- A UK Or French Mortgage?

Which Is Better- A UK Or French Mortgage?
There are a number of reasons for taking out a mortgage to
finance your property in France aside from the obvious
necessity for extra funds. Firstly it can be a good way to
invest even small amounts of capital if it is possible to
leverage a sizeable mortgage that will be covered by the
rental return of the property. Any increase in the value of
the property could reap great rewards on just a small
investment of say 10 or 15% of the value of the property.
Secondly you may have other priorities for your money such
as your own business investment, shares or renovation works
to your property that you view as bringing a greater return
on your investment. Thirdly, it can be a great way to
reduce the inheritance tax liability on your French
property by lowering its net value especially if the
inheritance rates are higher in France than back home.
Fourthly your mortgage interest repayments can be off-set
againts income tax thus lowering your French income tax
liability on your property.

Increasing your domestic (UK) mortgage

-This can be the easiest way to get your mortgage as there
will be far less paperwork and initial set up fees
-Money comes out of your bank account in the currency in
which you are paid thereby making it easier to forecast
your budget

BUT

-Interest rates in the UK are currently higher than those
on the continent so repayments could be reduced
substantially by raising the mortgage in France.

Getting a mortgage in France

-Interest rates are likely to be lower than current UK rates
-Your assets and liabilities will be balanced so that if
the mortgage cannot be paid you do not lose your home in
the UK, just the one in France.
-Your UK property will retain its equity so that it is
available if you need to use it to borrow money in the
future in the UK
-If your French home is rented out then you can offset the
mortgage repayments against rental income so that your tax
liabilities are reduced
-Inheritance tax can be reduced by taking out a mortgage on
your property in France as this will reduce its net value.

BUT

If you live and work in the UK then you are at the mercy of
exchange rate fluctuations so that if the Euro suddenly
appreciates in value you will have to make larger
repayments from your English account to cover the mortgage.
For example, if the Exchange rate moves from 1.6 to 1.4
Euros to the pound (an appreciation in the value of the
Euro) on a 200,000 Euro mortgage with an interest only
basis of 5% p.a. then annual repayments rise from
£6250 to £7143. The reverse can also happen but
you must calculate if you can cope or not with such
fluctuations. You can of course also enter into forward
contracts with currency specialists where you buy your
Euros up to two years in advance to protect yourself
against currency fluctuations.

What next?

If you decide that you do want to take out a mortgage in
France then we can help you by putting you in touch with
trustworthy mortgage brokers and banks who will endeavour
to offer you the best quote possible. This should be
arranged "in principle" before you set off to France in
order to avoid any untimely delays once you go ahead with
your property acquisition. Both fixed as well as variable
rates of interest are available depending on your financial
situation and although interest and capital repayment
mortgages over a 10 or 15 year period are the norm there
are also interest only mortgages available.

----------------------------------------------------
Leapfrog Properties is a French Property agency
specialising in sales across France and Niclas Dowlatshahi
is the Managing Director. Visit
http://www.leapfrog-properties.com to find out more.

Budget + Investment = Reward

Budget + Investment = Reward
If you find yourself using your savings account more often
than you would like, then it is time to re-evaluate your
spending habits. In doing so, saving money should become a
breeze. To better reap the rewards of a savings account,
update your budget to get the most out of your savings and
become familiar with your banking options.

It may seem tedious and time consuming to keep track of
every dollar you make, but it is necessary when you are on
a tight financial rope. Click here for a budget worksheet
to help you get started. Remember that this worksheet is
only a template. You can create your own or just use a
notebook to journalize your spending.

Once you have figured out how much you can safely deposit
into a savings account, then your next step is to make the
most out of what is being offered by banks and/or credit
unions. Interest bearing savings accounts are offered with
most major banks, but are they really giving you the
highest yield possible?

One way to do some research on high interest yield savings
accounts is through the Internet. If you are computer
savvy, jump online and check out local banks as well as
IngDirect.com or EmigrantDirect.com. These two web-based
banking institutions typically offer higher yields with
their savings accounts (four to five times as much) then
the brick and mortar you will find locally. Linking up with
an existing bank account of your choice, the Internet based
banks will allow you to make deposits and withdraws as
often as you need to. You have complete access to your
money. It is no different than the conventional bank
account. You receive the same benefits, with the exception
that you do all of your banking through the Internet.

As with budgeting, when you put your money into a savings
account, it is a good idea to review your financial goals.
What do you have planned for the next 5, 10, or 15 years?
When you figure out an amount you wish to save, you can
safely make timely deposits into an account and watch your
money grow. This can be done through a regular savings
account, by purchasing a certificate of deposit or
committing to a retirement fund. Both of the Internet based
banks mentioned above offer higher yields of return for all
of these options. Because an Internet based bank does not
have the costs of a brick and mortar, their customers
benefit from greater returns on their investments.

Whenever you open a bank account you want to make sure that
it is benefiting you and not the financial institution.
First, be an informed consumer. Review the bank's history
and credentials. No matter the type of account you open,
you want to make sure it is free of monthly service fees
and that they do not require a minimum balance, in case you
need to withdraw more than anticipated. Lastly, pay
attention to the customer service you receive from the
start. This will give you an idea of the type of service
you will receive in the future. If you are not content,
take your money and business to another bank. Do not settle
for mediocre service. It is your money, invest it wisely!

The subject matter contained in our educational
publications is for informational purposes only. We suggest
that you consult your financial or other advisors when
planning for your specific needs or requirements

----------------------------------------------------
Debt Management Credit Counseling Corp. ("DMCC") is a
501c(3) not-for-profit charitable organization located in
Deerfield Beach, Florida. DMCC provides free financial
educational materials, seminars and a financial literacy
program titled Debt, Money & Credit Concepts to consumers
across the United States. DMCC financial counselors can be
reached by calling 866-618-DEBT, emailing
debthelp@dmcconline.org, or by visiting
http://www.dmccorp.org .

The IRS has a holiday gift for you. Really, they do!!

The IRS has a holiday gift for you. Really, they do!!
How would you like a new computer for your business this
holiday season?

Even better, how about ten computers, a few printers, and
some iPhones? Or maybe an SUV - how would that Hummer look
under your tree (awkward comes to mind, but it's doubtful
anyone would complain.)

The preceding will happen for millions of businesses this
holiday season, with the IRS playing Santa Claus. All
because of a provision to the US tax code called Section
179.

What is Section 179, and how does it work?

In simple terms, Section 179 is an attempt by the United
States government to stimulate the economy by encouraging
small to medium sized businesses to purchase equipment this
year by making it very advantageous in a tax sense.

In a nutshell, it works like this:

Normally, when a business purchases equipment, they do not
get to "write it off" right away. They instead must
"depreciate" it over the course of several years. So a
business could not realize the full tax advantages until
years after the fact.

Section 179 does away with this, and allows certain pieces
of equipment (including most electronics and office
machines, and even some vehicles) to be deducted in full
the year they are purchased. This is an enormous
differential, and indeed spurs many businesses to make
year-end purchases (because the equipment must be purchased
and put into service by midnight 12/31/2007.)

Consider this:

Under the old provision of depreciation: A business
purchases a $5,000 computer system, and yields a taxable
income savings of $1,000 a year over five years. Yes,
that's nice, but it's hardly going to make a business run
out and buy a system right now. A business would simply buy
the computer system when they needed to upgrade, and not a
minute sooner.

Under section 179: That same business would realize the
full $5,000 deduction this year. This can have a profound
effect on the taxes this business pays. That might make the
business buy the system right now.

Why right now? Because tax codes change, so the smart
business will take advantage of Section 179 while it's
viable and actually look to buy qualified equipment this
year. And since many pieces of needed equipment qualify
(even many SUV's qualify), it makes it very easy to justify
a year-end purchase (statements like "we were going to need
new computers anyway - so we may as well save some tax
dollars" are often heard around the office supply store.)

Just like Santa doesn't bring gifts to bad children (so the
rumor says); there are some limits to what a business can
deduct. While the list of qualified equipment is extensive,
you still may want to make sure what you are buying
qualifies. There is also a limit to how much money can be
spent. $500,000 is the limit that a business can spend on
qualified equipment to fully qualify for the deduction, and
the total deduction cannot be more than $125,000. But most
small businesses will not reach these numbers, so Section
179 is truly a "small to medium sized business" deduction,
and aimed squarely at helping these businesses grow.

----------------------------------------------------
Want the details about this important tax strategy? Go to
http://www.crestcapital.com/tax_deduction_calculator for
information to maximize your equipment investment. Learn
about options that can remove financial roadblocks to your
2007 tax savings.

The Future of the French Property Market

The Future of the French Property Market
The property market generally in Europe appears to be
stabilising compared to the US market which appears to be
in a bit of a crisis due to the sub-prime lending market.
We have seen a marked slowdown in the Spanish property
market and the UK market seems to have lost most of its
steam now as well. This is likely to be pervasive over the
next few years as unlike in 2004 when everyone predicted
the same thing; today interest rates are that much higher
as are property prices and the uptake of mortgages in the
UK are also slowing while house repossessions are
increasing. The effect of this is likely to be a
stabilising property market with minimal capital growth and
in some areas of the UK even price falls. Getting a
mortgage in the US, Spain and the UK has always been
relatively easy than when compared to France thus ensuring
that a sub-prime crisis like we are witnessing in the US is
highly unlikely in France. French rules on mortgage lending
dictate that the mortgage applicant must be earning at
least three times their monthly mortgage outgoings after
taking into account all other loans. This means that
although people are refused finance more often in France
and the procedure of gaining a loan can often feel
protracted it does actually benefit the economy and its
property owners in the long run.

The new president Nicolas Sarkozy has clearly stated his
wish to make the French economy achieve its full potential
where it has failed to do so in the past. He also wishes to
turn France into a nation of home-owners much like Thatcher
did during her time in power in Britain. In France only 57%
of the population currently own their own home compared to
70% in Britain and an impressive 84% in Spain showing there
is plenty of room for growth here. He intends to achieve
his dream by implementing a number of economic and tax
reforms which are likely to encourage trade and increase
Economic activity. These changes include but are not
limited to the following-

1) Extending the 35 hour working week
2) Significantly reducing the amount of inheritance tax and
even making spouses exempt
3) Allowing mortgage interest payments on your main home to
be offset against tax
4) A shift away from direct taxation (such as income tax)
to indirect taxes (such as VAT and environmental tax) with
the result being an overall tax reduction of 4%

The effects of all these should increase demand for
property and the propensity to invest in French property in
the long term. By itself this does not mean property prices
will increase but when you take into account that there is
a housing shortfall of 400,000 properties across France
each year this excess demand and under supply is bound to
have a positive impact on real estate prices.

----------------------------------------------------
Niclas Dowlatshahi is the Managing Director of Leapfrog
properties who are an agency specialising in property sales
across France. Visit http://www.leapfrog-properties.com to
see how we can help.

Three Reasons Why Your Company HAS to Accept Credit Cards For Business

Three Reasons Why Your Company HAS to Accept Credit Cards For Business
Is yours one of the few companies out there that still
doesn't accept credit cards for business? If it is, you
might be shooting yourself in the foot without even
realizing it. Credit cards can make or break a business,
and that's no exaggeration. Here are four reasons why your
company needs to accept credit cards for business -- no
ifs, ands or buts about it.

1. Almost 90-Percent of Online Transactions Are Paid For
With a Credit Card

If you have any hopes of taking your business online, you'd
better accept credit cards for business. If you don't,
you're only going to get about 10-percent of the online
transactions you possibly could be getting. No two ways
around it -- that's a sad, sad number.

2. Customers Want Convenience

I can't count the number of times I've been out of the
house with nothing by my wallet and a few credit cards. No
cash, no checkbook. The only way I could purchase a product
or service is with a credit card. If an establishment
doesn't accept credit cards for business, I won't be buying
from them.

Think about how many customers you're excluding if you
don't accept credit cards for business. How many people
won't shop with you -- not because they don't want to, but
just because it's not convenient for them.

When it comes to making money, you need to offer your
customers convenience. Credit card acceptance is a big part
of that.

3. You Can Charge More

If you offer a valuable product or service, you might not
be getting as much as you could for what you're offering.
Because cash-only consumers are much more price-conscious
than credit card consumers, you have to lower your pricing
when dealing on a cash-only basis.

If, on the other hand, you accept credit cards for business
you may actually be able to raise prices without losing any
volume. In fact, chances are your volume will increase now
that you've opened yourself up to an entirely new segment
of the consumer market.

4. Those Who Don't Ebb and Flow Will Eventually Die

The business world is in a constant state of evolution.
Historically, the companies that don't ebb and flow with
the changes eventually die out. Credit cards are a part of
that change. If you don't accept credit cards for business,
you may be heading in the way of the dinosaurs -- which
means facing extinction.

If your company isn't yet accepting credit cards, consider
the above facts. Yes, merchant accounts cost money.
Processing credit card transactions isn't free. However,
keeping the above in mind, can your company really afford
to not accept credit cards for business?

----------------------------------------------------
For more tips on credit cards, saving money and avoiding
getting taken, check out CreditCardTipsEtc.com, a website
that specializes in providing credit card tips, advice and
resources.
http://www.creditcardtipsetc.com

SEP's, IRA's, 401(k)'s and RRSP's

SEP's, IRA's, 401(k)'s and RRSP's
One of the most common questions I get regards
"tax-favored" investment vehicles such as Self-employed
Retirement Plans (SEP's), IRA's, 401(k)'s, and, in Canada,
RRSP's. With the exception of the Roth IRA and Roth 401(k),
these vehicles primarily rely on the time-honored tradition
that paying taxes later is better than paying taxes today.
In each of these (except Roth's), the taxpayer receives a
deduction today for their contribution to the plan, the
investments grow tax-deferred while in the plan, and are
taxed at ordinary income rates when withdrawn fromt he plan.

Sounds like a great plan, right? Wrong!!! Let me briefly
outline my complaints about these types of investment
vehicles.

1. The tax benefits rely on the premise that when you
retire, you will be in a lower tax bracket than you are
now. Unfortunately, this is true for many people who use
these vehicles, because they will retire poor. However, if
you want to retire rich, you will likely be in a much
higher tax bracket than you are now. Why? You will have
fewer deductions. No business deductions (remember, you are
retired), no dependent exemptions, no home mortgage
interest. And you probably want to have more income
available when you retire than when you are working because
you have places to go and things to see.

Let me tell you a story about a client of mine. He was a
very successful businessman for many years. He set up a
very nice pension plan to which he contributed faithfully
every year. Then he retired. While he was in business, he
paid very few taxes and was actually in a very low tax
bracket. When he retired, though, he no longer had all of
these deductions. Immediately, he was in the highest tax
bracket possible. He complained to me constantly about his
high taxes. But, given that he was retired and all of his
income was coming as distributions from his pension plan,
there was nothing I could do for him. He just had to pay
the tax.

2. You have very little control over the funds. Who has
control? The government. They control what you can invest
in, how much you can add to your investment and when you
can take it out. I find that this lack of control normally
results in lower returns.

3. You can't take advantage of other tax-advantaged
investments. For example, you cannot receive the tax
advantages (e.g., depreciation) from real estate to produce
lower taxes from your other income. You don't receive
capital gains treatment from dividends and long-term stock
gains. And, if you do invest in a business (a very
complicated matter within a tax-deferred plan), you are
severely restricted as to your operating entity.

There are times when these arrangements can be very
profitable. I know several options traders who use their
self-directed IRA's for option trading. Since there are no
current tax benefits for option trading, why not defer the
tax? The same goes with hard money loans.

My gripe with SEP's, IRA's, 401(k)'s and RRSP's is that the
financial institutions and the government push them so hard
that people think they are the ONLY alternative. There are
many other ways to save taxes that are much better for many
people.

Warmest regards,

Tom

----------------------------------------------------
http://www.tomwheelwright.com