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Investors have long discussed, argued and debated whether single family homes or multi-units are better for your real estate investing portfolio.

There are advantages and disadvantages for each and I will briefly highlight some of these below.

Let’s start with single family homes.

Single family homes are typically easier to finance, easier to find long term tenants for and easier to sell.

They are easier to finance because you can go to just about any bank and get a non-owner occupant loan, often with very little down payment. (But note, at the time this is being written, May of 2008, lending requirements have gotten significantly stiffer.)

Single family homes are easier to find long term tenants for because many tenants prefer living in a detached home rather than sharing a wall and/or ceiling with multiple neighbors in a multiplex unit. Tenants also tend to stay longer because those who rent houses instead of apartments tend to have more stuff and they don’t like to move it as much.

Since you can sell your single family home either to another investor or to any family looking for a home, you have a very large market for liquidating your property.

Another advantage of single family homes is that there are lots of them. However, single family homes tend to cost more per unit and they are harder to justify an income approach to pricing.

If you looked at a cost per rental unit, single family homes tend to be much higher than the cost per unit of similar (in terms of bed/bath) multi-units.

Since single family homes are primarily built for and sold to owner occupants, they are not priced based on the amount of income that they will produce. Sellers tend to rely on appraisals to value their houses and not on the amount of rent their house can generate.

Now, let’s look at multi-units.

Multi-units are different (not worse) to finance and tend to have better cash flow since the cost per unit is usually lower than similar single family homes.

Multiplexes with more than four units usually don’t qualify for residential financing and require a commercial loan, which is a significantly different process than financing single family homes.

This can be an advantage or a disadvantage depending on your specific situation. It usually requires a larger down payment, but your personal credit score is less important.

Since the cost per unit is lower, you can usually realize better cash flow from the property when looked at on a per month basis compared to single family homes.

Since the number of people looking to buy multi-units is smaller than those looking to buy single family homes, you may be able to negotiate a better deal when buying, but it also may mean you need to give a better deal when selling. This may be a contributing factor to why the cost per unit is lower than similar single family homes.

Personally, I prefer single family homes, but I believe that multi-units have their place in the right portfolio.
Single Family Homes Versus Multi-Units – The Great Real Estate Investor Debate

Investors have long discussed, argued and debated whether single family homes or multi-units are better for your real estate investing portfolio.

There are advantages and disadvantages for each and I will briefly highlight some of these below.

Let’s start with single family homes.

Single family homes are typically easier to finance, easier to find long term tenants for and easier to sell.

They are easier to finance because you can go to just about any bank and get a non-owner occupant loan, often with very little down payment. (But note, at the time this is being written, May of 2008, lending requirements have gotten significantly stiffer.)

Single family homes are easier to find long term tenants for because many tenants prefer living in a detached home rather than sharing a wall and/or ceiling with multiple neighbors in a multiplex unit. Tenants also tend to stay longer because those who rent houses instead of apartments tend to have more stuff and they don’t like to move it as much.

Since you can sell your single family home either to another investor or to any family looking for a home, you have a very large market for liquidating your property.

Another advantage of single family homes is that there are lots of them. However, single family homes tend to cost more per unit and they are harder to justify an income approach to pricing.

If you looked at a cost per rental unit, single family homes tend to be much higher than the cost per unit of similar (in terms of bed/bath) multi-units.

Since single family homes are primarily built for and sold to owner occupants, they are not priced based on the amount of income that they will produce. Sellers tend to rely on appraisals to value their houses and not on the amount of rent their house can generate.

Now, let’s look at multi-units.

Multi-units are different (not worse) to finance and tend to have better cash flow since the cost per unit is usually lower than similar single family homes.

Multiplexes with more than four units usually don’t qualify for residential financing and require a commercial loan, which is a significantly different process than financing single family homes.

This can be an advantage or a disadvantage depending on your specific situation. It usually requires a larger down payment, but your personal credit score is less important.

Since the cost per unit is lower, you can usually realize better cash flow from the property when looked at on a per month basis compared to single family homes.

Since the number of people looking to buy multi-units is smaller than those looking to buy single family homes, you may be able to negotiate a better deal when buying, but it also may mean you need to give a better deal when selling. This may be a contributing factor to why the cost per unit is lower than similar single family homes.

Personally, I prefer single family homes, but I believe that multi-units have their place in the right portfolio.

With property management firms charging as much as 45% of a rental property’s income, more and more vacation home owners are turning to the Internet to book their rental properties themselves in order to keep more of their rental income.

While websites such as HomeAway have given vacation home owners a new venue to advertise their rental properties, most vacation home owners are finding that these sites alone do not produce enough rentals to keep their properties fully booked. Even worse, vacation home owners are finding that the mundane tasks of replying to inquiries, manually sending out invoices and rental agreements, updating their properties’ availability calendars, and all the other tasks associated with replacing a property management firm all add up to a full-time job.

There are online software management tools for vacation rental properties, though, that can greatly reduce the amount of time you have to spend managing these types of activities.

To help vacation home owners find, book and manage online rentals for their rental properties, here are the top 3 time-saving vacation rental management tools that no vacation property owner should be without.

1. Online Booking and Reservations Management System

If there’s one thing that online consumers have learned to expect, it’s instant gratification. If a potential renter can’t instantly book and reserve your vacation property online, then you are lowering your chances of getting their business.

Websites like HomeAway urge their vacation home owners to “respond quickly! Data shows that owners who respond to inquiries within 3 hours close 57% more bookings than owners that respond within 24 hours.” Just imagine what eliminating response time altogether can do to improve your bookings, then.

With today’s integrated online booking, credit card processing, and reservations management systems, there’s no reason to make your potential renters wait. These best of these services provide renters an instant rate quote, including taxes, and allows them to sign-up and book your vacation rental property instantly using any major credit card.

Some vacation rental management software solution providers offer this service – including setting up the merchant credit card processing on your behalf – with no up-front costs. You just pay a small portion of your reservation amount when a renter uses the online system. If you have multiple websites, make sure to find a provider who allows for their software to be integrated into your other sites, too, so you can centrally manage online bookings for all of your websites through one main interface.

2. Self-Updating Availability Calendars

If you’re like most vacation home owners, in order to find enough renters to book your property as often as you’d like, you have listings on all the large vacation listing sites. You might supplement those efforts with manual postings on Craigslist and even your own personal website that you maintain. Whenever you book a rental you have to log in to each website/ listing and update your vacation property’s availability calendar. That can take a lot of time.

A better way to manage your vacation home property’s availability calendars is to use a centralized, self-updating calendar that’s tied to a booking and reservations system. Whenever you accept a booking through the reservations system, the availability calendar automatically marks the dates booked as unavailable. Once you point all of your websites and listings to your centralized calendar (as easy as inserting a link into the webpage), then all of your listings are updated with the latest availability information automatically – requiring no manual intervention on your part.

3. Electronic Rental Agreements

A big time-saver for the do-it-yourself vacation home owner is electronic rental terms and agreements. If done correctly, an electronic agreement is a legally valid, signed contract. Many vacation rental software providers offer vacation home owners the ability to customize the rental terms and agreements and include agreeing to these contracts an integrated part of the reservations/ booking process – ensuring that your renters have signed and agreed to your terms before they are able to reserve your vacation home.

Looking to online software management tools for the vacation home rental owner can save you time and present a more professional appearance to your online renting activities. Look for a vacation rental software management company that makes installing their management software tools into your existing sites easy. Some providers even offer you the ability to create a website using their service for the most highly integrated looking website possible.

Be sure to do your research, though, as pricing, functionality and set-up activities vary widely among these vacation rental management software firms. In the end, though, using online software management tools for vacation rental property websites like the ones listed above can help increase your bookings through their increased functionality. Plus, they’ll save you time since they’re designed to put your online vacation rental website efforts on “auto-pilot”.

Money management is not as easy as it sounds. However, in order to lead a happy and successful life, it is a must for each and every individual to manage his or her finances effectively. Managing money effectively doesn’t require any special skills or training, it just requires a little understanding and planning. To help you get started, following are some of the financial tips that will ensure that you live a comfortable and prosperous life.

Plan your budget
Every individual must plan his or her financial budget. You will face times when you will be tempted to make a purchase, which you actually don’t require. However, it’s better to avoid such situations as far as possible. This is more apt in case of youngsters, who tend to spend lavishly on high-end phones, branded clothes and expensive automobiles. However, you should be wise enough and exercise self -control while buying these items. If you do not learn to manage your money at a young age then there is a strong chance that you may face financial difficulties in future.

Create an emergency fund
Irrespective of how much your salary is or how much you are spending, each month you should keep some money separate as an emergency fund. Having such kind of fund will help to ensure that you do not encounter any emergency problem. This fund will act as a cushion in the troubled periods of your life.

Start saving at an early stage
At a young age you can take more risk as the family responsibility is far more limited and thus you must invest in various financial tools that offer high returns. Also, never invest your money in a single financial tool and spread it across various tools to ensure that there is a proper mix of equity, bonds, fixed deposits etc. Also, by investing at an early age, you will be able to save a lot of money for your retirement.

Understand taxes
You must know how the income tax in your country works, so as to save money on it. You should try to invest in various tax saving tools so that you don’t have to pay more income tax. If you have a complicated balance sheet, you must avail the services of a charted accountant. He will suggest you about the various ways through which you can divert your funds, thereby saving money on taxes.

Destination weddings have become incredibly popular over the years, and for many newly engaged couples, the interest in getting married in the Caribbean is increasing every day!

After talking with many of my clients that have visited our travel agency to inquire about a destination wedding, they seemed to all agree that getting married on a Caribbean Island or even on a Caribbean Cruise is something they have always desired. The exotic locale, convenience, value, and stress free environment it fashioned were some of the many reasons couples find this option very appealing.

Before I talk more on the Caribbean, allow me to first talk a little bit about who I am, and the reason why I view the Caribbean as a popular wedding destination choice.

Back in July of 2000 I attended Travel College, and this is where I met this beautiful Italian girl in my class named Maria. It was clear that the both of us were on the same path of becoming professionals in the travel industry, and at the time we never knew what we were about to experience. Once we graduated, Maria and I were immediately employed by different travel agencies that soon opened up a world of opportunities for us, one being the awareness of how popular destination weddings were actually becoming at the time.

Now at this point you may be asking yourself; “What does this all have to do with having a Caribbean Wedding?” The answer will be clear once I explain!

You see Maria and I since we graduated College stayed in touch, and soon we fell in love! In March of 2004 we decided to get married, and being that we both were working in travel, and the fact that we were sending many of our clients to all these spectacular destinations for their weddings, plus getting all this positive feedback on how memorable their weddings were, it was a clear cut decision for the both of us on what we wanted to do next.

Taking the non-traditional route like many of our clients, we both agreed on having our ceremony somewhere outside our country, and our first choice was, of course, the Caribbean! Why not, with all the great experiences we have established for our clients, this was a destination we both dreamed of going. We looked at getting married in Jamaica, but after a long discussion, we eventually chose the exotic location of Varadero, Cuba, and it had a lot to do with the both of us visiting Cuba several times before! Cuba had everything we needed, and was the most affordable for the many guests that joined us.

Hands-On Destination Wedding Experience Helps When You’re Looking To Plan A Wedding At Destination!

You see, not only helping arrange destination weddings for our clients, but also having the opportunity to experience our very own, our hands-on experiences are what truly allows us to help our clients visualize what they should expect and experience.

Let’s Go Back And Talk About Why Destination Weddings Are So Appealing!

There’s no question that experiencing a ceremony on an exotic island destination is truly unique from the traditional wedding ceremonies, and if you’re planning to get married during the winter months where it may be much colder, having the opportunity to exchange vows in a warm sunset on a powdery soft white sandy beach with the angelic sounds of the crystal clear Caribbean waters echoing in the background is an experience that will create special memories for a lifetime!

However, it’s so much more than that! Destination weddings also offer convenience and true value, and most of all destination weddings provide a completely stress free experience. I have to admit our decision to have a wedding on a Caribbean island had a lot to do with us attending several family and friends’ weddings over the years. One consistent issue that would come up was that with all the guests that were invited, a good number of them really didn’t want to be attending that wedding. Unfortunately when you have approximately 300 plus people at your wedding, it’s impossible to spend quality time with all the guests, especially the ones that are very close to you.

Not having the opportunity to have more quality time with family and friends is a very important feature for many engaged couples that have decided to now have a destination ceremony! Many of our clients quickly realized the true luxury of spending quality time with the ones that were closest to them, and a destination wedding easily provided them that unique opportunity.

If a dream destination wedding, renewal of your vows or a special honeymoon is something you have been considering, don’t hesitate to reach us to explain more about the benefits of a destination wedding, and what is required if you happen to decide to get married in the Caribbean.

Explore Paros beaches, sites and attractions.

The Port of Paros is in Parikia (the capital) which is situated on the western part of the island. Parikia is a well-developed tourism infrastructure town offering lots of accommodation units, beaches and archaeological sites to visit.

There are also daily flights from Athens to Paros (4 flights per day – 45 minutes flight), with Olympic Air.

Paros is the third in size island in Cyclades, after Andros and Naxos, with a total area of 195 sq. km and 120 kilometers of shore and beautiful sandy beaches. Apart Parikia which is the commercial center of the island, the most beautiful village in Paros is Naoussa, which is much more picturesque and has a lot of beaches and attractions to offer. The center point of interest is around the small fishing harbour of Naoussa where are situated some of the best restaurants, fish taverns, cafés and bars of the island. Near Naoussa are some of the best beaches of Paros, awarded with the “blue flag” sign.

In this article we will talk about things to do in Naoussa Paros during the day.
Get up early in the morning, have a rich breakfast at your hotel and get ready to discover the beauties of places around Naoussa. If you prefer to have your breakfast in Naoussa, go to the Café Santé, situated in the heart of the village. It is one of the most popular meeting points in Naoussa, serving all kind of coffees and delicious omelets.

After that, rent a scooter (or hire a taxi or a boat) and drive to some of the best nearby beaches. Start your beach tour from Kolimbithres beach which is situated in the bay, just opposite of Naoussa village. Due to impressive huge sculpture-like rock formations that divide the whole beach into little coves of sandy beaches, Kolimbithres is one of the most popular beaches near Naoussa. Some of these small beaches offer umbrellas and sun loungers for hire and some water sport facilities as well. Another small sandy beach, pretty close to Kolimbithres, is Monastiri (or Agios Ioannis beach). It’s a very well-organized beach, with crystal clear waters, sea sport facilities and seafront fish taverns to enjoy your lunch with delicious tastes.

For snorkeling and windsurfing lovers, it’s suggested to go to Santa Maria beach, situated east of Naoussa at a distance of 5 km, facing Naxos island. This is a fully organized beach with sun loungers, umbrellas, sea sport centers and beach bars with nice music.

In the afternoon you may visit some churches, such as Kimisis tis Theotokou (the Church of the Assumption of the Virgin) which is the main church of Naoussa, located on the highest spot of the hill, the church of San Nicolas and the Monastery of Logovarda which is located 4 km from Naoussa on the way to Parikia. Logovarda is a male monastery and it is forbidden for women.

If you are going to stay in Paros for more days, then it’s worthy to visit some of the most interesting sites in Parikia, such as the church of Panagia Ekatontapiliani (meaning Our Lady of the Hundreds Gates) which was constructed in the 4th century A.D. by Saint Constantine, the first Emperor of Constantinople (Istanbul) and is one of the best preserved Christian monuments in Greece, where you may visit the Byzantine Museum and admire a collection of rare icons, various religious relics and other christian items dating from the post-Byzantine period. In Parikia is also located the Archaeological Museum of Paros where you may see a huge collection of findings dating from the Bronze and Neolithic period.

And last, don’t miss to visit Antiparos island, a small picturesque islet, just 1 nautical mile southwest of Paros, where you will feel like in paradise. Antiparos is accessible by ferryboat from Paros port (Parikia) which is a 20 minutes trip and from Punda beach which is just 7 minutes trip.

Business finance training refers to programs that teach individuals how to handle various financial duties. Finance training is similar to finance tips in that both help business owners make better monetary decisions, but training programs offer a more detailed explanation of finance strategies. Training programs vary in price and can be used by the owners and employees of a business.

The most basic business finance training provide information on budgeting, preparing financial statements, managing cash flow, strategizing, forecasting, improving performance, and applying basic procedures and concepts to more effectively manage a business. These programs are recommended for new business owners to help them understand standard business practices. Once these basic methods are mastered, more specific financial training may be looked into.

Advanced business finance training delves more deeply into a certain financial procedure or concept, usually at a higher cost than basic programs. Advanced programs may teach business owners how to set up effective business models, make decisions based on quantitative analysis, manage and control accounts, practice due diligence, measure productivity, and strategize concerning mergers and acquisitions.

Taking part in any kind of business finance training gives a business owner the resources to make more intelligent business decisions that result in increased productivity and profits. Many different types of courses are available either online or at a specified location. Some programs may even offer the option to train at the business. Taking into consideration the needs and abilities of a business is the key to finding the best business finance training.

A business finance solution generally refers to methods of funding and maintaining the finances of a business. Most solutions involve ways of obtaining working capital, but others also offer ways of protecting and increasing that capital.

To obtain working capital, business owners look to finance solutions that offer funding by several different means. The most common means are loans and financing. Asset-based loans use a business’s assets, such as inventory and equipment, as collateral. A business may also opt for a property loan in order to acquire commercial space. Invoice financing, such as factoring, involves liquidating or selling a business’s accounts receivables in exchange for quick funding. Some businesses look to trade financing to supply their inventory. The business will tell its financer the amount and cost of goods needed, and the financer will pay for the goods. The business then repays the amount financed over a specified period of time.

Most companies that provide business finance solutions also offer ways to protect and increase a business’s capital. Credit protection safeguards a business from daily risks, such as customers not paying on time, so that the business does not suffer incredible losses. This makes it much easier for the business to borrow money in the future, and it protects the balance sheet. A finance solution may also offer business insurance plans that increase the stability of a business. The most common types of business insurance are employee and public liability, car, property, and health insurance. These business finance solutions are designed to protect businesses against potential losses.

We live in an information overloaded society, yet we actually know so little. While I was reading this book I took a straw poll of some people I know, and 100% of them had no idea who the Colwell brothers, or Herb Allen are. So much information, yet so little knowledge is a real problem in today’s world. The three cowboy brothers and Herb, probably did more for world peace, or at least peaceful co-existence than any President, or any government organization has ever done. Frank McGee has produced a great book that chronicles the story of these eclectic individuals. Even better the book is peppered with photographs of the actual people and events.

The story starts right after WWII, the Colwell’s are in their teens, and have a true skill in the entertainment world, initially self taught, they make their mark on the radio landscape, appearing in the Tex Williams weekly show. Invited to ‘tour’ overseas for one month the young brothers can not resist, and against their parents better judgment they set off on their adventure. It was almost a decade before they returned to the US. As part of MRA (Moral Re-Armament) and later Up With People they joined in the youthful mission to try and make the planet a better place. As the saying goes, ‘They boldly went where no man has gone before’. If there was conflict, you can guarantee that the Colwell brothers were not far away, acting as ambassadors of peace.

A Song For The World is a great and heartfelt work, Frank McGee has certainly done his homework, he follows the Colwell’s and Allen across the planet. From India, Africa, China, Russia, and just about every other country you can think of, we vicariously watch these kids grow into men, and subsequently fathers. Very late in the book McGee talks about how they became married men, and I have to admit it is a pretty strange tale. As nomadic minstrels they had little opportunity to go through the conventional courtship rituals. Instead they married first and dated later! While this sounds bizarre, the formula obviously worked for them.

There are very few musicians that have the bragging rights that these guys have, they have played for Kings and Queens, Emperors and Empresses, they have entertained millions of people, and yet never had a top 10 hit! This is a fascinating read and reveals a side of humanity that today is sadly in short supply, happiness, caring, and above all giving. We can learn much from the selfless actions of the Colwell brothers and Herb Allen.

Coffee! The eye opening elixir. Coffee! Black, drinkable, the energizing drink that livens our lives. Coffee! A long history from an exotic unknown berry to a massive commodity production, back to exotic again. And what a past this bitter black beverage has had. The dancing goats, to high volume commodity sales, to the near extinction of the finest of quality coffee beans, the art of growing and handling coffee berries has never died. It has only been altered though out time.

Coffee! The eye opening elixir. Coffee! Black, drinkable, the energizing drink that livens our lives. Coffee! A long history from an exotic unknown berry to a massive commodity production, back to exotic again. One must hand it to that little coffee shop from Seattle that now encompasses the globe. They sure did take the world by storm. In one fell swoop that little coffee company took a commodity beverage and cast it back into the exotic drinkable realm where it was born from as well as distorting the beauty of specialty gourmet coffee for future generations. What is now perceived as a quality coffee bean has traveled back to the art of commodity coffee. The competition on the street corner for a drinkable cup of coffee has become fierce. Each brewer says that their brew is the “perfect cup of coffee”. However they all grab from the same commodity level stocks. Of course without these commodity grown stocks coffee would be in greatly diminished supplies. Yes, coffee is in diminished supply. That is the supply of good quality coffee beans had almost vanished over the last couple of decades as corner boutiques converted to the ravishing corner coffee shop.

There is a change! Finally there is a change in the air. The very small boutique coffee shop and coffee roaster is finally allowed the glory of finding high quality coffee beans once again. Small farm and niche green coffee beans are now becoming available to the fair trade coffee market. Quality organic coffee is being selectively grown just for the small independent coffee roasting operations.

Finally we have coffee drinkers who care more and more about the people of the Earth and the planet that we live on. We now have coffee drinkers who care about the survival of coffee farmers and the lands on which the coffee bean is grown. There are specialty coffee drinkers who cherish the survival and health of our mother earth.

Sustainable Organic Fair Trade Coffee is finally becoming a household request. Fair trade is good for the people. Organic coffee is healthier for you as well as giving health back to our planet.

Fair trade coffee provides a fair platform for the whole supply chain of this wonderful drink. Fair trade coffee beans mean fair prices for those who drink it. It may not be the cheapest coffee to buy however for the quality and sustainability the prices are equitable. It also provides better wages and living conditions for those who grow and produce the sought after bean. Fair trade is an agreement between farmers, workers, shippers, and consumers to care about each other and everyone involved. After all that is what community and health is all about.

Foresight by coffee growers proved beneficial. The few that saw a future for renewed exotic demand set course with new direction. Armed with a brighter knowledge these coffee plantations moved away from the distorted massive commodity market left to flounder by that little coffee shop from Seattle. These foresight seers set their sights on a smaller specialty marketplace. This knowledge was that there would be a need for finely grown and carefully cared for coffee beans. They knew that the land was important, that their community was important, and the survival of quality coffee was important. There would be a need for carefully grown, hand selected, artistically roasted, and rushed to the discerning consumers waiting coffee grinder and brewing system coffee. Out of the fair trade coffee supply grew the expertise to market the perfect cup of coffee. Quality fair trade organic coffee beans are available. Still a consumer can find the organic coffee they seek for their cup of coffee at the corner commodity brewer. Astute coffee drinkers find it a poor substitute for the real experience of fine coffee.

Those coffee drinkers with the discerning desire for the perfect bitter tinged elixir must still seek the out of the way roasters to fulfill their needs. They must discover the hidden gems in the coffee roasting world. And, yes, there are those little gems and merchants, imports, roasters, and sellers. And yes there are many who like yourself desire their cup of coffee to stand out as the pure enjoyment of a cup of coffee should be. After all tingling taste buds and allowing your senses to dance around the flavors of coffee is what life is all about. Allowing your mouth to wrap around the delicate chocolate or nutty earth flavors of the coffee bean and the smoky power of a fine roast is what we seek as a coffee drinker.

If, and when, you find that little quality niche coffee shop hold onto it tight allowing it to grow and become sustainable. Seek out the online coffee merchant that has done the leg work of finding the best roasters and fastest service. Get that cup of coffee. Get your organic blend. Get the roast you desire. Get the fair trade coffee beans you deserve. Don’t let go.

Yes, people drink coffee to stimulate their minds for the long stress filled hour of the day. Stimulating the senses is more important as well. Awakening the olfactory system with quality flavor from specialty hand selected coffee puts the shear aspect of the lowly commodity coffee production into a totally insignificant perspective. Hum drum becomes the everyday ordinary cup of coffee sold at all of the corner coffee shops. Taste bud boredom is a crime of depriving the human senses of ecstasy that we all crave and deserve. Alive taste buds cause the human being to be alive, excited, and adventurous in our every day activities. Start your day with an eye opening sense grabbing cup of coffee and know that your day will be brighter more enjoyable and full of experience. And further know that when you purchase great organic fair trade coffee that you are caring for the planet that gives us our daily life.

Any business (and affiliates and marketers) that engages in interstate commerce will be subject to federal laws. Interstate marketing and advertising practices are regulated by the Federal Trade Commission (“FTC”) under the FTC Act. Services and goods offered through the Internet are considered to be a “use in commerce” since the services are available to a national or global audience. The FTC regulates Internet advertising, marketing activities and sales to consumers as the watchdog agency. The same consumer protection laws that apply to commercial activities in other media apply to the Internet. Under Section 5 of the FTC Act, illegal advertising practices are categorized as either an unfair method of competition or an unfair or deceptive act or practice.

Any activity that is likely to cause consumer confusion as to source, sponsorship or affiliation of any good or service is essentially an “unfair” act or practice under the FTC Act. However, the real culprit for interstate businesses, affiliates and other Internet marketers is avoiding advertising claims which are unfair or deceptive. There is no hard definition of what practices are considered “unfair” or “deceptive,” under the FTC Act.

But, in the simplest terms, all advertisements:

must be truthful and not misleading;
must have evidence to back up any claims made in the ad; and
cannot be unfair.

Complying with FTC laws really boils down to a single standard that your advertisements or marketing practices will be judged under. This “standard” is known as ‘materially misleading.’ This is basically the crux of website advertising law and the standard by which all Internet claims and representations are measured to determine whether they are deceptive. Either an ad or claim is materially misleading, or it isn’t deceptive. This standard is defined by a series of guidelines, rules and policy statements published by the FTC. The FTC rules and guidelines illustrate what the FTC believes is illegal under the technical language of the FTC Act.

The principle guidelines on advertising are contained in the FTC’s Policy Statement on Deception. Under the FTC’s Statement, an advertisement or marketing practice is deceptive if there is a representation, omission of information or some other practice that is likely to mislead a reasonable consumer and which is likely to influence or otherwise “affect the consumer’s conduct or decision with regard to a product or service,” to that customer’s detriment.

In terms of Internet advertising, an unfair or deceptive act or trade practice is usually made by publishing a false advertisement. The Act specifically states that using a false advertisement in commerce is unlawful and doing so is also categorized as an unfair or deceptive act or practices. The term false advertisement means an advertisement, other than labeling, which is misleading in a material respect. As you can imagine, flat out lies about your products or services, or those that you promote or endorse, are going to be misleading and illegal. Simply stated, you cannot make any false claims. However, a claim can be misleading in many other ways and this is where most Internet businesses land into trouble.

If you don’t understand the nature of what is considered materially misleading, you could very easily violate FTC laws. You MUST understand all the ways a claim may mislead a consumer and you MUST know what is considered a claim or representation in the first place. This is really the key to understanding FTC laws. For instance, a claim can be literally true, but if it is only true in limited circumstances, or if it is subject to more than one interpretation, one of which is not true, or misleading in its overall effect, it is deceptive. I am going to take you through each element of an advertisement from the FTC’s point of view so you can master this understanding. Again, either you can pay an attorney to look at your specific ads, throw them up blind, or take the time to learn the fundamentals yourself.

A. Overall Context Matters

A claim can be suggested by the overall context of an advertisement. This means a representation or claim can be made or suggested by any “statement, word, design, device, sound, or any combination thereof”. In other words, the FTC won’t just look at the words of an advertisement by itself to determine if it is misleading. Other than the words of the ad, the name of the product, the nature of the product, any visual or audio depictions or symbolism can all provide the context to establish a claim. Even the website name or metatags can provide the context for a claim. The overall experience conveyed by viewing the ad in relation to the rest of the website sets the context for a particular claim.

The U.S. District Court, Third Circuit stated the FTC standard regarding context of an ad clearly. “The tendency of the advertising to deceive must be judged by viewing it as a whole, without emphasizing isolated words or phrases apart from their context.” Beneficial Corp. v. FTC (1976). Using illustrative pictures on your website to demonstrate the effectiveness or results of a product is a common example. Without stating some direct, express claim in words, these pictures would be just as effective in suggesting some claim to your visitors.

EXAMPLE: You operate a website called homesavers.com which offers loan modification and “foreclosure rescue” services. The title of your webpage is labeled as “save home” and your home page contains a picture of a “happy and relieved” couple sitting at a kitchen table looking at their laptop which shows homesavers.com on the screen. The website advertisements include a heading titled “Begin the process of saving your home now” and other claims of “if you act now, we can save your home.” Without any qualifying disclosures, the overall context of the website may imply that consumers can expect to save their homes by using homesavers.com.

B. Express and Implied Claims

If an ad makes either express or implied claims that are likely to be misleading without certain qualifying information, this information must be disclosed. You must determine which claims might need qualification and what information should be provided in a disclosure. The important thing to understand is the fact you can make an implied claim through your advertisement and that you cannot suggest any claim which you are not permitted to make expressly by law. An express claim is an obvious one. For example “This product will stop bullets from penetrating your body in an advertisement for a bullet proof vest. Similarly, the claim “removes every type of stain from your carpet” is an express claim that the advertised product will remove all stains from your carpet.

An implied claim is one made indirectly or by inference and causes the most problems for Internet advertisers.

EXAMPLE: In an ad about the innovative bullet proof vest, it claims the vest is “used by law enforcement officers and professional body guards.” Since the ad claims law officers and security professionals use the vest, it implies they use it to stop bullets. It may also imply reliability to the average consumer.

EXAMPLE: “2 out of 3 mechanics prefer mighty wrench to any other wrench on the market! Besides having to substantiate that 2 out of 3 mechanics prefer mighty wrench, this claim implies that the tool is adept at working on cars. This is an implied claim even though the ad does not expressly state that “mighty wrench” is suitable for cars.

EXAMPLE: In an advertisement for sprinting shoes, your website claims “Joe Sprinter wore these shoes during his Olympic 100 meter Gold medal run.” This implies that the shoes are made for, even particularly well-suited for, sprinting and running fast. This ad implies a particular quality about the shoe.

EXAMPLE: Your website sells household carpet cleaning products. You use an ad promoting your “wonder-clean” carpet cleaner, stating that it “removes the toughest household stains.” Directly below the ad, there are a series of illustrations depicting a dog standing on a carpet next to an obvious wet spot on the carpet and the product then being applied by a woman. Then, that same woman is depicted with a smile on her face and the wet spot has disappeared. The ad suggests that it removes dog stains from your carpet (maybe even common pet stains in general).

EXAMPLE: An ad claiming “experts agree our product beats our competitors hands down” probably implies that there is actual proof that most if not all experts have made such a proclamation.

C. Leaving Out Important Information

A claim can be misleading if relevant and material information is left out. An advertisement cannot leave out facts which are material in light of any claims made or material in light of how the customer will use the product under the conditions stated in the advertisement (or under ordinary conditions). If a claim is only true in limited circumstances or a benefit only applies sometimes, this must be disclosed.

EXAMPLE: In ad for revolutionary new speakers your sell from your discount stereo web store, your website boasts that the speakers “can achieve a 98% efficiency rating.” But, this rating cannot be done with every type of stereo receiver. In fact, a few different models of speakers can achieve the same rating, but only if they are used in conjunction with certain receivers. These are considered “high-end” receivers and are not common. Since the stereo receiver required is uncommon, this should be disclosed.

D. Material Claims

In order for a claim to be materially misleading, the claim or any information left out must be important or significant to the consumer’s choice to purchase the product or service. If the average consumer would not find the claim to have any significant influence on his or her decision to purchase, the claim is not material. The FTC has stated that examples of material claims include representations about health or safety, a product’s performance, features, price, effectiveness or other central characteristics. But, these are not the only types of claims which are material. Information is also likely to be material if it concerns durability, performance, warranties or quality. Information pertaining to a finding by another agency regarding the product may also be material.

The FTC presumes that express claims are material. As the Supreme Court stated recently, “in the absence of factors that would distort the decision to advertise, we may assume that the willingness of a business to promote its products reflects a belief that consumers are interested in the advertising.” Where the seller knew, or should have known, that an ordinary consumer would need any omitted information to evaluate the product or service, or that the claim was false, materiality will be presumed because the advertiser intended the information or omission to have an effect. Similarly, when evidence exists that a seller intended to make an implied claim, the FTC will infer the claim is material. The FTC might also look at other evidence that the claim or omission is likely to be considered important by consumers, such as testimony or customer surveys.

If a claim is material, it also means that injury is likely to exist because of the representation, omission, or practice. Injury to consumers can take many forms according to the FTC and it exists if consumers would have chosen differently but for the deception. If different choices are likely, the claim is material, and injury is likely as well. The statement on deception states that injury and materiality are different names for the same concept.

E. Substantiating Your Claims

Advertisers must have sufficient evidence to support any claims made, or the claims are deceptive. In order to avoid deception, you must have a “reasonable basis” for any factual or objective claims you make in any advertisement. (FTC vs. Pfizer, Inc. (1972)). This is also referred to as the doctrine of “substantiation.” This reasonable basis must be based on objective, credible and reliable evidence. You can use surveys, statistical evidence (studies) and expert opinions to substantiate any claim you make and otherwise prove a claim is true.

If the advertising claim suggests a level of support, it is obvious that the advertiser must have evidence of that support. For example, if a marketer claims that “three out of four customers prefer our brand”, then the marketer must have reliable survey evidence backing this statement up. If an advertiser claims “clinical studies show,” the FTC requires that clinical studies must show what you claim.Where a claim is not specific, the FTC will look at a number of factors in reviewing substantiating evidence to determine whether there is a reasonable basis for the claim including: 1) The type of claim; 2) The product involved; 3) The consequences of a false claim and the benefits of a truthful claim; 4) The cost of developing substantiation and 5) The level of substantiation experts would believe is reasonable.

EXAMPLE: A website that sells energy drinks and related energy products makes clams that its products give its customers energy lasting “all day” or “gets you through your work day.” Those claims need to be true and need to be backed up by an actual clinical study showing that the drink or other products boost energy levels for the duration specified.

The FTC will look at a number of factors to help determine the appropriate amount and type of substantiation necessary, including:

The Type of Product. Health and safety claims are subject to the most scrutiny by the FTC as they pose the most risks to consumers. Also, alcohol and tobacco are particularly put under the microscope along with dietary and herbal supplements, weight loss products and nutrient claims since these are related to health. These types of claims require competent, credible and reliable scientific evidence. I discuss scientific evidence in much more detail under the discussion of substantiating health claims.

The Type of Claim. Technical claims and claims that consumers would have trouble or cannot possibly evaluate themselves are subject to much more scrutiny. For instance, “reduces your energy costs by 30%” “kills germs on contact” or “environment friendly” are claims consumers cannot easily substantiate on their own. As a matter of policy, when consumers can easily evaluate the product or service this has historically attracted less FTC attention than those claims that consumers would have difficulty evaluating directly, such as “e-cigarettes contain none of the harmful ingredients of tobacco cigarettes.” Also, if a product is inexpensive and it is frequently purchased, the FTC will examine the practice closely before issuing a complaint based on deception. According to the FTC’s view, there is little incentive for sellers to misrepresent in these circumstances since they normally would seek to encourage repeat purchases.

General Results Claims

Stating that your products will deliver certain results may also be misleading. You must be able to substantiate any results you claim. If you make any specific claims of product results, you must also disclose that the product will not deliver the same results to everyone and may not even be effective for some purchasers, unless this is absolutely the case. Of course, if you can substantiate that the product would achieve the results claimed in each circumstance of use for all purchasers, you don’t have to worry.

For instance, a website that instructs businesses on how to establish and build a good business credit rating and makes the following claims on its website: “Instantly obtain multiple credit lines” and “establish a top credit rating fast.” How about a website offering SEO services that claims “our customers usually see double the traffic within 2 months.” These are results based claims. If the average client is not likely to achieve these results, you should disclose these facts. Otherwise, these ads may be misleading and thus deceptive.

If your business is offering a new product, then you can’t make a general results claim if no data on the results exists. As burdensome has this seems, the FTC’s comments on the matter of substantiating claims are pretty clear. I get a ton of questions on this issue. Section 5 of the FTC Act requires advertisers to have substantiation for the messages that consumers reasonably take from their ads, which means they must first know what messages consumers take away from those ads.

F. Reasonable Consumer Standard

The FTC will always evaluate any advertisement from the point of view of the “reasonable consumer.” This basically means looking at how the average reasonable person would interpret or respond to any claims or representations you make. Your business will not be liable for every interpretation or response by a consumer. This is actually a fairly well-stated principle in the context of advertising. Advertisers are not liable for every possible misrepresentation, no matter how outlandish. Misconceptions occurring among the foolish or feeble-minded are not reasonable.

The FTC provides the example that all “Danish pastry” is made in Denmark. The fact that some unreasonable individuals may believe that all Danish pastry is actually made in Denmark is not reasonable and does not cause liability to the advertiser. A claim is not deceptive only because it will be unreasonably misunderstood by an insignificant and unrepresentative segment of people.

When representations or sales practices are targeted to a specific audience, the FTC will look at how a reasonable member of that specific group would interpret the claim. For instance, terminally ill consumers might be particularly susceptible to exaggerated cure claims, children would likely believe claims adults would not, claims toward the elderly may be viewed by differently than the general public, etc. Similarly, “claims directed to a well-educated group, such as a prescription drug advertisement to doctors, would be judged in light of the knowledge and sophistication of that group”(FTC Policy Statement on Deception).

In addition, part of the reasonable consumer standard means that an ad may be capable of more than one reasonable interpretation by a consumer. So, if your ad conveys more than one meaning, or is interpreted differently and that meaning is misleading, you will be liable. This is true even if the main meaning of the ad is not deceptive. The critical question is determining what overall impression consumers would take away from a given ad when looking at the ad as a whole.

G. Subjective Claims, Opinions & Puffing

The FTC generally will not bring advertising complaints based on subjective claims that consumers can judge for themselves (i.e. claims based on taste, feel, appearance or smell), opinions or obvious exaggeration or puffing. For example, if a seasoning salt boasts on its website that the product is “delicious” or an ad claims a particular candle “smells great” these are general subjective claims regarding the taste and smell of the products. Stating a product has a “handsomely finished exterior” or comes complete with an “attractive carrying case” are examples of subjective opinions. Just because not everyone might find the exterior of the product in question handsome or that the carrying case is attractive does not make the ad deceptive.

Since these types of claims don’t pose risks to health or safety even if they were deceptive, they really are not scrutinized by the FTC anyways.

Similarly, a product endorsement that proclaims the product to be “the best product I ever used” is a subjective opinion. The claim is not a statement of fact or some claim about some result, quality or characteristic of the product. In general, if the claim is a subjective one and does not contain an objective component, it is not unlawful.

In contrast, claiming a product is superior based “on all the latest research and data” is not subjective any longer. It’s misleading if the product really is not superior based on the most recent research and data. Claiming a flashlight “outlasts all other major brands” or “more customers prefer our hand lotion to any other” is an objective claim which must be supported with some credible evidence of what is claimed. Opinions are deceptive only “if they are not honestly held, if they misrepresent the qualifications of the holder or the basis of his opinion or if the recipient reasonably interprets them as implied statements of fact”.

Advertisements involving obvious exaggeration or puffing are not unlawful. These are claims that the reasonable consumer would not believe. For example, claiming a child’s wooden sled that is “handcrafted by Santa’s elves” is obvious exaggeration, or claims that a product is “superior” to all others is a general statement and is puffing. Vague statements such as “the breakthrough the Industry has been waiting for” or “this could be the opportunity of a lifetime” are also examples of puffing and are lawful. These statements are really more in the nature of boasting than making an actual factual claim.

EXAMPLE: American Italian Pasta Co. vs. New World Pasta Co. (2004). The court stated that in order for a claim to be false, it must be “a specific and measureable claim capable of being proved false.” The Court in this example found that American Italian Pasta Co.’s use of the phrase “America’s favorite pasta” was not a statement of fact, but was considered subjective and vague puffing. This case provided a very good definition of what is considered puffing: “puffing is exaggerated statements or boasting upon which no reasonable person would rely or vague and highly subjective claims of product superiority.”