Cash Flow Analysis from Financial Books

About the cash analysis we can say that it is the lifeblood of any business. In an organization we can see many activities to get the cash from sales, debtors, sale of assets, investment etc. like this the company spend also the cash in some areas – payment to salaries, rent dividend, interest etc. Lastly, we can say that cash flow reveals the inflow and outflow of cash during a particular period.

Objectives of Cash Flow Analysis:

Meaning of Cash Flow Statement

Uses of Cash Flow Statement

Steps in Preparing Cash Flow Statement

Distinguish between Cash & Fund Flow Statement

Compute the Cash from Operations

I have already mentioned about the meaning of Cash Flow Statement that it reveals the inflow and outflow of cash during a particular period in a particular organization. From the management point of view it is also important tool of cash planning and controlling.

Main objectives of Cash Flow Statements (CFS):

To show the causes of changes in cash balance between the balance sheet dates.

To show the factors contributing to the reduction of cash balance in spite of increasing profit or decreasing profit

Now, after knowing about the CFS objectives we can discuss about the uses of CFS:

It is for explaining the reasons for low cash balance

CFS shows the major sources and uses of cash

It helps in short term financial decisions relating to liquidity

From the past year statements projections can be made for the future

It helps the management in planning the repayment of loans, credit arrangements etc

If you want to prepare CFS then use these:

Opening of accounts for non-current items

Preparation of adjusted P & L Account

Comparison of current items

Preparation of Cash Flow Statements

Cash Flow Statements Formula:

Net Profit + Decrease in Current Assets - Increase in Current Assets
Increase in Current Liabilities Decrease in Current Liabilities

A format of Cash Flow Statement:

In the summery I can say that CFS study in the chapter is not in more details but all the understanding, uses, steps and meaning are clear. For more example and definition I will let you know further.

REBUTTALS for UK Mortgage Sell

Are you selling me something?

No sir, I’ m not selling anything. I am calling to make you aware of the fact that interest rates are quite low at this time and we can help you save your money over existing mortgage arrangements.

Where did you get my telephone number from?

We have a research department and have the phone numbers of all the residents in the country.

What is the name of your company and where is based?

It’s a network of independent financial advisers based in London. We deal on behalf of all the major Banks and building societies.

I won’t give my personal details to a stranger over the phone? How safe is it to give you my details?

Sir/ Madam we are registered under the Data Protection Act and all these details will be kept under the strictest of confidence and not used for any other purpose as we are bound by the law.

Send me something through the post, I wan written quotation?

Sir/ Madam First my financial adviser will call you to discuss your specific requirements and then provide you with a written quotation.

What is the interest rate that you will offer?

Sir, It will completely depend on your personal circumstances and the product you choose. But let me assure that with so many products available you will definitely find a better deal for yourself.

If I want finance I can directly approach a Bank?

We are dealing with most of the major bank and building societies and thus can provide you with more choice and options. As we are completely independent, we also have access to some special deals which are not available directly.

I am planning to take loan/ Mortgage but after few months?

Sir/ Madam the interest rate are quite low at this time and they might go up in the future and if you are planning for any loans then this is the best time.

I am tied with my lender for few years; else I have to pay the Penalty.

Sir/ Madam if we are able to help you save a large amount of money, it can take care of your redemption penalty. By the way, how much is the redemption penalty. If equal or less than 1000 continue with the call.

I requir4e finances, but my credit rating is not good?

No problem sir/ madam we specialize in such case and will definitely provide a very good deal.

Give me your number I will give you a call?

Sorry sir, this is an outbound call center and incoming calls are not possible. Moreover, the adviser local to you will provide you will all the details.

I don’t know you why should I talk to a stranger?

Sir/ madam we are completely operating under the UK laws and can help you in saving a lot of money. We close more than 2000 loan and mortgage applications a month.

I don’t do any business on the phone?

Sir we cannot complete the business over the phone. My financial adviser will call you to discuss all your requirements and then send a written quotation if you are satisfied, we will underwrite the deal.

I cannot give you my annual income?

Sir unless we have this information, we cannot determine the maximum loan amount that we can offer you.

If the Customer is a pensioner/ retied

We can offer only personal loan to these prospects, provided their situation meets with the criteria.

If the customer is on income support/ unemployed

Say thanks for your time and end the call

Secured Loans and Unsecured Loans Overview

Secured Loans

The amount borrowed is secured against your property and is usually repaid over a shorter period than the life of any existing mortgage. These loans generally have a very competitive rate of interest, depending upon your circumstances, as the lender has the security of your property if it is not repaid. You must remember that your property may be at risk if you do not keep the repayments to a secured loan.

UK Secured loans often offer two main advantages- due to the security they to the lender they are easier to obtain and often have more preferable interest rates.

The main disadvantage to the secured personal loan is the most obvious one that the loan s secured upon your property and if you fail to keep up repayments then your property will be at risk and could be repossessed.

Unsecured Loans

This loan can be used for any purpose. To obtain a unsecured loan, you have to have a good credit history. Unsecured loans usually have a slightly higher interest rate, as there is more risk to the lender if the loan is not repaid.

UK Unsecured loans are more difficult to obtain than secured loans, and you must usually have a good credit record in order to obtain one.

EMI for 20 lakhs loan for home differ from one lender to another

There are several types of loans available in India. Among those, home loan is the one that can be taken either to build a home or to purchase a home. Some of the lenders also offer home loans to renovate your old home.

Though the interest rates and repayment modes of home loans vary from one lender to another, they have some unique features and conditions that are mentioned by all the lenders, who sanction these loans. One should mention the purpose of taking loan on the application form clearly. As per the rules and regulation of all the home loan lenders, depending on the income, eligibility and repayment capacity, the borrowers can get the loan amount. As loan for a home comes under the classification of secured loans, the borrowers should submit any one of their properties as a security against the loan amount. Fixed interest rate and floating interest rate are the two popular types of home loan interest rate.

Quite evidently, everyone expects high amount of home loan at a very low interest rate. To fulfill the desires of the borrowers, who want to get home loan at low interest rates, the public sector banks have recently announced interest rates cut of home loans. According to PSU banks, now the borrower can avail up to 5 lakh loan amount at the interest rate of 8.5 percent, where as the 5-20 lakh loan amount borrowers have to pay 9.25 percent interest rate. Moreover, these banks do not collect any such type of processing fee from the borrowers and also provide insurance coverage without taking money.

EMI a.k.a Equated Monthly Instalment is a mode of payment through which the repayment of loan is done in a much smoother and hassle-free manner. The concept of EMI has been chiefly concocted to ensure that the burden of repayment of loan, does not get to the head of the borrower. These days, finance organisations make sure that they offer attractive and easy EMI plans to the prospective borrower, ultimately brightening their future business prospects. However, the borrower is advised to make sure that the EMI plan offered to him in the offered loan (in this case home loan) is on the extreme transparent lines.

EMI for 20 lakhs loan for home differ from one lender to another. Depending on your repayment capacity and monthly income, you can select any one of the repayment modes that are offered by the lender. Most of the home loan borrowers get confusion to select the best EMI mode. To clear their doubts, the users can visit reliable Internet websites for EMI calculation. It helps them to know the total amount of interest rate that they have to pay over the term of the loan.

To find the best EMI deal for 20 lakhs loan for home, you can take the assistance of the Compare loan feature that allows you to compare the interest rates and equated monthly installments of all the home loan lenders at one place. If you follow some tips, the EMI calculation will be easy for you. To calculate EMI for 20 lakh home loan, Just open any of the reliable EMI calculator websites and select the 20 lakh term work sheet. Then, enter the principal loan amount (the amount of loan that you want to take) and rate of interest that is decided by your lender. Immediately, you can see the total amount of EMI and the total amount of interest rate that you have to pay up to end of the loan period.

Re-Mortgage : take advantage of lower rate of interest

Re-Mortgage

A recent survey has estimated that homeowners currently spend $720 million per annum too much on mortgage payments because they were unaware they can get a better deal from another lender. The financial services industry is arguably the most competitive it has ever been and because of this consumers can get fantastic saving on their mortgages as companies compete with each other for business.

Why to re-mortgage?

To take advantage of lower rate of interest or to release the equity that has built up in your home, to extend or reduce the term of mortgage or even to consolidate the debts. You may also want to release money to buy-to-let a property.

Personal Loan

A personal loan is an agreement between a borrower and a lender such as a bank, building society or loan company, allowing the borrower to be lent a specified amount of money according to certain terms and conditions. The loan is usually dispensed as a lump sum and then repaid by monthly installments. Personal loans usually start at about $500 and can go up to beyond $20000. Customer will agree to pay back the loan over a predetermined period of time, referred to as the term of the loan, in monthly installments. Loan terms can very between six months and twenty-five years; but it depends on the individual lender as to their requirements and conditions.

This charge is calculated as a percentile of the borrowed amount and accrues with the length of time for which the money is borrowed. This is called interest.

UK Personal loans are usually available for almost any purpose. You might want to fund your dream holiday, pay for an extension on the house, or buy a car. Personal loans are available for almost any amount you require, though lenders will usually only provide loans between certain brackets.

Financial Products for UK Mortgage Product Training

MORTGAGE

Mortgage is a structured loan- term loan to enable you to buy your own home.

The following is an introduction to type of payment methods.

REPAYMENT MORTGAGE

It is also known as the Capital and interest mortgage. This involves the borrowing of a Sum of money over a chosen term, often 25 years, over which the borrower makes a monthly payment to the lender that includes interest as well as part of the capital. This is the only method which guarantees that by the end of the mortgage term, the mortgage would be paid off. The borrower can see the mortgage debt reducing each year.

INTEREST ONLY MORTAGE

In this kind of payment method the borrower agree to pay only the interest each month and the capital borrowed is paid off the end of the term as lump sum.

This, therefore, requires a separate saving vehicle to run the mortgage so that the mortgage can be paid at the end of term. This is usually in the form of an endowment, ISA or pension.

The three most common savings vehicles used for mortgage repayment are

ISA: One can benefit from the tax concessions available within these plans. It is from the proceeds of your plan that pay off your mortgage. An added opportunity, if ISA performs exceptionally well, or you can afford additional payments it, is that you may be able to repay your mortgage ahead of schedule.

Pension: By using the tax free lump facility available from pension plan to pay off your mortgage debt, you can take advantage of the tax relief they are available on pension contributions.

Endowment: These are life Assurance Policies that serve two purposes. Firstly They Provide Financial Protection in case you die before the end of the mortgage term. Secondly, if you survive throughout the policy term, the investment element of the policy provides a lump sum (maturity value) that be used to repay the outstanding mortgage debt.

Financial Crisis Analysis

Today, we are facing now financial crisis in all over world. I think it is better to introduce about financial crisis at first. In my point of view financial crisis is the stage of capitalist system. The crisis comes time to time in the system and it is not new. We know, 1929 financial crisis was world’s biggest crisis and after that we face two world war to reduce the crisis. You will think I am talking about war and it is not related to financial crisis. But it is not true. Basically, war comes in the stage of crisis.

At first, we should discuss about capitalist system because the crisis has been produced by this system. It is simple every state has system to run that. Currently in the capitalist state what is the system to run the state we will see here. I have already said it is not new financial crisis in the system because every after every 10 years we face the crisis and after some time we forget all the things.

I think here should discuss about capitalist system something. Capitalist systems is different from its all previous system because it runs on money and capital. Now, the question is what is money? Money is nothing but a mediator. It is only exchange value. Suppose, we have a product A and money B then we can exchange from each other if the value is same.

To run every system and every thing basic is productions and products. The basic things is product and money is secondary thing which runs as exchange value. But in the capitalist systems the capital ruled over the production. Here creates all the problem because capital runs but the product remains constant in the situations we face some times inflations and some times crisis.

Now, we will see how the production increase and the sell of products goes in down in the system. The product has been produced for market not for people uses in priority. For example, if we are not able to pay a lump-sum for a product we can’t buy however the product after some times will be diminish. But the run market the product will not be sold.

It is the basic laws of production in the capitalist system. Now, we will discuss about circulation systems. In the circulation system the product comes in market but the money doesn’t come with that in market to buy the product. For example, in a company a labour work 8 hours and produced 100 rupees product but after the 8 hours he get only 20 rupees as a labour value. In this condition 80 rupees goes in the pocket of capitalist. We can assume that if the capitalist spend 40 rupees more to buy the row material, labour, machine etc. however he has still 40 rupees in his pocket. In this conditions in the market the product has been sold only the rupees of 60 and product of rupees remain in the store of capitalist. In this cycle the production accumulation became higher and crisis comes itself.

The capitalist system in this situations use the financial loans to face the problem which we can see today with the banks. Banks are trying to give more and more loans to the consumer. What is the reason behind it? They want to sell their product and want to capture the future saving of the people. I have already written about it with the topic of loans – killer of people future savings.

Lastly, the capitalist system can’t face the problem forever and can’t remove the financial crisis forever because the cycle of capitalist system is very bad. We can say the current scenario of the India. From the 2006 to 2008 the market was on boom because people got the loans and bought the product which was already produced before production of that.

People were thought that India is growing and market is in boom but what about today’s scenario. The market is in its real conditions and all the growth remain same of 2005. Actually, it was not growth it was the boom of capitalist system by the loans. Actual, production was remain constant then how a country can develop and growth. Only the consumptions was developed not production that is why after 2 years again we are facing the problem.

I think it is the analysis of financial crisis in the term of capitalist system. Now, from here we can deal what can be better options to escape the financial crisis.

I will write that in my next post with some example.

Loans – Killer of People Future Savings

1st we have to understand about the loans. A loan is a type of debt. It is sum of borrowed money which is general repaid with interest.

Next from where we get the loan? Loans are provided by lender or broker for a time period with some interest.

History of loans shows that some people take over the resources of social property and became a rich persona. All the history is evident of its. The people who captured on the resources started exploiting the people who had nothing to eat and live.

From here the concept loans came. It is basically come with the capitalist system because the system runs on capital. Basically it runs on accumulated capital.

With the development of industries the goods produced exceedingly. In this situation the accumulated goods were exceeded and crisis comes in economics.

We can see the recent scenario of Indian share market. The Sensex was started from about 8 or 9 thousands last year and this year reached over 20000.

People were happy that they are developing and their country is going to be world’s imperialist power. But all are only a showcase.

The real things were crisis of market. Accumulation of capitalist system reached in higher position in 1 year. All the things were not related to production but all things were related speculation and share market.

Banks provides money as a loan to people and people became a big consumer of market and all the products were sold very fast. But after this all the things became normal. Many banks announced their bankruptcy and now in the recent scenario all the banks trying to close their business.

Loans are given by banks as back support to sell the products of capitalist and they captures people future savings which is taken as interest by banks.

This was the thought about the loans that is why said, “Loans – Killer of People Future Savings”.

Welcome to Mortgage Loans Blog!

The blog is intended to let you learn about mortgage loans and mortgage process. Basically, it is for UK mortgage loans process and Indian Property investment. India is very hot today in the investment of real estate property.

In the UK mortgage loans are most famous and active. So, I have decided to write on the blog about mortgage and real estate. According to news in the real estate Indian person owner of the DLF is the 3rd richest person of India.

In the mortgage loans process all the outsourcing of UK runs in India. So, Finance department for the loans process is very strong in UK.

About more than 900 banks and associates of banks are working in UK to provide the loans of UK people.

In the loans and finance market UK is the major market and along with mortgage process there are other loans process are also running by the banks. Like – debt consolidation loans, car loans, wedding loans, personal loans, tenant loans etc.

In the same situation in India loans market is now in growing position and here personal loans, car loans and home loans are the main type of loans.

After the consolidation of these knowledge I will proceed for mortgage loans process in the UK and Indian investment.