Are short sales the answer?

Posted by Alan Chokov, Alan Chokov Realtors
With the highly touted federal mortgage-modification program falling short of its target numbers, Washington is starting an alternative effort to slow the rising numbers of home foreclosures using an old process.
It depends on short sales, transactions in which the lender accepts less than the balance owed on the mortgage when the house is sold.
Beginning April 5, under new Treasury Department rules, short sales will be presented as the potential next step for homeowners who are rejected by or fail to make the grade for the federal Home Affordable Modification Program, which critics say is slow and ineffective.
"It's the bureaucracy," said Alan Chokov "They can take months. I even had one go 700 days. Then the person you negotiate with at the banks keeps changing, paperwork gets lost and then it comes down to the wire and it's denied. It's frustrating for the buyer, seller and everyone involved."
RealtyTrac chief economist Rick Sharga said offering the short-sale program is the administration's acknowledgment its current mortgage-modification effort "can't solve the foreclosure problem by itself."
The mortgage modification plan started early last year with a goal of reducing payment for 3 million to 4 million distressed homeowners. Through the end of February, 1.35 million trial modifications have been offered, 1.1 million modifications have been accepted, but only 170,000 are permanent, according to the U.S. Treasury Department. started slow with only 67,000 permanent modifications approved through December. Since then, the process is moving faster with 103,000 approved the first two months of this year.
Program supporters said floods of paperwork the banks and lenders had to wade through, as well as learn a new process, caused the slow start. The new alternative offers financial incentives to participate in short sales, provides limited pay outs for second lien holders and paperwork is more standardized.

The use of short sales has been limited because they tend to be difficult and time-consuming. Nationally just 14 percent of all existing-home transactions in January were short sales, the National Association of Realtors said, even though Volusia and Flagler Realtors and mortgage brokers say distressed home sales and bank owned properties account for 50 to 80 percent of their transactions.
But these days, as buyers race to meet the April 30 agreement-of-sale deadline for the federal income tax credits, time is money.
"It's trying to create a uniform process and requires the lenders to establish a minimum amount it would accept," said Ross.
"There's also more incentives for the lenders," he said.
However, the alternative push for more short sales is not the cure all.
It's still a voluntary program, Chokov said.
It also fails to address the underlying causes of home defaults right now -- high unemployment and tight credit markets, Chokov said.
"I don't see the housing market getting better for 12 to 24 months, not until we reduce the months and months of unsold inventory down to below 6 months," Chokov said. Bob Koslow contributed research to this article.
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Chokov: "Reverse Mergers & Other IPO Alternatives

eFinance Portal of New Jersey, www.efpnj.com
On Tuesday, March 23, the featured speaker at the regular monthly meeting of the Venture Association New Jersey (www.vanj.com) was David N. Feldman, Esq., Managing Partner of Feldman LLP (www.feldmanllp.com), a New York law firm focusing on corporate and securities matters. His topic was reverse mergers, a technique by which a private company acquires a majority stake in a public one and thereby becomes public itself, avoiding many of the pitfalls of a traditional IPO.
Prior to the main presentation, Randi Altschul, Inventor and Serial Entrepreneur, introduced her newest company, Shout Out Technologies (www.ShoutOutTech.com). The company works closely with the U.S. Army and Marines to develop systems for energy harvesting, short range communications between military vehicles, vehicle health maintenance and trace explosives detection.
Feldman then offered examples of companies formed by reverse mergers, including Berkshire Hathaway, Turner Broadcasting Systems, Texas Instruments, Tandy Corporation, Occidental Petroleum, Blockbuster Entertainment and the New York Stock Exchange. "All went public without an Initial Public Offering (IPO)," he said.
"A number of factors have led to the increasing popularity of reverse mergers," Feldman told the audience. "These include a number of advantages over traditional IPO’s, recent changes in SEC rules, the effect of the current economy on IPO’s, changes in the PIPE (Private Investment in Public Equity) market, increasing investment by Chinese companies and the introduction of WRASP (the WestPark Reverse Alternative Senior Exchange Process) by Westpark Capital, Inc. of Los Angeles."
Advantages over traditional IPO’s include lower costs and shorter timelines, elimination of the risk of unfavorable market conditions at the time of the IPO, less dilution of existing stock and less management attention required. Reverse mergers also eliminate the risk of underwriter withdrawal because there is no underwriter involved in the process.
"New SEC rules effective November, 2005 require substantial and timely disclosure following a reverse merger with a shell company," Feldman noted. "The new rules also refine the definition of a shell company, although intentionally leaving it somewhat vague, and prohibit it from registering securities for offer and sale within 60 days of the merger. The new rules apply to foreign as well as domestic companies and are generally hailed as a positive development leading to more transparent transactions and being troublesome only to unsavory players."
Over 25 percent of the approximately 200 reverse mergers that have occurred in past two years have involved Chinese companies. "This has been due to a number of factors, including new rules and regulations leading to increased due diligence and better auditing procedures," Feldman explained. "The trend is expected to continue, and another PIPEs and Reverse Merger Conference is scheduled to take place in Shanghai in May."
The rapid growth of reverse mergers has also been accelerated by the introduction of WRASP. "Developed by Richard Rappaport of WestPark Capital to take companies public without an IPO, trading shell or self-filing, it consists of a PIPE and reverse merger followed by a small secondary public offering," Feldman explained. "Rapidly rising in popularity, it has been used to complete over a dozen deals since its creation in 2007." Contribution by The Venture Association of NJ
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White House offers help, plans to avert foreclosure rage

Posted by Alan Chokov
Criticized for its "ready, fire, aim" approach to reducing foreclosures through voluntary mortgage modification, the Obama administration announced plans yesterday to more actively help homeowners who are unemployed or owe more than their houses are worth.
Under the rules that previously governed the Home Affordable Modification Program, unemployed homeowners could not qualify for mortgage assistance.
As outlined by the Treasury Department, the "enhancements," to be funded by $50 billion from the Troubled Asset Relief Program, include these changes:
Instead of lowering interest rates or extending loan maturities, or both, to reduce monthly mortgage payments to 31 percent of household income, lenders would gradually lower the principal if homeowners remained current on their payments.
Greater monetary incentives would be offered to second-lien holders who wrote down their loans. About half of all troubled mortgages have second liens that can hamper mitigation efforts.
Federal Housing Administration lending would be expanded to ease refinancing for homeowners "deeply underwater" but still current on existing mortgages whose balances were higher than the value of their homes.
Lenders would be encouraged to reduce mortgage payments for temporarily unemployed workers to an amount equal to 31 percent of the borrowers' unemployment benefits for up to six months.
Immediately, the new approach generated debate.
Some housing experts called it an improvement on the current program, which the Government Accountability Office, in a report Thursday, said remained "overly optimistic" about the number of troubled borrowers it would help, and which TARP inspector general Neil Barofsky called a " 'ready, fire, aim' type of approach."
Mark Zandi, chief economist for Moody's Economy.com, said the program's new provisions offered "incentives to lenders to reduce homeowners' principal, a critical element for millions living with underwater mortgages."
A preliminary estimate suggested the changes could spare 1 million to 1.5 million homeowners from foreclosure, Zandi said.
Others criticized the new approach for its continued reliance on the voluntary cooperation of 113 lenders participating in the government's program. Some, such as Bank of America, have their own modification programs.
Center for Responsible Lending president Michael Calhoun said he was concerned that mortgage servicers were not required to participate, "and homeowners have little control over the outcome."
"It's important to understand that the [government's] entire Making Home Affordable program and FHA refinancing system relies on incentives without any mandates - we have carrots, but no sticks," Calhoun said.
Rick Sharga, chief economist for RealtyTrac Inc. of Irvine, Calif., which monitors foreclosures nationwide, saw as good the likelihood that the changes "will have the effect of delaying the initiation of new foreclosure actions."
Such a delay might not save a house, Sharga said, but it might provide time for the owner to sell it or find a job.
That's not good enough for John Dodds, director of the Philadelphia Unemployment Project, who has been advocating direct loans to jobless homeowners in trouble.
"A short-term forbearance plan is very disappointing and misses an opportunity to provide real aid to jobless Americans struggling to keep their homes," Dodds said.
Bureau of Labor Statistics data show that 6.1 million people, or 40 percent of all those who are unemployed, have been jobless for more than 26 weeks. In February, the typical unemployed American had been out of work 30 weeks, the bureau said.
More than 11.3 million, or 24 percent, of all residential properties with mortgages had negative equity - known as "being underwater" - at the end of 2009, according to First American CoreLogic Inc., which tracks such data.
Sharga said the program's new provisions might work if lenders used them "to off-load loans that are only slightly upside down," making those mortgages cheaper to write down than foreclose on.
A Modification Scenario
2006: A homeowner receives a 30-year fixed-rate mortgage, with a balance of $250,000 and an interest rate of 9 percent. Monthly payment: $2,000; monthly income, $6,500.
2010: Homeowner has been unemployed for four months, collecting benefits equal to $2,000 per month.
Under new Home Affordable Modification Program rules: Mortgage payment is set for six months at 31 percent of current monthly income or lower (about $620), cutting payments by nearly $1,400 per month and postponing payments for six months while homeowner looks for work.
At the end of six months: Homeowner is employed, resumes payments of $2,000 per month, plus interest that accumulated during the modification period. If the homeowner takes a lower-paying job or has other financial hardship, a permanent modification, excluding temporary income, will be considered. Payment would be set at 31 percent of new, lower monthly income.
SOURCE: Home Affordable Modification Program
Alan Chokov, Publisher -For more Real Estate News, go to the Home Page of eNJBusiness.com and click on the link.
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IRS Provides New Safe Harbor For Section 1031 Exchanges Using Qualified Intermediaries

Alan Chokov, eFinance Portal of New Jersey, www.efpnj.com
The IRS recently issued Revenue Procedure 2010-14, which provides long-awaited guidance for taxpayers whose deferred like-kind exchange of relinquished property would be non-taxable under Section 1031 of the Internal Revenue Code but for the failure of the qualified intermediary ("QI") to acquire and transfer identified replacement property due to the QI's insolvency proceedings.This update provides general background information on Section 1031 and summarizes the key highlights from Revenue Procedure 2010-14.
General Background on Section 1031
Section 1031 and the regulations thereunder provide criteria for a nontaxable exchange of property. No gain or loss is recognized on the sale of property that is held for productive use in a trade or business or for investment if the property is replaced with a property of like kind for similar use. To qualify for nonrecognition, the taxpayer must:
Identify the replacement property within 45 days of the transfer of the relinquished property; and
Acquire the replacement property within 180 days of the transfer of the relinquished property, or by the due date of the taxpayer's return for the transfer year, if sooner.
The taxpayer may employ a QI to accomplish the acquisition and transfer of the relinquished property from the taxpayer and the replacement property to the taxpayer. If a QI enters bankruptcy or receivership proceedings, taxpayers may be prevented from obtaining immediate access to the funds from the sale of any relinquished properties and be unable to acquire replacement property within the required time period under Section 1031. Prior to the issuance of Revenue Procedure 2010-14, this arguably caused such taxpayers to lose the protection of Section 1031 and be subject to taxation based on the taxpayer's agent having receipt of the consideration for the relinquished property.
Highlights of Revenue Procedure 2010-14
If a taxpayer's effort to complete a proper deferred like-kind exchange under Section 1031 is frustrated solely because the QI holding the taxpayer's proceeds from the sale of relinquished property enters bankruptcy or receivership proceedings, the IRS will treat the taxpayer as not having actual or constructive receipt of the proceeds during that period prior to payment if the taxpayer reports gain in accordance with the safe harbor gross profit ratio method. The taxpayer need only recognize gain as he receives payments attributable to the relinquished property. However, if the payments received exceed the tax basis of the relinquished property, no tax loss can be taken even if the payments received are less than the value of the relinquished property.The safe harbor gross profit ratio method is determined by multiplying the payment attributable to the relinquished property by a fraction, where the numerator is the taxpayer's gross profit and the denominator is the taxpayer's contract price. For applying the safe harbor gross profit ratio method, the following definitions apply:
A payment attributable to the relinquished property is a payment of proceeds, damages, or other amounts attributable to the disposition of the property (except selling expenses), whether paid by the QI, the bankruptcy or receivership estate of the QI, the QI's insurer or bonding company, or any other person. Satisfied indebtedness is not a payment attributable to the relinquished property unless it exceeds the adjusted basis of the property.
Gross profit is the selling price of the relinquished property minus the taxpayer's adjusted basis in it (increased by any selling expenses not paid by the QI using proceeds from the sale of the relinquished property).
The selling price of the relinquished property is generally the amount realized on its sale, without reduction for selling expenses. But if a court order, confirmed bankruptcy plan, or written notice from the trustee or receiver specifies, by the end of the first taxable year in which the taxpayer receives a payment attributable to the relinquished property, an amount to be received by the taxpayer in full satisfaction of the taxpayer's claim, the selling price of the relinquished property is the sum of the payments attributable to the relinquished property (including satisfied indebtedness in excess of basis) received or to be received and the amount of any satisfied indebtedness not in excess of the adjusted basis of the relinquished property.
The contract price is the selling price of the relinquished property minus the amount of any satisfied indebtedness not in excess of the adjusted basis of the relinquished property.
The maximum gain to be recognized under Revenue Procedure 2010-14 is the sum of:
The payments attributable to the relinquished property (including satisfied indebtedness in excess of basis); and
The satisfied indebtedness not in excess of basis, minus the adjusted basis of the relinquished property.
A Section 165 loss deduction may be claimed for the amount, if any, by which the adjusted basis of the relinquished property exceeds the sum of:
The payments attributable to the relinquished property (including satisfied indebtedness in excess of basis), plus
The amount of any satisfied indebtedness not in excess of basis.
Taxpayers entitled to this deduction may also claim a loss deduction under Section 165 for the amount of any gain recognized in accordance with the revenue procedure in a prior taxable year. However, as stated above, if the payments exceed the amount of tax basis, no tax loss is allowed with respect to the economic loss arising from the payments being less than the value of the relinquished property.
Alan Chokov, Publisher -For more IRS News, go to the Home Page of eNJBusiness.com and click on the link.
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The Capitalization of a Startup Corporation

Posted by Alan Chokov, eFinance Portal of New Jersey, www.efpnj.com
When you create your corporation and make it a legal entity in your principal State of Business, one of it's foundation requirements is to Capitalize your company to give it value.
The interpretation is to create a number of shares (stock) in the company and give it a “par value” (which may be no par value). You are taxed based on this value until you start making revenue, etc.
It is recommend that you Capitalize your company, at start up at 10,000,000 shares, with a par value of $0.0001 or $0.00001 (depending on the State you are incorporating in). This level of stock does a few things for you.
First, it gives you a somewhat large pool of stock to work with in issuing stock to key players, and in getting Friends/Family and Angel Investors involved, and with time, Venture Capitalist.
Second, it allows for realistic prices per share growth as each new person comes on board and buys stock.
Let’s break down a new company startup:
The company is being created and started by a CEO, CFO and CTO (three people), with the CTO being the predominate person behind the company and the CFO and CEO are past business associates of the CTO. CTO wants controlling interest in the company and the other two both want equal shares to each other, giving the CTO control.
10,000,000 shares at a par value of $0.0001 valuates your company at a net worth of $1,000 for tax purposes.
The CTO takes 20% of the total value of the company, which is 2,000,000 shares. At this point, with no other shares being issued yet, the CTO owns 100% controlling interest in the company. These shares can be issued on the basis of work done to date, start up cash put into opening the company for business, and the release of IP to the company.
The CEO and CFO each get 750,000 (or 7.5% of the company Capitalization each). At this point, the CTO now owns 57.2% controlling interest in the company.
500,000 shares are put aside for bringing in new employees. We have now allocated 40% of the Capitalization of the company to be issued, and 35% is actually issued.
You now have 1,000,000 shares put aside for you Friends/Family/Angel’s. (Another 10% of the company, taking the total allocated position to 50% of the Capitalization of the company.)
It is felt by your Executive Team that you need to raise $1,500,000 in Friends/Family and Angel money to get the Proof of Concept completed and to get ready to for your first (and if you listen to us, last) Venture Capital Round that will take you to revenue and positive cash flow. You now go to your friends, family, pocket, Angels and offer them shares at a dollar per share. You sell 1,000,000 shares and have your money to get the product developed and proved.
The DAY you close the last part of that money, you begin courting your Venture Capitalist for what you feel will take you to cash positive revenue. Let us say that will be $5,000,000.
You have 50% of the company Capitalization that is allocated, with 45% (plus what ever stock you have issued to new employees since you raised the Angel Funding) being issued, giving you 5,000,000 shares available for you to barter with the Venture Capitalist.
Your goal is to give away no more than 20% of the company for that $5,000,000 (2,000,000 shares). If you are able to do that, you have taken the value of the company from $1.00/share to $2.50/share, making your initial investors happy, their stock went up in value already, and leaving room for future sales if need be.
The Venture Capital is probably going to come to you offering you $5,000,000 for 51% of the company or more. In that you are coming to them from a position of power (you still have money in the bank, and are able to work on the product), you should be able to get them down below the 50% level.
Let us say you get them to invest the $5,000,000 at 20% (2,000,000 shares). The ownership of the company is as follows, assuming no shares are issued to any other employees at this time:
CTO = 2,000,000 shares/20% of the Capitalization of the company or 30.77% control of the company
CEO = 750,000 shares/7.5% of the Capitalization of the company or 11.54% control of the company
CFO = 750,000 shares/7.5% of the Capitalization of the company or 11.54% control of the company
Friends/Family/Angels = 1,000,000 shares/10% of the Capitalization of the company or 15.39% control of the company.
Venture Capitalist = 2,000,000 shares/20% of the Capitalization of the company or 30.77% control of the company
Often the concern of the Founder (CTO in this case) is that they will not have “ownership” of the company, and it looks like it here. In fact though, assuming that they have a good relationship with the Friends, Family and Executive Staff, they have control of the controlling interest in the company by pooling the shares of those loyal to them. (This of course assumes that what they want to do isn’t against the best welfare of the company and stock holders and the stock holders agree with them. Remember, the 1,000,000 shares in the Friends/Family/Angel round is typically not in one person’s hands, but several peoples hands.)
If your calculations were off mid way through the spending of the $5,000,000 (and you still have about $2,500,000 in the “bank”) and you are going to need another round of Venture Capital, you have 3,000,000 shares left over to raise capital with, potentially at $4.5 plus per share, again making everyone happy, and reducing the amount of share that go out for each round.
Many companies do not follow this plan, but base their offerings based on “outstanding shares” versus Capitalization of the company. Good Venture Capitalists will be looking at total Capitalization and not “outstanding shares” for their percentage of the company.
This also assumes that only Common Stock will be issued in the company, which is what we recommend, giving equal rights to all shares.
For related news, go to the Home Page of efpnj.com and click on the link. Alan Chokov, Publisher.
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eNJBusiness.com reaches milestone

eNJBusiness.com has reached a milestone by reaching 4million visitors www.eNJBusiness.com (a division of eFinance Portal of New Jersey, www.efpnj.com) provides a unique platform for submitting personal business & social content, local, state and national news, events, services and products that affect the citizens of New Jersey, while providing a platform for financial literacy. It is viewed through a free consumer, patent-pending, interactive, multi-cultural Financial, Business & Educational News Portal and Search Engine, according to Alan Chokov, Founder & CEO. Membership is complimentary, and it provides the unique ability to create multiple profiles, management of your own account to submit business & social content (and to over 50,000 defined categories with supporting internal search compatible results; 150 interactive features; 17 industries and related venues of interest), directly to the Portal, within seconds of your confirmed submission, in your written languages of preference… 24/7. It supports 99% of the world’s spoken languages. Members control viewable duration, sponsorship and online placement throughout the site. All content submissions are archived, editable with feedback features. This is channeled through all of the Portal’s categories, features, industries and components. Users can choose their Industry news by clicking on the Industry Icon located on the Home Page. This equal opportunity Portal, “Where News Has More Than One Perspective”, was designed to offer dynamic content in multiple cross-industry venues, submitted by our Members and other related disciplines. This is then matched to corresponding keywords/categories by the Portal’s six internal search engines to provide additional learning experiences for the consumer. Consumers can also search Members through the same process. Developed exclusively for New Jersey, a state that is home to over 140 ethnic groups, ranking 3rd. in the country for diversification. Plans include representation in all 50 states individually, since each is unique in their Member participation and content. The Portal has received over 4million visitors…and counting. For further information contact Alan Chokov, Founder/CEO at 877.424.6568 or by email: alanchokov@efinanceportal.com Alan Chokov, Publisher - For more Marketing/Social Media News, go to the Home Page of www.eNJBusiness.com and click on link.

Tax Lien Investing?

Posted by Alan Chokov, eFinance Portal of New Jersey, www.efpnj.com Here are some frequently asked questions raised by readers about tax lien investing. Q1: How can I buy tax liens or tax deeds without going to the auction? A: In most states you have to attend the auction in order to bid, or have a representative there to bid on your behalf. But there are 2 ways that you can purchase a tax lien or deed without physically going to the sale. A few states do have online auctions, but not all counties in these states conduct their auctions online. Usually just the larger counties do. Many counties in Florida, California, and Arizona have online tax sales. And I know that some counties in Colorado and Illinois have online tax sales as well. Another way that investors have bought tax lien and tax deeds without going to the sale is to bid on left-over liens, this can usually be done through the mail. The only problem is that as tax lien and tax deed investing become more popular, there are less and less good properties left-over after the tax sale. Q2: I don’t live in the US; can I still invest in Tax Liens or Tax Deeds? A: Yes, in most states you can invest in tax liens and tax deeds even if you are not a US citizen and do not live in the US. There are a couple of states that you have to be a resident of the state to invest, but these are not the most popular tax lien states and they don’t have online sales. All you have to do in order to purchase a tax lien is to fill out a tax form called a W-8BEN form. In order to complete this form you will also need to apply for an Individual Tax Identification Number (ITIN) if you are bidding in your own name. If you are bidding using a business name, you must apply for an Employer Identification Number (EIN). This is only for tax liens. You do not have to do this to participate in a tax deed sale. Q3: So how much money do you need to get started with tax lien investing? A: The beauty of tax lien investing as opposed to tax deed investing and other types of real estate investing, you can start with a very small investment. The first very profitable tax lien that I purchased started with an initial investment of only a couple of hundred dollars, on a small sewer lien. Then I was able to pay the subsequent sewer taxes the next couple of years and instead of trying to foreclose I just kept paying the subsequent taxes. After a couple of years, the homeowner moved out of state and stopped paying the taxes on the property, so then I got to pay even bigger payments $5000 over the next couple of years. The lien finally redeemed and I collected 18% per annum on most of my investment plus penalties. Q4: How often do you acquire the property with tax liens? A: In the state of New Jersey where I invest, very, very seldom do you get to foreclose on the property. If you are interested in owning property than tax deed investing or redeemable tax deed investing is the way to go. Only about 1% of tax liens will not redeem and of those properties, once you start the foreclosure process about 80% will redeem sometime during the foreclosure process. I’ve been investing for about 6 or seven years and I haven’t foreclosed on a property yet. I do have a couple of liens that I could start foreclosure on right now, but I know that when I do, they will redeem, so I just let them go. I know some investors who have foreclosed on a couple of properties, but either it is not recent – we’re talking a few years ago when property values were not what they are today and it was much harder to get a loan, or they have a really huge portfolio with thousands of liens. Q6: Are there risks involved in this type of investing? What are they? A: Yes, there are risks involved and that’s what the gurus leave out, they make it sound so easy. They like to use the term “Government Guaranteed” to make people think that they can’t go wrong with tax lien investing, that the government guarantees that they’ll get paid on a tax lien. That’s really not true, what they mean by “government Guaranteed” is that there are laws that protect the investor but you not guaranteed to get paid. The guarantee is the property. Tax Liens are guaranteed by the property that you have a lien on, so if you buy a tax lien on a worthless piece of property, then you made a poor investment and it is possible that you could lose your money. Yes, there is risk involved, but that risk is minimized by doing your due diligence on the property before you purchase the lien, just like you would do due diligence on property before giving someone a loan against it. If you do your due diligence properly than tax lien investing is a very safe investment because it’s secured by something tangible, not just a piece of paper. Q7: Can you invest in tax liens and tax deeds in your IRA? A: We all want to keep more of those profits for ourselves and not give half of it away to Uncle Sam. The good news is that you can use money in your IRA or Roth IRA to invest in tax lien certificates or tax deeds, but only if it’s a true self-directed IRA. With a self-directed IRA, your profits can grow tax-differed, and with a Roth IRA, your profits can be totally tax-free. Alan Chokov, Publisher - For more Real Estate News, go to the Home Page of www.eNJBusiness.com and click on the link.

“Using The News To Teach Financial Literacy”

Much has been discussed about financial literacy, or the lack of it, among Americans, according to Alan Chokov, Founder/CEO of eFinance Portal.com, a patent-pending, free consumer, interactive, multicultural, Financial, Business & Educational Portal & Search Engine.

With numerous seminars, educational forums, printed literature and countless preaching of financial literacy being marketed, typically it’s about a particular industry or product, leaving subjective interpretations.

Too much of what passes for financial literacy may consist of how to secure credit cards, open a savings account or how to balance your checkbook. "Many people are making decisions not understanding their full consequences", according to Chokov. That inspired him to create eFinancePortal.com.

The cornerstone of our efforts is the talent and expertise of our Members (Registration is complimentary) in the area of financial literacy. It allows all of its Members to submit personal business, social and educational content (and to any of it’s 50,000 categories and 17 industries with point of interest venues) from their personal computers, directly to the Portal, in their written languages of preference, within seconds of their confirmed submission…. 24/7. The Portal supports 99% of the world’s most spoken languages.

Consumers are provided dynamic news content in multiple cross-industry venues, matched to our corresponding categories and industries. This enables them to consider interpretive content from various sources, rather than just a generic definition.

Members have the unique ability to manage their own account, submit and control viewable duration, sponsor identifying keywords that describe their profession and services, and online placement throughout the site. All content submissions are archived and editable with feedback features. Choice of industry news can be selected by clicking on the Industry Icon located on the Home Page. User’s can select the categories and industries of interest and be notified the moment any relative content is posted on the site by our free email alert service.

Featuring six internal search engines, Consumers can access “Members” by its proprietary 13-point criteria-ranking search, or by name, category, profile, company or by content submissions. Our core discipline is based on a “personal relationship philosophy”, established through a single destination platform.

eFinancePortal.com creates a forum for an interactive, intuitive venue that provides financial, business & educational information and support based on easily accessible, unbiased, uniformly presented timely data.

· Enables you to establish and expand upon your personal financial profile. Gain a broad view of your financial picture. Identify your financial obligations and goals, personal interests, aversion/affinity for risk, degree of diversity desired, existing investments and more!

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· On-line seminars - like a chat room, but extended to include graphical information in the form of pictures and charts, text page by page, and interactive questions and answers are provided. Members have the ability to create and deliver these live and pre-taped seminars.

· You can engage in dialog with several financial investors in an anonymous fashion (e.g., via Q&A and Forum services) until you decide to forge an open relationship with a Professional Service Provider with whom you trust. Provides you the opportunity to discuss with vendors how particular financial products meet your specific growth, risk factors and portfolio characteristics.

· Feel empowered by competitive knowledge and strengthened by your ability to forge new relationships with professional service providers on your terms by reviewing vendor profiles, which include annual investment statistics, number of clients, corporate affiliation, industry affiliation, commission rate, professional licensing and degrees in education.

· Utilize eFinancePortal.com in your choice of language - this includes our efinanceportal.com dictionary, Member profiles, and a listing of Members that speak your language.eFinancePortal.com supports 99% of the world’s spoken languages.

· Tools – participating Professional Service Providers will present the financial, business & educational tools to allow you to perform analyses of your investments, speculate on investments, and plan for your future. This site encourages advertisers to provide you with tools to assess your strategy and track your financial and business investments. You can choose from any of these tools and place them in your toolbox.

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· Dated information - All information contained on the site will be archived for future reference.

· Mail Subscription Services selected by Registers Users to decide on what content they would like to receive (at no obligation) from our site’s offerings.

· Q&A – you can submit questions and check our archives for previous submissions. If a similar question has been asked, you will see the similar questions and view the Professional Service Provider’s answers. If your question is new, you can submit it via email to a list of “Members” who specialized in the particular area pertinent to your question. Communications can be anonymous. You can choose to expose any or all parts of your personal financial profile using your per service default profile exposure or modify your default settings for this particular communication. Emails that are waiting for you are kept in a common area for ease of retrieval.

This free consumer service was developed exclusively for New Jersey, a state that represents 140 ethnic groups, ranking 3^rd. in the nation for diversity. It is a fusion of New Jersey and National real-time news, personal & education presentation and Financial Literacy resources. Chokov intends to offer this platform to all 50 states individually, since each state is unique in their membership contributing providers and content.

Contact Info:

Alan Chokov
Founder/CEO/eFinancePortal.com

Phone: 877.424.6568

Fax: 732.428.7152

eMail: alanchokov@efinanceportal.com

Chokov: How to Reduce Your Tax Bill With 1031 Exchanges

Posted by Alan Chokov, eFinance Portal of New Jersey, www.efpnj.com Real estate owners can easily reduce their tax bill by using 1031 exchanges. The 1031 exchanges also referred to as tax-free exchanges helps investors to trade in the real estate market with respect to purchasing property without paying taxes. However, there are certain rules and regulations that need to be followed in order to qualify for 1031 benefits. The main reason is to find out the need to go for tax-free exchange. There is a need to balance the benefits received at present to what might be receivable in the future for finding out whether the purchase or sale of property using tax-free exchanges is a good idea. Such an exchange only makes sense to an investor if they hold on to a certain real estate for a longer duration of time. With increase in value of the property, it might be necessary to sell the same for making profits. Through suitable depreciation in value due to these exchanges, it will be possible to save tax with an increase in the cash flow for the investor. It is possible to purchase the property at a lower rate after getting rid of the depreciation amount. 1031 exchanges can help you look at the possibility of getting hold of larger properties. Since larger properties are sold depending on the kind of cash flow they generate it might be a good idea to look at the possibility of tax savings while purchasing them. However, while attempting to secure a deal using 1031 exchanges it is important to complete the necessary paperwork in a proper manner. This is important since any sort of missing documents can lead to rejection of the deal under 1031 exchanges. Alan Chokov, Publisher - For more Real Estate News, go to the Home Page of www.eNJBusiness.com and click on the link. If you would like to contribute articles to our website, please Register. Receive News & Updates, and Free Email Alerts Relevant to New Jersey In Your Industry of Choice, please Register Here.

Understanding the Auction Process of Foreclosed Homes

Posed by Alan Chokov, Alan Chokov Realtors There is a great many infomercials punting the idea of investing in tax foreclosed homes in order to make big profits. While these infomercials are true, many of them are a little misleading because basically they really want to sell you a product. It is possible to educate yourself regarding the processes involved in investing in tax foreclosed homes, just by reading the right kinds of books and collecting information from the internet. It is certainly best to arm yourself with some education and research on this subject matter before entering the real estate investment market. And the purchase tax foreclosed homes does allow for some good profits to be made. It is a sad fact of life that in today’s credit crunch, many homeowners are feeling the pinch. The Internal Revenue Service has the right to foreclose on a persons property if they have unpaid income taxes. This in not a quick process, but if the home owner is also in default with his mortgage the process speeds up somewhat. However it is important to know that a Tax lien is superior to any other lien over a mortgage. So even in the lender forecloses on the mortgage owner first the tax lien will still have to be paid. Lenders who purchase foreclosure homes on auction always pay the tax liens, as if they did not the property would become the property of the IRS. If you are an educated investor, it is also possible for you to buy tax foreclosed homes on auction. There are greater rewards in this method of purchase, but also greater risks, particularly if you have not done your homework, according to Chokov. The attraction of investing in tax foreclosed homes is that you are allowed to inspect the property prior to bidding. This is not the case with bank foreclosures as generally the homeowner is still resident. There are a number of reasons for properties being sold at foreclosure auctions these include: Failure to meet the demands of mortgage repayments Failure to make real estate property tax payments Failure to make Income tax payments Personal bankruptcy Illegal activity by the owner Tax foreclosed homes are either sold at a public auction or at a court auction, sometimes also referred to as a Sheriffs sale. In court auctions investors are not able to request discounts for early payment, pay in installments, modify the terms of the contract or transfer the title. This does make thing a little more sticky, but that is the way it goes. Some auction allow verbal bidding while others only accept bids as sealed written offers, so make sure you know what is required of you. In “non judicial” states, such as New Jersey, the foreclosure process proceeds much faster, generally around three months. In judicial states this process can take as long as eighteen to twenty-four months. For example, judicial states include: Indiana, Connecticut, Louisiana, Florida, Maine, New York, New Jersey, North Dakota, Pennsylvania, Ohio and South Carolina. Alan Chokov, Publisher - For more Real Estate News, go to the Home Page of www.eNJBusiness.com and click on the link. If you would like to contribute articles to our website, please Register. Receive News & Updates, and Free Email Alerts Relevant to New Jersey In Your Industry of Choice, please Register Here.

Want to Get Your Blog Into Google News and Yahoo News?

Posted by Alan Chokov Google News and Yahoo News are the biggest automated news aggregators online. Millions of news junkies across the world read these news sources on a daily basis. If you want major exposure and publicity for your blogs, Google and Yahoo are where you want to be. You will be able to drive HUGE traffic to your blog plus you gain instant popularity from readers across the world! This is another great way to showcase your expertise and credibility to mass audiences. Before you can submit your blog URLs, make sure to sign up for both a Google and Yahoo account (sign-ups are free!) How Google News Works Google “crawls” news sites and gathers articles. Headlines are crawled based on algorithms/certain factors: how often and the particular site where the story appears. Google taps into more than 4,500 English-language news sources worldwide. There are NO human editors associated with selecting articles. They solely rely on online news outlets and online publishers to determine which stories have the most prominence/relevance. Google News consists of top stories and eight sections: World, Nation, Business, Sci/Tech, Sports, Entertainment, Health and Most Popular. • Currently, Google News does NOT accept single articles or RSS/Atom feeds. • Submit blog URL - You have to answer a few questions first before you submit your URL. Google reviews your blog to determine if it’s suitable for inclusion. They will notify you if your blog is accepted or if they need additional information. They cannot guarantee that your site will be added to Google News • Google News Help Topics provides further information and tips for publishers. How Yahoo News Works Yahoo also gets millions of visitors to Yahoo News each day. Yahoo News works similar to Google News. There aren’t human editors picking out top stories. Main stories (that you find on Yahoo News front page) are generated by content partners. Internal search stories are found via the Yahoo News indexing. • Fill out the Yahoo News source form. Yahoo asks you to fill out some preliminary questions. You also need to be able to “pitch” your blog. Yahoo asks you why you recommend your blog so make it sound good! • Yahoo News will determine if your blog is suitable for inclusion - they will contact you if your blog is accepted. How to Get Your Blog Accepted The competition is stiff when applying to Google News and Yahoo News, and many blogs are rejected. However, there are some publishing tips to keep in mind when creating/writing your blogs. • Original content - Unique content wins every time! Remember to make your content SEO-friendly and add relevant keywords. Don’t duplicate content on your blogs! • More than one blogger/author - Content from one writer alone won’t do the trick - include guest bloggers/writers or ask another blogger to join you! • Response time - Server response time (Bots look for pages they can index quickly and that load quickly for readers) If Google News accepts your blog, Google suggests adding sitemaps to your blog. Sign up for Google Webmaster Tools and add sitemaps via the tools section. This is the easiest way to promote web traffic and for spiders to efficiently crawl your blog. Alan Chokov, Publisher - For more Technology & Internet News go to the Home Page of www.efpnj.com and click on the link. La If you would like to contribute articles to our website, please Register. Receive News & Updates, and Free Email Alerts Relevant to New Jersey In Your Industry of Choice, please Register Here.

Chokov: Use Capital Gains to Reinvest in Real Estate

Posted by Alan Chokov When it comes to selling property capital gains reinvestment can be an important strategy for homeowners and commercial and business owners. The Internal Revenue Service requires capital gains tax to be paid on the sale of all capital assets, including properties. Once the sale occurs the tax expense can be enormous, but with a little ingenuity capital gains tax can be avoided and the tax burden relieved. The sale of a home or an investment property can facilitate incredible steps forward for anyone in the real estate market. Planning, education and consulting the experts are the keys to increased buying power! Uncover the Secret to Real Homeowner Potential The Internal Revenue Service allows gain generated by the sale of a home to be excluded from federal tax returns. The homeowner must meet the IRS requirements for exclusion. Eligibility for exclusion is based on the five-year period prior to the sale. If a homeowner has owned the property for at least five years and lived in it as a primary residence for at least two years, as much as $250,000 of the gain does not have to be reported on the yearly tax return. For couples filing jointly, up to $500,000 can be excluded based on the eligibility of each spouse. An unknown fact in the real estate world is that exclusion can apply to the sale of vacation and rental homes if they have been used as a primary residence for two out of the last five years. This amount of unreported gain leads to huge savings and greater investment potential. The Hidden Advantage of Tax Exchange In the past property exchanges were regarded as highly complex. The current real estate market now agrees that property exchanges are trouble-free, secure and profit producing. Even if a commercial or business property owner sells and then immediately reinvests, capital gains tax must be paid. The Internal Revenue Code Section 1031 allows a taxpayer to exchange property used productively in a trade, business or investment for property of a like-kind. In the exchange the IRS does not recognize any loss or gain and the capital gains tax is deferred. This deferral allows property owners to utilize money originally budgeted to pay the government for investment. Following the Rules Leads to Success IRC Section 1031 has strict guidelines for property owners to follow while engaging in property and tax exchange. Consultation with real estate professionals, qualified intermediaries, lawyers and accountants is essential. Like-kind commercial and investment properties must be the same in nature and have comparable characteristics. The properties can differ in quality and improved property may be exchanged for unimproved property. The relinquished property must be exchanged for a property of equal or greater value, equity or debt. If the replacement property is of lesser value, equity or debt tax is then computed for the amount of the gain or the difference in value. The property owner must pay whichever cost is lowest. Also, properties are only considered to be like-kind when they are located within the same country. Properties within the United Sates cannot be exchanged for properties located outside of the country. Time Is Money Property exchange does not require the taxpayer to sell and buy simultaneously. The Tax Reform of 1984 imposed precise limits on the amount of time an exchange transaction can be in process. Property owners have 45 days from the sale of the relinquished property to identify a replacement property. The exchange must be completed within 180 days of closing or on the tax return due date for the current year. Do not miss identification or exchange deadlines! If these deadlines are not met the exchange is no longer qualified and the capital gains tax must be paid. Armed with knowledge and creativity any property owner can increase their buying power and take their real estate success to even greater heights. Remember to find real estate and financial professionals to assist with adherence to the federal laws. Once you have learned to the most lucrative way to manage your ventures and capital gains real estate victory will be at hand! Alan Chokov, Publisher - For more Real Estate News, go to the Home Page of www.eNJBusiness.com and click on the link. If you would like to contribute articles to our website, please Register. Receive News & Updates, and Free Email Alerts Relevant to New Jersey In Your Industry of Choice, please Register Here.