Get a CLUE Report if your buying a home

The purchase contract for a home usually contains a stipulation for financing and a home inspection. These stipulations allow the buyer to back out of the contract if they cannot get a mortgage or the inspection turns up something wrong. But another not well known report to show the buyer the insurance history of the house should always be requested. That report is called the homes CLUE report. 
 
The Comprehensive Loss Underwriting Exchange (CLUE) report will tell you what kinds of insurance claims have been filed by the previous owners. Why is this important to you as a buyer? The current owner may have forgotten to tell you about some past damage to the house. The CLUE report will tell you the exact date of loss, type of loss (water damage, mold, fire, etc.) and the amount of loss for all claims. Also it will tell you if it has a long history of claims which may get you denied home insurance which will impact if you can even get a mortgage. You may not get denied coverage, which is rare, but you may be put in a high risk pool or paying more than you should if the house was not messed up insurance wise. 
 
If you are going into contract it makes sense to put the CLUE report stipulation in it. This way you can make sure it's clean and if not straighten out the inaccuracies. Go to Choicetrust.com for the report. 

15 Year Mortgages Becoming More Popular

Image by Rev Dan Catt via Flickr

A trend is starting of more people who are refinancing choosing to have a 15 year mortgage. CoreLogic, a provider of financial, property and consumer information, states this is a rising trend (CoreLogic.com). 
 
The data reveals in 2007 9.4% of refinanced mortgages were on a 15 year note. In 2009 it rose to 18.5%. This year from January to June, 26% of refinanced mortgages were 15 year. Why is this happening? 
 
With the interest on a 15 year mortgage as low as 3.86% the higher payment is becoming more affordable. The public push back on rising government debt and fiscal irresponsibility of the government is making people reevaluate their own situations. People are rethinking the sense of having a longer term on their mortgage, the money they are paying for this lower payment on a 30 year note. 
 
With the economy in the drink, their investments going nowhere and the insecurity of the times a paid of house is something tangible that people can get a sense of security from. Seeing an interest rate with a "3" is very tempting. 
 
People have awaken from their sleep. They are more aware of where their money is going. A 30 year mortgage is not so appealing anymore. The mac-mansion is being put on the shelf as a disaster financially. People used to take out the biggest mortgage they could and use the rest of their money to invest. But now people see debt as drag on their budget and psyche. Being debt free and financially secure is the rising trend. 
 
The new young homeowner sometimes can't make the payments of a 15 note work in their budget. They have to go for the 30 year note. I remember, my own experience was I had to get the 30 year note and to make it worse it had a negative amortization. It was stupid, but I didn't know better at the time. 
 
If you have a 30 year mortgage and want to go to a 15 year but can't refinance for whatever reason here's a workaround. Pay the 30 year note as if it was a 15 year. Find out, through the many financial calculators on the Internet, take your mortgage balance with your interest rate and plug it in for a 15 year mortgage. The result will be the 15 year payment, take the 15 year payment subtract the 30 year payment, this is the amount you add to the principle amount every month. With this new payment your mortgage will be payed off in 15 years. 
 
If you have a crisis you can stop the extra principle payment and continue when you can. Any amount of extra principle will pay off your mortgage sooner. If you have a mortgage of $200,000 at 4.5% for 30 years even a extra $100 per month will shave 5 years off your 30 year mortgage and save you $31,700 in interest.

Taxes Going Up As The Bush Tax Cuts Go Down

Image via Wikipedia

There were two major tax cutting bills enacted during President Bush's administration. They were the Economic Growth and Tax Relief Reconciliation Act of 2001 and the Jobs and Growth Tax Relief Reconciliation Act of 2003. These two pieces of legislation are what we call the "Bush Tax Cuts". The bills included across the board tax relief for American taxpayers. They will expire as of December 31, 2010. 
 
Exactly what will the loss of these tax cuts mean to you and me? 
 
Tax Brackets 

Tax brackets that are currently 10%, 15%, 25%, 28%, 33% and 35% will go up to 15%, 28%, 31%, 36% and 39.6%. This means that if you are in the 10% bracket your taxes will increase by half to 15%. What happened to helping the lower and middle class? 
 
Marriage Penalty 
 
Remember when the marriage penalty was such a hot topic in the news, well the Bush Tax Cuts fixed it. But now it's going back to the way it was, when a couple living together was paying less taxes. Married couples will have to pay more than single couples. 
 
Child Tax Credit 
 
The current child tax credit is $1000. This will fall back to $500 in 2011. Also eligible families will decline. 
 
Dividends and Capital Gains 
 
The tax rate on dividends is currently 15%. It will climb to a range of 15% to 39.6%. Capital gains top rate will climb from 15% to 20%. 
 
Estate Tax 
 
In 2010 there is no estate tax. But in 2011 it returns with a exemption of $1,000,000 and a tax bracket of 55% 
 
The Tax Foundation estimated that the median family of four saved about $2,200 in taxes under the present plan. These cuts will vanish with the next tax year. 
 
I can't reconcile any of these tax cuts as unnecessary. They effect all tax payers of every age. I can't see giving the government more of our money when the budget is out of control. When our money is wasted at every turn it unconscionable to allow them more money. Cut the budget 10% and leave us alone. 
 
Not making these tax cuts permanent will be the final nail in the Obama Administration. The damage done will echo for years to come. 

From Mortgage Fraud To Foreclosure Fraud

Image via WikipediaBank of America, the nations largest bank, on Friday became the latest lender to put foreclosures on hold in 23 states because of concerns that court documents it submitted were prepared incorrectly. 
 
A Bank of America executive, Renee Hertzler, said in a February deposition in Massachusetts that she signed as many as 8,000 foreclosure documents a month without reviewing them. Here's the problem with this: an executive of a major lending company, who is responsible for 8,000 foreclosures a month blindly signs legal documents without checking for accuracy. This is only one of the many banks operating in this way. Maybe the documents are accurate, time will tell. 
 
At OneWest in Austin Texas, Erica Johnson-Seck a vice-president and her team sign off on 6,000 documents a week and about 24,000 a month. OneWest is the successors to defunct IndyMac of California. 
 
What's the problem with all this? The banks really don't care if the documents are correct. They don't care because these foreclosures are a big drain on the resources of the bank. The costs of foreclosure and the money lost in the lending is eating away at the companies. They have had to hire additional staff and the light at the end of the tunnel cannot even be seen. 
 
It's not revealed but I believe the people who are really upset about this fiasco is the Judges that have to sign off on the foreclosure. They look like fools taking for granted the documents are correct. 
 
The banks in today's world have really let the industry go to pot. Banks are rated at the bottom in customer service. Just try to get a short sale to progress in a timely manner. The lending that was supposed to loosen up with the TARP bailout has not happen and if it did only in the slightest way. Banks are not lending like they should. The lending they do is in such a way as to be totally useless. 
 
Banks have become a massive, bloated, fat behemoth of in efficiency. They can't even get out of their own way. The time will come when they will have to be broken up like AT&T was. They are unresponsive to the needs of the public in the extreme. The credit system of this country in integral with the health of the economy. If these banks can't get it together Uncle Sam may have to step. Under normal circumstances I'm apposed to government regulation but not in this case. 


       Sorry about the Rant but banks misbehavior is a sore subject with me.
                                                                                                  ,Dave

How to: Go to College Without Loans

There is a new book out called "Debt-Free U: How I Paid For An Outstanding College Education Without Loans, Scholarships, Or Mooching Off My Parents" by Zac Bissonnette. Zac is the new poster child for a debt free college education. I can see he will soon be on all the morning shows hawking his new book. He is presently in a public college and paying cash. 
 
Zac's premise is that if you pick an affordable school, live within your means and work during college, college without loans, financial aid or parents looting home equity or retirement accounts is within reach. Zac knows because that's what he's presently doing. 
 
Here's the math on going to college, according to "The College Board", public four-year colleges charge an average of $7,020 per year in tuition and fees, plus another $7,404 for room and board. That's a total of $14,424 per year. 
 
Most families qualify for a tax credit of $2500 on the first $4000 in college expenses. So after tax that $14,424 is really $11,924. If you break it down it's $229.31 per week. Then divide that in half makes it $115 for the child and $115 for the parents. Not bad seems manageable. Nearly all colleges allow you to pay monthly over the course of the semester. So you can really cash flow college. 
 
If the child works during the summer 40 hours plus and at least 20 hours a week during the school year at $8.00 per hour, it comes to $11,200 per year. 
 
34 weeks work 20 hours per week at $8.00/hour = $5440 
18 weeks work 40 hours per week at $8.00/hour = $5760 
 
According to Zac Bissonnette, junior will only need half of that total because Mom and Dad will pay the other half. So junior has plenty of money for other things. 
 
Included in this scenario is that it is assumed you start out with no savings. If Mom and Dad did save it would make it a little easier. It's assumed you received no financial aid or grants. According to the website knowhow2go.com 60% of students qualify for grant aid to the extent of $3,300 per year for four year public colleges and $1,800 for two year public colleges. That's a big help. Also assumed the student stays on campus, no private housing. 
 
The only problem with this plan is that it's a lot of work. With today's self indulgent society brainwashing you, are you willing to work hard to stay out of debt. 

5 Ways To Deal With Co-Workers From Hell

 
Here I am offering 5 tips to make it a little easier to get along with that pain in the @$$ at work. Don't waste energy having a breakdown on account of someone you can't stand. 
 
Dealing with Co-Workers Tip #1: Be prepared for Conflict 

If you have some in the organization who is difficult be prepared for a potential situation. If you don't you may react with anger or some useless childish behavior that will only make the situation worse. 
 
It may help to practice a potential argument in your head to get ready for the situation. Listen to what your saying to see if it comes across as immature or foolish. Also remember to not be wishy-washy, uphold your morals and values. Don't be arrogant but be self-confident. And by all means don't letthe person get under your skin , be ready for cheap shots. 


Your job is already quite stressful with deadlines and difficult bosses. Not getting along with co-workers makes your job ten times more difficult. You have no choice but to try and get along or just change jobs. 


Dealing with Co-Workers Tip #2: Don't fuel the fire. 

If tempted to retaliate, don't. People who cause tension and confrontation also thrive on it. They feel powerful with an exchange of harsh words. Don't get sucked in, you'll only look like the bad guy. Instead react in the opposite way they expect, be nice to them. It drives irrational people crazy. You'll either become friendly with them or drive them away. 
 
Dealing With Difficult Co-Workers Tip #3: Lend a Helping Hand 

It may not work in all situations but difficult people may be just a troubled person or someone with poor social skills. They end up making enemies instead of friends because they have money problems or marriage problems at home. This makes them an actual miserable person to be around. They may not be justified in mistreating you, but at least you know why they act the way they do. 
 
Dealing With Difficult Co-Workers Tip#4: Get a Third Party Involved. 
 
No matter how hard you try you may just not be able to get through to the person. This is when you get a neutral party to help. They can listen to both sides and try to find common ground. 
 
Dealing With Difficult Co-Workers Tip#5: Move On 
 
You tried your best and nothing worked. You will reach a point where it's not going to be resolved. If one of you doesn't move on your going to have to suck it up or quit. If this treatment by the person effects your productivity it could he considered grounds for termination. But before all this occurs be careful in examining your own behavior and if your doing the right things. Most of all don't ignore the situation it will only get worse.