Korene's Blog

Every month, you receive a mortgage statement that reminds you to make your regular payment against your loan, but did you realize that it can serve as a strategic financial tool?

It's true. Whether you receive your statement via regular postal mail, or get your statement online, there are various pieces of information on it that can serve as useful intelligence for better managing your home financing, and help you make well-informed decisions about your loan.

Let's take a look at four important pieces of information found on your statement each month:

1. Taxes.
As tax season approaches, you'll want to review your property tax write-offs, but also use your statement to check that you aren't paying too much. Many people have their property taxes paid via an escrow account attached to their home loan. The yearly property tax is put aside in the account and paid out per your local county assessor's tax collection.

If you pay your property taxes through such an escrow, the year's property tax total will be divided by 12 and bundled into your monthly mortgage payment. If your local real estate market has shifted, the figure being set aside for your property tax escrow could have shifted, as well. If the property tax fees on your payment stay the same while your home's value changes, it might be time to have your home's value reassessed.*

That said, there can be limitations placed on how much the assessors can adjust the value of your property each month, so make sure you familiarize yourself with your local regulations.

2. Amortization.
When you make a payment against your home loan each month, you pay the same amount, but what that money goes toward changes over time. In your loan you have the principal amount, which is the amount you borrowed to finance the purchase of your home, and you have interest, which is the fee you are paying for borrowing that money.

When you first begin paying your loan, your payment goes predominately toward interest, but over time your monthly payment shifts increasingly toward principal. This process is amortization, and your statement shows how your loan is amortizing each month.

If you want to try to pay down your loan more quickly in order to gain additional equity in your loan, you can pay a little extra each month, or make an additional payment each year. Make sure to note on your payments that you wish these extra payments to be applied toward principal, and watch your progress on your statement.

3. Homeowner's insurance.
Like your property taxes, many homeowners pay their homeowner's insurance in monthly installments that are bundled into their loan payment. If you do this, make sure to monitor your loan statement to see if this amount increases or decreases, which would obviously reflect changes in your insurance rates.

Also, taking a moment to examine the amount you are paying provides you with an opportunity to mull over whether or not you need to alter your policy in any way.

4. Private mortgage insurance.
Borrowers are generally required to pay for private mortgage insurance (PMI) if their down payment is less than 20 percent of the sales price of their home. This means that the loan-to-value (LTV) ratio is more than 80 percent. Essentially, PMI is designed to protect the lender in cases where the borrower defaults on the loan.

In most cases when your current loan's LTV falls to 78 percent or below, you no longer need to pay for PMI. So, if you pay PMI, watching the principal on your loan each month can help you keep track of when you may be able to cancel your PMI, which can save you a fair amount of money (which you could consider putting toward the principal, in fact).

Remember, your mortgage statement is more than just a reminder to make your payment — it's a useful tool. If you'd like to learn more about how to strategically leverage the information on your loan statement, or if you have any other home financing questions, please contact me using the information on this email.

*Neither Korene Clopine-Seaman nor WJB are a tax advisory firm. The information contained in this article is for informational purposes only and may not reflect current tax year rules and regulations. Consult your tax advisor or the IRS for current tax year rules, restrictions and regulations.

We talk a lot about goals and focus, but the reality is that keeping sight of your goals and focusing on the steps to achieve them truly does bring success. As the new year begins, refresh your sense of purpose and strengthen your focus by keeping these four ideas in mind.
 
Multi-tasking is a myth.
The software industry, time management gurus and the overall climate of modern business and personal life have convinced us that we can not only do everything, but do it simultaneously. Don't believe it. As professionals, as individuals and as family members, we as a nation are over-scheduling ourselves into ineffectiveness. Instead of having time to do things thoughtfully, or having the downtime that gives our brains much-needed rest, we are filling our minutes with multiple priorities and obligations.
 
Break the cycle.
Start learning to assess whether you can really add more to your schedule before just agreeing to it. For many people it's hard to say "no" or "I can get to it, but it may take a little while." But understanding when and how to say no to those you work with can be just as important as meeting deadlines. Of course, if a new obligation or task truly outweighs a current one, then have one replace the other, but don't try to double up and consistently over-achieve, as that can yield mixed results.
 
Pick one tool and stick with it.
Between the web, smart phone apps, software and plain old paper and pens, there are scores (and perhaps hundreds) of productivity tools to help you create task lists, track your time and become a master of your destiny. Here's the problem: Many people adopt one of these tools, use it for a week or so, and then move on to the next hot thing, as they may be continuously attracted to the next shiny new productivity tool. Don't make that mistake. Jumping from technology to new technology can slow your business down and have you focused more on implementing a new process rather than delivering results. Be aware of emerging technology, but understand there may be many ways to accomplish your same goals. Newest isn't always best.
 
Your communications — who's in charge?
From email to texting to social media, our online communications tools have become so ingrained in our lives that we are constantly monitoring, managing and responding to them. Think about it: How often do you catch yourself checking your inbox on your phone at the dinner table, or reading Facebook posts at your kid's soccer practice? That is because your tools have taken over. Work on reversing that.
 
Your inbox is not your job, so check your inbox as infrequently as possible. When you do access it, first scan by sender and subject line for emails that you know will help you accomplish your agenda items, and prioritize those. Then go through everything else, deleting the obvious noise and clutter. For the remaining emails, take one of five actions immediately: trash it, answer it, refer it to someone else, file it for reference or delete it.
 
Ultimately, many of our modern organizational problems stem from the fact that we often confuse the means with the end. We can become so fixated on the how of getting things done that we have decided that managing our systems and tools equates to actually accomplishing something. Stick to your purpose and you will see a less frazzled and stressful, and more focused and successful, 2012.

The six strategies you may want to avoid:

The first piece of advice from experts in the financial field is to be sure you do not make your situation worse by making common mistakes. In particular, try to avoid:

1.    DO NOT Declare bankruptcy--this can have permanent and severe consequences on your financial future. Avoid it if you can, especially when debt settlement may work for you.

2.    DO NOT rely on advice from amateurs like family, friends, co-workers, and strangers.  Get your advice from licensed, trained professionals.  There is no over the counter medicine that fits everyone’s financial situation or circumstances.

3.    DO NOT pay only the minimum payment on your debt, as this will result in the amount you owe actually growing, and your problems will only become worse.

4.    DO NOT rely on friends and family to pay your bills and or debt, as this can damage relationships with the most important people in your life.

5.    DO NOT use unscrupulous credit counselors that demand cash high upfront fees for help they promise, but don't deliver.  Remember they do want to make money.  This is their business but do not pay high upfront unreasonable fees.

6.    DO NOT use new, high-interest loans to pay off lower interest rate loans. While it may be easier to just have one payment, it will actually increase the amount you have to pay back.

Debt Settlement

For many people, working with a debt settlement company can actually be a great solution. You’ve probably heard a lot of advertising for these services recently, but what exactly do they do?

Debt settlement is the process of negotiating with creditors to get them to forgive a big portion of your debt. Why would a credit card company do this? Well, it’s not out of the generosity of their heart. They have made the financial calculations and determined they are better off knowing for certain that they’ll get paid something, rather than not knowing if they will get paid anything.

Settlement companies work with individual consumers to determine a reasonable, monthly amount that they can afford to pay against their debt load. The individual makes the affordable payment every month into a special-purpose account, and as these funds accumulate, the settlement company reaches out to creditors to negotiate a full and final actual settlement amount that they will take. The debt settlement company only charges a fee after they have achieved a satisfactory settlement for you.

Typically, these companies have excellent relationships with creditors and are negotiating on behalf of thousands of people every day. The amount of savings they can obtain for consumers can be significant.

While each situation is different, it’s not uncommon for debt settlement companies to negotiate reductions of as much as 50 percent of the outstanding amount and help get their customer debt free in just a few years.

There are many debt settlement agencies, so how do you find a legitimate and trustworthy company to work with? One great way to start is by calling (866) 488-2066 or visiting Continental Credit, LLC (will@continentalcreditllc.com). They offer a free, no-obligation consultation to evaluate your options. Then, if you choose to proceed, they will develop a plan that meets your specific needs and negotiate it on your behalf with your credit card companies. Continental Credit LLC is fully compliant with all FTC rules.

The holiday of Thanksgiving is rooted in gratitude. When the early pilgrims sat down to dinner they gave thanks for their safety, thanks for the food they foraged and grew, and thanks to the Indians for not killing them instantly! They thanked God for the wonders of this magnificent country and they thanked each other for their support, love and kindness, even as they were frightened about the future, afraid of the coming winter, and missing the security they once knew.  Does any of that sound familiar?  

Giving thanks is not a natural impulse. We say thank you when anyone does something nice for us. By the way, did you know that the meaning of ‘nice’ is ‘socially acceptable’?  Saying thank you is not only polite, but it makes people feel good too.

But the gratitude I want to speak about today is self-gratitude. I am grateful to be alive.  I am grateful for a loving family and lots of great friends who give my life meaning. I am grateful for my wonderful clients who trust me to help them shape their lives and finances, for the thousands of experiences, good and bad, that have shaped my life, for the family, friends, colleagues, and referral partners who have shared of themselves while touching my life and help make me into the woman I am today.

Gratitude is the awareness of all the good things that surround us, and which we consciously acknowledge on a daily basis. That’s why I start with the advice to start a Gratitude Journal. It’s a record of where you’ve been, what has inspired you, and who you would like to acknowledge as part of your history. This is YOUR history of the good things in your life. Writing it down is an act of gratitude that keeps on giving. 

I have several gratitude journals, and at Thanksgiving, I sit down with them, and read through all the amazing times I’ve had, blessed by the people I’ve met, worked with, dreamed with, laughed with, shared my life with and the actions I’ve taken to maintain my life of purpose. It is a blessing to reflect on your life from a gratitude perspective.

Being in gratitude is not hard. Even when things may not be going as smoothly as you would like, all it takes is a moment to reflect on what is right, as opposed to what is wrong with your world. In those moments, we find our gratitude. There is gratitude in big things and in small. Sometimes we just have to look harder.

If you are not actively practicing gratitude in your life, start now. I challenge you to keep a gratitude journal. Write five minutes a day on what you are grateful for that day. Write down the people, places, and actions you feel inspired by, thankful for, and pay attention to the effect you have had on others, and that they have had on you. It does not need to be complicated. It can be as simple as a list. 

Keep that going for the next six months at least, and see what it does to your mindset.

Gratitude is an act of positivity, and when we share our gratitude with others, it is the act that keeps on giving. 

Gratitude is not just a receiving vehicle. It’s also a giving one. We feel gratitude in helping others to achieve something, we feel gratitude knowing we can make a difference. That’s why I love the work I do, and why I love delivering a mortgage or refinance to my clients and customers, I love the blogging and marketing that I do that inspires you to think differently, take different actions, and ultimately help you to create a meaningful life.

How many people do you want to help today by giving them a compliment?  How many people can you help to brighten up their day by doing something for them that they didn’t ask for? What does gratitude look like in your life?

At the top of my list right now is my gratitude for the people who came together to help me create an amazing celebration. This year marketed the Twentieth Anniversary of my life. It was interesting, inspiring, and a good time. I am grateful for the way it all came together, for Pastor Robert McFarland for sharing the pulpit, for Darlene Neptune for sharing her talent and testimony, for my brothers and sisters in Christ who shared this night and experience with me. Without the support, love and passion that the family of God, of those who did so much for me during the years of cancer treatments, surgery, and side effects of the treatments and procedures, I would not have been able to see the light at the end of the journey.

My heart and gratitude go to these outstanding people who are here and those who have gone before us:

Dr. Vince Thompson, my extraordinary surgeon who was diligent in the study and perfection of his skill and knowledge.

Dr. David Strong and Dr. Henry Neuman, the talented doctors who took the extra time and care to make my life after cancer fully functional not an existence and made me feel better all the time.

Karen Rausch, for friendship, sisterhood, toughness when needed, and the tenderness not to let me quit when I was too tired to fight any more.

Karmyn Althaus, for stepping out of the role of “little sister” and became chief care overseer to make sure I had the doctors, medicine, care, and support I needed but did not always want or appreciate.

Kenneth Clopine, cousin above and beyond, who changed his entire life to “help however he could” but always with heart and kindness and generosity of time, talents, resources, and optimism.

Myron Clopine, best uncle who reminded me of Biblical truth, promises, heritage, and confidence.

Lyle and Ruth Clopine, my parents who always step to the plate with what they have and then reach inside for more to support, encourage, kick you in butt, and most of all for their prayers.

Darlene and Dennis Neptune, who came from Florida to encourage, share, uplift in word, song, and sharing of struggles endured and victories won.

Jane Linkswiler, who is there and does “where she can” as only a friend does.

Jayne Blondt, who listen to a higher call and said I can help and then did.

Alyce and Terry Johnson, friends who have been true and faithful over many a valley and mountain path.

Andrew John Althaus, you are something special.  Thank your Mom for sharing and giving me a reason.

Dianne and Larry Matthews, who as adopted cousins stood strong and faithful and loving over the years and never let me be anything but true family.

To Friends and Family, Pastors, and fellow believers, who would not and have not let me quit even when I wanted to finally just go home but have held my hand, my heart, at times my mind, and my spirit and kept me going.

And to the family of Evangel Church who have been so open and loving to the teenager in me as friendships and relationships develop and grow and mature as you allowed me to share my heart.

I am truly grateful for all of you, and thankful that you are in my life to help me be the best I can be.

And last, but certainly not least, I’d like to say how deeply grateful I am for your support and love. There are many that are not on this list and even others that have had smaller roles but have never made it to be more

that I’ve never met, but you send me notes from time to time to tell me how grateful your are for the books I write, the coaching I do, and the opportunities to connect with you that are meaningful. I cherish all of them. And for those of you who keep opening these emails, you may not connect with me directly, although I invite you to do that at any time, I would like to thank you for the blessings of your attention.

This Thanksgiving, ask your friends and family what they are thankful for, and share in the wealth of their gratitude. It is a joyous holiday, and I will be sharing it with my friends and family as I take off a few days to rest and relax and recharge.

Happy Thanksgiving everyone.

In Gratitude,

If you have found this article meaningful, don’t keep it to yourself. Send it along to a friend or a family member that you are grateful for in your life. Tell them how grateful you are to have them there, and then start that Gratitude Journal today. There is much for all of us to be grateful for.

Are you making progress toward your financial goals? Are your finances in order? Are you prepared for a financial emergency? If you're not sure, take time to thoroughly evaluate your finances so you have a road map for your financial life:

Assess your financial situation.

Evaluating where you currently stand financially will help you determine how much progress you are making toward your financial goals. There are several items to consider:

Your net worth. Prepare a net worth statement, which basically lists your assets and liabilities, with the difference representing your net worth. Prepared at least annually, it can help you assess how much financial progress you are making. Ideally, your net worth should be growing by several percentage points over inflation.

Your spending. Next, prepare a cash flow statement, detailing your income and expenditures for the past year. Are you happy with the way you spent your income? You may be surprised by the amount spent on nonessential items like dining out, entertainment, clothing, and vacations. This awareness may be enough to change your spending patterns. But more likely, you will need to prepare a budget to help guide your future spending.

Your debt. Debt can be a serious impediment to achieving your financial goals. To assess how burdensome your debt is, divide your monthly debt payments (excluding your mortgage payment) by your monthly net income. This debt ratio should not exceed 10 to 15 percent of your net income, with many lenders viewing 20 percent as the maximum. If you are in the upper limits or are uncomfortable with your debt level, take active steps to reduce your debt or at least lower the interest rates on that debt.
Increase your savings.

Calculate how much you are saving as a percentage of your income. Is it enough to fund your future financial goals? If not, go back to your spending analysis and look for ways to reduce expenditures. That may mean reassessing your lifestyle choices, since you need to live below your means to find money to save. Commit to saving more immediately and then take steps to make that commitment a reality. For instance, you may decide to increase your savings by $25 a week through your 401(k) plan at work. To do that, you may need to forgo your daily stop for coffee and a doughnut, cut back on how often you go out to dinner, and reduce your monthly clothing allowance. Not sure it's worth that much sacrifice to save $25 a week? After 20 years, that weekly $25 savings could grow to $63,811 at an 8 percent rate of return, before the payment of any income taxes. (This example is provided for illustrative purposes only and is not intended to project the performance of a specific investment.)

Rebalance your investments.

At least annually, thoroughly analyze your investment portfolio:

Review each investment in your portfolio, ensuring that it is still appropriate for your situation.

Calculate what percentage of your total portfolio each asset type represents, compare this allocation to your target allocation, and then decide if changes are needed.

Compare the performance of each component of your portfolio to an appropriate benchmark to identify investments that may need to be changed or monitored more closely.

Finally, calculate your overall rate of return and compare it to the return you estimated when setting up your investment program. If your actual return is less than your targeted return, you may need to increase the amount you are saving, invest in alternatives with higher return potential, or settle for less money in the future.
Prepare for financial emergencies.

To make sure you and your family are protected in case of an emergency, set up:

A reserve fund covering several months of living expenses. The exact amount you'll need depends on your age, health, job outlook, and borrowing capacity.

Insurance to cover catastrophes. At a minimum, review your coverage for life insurance, medical insurance, homeowners insurance, auto insurance, disability income insurance, and personal liability insurance. Over time, your insurance needs are likely to change, so you may find yourself with too much or too little insurance.
Review your estate plan.

With estate tax changing year to year, you should thoroughly review your estate plan.  Estate tax was repealed for 2010, but reinstated for 2011 and 2012. Take a fresh look at your estate planning documents and review them every couple of years as changes in law occur. 

Even if the increases in exemption amounts mean that your estate won't be subject to estate taxes, there are still reasons to plan your estate. You probably still need a will to provide for the distribution of your estate and to name guardians for minor children. You should also consider a durable power of attorney, which designates someone to control your financial affairs if you become incapacitated, and a health care proxy, which delegates health care decisions to someone else when you are unable to make those decisions.

Most people use credit to make a purchase at some point in their lives, whether it's a big-ticket item like a home or car or smaller purchases made on a bank or store credit card. These lines of credit are extended to individuals based on a number of factors that, when combined, determine your credit score. Understanding your credit score may help you understand how to protect or even improve your score, which can impact many areas of your life — not just your mortgage terms.

With credit so enmeshed in everything that we do, it's surprising how few people realize what goes into their credit score. Anyone who is interested in financing a home purchase through a mortgage should have a solid understanding of what goes into his or her credit score. In fact, even some employers are beginning to run credit score checks on prospective employees.

A credit score is a numerical value calculated by a third party that describes how likely someone is to repay a loan. Credit scorers look at a variety of factors including past financial and borrowing history to determine the score. Lenders then use this score to decide how safe it is to lend that person the money they need.

How those scores are calculated depends on the rating system. Most people are familiar with the FICO score. FICO is named for the Fair Isaac Corporation, which was founded by an engineer named Bill Fair and mathematician Earl Isaac, who developed their credit scoring system in the 1950s. It has since gone on to be the gold standard of credit scores — and that should come as little surprise given that Fair and Isaac were true visionaries for their time (Isaac even experimented with artificial intelligence as early as the 1950s).

FICO scores range between 300 and 850 points, with the higher scores telling lenders that a borrower is a low risk, and lower scores denoting a higher credit risk. If your FICO ranks too low, you'll have a tough time finding a loan, and if it's high enough, lenders might offer you competitive terms to secure your business. To provide some perspective, the median FICO score for U.S. borrowers in 2010 was 723.

The FICO credit scoring model is used by the three biggest U.S. credit repositories, Equifax, Experian and TransUnion. For mortgage lending purposes, if three scores are present, the middle score is used. If two scores are present, the lowest score is used.

The factors that go into your FICO score are:
Your payment history on loans and other credit, as well as bankruptcies, delinquencies and past due payments. Late payments, especially multiple late payments, can seriously hamper your credit. Payment history constitutes approximately 35 percent of your FICO.

The number of accounts you owe on and how much. Also, how close you are to your loan limits is important. The amounts you owe impact roughly 30 percent of your FICO.

How long your various credit accounts have been open and how long since each has seen activity. The longer you have had credit, the more it helps your rating, especially if you use that credit, so don't close out old accounts. Fifteen percent of your FICO is influenced by the age of accounts.

Recently opened new accounts. Applying for lots of different credit at the same time will hurt your rating. That said, applying for various loans of the same type in a concentrated period of time, such as a car loan, will not impact your FICO as it denotes that you are shopping for a good loan. Newly opened accounts affect 10 percent of your FICO score.

Types of credit used. FICO scores also rate your ability to manage a mix of different types of credit, such as a mortgage, student loans, car loans, credit cards and other types of credit. This impacts about 10 percent of your FICO.

Remember, your score matters. Make sure to review your FICO early in the process of securing a home loan. Ensure that none of the three credit agencies' reports contain any errors, and appeal to have them removed if so.

Would you like to learn more about FICO scores and how they relate to loan eligibility? I'd love to help. Please contact me via the information on this message and I'd be happy to sit down and meet with you.

*W.J. Bradley is not a credit counseling or financial advisement firm and this information is for educational purposes only and is not to be taken as guidelines or guarantees to improve your credit or financial situation or eligibility to secure a home loan.

With housing prices and mortgage rates still near historic lows, now could be a great time to become a homeowner. I recently talked to a caller who had a great credit score and could afford the mortgage payment for the home value she wanted since it would be about the same as her current rent. (In many parts of the country including California and Arizona, it’s actually cheaper to buy than to rent right now.)

There was one problem though. The traditional down payment is 20% of the home value but she only had enough to put down about 10% and was worried about missing years of building equity if she tried to save up the rest over time. If you’re in a similar situation, here are some thing to consider:

You Need More Than the Down Payment

Keep in mind that you’ll also probably have to pay at least some closing costs, which are generally about 2% of the price of the home. You’ll also want to have an emergency fund with at least 3-6 months and ideally 6-12 months of necessary expenses. That’s because the last thing you want is to lose your home to a foreclosure if an unexpected emergency makes it difficult to pay the mortgage.

An Insured Mortgage

You might be able to put down less than 20% by having your mortgage insured against default. One way to do that is with a government guaranteed mortgage. For example, the FHA loan program uses more lenient credit criteria than traditional mortgages, requires only a 3.5% down payment, and has the seller pay most of the closing costs.

There are other loan programs that have different down payment or credit scenarios that may be available to you based on where the property is located, based on your FICO credit score, based on your total financial qualifications.  You need to work with a licensed (not registered) NMLS approved Loan Originator.

Sounds pretty good, huh? Of course, there are costs to this. First, to qualify you typically need 2 years of steady employment with a stable or increasing income, a minimum credit score of 620 with no more than 2 30-day late payments over the last 2 years, no bankruptcies in the last 2 years, no foreclosures in the last 3 years, and a mortgage payment no more than about 30% of your gross pre-tax income. Second, there are limits on how much you can borrow based on where you live. Finally, you have to pay a premium of up to 1% of the loan amount at closing (it can be rolled into your mortgage but that would increase your monthly payments) and a monthly premium of up to .9% of the loan amount each year.

VA loans are another type of government guaranteed mortgage but only veterans on active duty in World War II and later periods are eligible. The loan limits are determined by the lender but generally max out at $417k except in certain high-cost counties. No down payment is usually required at all and there are no monthly premiums. However, there is a one-time funding fee of up to 2.4% that is reduced based on the size of your down payment.

Alternatively, you can get private mortgage insurance. The premiums can vary but are reduced the more you put down. The best part is that unlike with the government programs, the premiums can disappear altogether once you have 20% equity in your home, whether by you paying down the loan, the property rising in value, or (hopefully) both.

Confused? Don’t worry about it. Your mortgage lender can help you decide which programs you qualify for and which one might be most beneficial for your situation.

Piggyback Loans

In this scenario, you would get 2 loans. One would cover 80% of the home value and the other “piggyback loan” would cover the rest minus your down payment. The advantage is that you can avoid paying for mortgage insurance with less than 20% down. The disadvantage is that the piggyback loan has a higher interest rate and often has a “balloon payment” at the end. This is a final payment that’s considerably larger than your normal payments so be sure to save up for it if you’re going to keep the loan that long.

Using Your Retirement Accounts

Finally, there are several ways you can use retirement funds for a down payment. If you have an IRA, you can withdraw up to $10k penalty-free to purchase a home if you haven’t owned one in the last 2 years. This is a lifetime limit for the total of all your IRAs so only use it if you must. If it’s a Roth IRA, the earnings can also be withdrawn tax-free if the account has been open for at least 5 years (the contributions can always be withdrawn tax and penalty free). Otherwise, the withdrawals could be taxable.

If you have a retirement plan at work, you may be able to take a hardship withdrawal or a loan. A hardship withdrawal doesn’t have to be paid back but it’s taxable and subject to a 10% penalty if you’re under age 59 1/2. A loan isn’t taxable but must be paid back with interest. The good news is that the interest goes back into your account and the payments for a loan used to buy a home can often be spread over a longer time period than a regular loan.

The real cost of using your retirement accounts isn’t the taxes or interest you pay but that those funds aren’t growing for your retirement. The more aggressively you’re invested, the greater that opportunity cost is likely to be. On the other hand, you have to weigh that against the value that owning a home can add as an asset that you can later sell or borrow against to help provide for your retirement.

The Bottom Line

If you want to take advantage of today’s real estate market and record low interest rates but don’t yet have the full 20% down payment, be sure to explore all of your available options. Figure out how much each option would cost you in mortgage premiums, interest rates, taxes, and lost investment earnings. Of course, you could always decide to stick with the tried and true old-fashioned method: save for it.

FHA Waiting Guidelines

 Bankruptcy – You may apply for a FHA insured loan after your bankruptcy has been discharged for TWO (2) years with a Chapter 7 Bankruptcy.

 You may apply for a FHA insured loan after your bankruptcy has been discharged for ONE (1) year with a Chapter 13 Bankruptcy

 Foreclosure - You may apply for a FHA insured loan THREE (3) years after the sale/deed transfer date.

 Short Sale / Notice of Default – You may apply for a FHA insured loan THREE (3) years after the sale date of your foreclosure. FHA treats a short sale the same as a Foreclosure for now.

 Credit must be re-established with a 640 minimum credit score

VA Waiting Guidelines

 Bankruptcy - You may apply for a VA guaranteed loan TWO (2) years after a Bankruptcy is discharged.

 Foreclosure - You may apply for a VA guaranteed loan TWO (2) years after a foreclosure

 Short Sale - You may apply for a VA guaranteed loan TWO (2) after a short sale, unless it was a VA loan then restrictions apply

 Credit must be re-established with a minimum 620 credit score

 Conventional Waiting Guidelines (Fannie Mae)

 Bankruptcy – You may apply for a Conventional, Fannie Mae loan after your bankruptcy has been discharged for FOUR (4) years.

 Foreclosure - You may apply for a Conventional, Fannie Mae loan SEVEN (7) years after the sale date of your foreclosure. Additional qualifying requirements may apply,

 Short Sale / Notice of Default – Currently treated the same as a foreclosure with a waiting time of SEVEN (7) years before you can buy again using a Fannie Mae conventional home loan.  Credit must be re-established with a minimum 660 credit score.

 Fannie Mae has reduced waiting periods in cases of extenuating circumstances – down to 2 years with larger down payments.

The number of home offices is definitely on the rise. As of 2010, the number of employees telecommuting most of the time totaled 2.8 million, or a little more than 2 percent of the total workforce, according to Telework Research. And partial telecommuting is increasing, as well. As of this year, roughly 34 million professionals work from their homes occasionally, Forrester Research reports. Moreover, Forrester expects the number of people working remotely will nearly double to approximately 63 million telecommuters by 2016.
 
The question is, are these home workers doing it right? Working from home is an entirely different challenge from working in an office. How does someone who's never had to work on their own master the home office setting?

• Defend your space. There will be friends and family members who will equate working from home with you having more free time to visit or chat on the phone. Politely set clear boundaries from the start.
  
• Respect your time. It is all too easy to fall into the trap of giving into distractions. You might decide to multi-task and try to run loads of laundry or start a roast, or even give in to multiple daily visits to your favorite website. Don't. Don't let bad habits start and you'll never have to struggle to break them.
  
• Set a balance. Set a firewall between when you are working at home and when you are living at home. This is not only important because you don't want your work to take over your life, but because this can give your managers and coworkers an unrealistic expectation of what your workload should be — and that can cause you to very quickly resent your home office circumstance.
  
• Maintain human contact. Many professionals are motivated by the general workplace "vibe" and can lose productivity and sometimes grow isolated in a home office setting. If interacting with other people, even to shoot the breeze, keeps you motivated, have a short list of coworkers who don't mind an impromptu, five-minute phone chat. Consider taking a break at a local coffee shop, or meeting with fellow home officers in your neighborhood. Keep these moments brief but regular to stay motivated.
  
• Make your workspace fit you. Conventional home office wisdom says to create a workspace that is apart from the rest of the household to minimize distraction. This is true, but you might find that while a dedicated workspace is important, you do some of your best work at the kitchen table or roaming about. Your best bet is to set aside a dedicated space initially, but monitor your work habits and stay flexible.
  
• Management through strong communication. With today's geographically dispersed workgroups, even managers are often working remotely. The key to effective management is to regularly and routinely communicate via meetings and one-on-one calls and to set and monitor metrics to employee performance. Leverage the work-at-home environment to foster solid independent work habits in your team, but communicate to ensure that each member has the resources he or she needs, and is on-task both tactically and strategically.

Topic Summary: Regulators and Legislators are close to mandating new qualifications for a conventional mortgage. There is much blame to apply as to what caused the 2007-2009 meltdown and stringent terms are now being discussed including 20% down payments.

The recent activity stems from the Dodd-Frank Wall Street Reform and Consumer Protection Act  The Act represents the most sweeping change to financial regulation in the United States since the Great Depression. This act is being phased in now with the intent of creating a stable mortgage market that will have much fewer defaults. The increases in mortgage defaults in the 2007-2009 period were primarily caused by lax standards for approving mortgages. From No-Doc loans on to "no down payment loans", the originator of the loan or the firm creating the security had little stake in whether the loan performed because it was being sold to investors.

In the new provisions, the load originator has to assume 5% ownership in the mortgage before it is sold and packaged in to a mortgage-backed security. This new rule would insure that mortgage originators have some "skin" in the game and do a better job insuring the consumer can repay the loan. Mortgages that meet strict underwriting standards, however, are exempted from this risk retention requirement. These exempted loans are known as Qualified Residential Mortgages (QRM).

The  idea behind QRM is that  defaults rates will be lower as down payments on a mortgage increase. The Dodd-Frank act is suggesting 20% as the down payment level. Many in the industry say that the 20% goes too far and will knock many consumers out of a mortgage. Roughly 39% of homebuyers in 2010 made a down payment of less than 20%, loans that may not have been made had the current risk-retention proposal been in place, according to data from CoreLogic

A bi-partisan group of 30 Senators think the intent of the legislation is fine, but the rules are too stringent. This group of senators sent a letter to regulators asking for changes to insure qualified homeowners will not get shut out of the marketplace.

What's Not Included.

The legislation does not cover Government Sponsored loan programs such as mortgages provided under the FHA, which has much lower down payment requirements. The FHA lending programs are also changing and requiring more down payment funds. There are fears that many consumers will try to get a FHA mortgage if they can, putting pressure on that system which is already on shaky financial ground. FHA loans are provided with limits on the value of the home being financed and in many high cost areas, FHA loans would be unattainable.

Impact For All Homeowners. The introduction of QRMs will increase overall mortgage costs and thereby reduce the pool of potential home buyers, pushing down demand for homes and prolonging recovery even more. The current high supply of homes for sale and homes in foreclosure also dampen home values.  If current homeowners can't sell their home, they are unlikely to buy another one. This chain off events is also having an negative impact on home values all over the country.

I will keep you updated on this issue in future blogs as the updates are posted.

Financing Smart Home Improvements

You've found a great home, but it's a bit rough around the edges and you're on a limited budget. That leads to a number of questions: How much will the necessary upgrades and repairs cost? How much value will they add to the home? How are you going to pay for all this?

Whether you are upgrading to a larger home in a neighborhood you've always loved, downsizing to a smaller home now that the kids are out of the house or even moving to a new state, don't let a house that you love get away just because it needs some repairs or updates — you do have options!

203(k) Loans
A 203(k) loan lets a qualified borrower not only finance the purchase price of the home, but also include the price of the necessary repairs to the home.

Many types of properties qualify for 203(k) loans. Approved improvements include painting, room additions, decks, bathroom and kitchen remodels, finished attics and basements, structural changes and repairs, environmental rehab such as removing lead paint or making energy efficiency upgrades, roofing, flooring or accessibility upgrades for disabled residents.

It's important to note that there are two different types of 203(k) loans available and you'll need to determine, along with your lending professional, which type of loan is right for your particular situation. I'd be happy to spend some time with you to review and determine what might best meet your needs. Here's a quick overview of the available 203(k) options:

• A "streamlined" 203(k) loan is intended for a home that requires only non-structural repairs like cosmetic upgrades (painting, new carpet and appliances, new roof). In addition to the price of the home, you can borrow up to $35,000 to cover improvements.
  
• A "regular" 203(k) loan is for properties that require structural repair, such as room additions, or major landscape work or site improvement. You can borrow the purchase price of the home, plus the price of the improvements, up to 110 percent of the home's expected value after the improvements.

Once you've understood your loan options you'll also want to examine the specific types of upgrades or repairs you'd like to make to your new home.

Eligible Upgrades and Repairs that Make Sense
Whether you plan to be in your new home for a short or long period of time, you'll always want to be mindful about how much your improvements will cost and what type of value they will add to your home.

A good place to review this data is in Remodeling magazine's annual "Cost vs. Value" report. The report is considered a sort of gold standard for the return on investment for various home improvements. This can also serve as an excellent guide towards helping you understand the costs of certain types of upgrades and repairs. The data is available for free on the magazine's site (www.remodeling.hw.net/2010/costvsvalue/national.aspx), and can be broken down by region and even city. It even provides drill-down information on various improvements, including pictures.

Here's a look at some of the top remodeling projects you may want to consider that are eligible under 203(k) loans.

• Minor kitchen remodel. If your new home doesn't have your dream kitchen, this may be a smart choice for an upgrade. While kitchen upgrade costs can be high, Remodeling magazine estimates replacing the cabinet door fronts; adding new hardware; getting a new range; swapping out the counters; laying new flooring; installing a new sink; and painting a dated, 200-square-foot kitchen can bring a 72.8 percent return on investment.
  
• Attic bedroom. Does your new home lack that extra bedroom you desire? You may want to consider converting your attic space into an extra bed and bath. This will not only provide you with more living space but converting an attic to a 15x15 bedroom with a 5x7 bathroom will bring on average a 72.2 percent return on your investment, according to Remodeling magazine.
  
• Basement remodel. Finishing a 20x30 basement area into a bonus room with a bathroom and a wet bar can provide you with a great deal more space in your new home and can also add a good deal of value to it.

Another key trend to keep in mind, presented in Remodeling's latest national data, is that upgrades on the outside of the home offer some of the best value of all home repairs and upgrades. These include:

• Steel entry-door replacements. Swapping out a drafty wood door and jambs for a 20-gauge steel door is the No. 1 replacement in the country.
  
• Replacing the garage door. This improvement takes the No. 2 spot.
  
• Wooden or composite deck additions. In addition to adding ambience to your home, decks can also add to the value of it. For instance, Remodeling magazine data shows that adding a wooden deck with an anchored, 16x20 deck using pressure-treated wood with railings and stairs delivers a 72.8 percent return on your investment.

There are a wide variety of upgrades and repairs permitted under the 203(k) loan programs, so be sure to examine all of your options and determine what makes the most sense for your new home.

Getting Started
Once you've determined the upgrades and repairs you'd like to pursue, be sure you speak with an experienced 203(k) lender that is well-versed in the details of permitted improvements under the program. It is also important to note that FHA rehab loans may take longer to close with a lender that doesn't have experience with them, because there is more paperwork. Working with a lending professional that is experienced with 203(k) loans will help you avoid those delays.

Please contact me using the information on this email, and I'd be happy to review how you can use the right funding to put some shine on that diamond in the rough!

This is not going to be the kind of blog you are thinking about right now, so, please read it all before you start calling me.

Often I wonder what happened to Americans and America.  Not all that long ago, I remember when it was considered the minimum standard of acceptable behaviour:

• to strive to be all one could be
• to learn as much as possible
• to obey the laws of the land
• to reach out and help one's fellowman
• to live your life with honor, compassion, dignity, truth, love, and foregiveness.
• IN SHORT---We expected to be held accountable and our behaviour reflected that belief.

More often than not, today I see the standard of behaviour, conversation, conduct, accountability, and desire to succeed has dropped to such a level that we want others to be all that they can be but not WE, OURSELVES"This is a life-long process not some point that we have arrived on the coat tails of our forefathers and now we can coast.  If we are coasting, it is going downhill at a high rate of speed.

YOUR LIFE WAS YOUR MESSAGE not some Eulogy at the end of your journey, spoken with a smirk by someone who would not have been proud and pleased with you before you passed.

We really need to get back to the basics and start using God-given common sense in our lives, our government, our laws, our applications, and our expectations.  

I heard a comment the other day where someone said "they are dead and just don't know it yet."  Well before America is dead, we need to AWAKEN and return to the principles and practices that made us great as a people, as a country, as a nation. We need to leave this nation GREATER and BETTER than we received it for those who come after us so that they can build an even Greater nation, Greater future, and Greater people than came before them.  But it starts with me, mine, and how that is applied to everything around us.   If me and mine get to be bigger and more important that we and our or at the expense, in any manner, then me and mine are smaller and insignificant in the long run.  Truly GREAT men and women were humble, not boastful, or self-seeking but giving and forthright in all they did.

May WE return to the basics and become once again that Nation committed to those principles and practices that made us GREAT  and it starts with me and mine....  

You May Have too Much Debt But You Also Have Options

If you feel like you're in over your head with personal debt, you're not alone. Millions of Americans have become overextended, many as a result of easy credit and the recessions. Credit cards, medical bills, personal loans, and raising interest rates do not make a good financial mix.

The five strategies you may want to avoid:

The first piece of advice from experts in the field is to be sure you don't make your situation worse by making common mistakes. In particular:

1. Beware of just paying the minimum payments on your debts. This will result in your overall debt actually growing and your problems will only become worse.
2. Beware of relying on friends and family, as it could damage relationships with the most important people in your life.
3. Beware of unscrupulous credit counselors that demand cash upfront or high fees for help they promise, but don't deliver.
4. Avoid taking out a new high-interest loan to pay off lower interest rate loans. It may be easier to just have one payment, but it will actually increase the amount you have to pay back.
5. Declaring bankruptcy when debt settlement may work for you.

Debt Settlement or Bankruptcy?

Two common solutions people turn to are debt settlement and bankruptcy. Generally, if you are struggling with a financial hardship and are behind or falling behind on your minimum payments, then debt settlement may be right for you. If your situation is more dire, then you may consider bankruptcy.

However, bankruptcy is a serious step with long term implications for you and your financial future. Most experts would suggest it only as a last resort. The better course of action is to attempt to work through your debt issue with your creditors, and this is where debt settlement companies can help.

What is Debt Settlement?

You may have heard companies advertising recently that they can settle your debt for less than what you owe. Is this process legitimate?

Working with a debt settlement company could actually be a great solution for many people struggling with a financial hardship. Debt settlement is the process of negotiating with your creditors to get them to reduce a potion of your debt. Specialty settlement companies determine a reasonable monthly amount that you can afford to pay, which is based on total amount owed. You make your affordable payment every month into a special purpose account, and as these funds accumulate, the settlement company reaches out to creditors to negotiate a final actual settlement amount for you. Typically these companies have excellent relationships with creditors and are negotiating on behalf of thousands of people every day.

So, how do you find a legitimate and trustworthy debt settlement company to work with? A great way to start is by visiting Freedom Debt Relief for a free, no-obligation consultation to evaluate your options.

To learn how much of your debt can be reduced, click here.

Like many other homebuyers who consider buying a foreclosed home, Chad Kinney was disappointed when he learned it would be difficult to get a mortgage for the property he chose.

The Fannie Mae-owned house that he wanted to buy needed repairs and would likely not pass the property inspection required by mortgage lenders, he was told. That is when the listing agent suggested he apply for a HomePath Mortgage, which does not require mortgage insurance, a property inspection or appraisal and is offered exclusively to borrowers buying homes from Fannie Mae.

"That was the first time I ever heard of HomePath, so I started researching," he says. "To me, the selling point was my monthly payment is lower and I can get an additional $15,000 for renovations."

Fannie Mae started offering HomePath loans and HomePath renovation mortgages in 2009 to unload the thousands of homes the agency repossesses through foreclosure.

The little-known program has been gaining popularity in recent months, but many buyers are not aware of it and do not understand the pros and cons of HomePath financing until a broker or agent suggest it to them.

How HomePath works

Fannie Mae does not directly lend to buyers. The agency sets the guidelines that lenders need to follow if they want Fannie to buy the loans after they are originated. In the case of HomePath, Fannie allows lenders to finance properties owned by Fannie Mae with as little as 3 percent down for buyers who plan to occupy the home and 10 percent down for investors.

HomePath also offers renovation loans for buyers purchasing properties that need minor or substantial repairs. The financing can be for up to 97 percent of what the home is expected to be worth after the repairs.

Most lenders require a minimum credit score of 660 for borrowers putting only 3 percent down.

Potential buyers can choose from about 80,000 homes listed for sale on the HomePath website (www.homepath.com). The agency acquires thousands of properties through foreclosure each month, but they sell quickly. In the first three months of the year Fannie sold 62,814 properties. Fannie took over 53,549 properties during that period.

W. J. Bradley Mortgage Capital Corp. is one of about 50 lenders nationwide are approved to offer HomePath financing. Most are regional and local lenders.

Advantages of HomePath

One of the advantages of buying a home through Fannie Mae's HomePath is that homebuyers who plan to occupy the house do not have to compete with investors during the first 15 days the property is listed. Fannie prohibits its agents from accepting offers from investors during that period.

Unlike with most other types of mortgages, HomePath financing does not require the property to be appraised, unless the buyer is borrowing money for renovation.

"It is a huge advantage," Many deals relying on traditional or Federal Housing Administration financing get killed in the last minute because the appraisal falls short of the sales price, sometimes by small amounts, he says.

The property does not have to go through an inspection. Buyers should always have an independent inspection prior to purchasing a home regardless of what lenders require so they are aware of the property's condition. But knowing that the lender does not have to evaluate and approve the inspection results is one less concern for the borrower, Rodriguez says.

"Typically, we are concerned about credit, capacity (to pay), and collateral," Rodriguez says. "HomePath eliminates the collateral element. Fannie already knows the value and the condition of the property they are selling."

One of the biggest advantages of a HomePath mortgage is that it doesn't require mortgage insurance, regardless of the down payment amount. With conventional loans, borrowers are required to pay mortgage insurance when they put less than 20 percent down. All FHA loans require borrowers pay for mortgage insurance.

To give you an idea of the savings, a borrower who is buying a $200,000 home with a 5 percent down payment spends about $150 a month on mortgage insurance with a conventional loan.

HomePath has slightly higher rates

But as Rodriguez points out, "nothing comes free."

HomePath mortgages have slightly higher interest rates. Generally, HomePath rates are about a quarter to half of a percentage point higher than the rates on the conventional loans. However, the cost is offset by the mortgage insurance savings, Rodriguez says.

Some buyers can choose to reduce the interest rate by paying points. That adds to the upfront costs, but Fannie Mae often offers closing cost incentives of up to 3.5 percent of the purchase price.

"In the end, the interest rate is higher but the mortgage payment is lower," Rodriguez says.

That was the case with Kinney. He is buying a home from Fannie Mae in Hampstead, Md., for $165,000 and borrowing about $180,000 through the HomePath renovation mortgage. Kinney says that, based on estimates he was given, his monthly mortgage payments are going to be about $50 less with HomePath than with the FHA loan he had considered before. That includes $15,000 to make the necessary repairs in the house.

"By and large, HomePath is the best loan for a homebuyer to buy and fix up a foreclosure asset today," Kluge says.

I meet and learn from Champions every day. Not just in locker rooms but in classrooms, hospitals, homeless shelters, homes and office buildings. I've learned that to be a champion you must Think Like a Champion. Champions think differently than everyone else. They approach their life and work with a different mindset and belief system that separates them from the pack.

1. Champions Expect to Win - When they walk on the court, on the field, into a meeting or in a classroom they expect to win. In fact they are surprised when they don't win. They expect success and their positive beliefs often lead to positive actions and outcomes. They win in their mind first and then they win in the hearts and minds of their customers, students or fans.

2. Champions Celebrate the Small Wins - By celebrating the small wins champions gain the confidence to go after the big wins. Big wins and big success happen through the accumulation of many small victories. This doesn't mean champions become complacent. Rather, with the right kind of celebration and reinforcement, champions work harder, practice more and believe they can do greater things.

3. Champions Don't Make Excuses When They Don't Win - They don't focus on the faults of others. They focus on what they can do better. They see their mistakes and defeats as opportunities for growth. As a result they become stronger, wiser and better.

4. Champions Focus on What They Get To Do, Not What They Have To Do - They see their life and work as a gift not an obligation. They know that if they want to achieve a certain outcome they must commit to and appreciate the process. They may not love every minute of their journey but their attitude and will helps them develop their skill.

5. Champions Believe They Will Experience More Wins in the Future - Their faith is greater than their fear. Their positive energy is greater than the chorus of negativity. Their certainty is greater than all the doubt. Their passion and purpose are greater than their challenges. In spite of their situation champions believe their best days are ahead of them, not behind them.

If you don’t think you have what it takes to be a champion, think again. Champions aren’t born. They are shaped and molded. And as iron sharpens iron you can develop your mindset and the mindset of your team with the right thinking, beliefs and expectations that lead to powerful actions.

Freddie Mac just released its rates for a 30-year home loan.  Guess what?  It is on the rise for the third month in a row.

What does this mean, it means that you need to stop waiting to get that new house mortgage or refinance.

I know what you are saying, the rate is only rising a few tens of a percent, but those tens of percent over the life of a loan could mean tens and even hundreds of thousands of dollars back in your pocket.

To calculate the money you could be saving on a refinance visit our mortgage calculator.

To get started on a rate quote use our mortgage quote request form.

Hey Gang,




Do you know that the average homeowner has a net worth that is about 41 times greater than that of a renter, according to a report from the National Association of Realtors. Homeowners' net worth averaged between $150,000 and $200,000 this year, according to NAR. The trade group for Realtors said homeowner equity accounts for a substantial part of that net worth. NAR based its research on results from a 2007 Federal Reserve Survey that provides a snapshot of family income and net worth in conjunction with basic demographic makeup. The Fed survey is conducted once every three years. A 2010 survey has not yet been released. Homeowner net worth back in 2007 was 46 times greater than that of renters, reflecting the economic conditions before housing price declines and a decreasing equities market. The average net worth of a homeowner was above $200,000, while the average net worth of a renter in 2007 was $5,000. Source: HousingWire

Total housing sales in 2010 will be down about 8 percent from last year, and will mark the bottom of the downturn, says a monthly report from Fannie Mae economists. The economic outlook from Fannie Mae is fairly upbeat looking ahead. Foreclosures will keep housing sales subdued in the final quarter of this year, the report says, but sales will see gradual improvement in 2011. "We expect home sales to increase by about 3 percent in 2011, says Fannie Mae (OTC BB: FNMA) chief economist Doug Duncan. "However the pace of the recovery will be largely determined by labor conditions. If hiring improves at a faster pace than expected, home sales will likely see a stronger gain in 2011 and vice-versa." Improving financial conditions and recent encouraging signs from the labor market should set the stage for an above-par growth trend by mid 2011, the report says. Source: Washington Business Journal

A tougher economy is changing the way people regard housing design. Here are some of the new realities:

• The ideal home size is less than 2,000 square feet, according to Trulia.com.
• Formal living rooms and dining rooms are out; flexible space that can double or triple as home offices, guest rooms or dens is most appealing.
• Porches are back.
• Energy efficiency trumps everything, with a private wind turbine in the back yard a real winner. Source: USA Today

Rental apartments are the favorite sector for real estate investors, according to an annual survey conducted by the Urban Land Institute and PriceWaterhouseCoopers. Researchers note that financing for apartments is readily available through Fannie Mae, Freddie Mac and the Federal Housing Administration. Moreover, demand is healthy as foreclosures force former homeowners to become renters and the generation known as the 'Echo-Boomers' are looking for rentals. "This is making apartments the favorite of our survey respondents," said Jonathan Miller, the author of the ULI/PWC "Emerging Trends" report. He noted that apartment vacancy rates are headed down well ahead of all other sectors, such as office and warehouse properties. "In some markets, we are going to see development next year in apartments," Miller said. Source: National Mortgage News

If you are thinking about Buying or Refinancing a Home with today's low rates even with less then perfect credit call me direct we have some great programs even if you are underwater on your home. We also work with a great company that can get your credit score going in the right direction .

All the Best,

Korene Clopine-Seaman
Phone: 623-340-0934

For full disclosure, I need to say that the current administration and I view things very differently in a lot of areas and I am not a big fan of Mr. Obama's method or motives in government.

The Obama administration wants to raise fees for borrowers and require larger downpayments for home loans as part of a long-term effort to restructure the nation's housing market. But it warned that these measures could boost mortgage rates and lower the availability of the 30-year fixed rate mortgage, a mainstay of American home-buying for decades.

In a long-awaited white paper, the administration said it intends to wind down the federal mortgage giants Fannie Mae and Freddie Mac and curtail the Federal Housing Administration to help reduce the government's outsized role in mortgage funding.

The housing finance system, which has ensured that Americans can get home loans, came crashing down in the financial crisis, helping fuel millions of foreclosures and the recession.

But in proposing a strategy for the future, administration officials acknowledged they are walking a tightrope. Any steps that too dramatically dial back government support too dramatically -- making mortgages more expensive -- could extend the already protected housing decline.

Treasury Secretary Timothy Geithner said Friday morning that a new housing finance system without Fannie and Freddie could take seven years to put in place, suggesting it might fall in part to future administrations.

"We have to see the process of repair in the housing market completed," Geithner said in a conference call with reporters. "

The white paper focuses on a series of short steps to increase fees and downpayment requirements. The administration hopes these measures will allow banks to more effectively compete in offering loans without government guarantees.

The report offers three options for replacing Fannie and Freddie, rather than a single long-term vision for the housing finance system. By refusing to endorse one option, the administration may be able to avoid a contentious clash with Republicans, who view companies as the chief culprit in the financial crisis.

Republicans are likely to agree with the administration's plan to reduce taxpayer support for mortgages.

The options include creating a new government agency that would continue to insure mortgages or a new agency that would step in only during times of crisis. Each, however, could put taxpayers at more risk of having to bail out the mortgage market during big declines.

The most drastic option would end government backing for home loans beyond the FHA. But the administration warned that this measure could affect access to credit for many potential homeowners. This option could boost mortgage rates the most, the officials said, and it could make it harder for community banks to compete in the housing market.

In the short term, the administration suggested a range of new measures to make government-backed mortgage more expensive - helping private-sector firms to better compete in offering mortgages.

These include reducing the size of mortgages Fannie and Freddie may purchase, from $729,750 to $625,500, by this fall. It would phase out the companies' 10 percent downpayment requirement. And it would raise fees that the companies charge to insure loans.

The administration also suggested scaling back the FHA, which caters to first-time homebuyers with low downpayment options. The White House said it wants to reduce the size of loans that FHA can provide, increase fees by a quarter percentage point, and raise the downpayment requirement from 3.5 percent to 5 percent in the future.

The report also emphasized the importance of rental housing for low and moderate-income communities.

Senior administration officials said they would take gradual steps to avoid harming the already struggling housing market. But they said this plan laid the groundwork for the future of U.S. housing.

"This is a plan for fundamental reform - to wind down [Fannie and Freddie], strengthen consumer protection, and preserve access to affordable housing for people who need it," Geithner said. "We are going to start the process of reform now, but we are going to do it responsibly and carefully so that we support the recovery and the process of repair of the housing market."

Mark Zandi, chief economist for Moodys.com, told CNBC that the Obama administration had "laid out a prudent, appropriate plan."

"At the end of the day, though, the government is going to have to play some role in a catastrophic backstop," he said.

To my way of thinking it is just another government level and layer that hurts the consumer, the American public and put more employees on the government regulatory process but provide NO real benefit to the public at large.

Many Americans have been content to rent after witnessing the crumbling housing market in recent years. However, with rents on the rise and home prices continuing to fall, a reversal is in sight.

It was not hard for many homeowners to bid adieu to 2010. It was the year where, in many metropolitan areas across the country, rents surged as home prices continued to fall, leading a growing chorus of skeptics to question the so-called American Dream of homeownership.

Perhaps not surprisingly, it makes more financial sense to rent than buy today in some U.S. cities, according to the latest data from Moody’s Analytics. After declining during the depths of the latest recession, prices for rentals nationwide increased modestly by about 3% in 2010, partly driven by a record number of homeowners looking for new digs after foreclosing on their homes. In Moody’s latest list of rent ratios (which is the price of a typical home divided by the annual cost of renting that home) for 54 U.S. metropolitan areas, 39 fell into the ‘better to rent’ category — roughly the same level it’s been for the past year.

That is finally changing. We expect the trend to reverse this year in many major cities including the Metro Phoenix, Los Angeles County, Metro San Diego and San Diego County. This is a positive development, as a healthy housing market typically puts renting and owning at a much more equal footing.

“By mid 2011 and certainly by end of 2011, buying will be superior to renting in most parts of the country.

A few factors will be at play. For one, home prices are expected to fall further, with some economists expecting a 15% to 30% drop this year. This might be bad news for household finances and current homeowners fearing that their most prized asset stands to lose more in value. On the flip side, this makes homes more affordable and might finally spur more home sales, especially at a time when the rate of home construction has been the lowest since before the Second World War.

Just last week, the S&P/Case-Shiller index of property values reported a 0.8% fall in prices from October 2009 – the biggest year-over-year drop since December 2009. Eighteen of 20 cities showed a drop in prices in October. This was led by a 2.1% decrease in Atlanta, followed by a 1.8% drop in Chicago and Minneapolis. What’s more, six markets, including Atlanta, Miami, Tampa and Portland, Ore., reached their lowest levels in October since prices started to retreat.

Indeed, the housing market continues to suffer from too much supply. Though rent prices are generally expected to continue rising modestly this year, the overhang will probably help keep prices from rising too much. “Expect more declines in home prices and more rent stability,” Zandi says.

Still, the comparative costs between renting and buying will largely depend on individual market conditions. For instance, cities in Florida and Arizona, which continue to experience high foreclosure rates, falling home prices and widespread unemployment, will be areas where homeownership will likely be more affordable than renting, says Daisy Kong at Trulia, a San Francisco-based real estate data provider. Meanwhile, renting will probably continue to make more financial sense in national and regional job centers such as New York, Omaha and Seattle, she says.

And while it could become more attractive to buy than rent this year, it’s anyone’s guess how long it could take before a flurry of home sales transpires. Household finances have improved only modestly and are still quite a mess. Also, lending standards for new mortgages have tightened considerably and many economists have said a housing rebound will likely fall mercy to the unemployment rate, which is expected to improve some but still hover over 9%.

Will the American Dream return to your town?

Source: Moody’s Analytics, price-rent ratio for third quarter of 2010. As a general rule of thumb, you should often buy when the ratio is below 15 and rent when it’s above 20. If it’s between 15 and 20, lean toward renting.

Let's look at some very dry statistics first.

The Census Bureau has released its survey of Residential Vacancies and Homeownership for the third quarter of 2010. 

A Quck Recap........ .

Total Housing Units in the United States: 130.68 million.

How Many Are Occupied:  111.91 million (85.6% of the total) 

How Many Are Owner-Occupied: 74.87 million (57.3% of total)

How Many Are Occupied By Renters: 37.04 million (28.3% of total)

How Many Homes Are Vacant: 18.77 million (14.4% of total) 

How Many Homes Are Being Held off the Market 7.058 million (5.4%)

DEFINITION OF "HOUSING UNIT": A housing unit is a house, an apartment, a group of rooms, or a single room occupied or intended for occupancy as separate living quarters. Separate living quarters are those in which the occupants do not live and eat with other persons in the structure and which have direct access from the outside of the building or through a common hall. For vacant units, the criteria of separateness and direct access are applied to the intended occupants whenever possible. If the information cannot be obtained, the criteria are applied to the previous occupants. Tents and boats are excluded if vacant, used for business, or used for extra sleeping space or vacations. Vacant seasonal/migratory mobile homes are included in the count of vacant seasonal/migratory housing units. Living quarters of the following types are excluded from the housing unit inventory: Dormitories, bunkhouses, and barracks; quarters in predominantly transient hotels, motels, and the like, except those occupied by persons who consider the hotel their usual place of residence; quarters in institutions, general hospitals, and military installations except those occupied by staff members or resident employees who have separate living arrangements.

Excerpts from the Release...

The homeownership rate of 66.9 percent was 0.7 percentage points (+/-0.4%) lower than the third quarter 2009 rate (67.6 percent) and approximately the same as the rate last quarter, also 66.9 percent. When adjusted for seasonal variation, the current homeownership rate (66.7 percent) was lower than the rate in the third quarter 2009 (67.4 percent), but not statistically different from the rate last quarter (66.9 percent).

For the third quarter 2010, the homeownership rates were highest in the Midwest (71.1 percent) and lowest in the West (61.3 percent). The homeownership rates in the South and West were lower than a year ago, while rates in the Northeast and Midwest were not statistically different from their corresponding third quarter 2009 rates.

We know that stable housing has a strong positive impact on a single individual or family and that, in its absence, the problems can be profound.

An adult without a permanent address has difficulty finding employment, maintaining a healthful lifestyle, or a medical regime. A family without stable and affordable housing cannot access many social and health related services, or provide adequate clothing and nutrition; its children become transient students, frequently with social and psychological problems. Imagine how those individual small human problems impact the schools which must educate the transient and troubled students, a health system that must cope with crisis rather than prevention, an increase the burden on law enforcement and the social network.

Add to this list the effect on whole cities of the vacant and deteriorating properties that have been or soon will be foreclosed and the problem of housing their dispossessed former homeowners and renters, not to mention the lost property tax revenues. Banks are foreclosing at rates not seen since the depression of the 1930s....

It is beyond time to take a holistic look at the entire housing universe and get our economy back on track and back to building a strong, safe, secure America.  This is not done with a government bailout, government handout, nor with free housing...but by rolling up our sleeves and going back to the values that made our nation GREAT and provided stability to our economy, our families, our government, and our investments.

As American citizens, it is time to practice common sense.  We can and should invest in what we need and can afford.  We should NOT be looking for a GREAT deal for ourselves at the expensive of others.

As a mortgage banker, We of the KLCS Loan Team are here to help you with the financing necessary to purchase, invest, remodel, and stay in your homes. 

Many companies are making the leap to wireless networks in the office for both financial savings in overall equipment and sheer convenience for their employees. They also often provide mobile PCs with wireless capabilities to their employees so that they can be productive anytime anywhere, hence enhancing the company's bottom-line.

In this blog, I will explain what WiFi is and how it works. I will also discuss what you need to start working wirelessly as well as what you can expect to gain from doing so. Finally, I'll discuss the precautions you should take when working on the go.

What is WiFi? Learn the lingo

Wireless, or WiFi, technology is another way of connecting your computer to the network using radio frequency and no network cables.

Wireless works similarly to cordless phones; they transmit data from one point to another through radio signals. But wireless technology also requires that you be within the wireless network range area to be able to connect your computer. There are three different types of wireless networks:

• Wireless Local Area Network (WLAN): WLAN are wireless networks that use radio waves. The backbone network usually uses cables, with one or more wireless access points connecting the wireless users to the wired network. The range of a WLAN can be anywhere from a single room to an entire campus.

• Wireless Personal Area Network (WPAN): WPANs are short-range networks that use Bluetooth technology. They are commonly used to interconnect compatible devices near a central location, such as a desk. A WPAN has a typical range of about 30 feet.

• Wireless Wide Area Networks (WWAN): WWANs are created through the use of mobile phone signals typically provided and maintained by specific mobile phone (cellular) service providers. WWANs can provide a way to stay connected even when away from other forms of network access. Also, be aware that additional charges are often associated with the usage of WWANs in some locations.

How do I get started?

The only thing you really need to go wireless (in addition to a mobile PC) is a wireless PC Card. Depending on the age of your mobile PC, the card is either built-in or needs to be inserted in the PC Card slot and includes an antenna. In addition, you can also use wireless keyboards and mice, which can provide more freedom and flexibility when you're working in your office.

It's always good to research the available hotspots in the area you're planning on visiting (whether a neighborhood in your city you're not familiar with or a city on the other coast). You can use Bing to find hotspots when you travel.

As you head out in this brave new world of wirelessly connectivity, you can connect to a wireless network (whether at home, at work, or on the go).

Connect to a wireless network

• Windows 7

• Windows Vista

• Windows XP

Working wirelessly

Working wirelessly can offer you the following benefits.

• Flexibility: The lack of cables that comes with wireless networking enables you to roam with your mobile PC. You can roam from your office to a nearby conference room for a meeting, or from the couch in the living room to a kitchen for a snack. For example, if you're working wirelessly in a meeting you can printout a report for a co-worker without having to leave the meeting.

• Time-saving: If you're waiting for an important response you can use your mobile PC to monitor your email even when you're in meetings or at lunch. As soon as you get the data needed, you can promptly forward it to your customer rather than wondering whether the information has come in while you were away and having to run back to your office between meetings and other commitments.

• Increased productivity: Working wirelessly enables you to turn down times between meetings or while in transit into productive time. For example, you may be attending a conference and just found out that one of the sessions you were planning on attending has been cancelled. Rather than waste the next hour, you can check email, start compiling your trip report, or order your son's birthday present.

• Easier collaboration: Using wireless mobile PCs, you can easily share files and information with others. For example, you can collaborate on a presentation with colleagues during a flight delay in an airport lounge, or you can share the syllabus of a course while attendees so that they can take more digitally during the class.

What should be my concern about working wirelessly?

When working wirelessly from hotspots and public places, you are responsible for ensuring the security of your files and your mobile PC.

To make network access easier for their users, public hotspots typically leave all security turned off. This means that any information you send from a hotspot is most likely unencrypted, and anyone within range of the wireless LAN, whether at a next table or in the parking lot, can access and use your Internet connection, and look at your unprotected information.

For more information, see tips for working securely from hotspots.

WiFi gives you the freedom to go anywhere and still be connected to your office, your family, and other important aspects of your life. Your virtual office can now be an ice cream parlor in a seaside resort. Embrace and enjoy the flexibility that WiFi affords you.

9 Ways to Increase the Security of Your Laptop While on the Road

Using your laptop to get work done away from your office or on the road is becoming widely accepted. But this rapid growth in laptop computing has made portable systems the target for theft around the world. If your laptop computer is stolen, company information can be exposed, as well as your personal and financial information.

Use these 9 tips to learn how you can keep your laptop more secure when you're on the road.

1. Avoid using computer bags

Computer bags can make it obvious that you're carrying a laptop. Instead, try toting your laptop in something more common like a padded briefcase or suitcase.

2. Never leave access numbers or passwords in your carrying case

Keeping your password with your laptop is like keeping the keys in the car. Without your password or important access numbers it will be more difficult for a thief to access your personal and corporate information.

3. Carry your laptop with you

Always take your laptop on the plane or train rather then checking it with your luggage. It's easy to lose luggage and it's just as easy to lose your laptop. If you're traveling by car, keep your laptop out of sight. For example, lock it in the trunk when you're not using it.

4. Encrypt your data

If someone should get your laptop and gain access to your files, encryption can give you another layer of protection. With Windows XP, Windows Vista, and Windows 7 you can choose to encrypt files and folders. Then, even if someone gains access to an important file, they can't decrypt it and see your information. Learn more about how to encrypt your data with Windows XP, encrypt your data with Windows Vista, or encrypt your data with Windows 7.

5. Keep your eye on your laptop

When you go through airport security don't lose sight of your bag. Hold your bag until the person in front of you has gone through the metal detector. Many bags look alike and yours can easily be lost in the shuffle.

6. Avoid setting your laptop on the floor

Putting your laptop on the floor is an easy way to forget or lose track of it. If you have to set it down, try to place it between your feet or against your leg (so you're always aware it's there).

7. Buy a laptop security device

If you need to leave your laptop in a room or at your desk, use a laptop security cable to securely attach it to a heavy chair, table, or desk. The cable makes it more difficult for someone to take your laptop. There are also programs that will report the location of a stolen laptop. They work when the laptop connects to the Internet, and can report the laptop's exact physical location. One such tracing program is ComputracePlus.

8. Use a screen guard

These guards help prevent people from peeking over your shoulder as you work on sensitive information in a public place. This is especially helpful when you're traveling or need to work in a crowded area. This screen guard from Secure-It is just one example of a screen guard you could use.

9. Try not to leave your laptop in your hotel room or with the front desk

Too many things have been lost in hotel rooms and may not be completely secure. If you must leave your laptop in your room, put the "do not disturb" sign on the door.

Be safe, secure and ask a computer expert for advise for your computer needs.I believe you need to find the best expert in the field you are needing information about.  Do not just call your neighbor's friend's best friend's boyfriend.  Call an expert and make life better and safer for yourself, your family, your business.  I know a bit about computers but I am not a computer technology expert.  I am a mortgage expert.  I am here to be of service to you and your family.

This is the time of the year when we need to be especially alert and aware of our fellow drivers on the road.  December is National Drunk and Drugged Driving Prevention Month

Every day, 36 people in the United States die, and approximately 700 more are injured, in motor vehicle crashes that involve an alcohol-impaired driver.

This December, during National Drunk and Drugged Driving Prevention Month (3D Month), consider what you and your community can do to make injuries and deaths from impaired driving less of a threat.

The Problem

• According to the National Highway Traffic Safety Administration (NHTSA), about three in every ten Americans will be involved in an alcohol-related crash at some point in their lives.
• In 2006, 13,470 people died in alcohol-impaired driving crashes, accounting for nearly one-third (32%) of all traffic-related deaths in the United States.
• In one year, over 1.4 million drivers were arrested for driving under the influence of alcohol or narcotics. This accounts for less than 1% of the 159 million self-reported episodes of alcohol–impaired driving among U.S. adults each year.
• Alcohol-related crashes in the United States cost about $51 billion a year.

Protect Yourself and Your Family and Friends

During the holiday season, and year-round, take steps to make sure that you and everyone you celebrate with avoids driving under the influence of alcohol. Following these tips from NHTSA can help you stay safe:

• Plan ahead. Always designate a non-drinking driver before any holiday party or celebration begins.
• Take the keys. Do not let a friend drive if they are impaired.
• Be a helpful host. If you’re hosting a party this holiday season, remind your guests to plan ahead and designate their sober driver, always offer alcohol-free beverages, and make sure all of your guests leave with a sober driver.

Know How Communities Can Help

Proven community and state-level methods for reducing alcohol-impaired driving include:

• Sobriety checkpoints. Studies found that fatal crashes thought to involve alcohol dropped by about 22% following implementation of sobriety checkpoints.
• Minimum legal drinking age (MLDA) laws. Studies found that raising the MLDA to 21 reduced crashes by about 16% among people ages 18.20 years.
• 0.08% BAC laws. Fatal alcohol-related crashes declined about 7% after 0.08% BAC laws were passed.
• "Zero tolerance" laws for young drivers. Three studies found that zero tolerance laws resulted in declines in fatal crashes among drivers ages 18.20 years of between 9% and 24%.

Be Safe!  Be Careful!  Stay Alert!  And if you are drinking , Call a Cab or have a designated driver who is not drinking...

Have a Wonderful and Happy Life....Merry Christmas

The end of the year is closer than you think. With time running out to make important year-end tax moves, charitable giving is an important component of any sensible tax strategy.

Although rules surrounding charitable giving have not changed much recently, they are very complex. The IRS is not forgiving of mistakes.

When making donations, consider IRS gift criteria, IRS deduction limits, proof of the donation, and the complex issues involved with donating property. Taxpayers can deduct charitable donations only if they itemize deductions. Here is an overview of the regulations covering charitable giving in 2010, although you should consult a tax professional before making any final decisions.

Qualified Charities

Before donating, make sure that the organization is a qualified charity under IRS rules. These include corporations, trusts, community organizations, funds, or foundations organized and operated in the United States for religious, charitable, scientific, literary, or educational purposes.

Other qualified charities include cemetery companies, veterans' organizations, fraternal organizations, and organizations designed to prevent cruelty toward children or animals. Certain charities in Canada, Mexico, and Israel may also qualify. You can search for qualified charities using the IRS's online search tool. Be sure to check the addendum for listings not yet included in the electronic search version.

Gift Criteria

If you receive any consideration in exchange for the gift, there's a limit on how much of the gift you can deduct. For example, if you make a $200 donation to a qualified charity and receive a gift in return valued at $50, you can deduct $150. A major exception to this rule is athletic tickets purchased from colleges and universities, where the allowable deduction is 80% of the price paid for such tickets.

Donation Documentation

For donations of more than $250, there must be written substantiation of the gift, which can include a letter documenting the gift from the charity. If cash is contributed, a canceled check, a bank statement, or a credit card statement can serve as documentation, according to the IRS.

For donations made via payroll deduction, a pay stub, Form W-2, or pledge card to a charitable organization suffices. For donations of less than $250, maintain a record that states the name of the charitable organization, the date of the donation, and what was donated.

Deduction Limits

Deductions are limited to a certain percentage of adjustable gross income (AGI), depending on the type of property that is donated and what type of organization receives it. Below is a general rundown on donations, but you should check with a tax professional for confirmation on your client's specific situation. Charitable Deductions for Property Type of donated property Type of charity How contribution is valued General deduction limit Cash Public charities Canceled check, credit card receipt, or written communication from charity if under $250; substantiated by charity if over $250 50% of AGI Private non-operating foundation, veterans' organizations, fraternal societies, and nonprofit cemeteries Canceled check, credit card receipt, or written communication from charity if under $250; substantiated by charity if over $250 30% of AGI Capital gain property Public charities Fair market value 30% of AGI Private non-operating foundation Property basis, unless fair market value is less Whichever is less: 20% of AGI or 50% of AGI minus contributions to charities Ordinary income property Public charities Property basis, unless fair market value is less 50% of AGI Private non-operating foundation Property basis, unless fair market value is less 30% of AGI

This blog is not to be used as legal or financial advice but as a tool to start you thinking of possibilities and to obtain more detailed professional advice.

We Need to Stay Aware and Stay Involved in Our Government Processes

Hi, a few minutes ago the Votes on the President's Deficit Reduction Committee came in. As only six or seven YES votes were expected, the drastic suggestions received 11 votes. 14 were needed to send the plan right to Congress. The comments in this WASHINGTON POST story say it all.. MID may be RIP! Here is the link

http://wapo.st/gB4fhR

Of MAJOR importance is this segment:

Two Senate Democrats on the panel also voted yes, including assistant Senate Majority Leader Richard J. Durbin (Ill.), an influential liberal who sought to bridge a major partisan divide by explicitly endorsing a gradual increase in the retirement age from 67 to 69.

The chairman of the Senate Budget Committee, Kent Conrad (D-N.D.), also voted yes, and Durbin predicted that Conrad would use the commission's report as a basis for constructing the party's next fiscal blueprint early in 2011

November 19 marked the 147th anniversary of Abraham Lincoln’s most famous speech — the Gettysburg Address.


The Gettysburg Address would never have happened but for the lack of grave diggers. In the sweltering August that followed the epic battle, the stench from the 10,000 rotting bodies left on the field forced the townspeople to stay inside their homes.


Some citizens tried their hand at the grisly task of cleaning, sorting and carting the corpses to the rail depot to be shipped to places like Massachusetts or Michigan, but the enormity of the effort soon daunted them.

They turned to their congressman for relief. His solution? Federalize the problem. Have Congress declare the battlefield a national cemetery and then the Union troops could be ordered to clean it up.

Back in the mid-19th century, the dedication of a new cemetery was a sacred civic ritual. This national cemetery would in addition carry the solemn gravity of momentous import. For that they needed an orator of eminence equal to the occasion. Daniel Webster was dead. But the Gettysburg civic fathers were unanimous in their opinion that only one man would suffice: Edward Everett, a distinguished statesman who, with silver mane of hair and booming baritone voice, looked the part and had the credentials to match.

He was a former secretary of state and minister to the court of St. James in London and to Queen Victoria.

The committee of town fathers discussed the idea of inviting President Abraham Lincoln, but he was not a popular figure in 1863. The awkward, folksy president wouldn’t do much to elevate the tone of the momentous occasion. But then some offered that the president never left Washington during the war — except to cross into Virginia to inspect the army of the Potomac. But if he got an invitation he would have to write a letter which could be read at the event giving the equivalent of a national seal of approval for the occasion. So an invitation was composed and sent. And to their chagrin, Lincoln accepted.

After some discussion, it was decided to ask Gov. Andrew Curtin, a close political friend of Lincoln in Pennsylvania.

Curtin, at Lincoln’s request, had convened a conference earlier that year in Altoona, a rail center near Curtin’s home of Bellefonte, for Northern governors to meet to discuss emergency measures that might be helpful to the Union cause. (Curtin, by the way, was a partner of the Humes, Curtin Law Firm in Bellefonte.)

Tthe gist of Curtin’s meeting at the White House. “Abe, keep it short and solemn — remember it’s an almost religious occasion,” he said.  Curtin’s advice jibed with what Lincoln was thinking. He wanted to infuse some of majesty of the King James Bible into his short address. He would open “four score and seven years ago.”

His listeners would be familiar with the “three score and 10” in Leviticus that was the scriptural allotted human span of life and the biblical phrasing would send the message that this new experimental government called democracy had already surpassed man’s 70 years.

Then he borrowed from Matthew’s nativity scene, “Our fathers brought forth a nation” — not “gave birth to.” Lincoln, note said “nation,” not “union,” the first president to do so.

If these biblical references sound stilted by today’s conversational usage, remember they brought familiarity as well as majesty to Lincoln’s phrasing.

Lincoln, with a stubby Faber pencil sitting on his ear, composed six drafts on blue-lined legal tablet paper right next to the Bible. For the ending, he wanted an allusion to his favorite biblical verse from Proverbs, “Where there is no vision, the people perish.”

He was closing with an important message that if the nation did not keep to the Founders’ dream, that all men are created equal, it would surely die.

Lincoln’s greatest speech was almost never delivered. On Nov. 18, the morning he was scheduled to take the train to Gettysburg, his wife, Mary, clasped her husband around the knees. “You can’t go. Tad will die if you do.” His youngest son was sick with a high fever. Tad’s brother, Willie, had died the year before. Edward, an older son, had died in 1850. Lincoln was torn. But with heavy heart, he took the carriage to the rail depot.

On the four-hour trip (for security reasons the train took a longer route), Lincoln kept to himself in one carriage. Onlookers noted he was distracted.

At dinner in Gettysburg at the Willis House, he did not join the conversation with the other distinguished guests. He retired early to his bedroom and prayed. An answer would come later in a telegram from Washington that Tad’s fever had broken.

The next day, after Everett, the featured speaker, finished his two-hour address to the multitude of over 10,000, Lincoln rose, gave his top hat to William Seward, the secretary of state, and began his address, never looking down at the speech in his hand. He would make an addition to his prepared speech, ad libbing one phrase, “under God.”

When he finished, there was no applause. The two minute address had more the feel of a prayer than an oration. He told Seward, “It didn’t scour, did it, William?” Seward nodded his approval.

Yet Everett, the American expert on rhetoric, said, “Mr. President, you achieved in two minutes what I tried to do in two hours.”

The speech might have had its genesis 40 years before. The 10-year-old Lincoln taught himself by borrowing books. Someone in his church loaned him Mason Weems’ “Life of General Washington.”

He read and re-read it by candle light in the cabin loft. One morning he woke to find the book destroyed by spring rains that seeped through the logs. He had to repay the farmer by pulling stumps from his fields. The ruined book was now his only possession.

One part of the book, however, remained intact. It contained a picture of a kneeling Gen. Washington in front of a stone memorial entitled, “Valley Forge.” Below it was the sentence, ”That these dead shall not have died in vain.”

Those nine words remained forever etched in the boy’s heart. And 40 years later he would recite them before the graves at Gettysburg.

We need to remember and learn our lessons from history as well.  We are forgetting the price paid by so many for such great freedoms and not allow them to be torn away nor given away because it is politically correct or numerically easy.

Freedom is Never Free nor is a law breaker a law-abiding citizen until he or she corrects the crime and pays the price.

As we count our blessings, let us thank God above for that which we have been blessed with and for, plus those who have paid so dear a precious price for our freedoms and liberties.  Happy Thanksgiving to you and your family.

With Great Privilege and Freedom
Comes Great Responsibilities!

If you have read the content of my website or my social networking sites or my previous blogs, you know that I love this land we call America, the Beautiful.   I believe to it is a privilege and a responsibility that has been taken for granted by too many Americans.

What am I talking about?  This last week as a nation we observed VETERANS DAY.  Notice I said "observed" not celebrated or honored.  We have young men and women and their families paying the ultimate sacrifice of their time, health, and lives for OUR freedom.  We have too FEW American stepping up to the responsibilities of being an American  by getting involved in our government process by voting, running for office, volunteering to serve in office and even taking responsibility for standing with and for those we elect by serving on volunteer advisory committees.  This is totally reprehensible. 

Do you know that The Federal Convention convened in the State House (Independence Hall) in Philadelphia on May 14, 1787, to revise the Articles of Confederation. Because the delegations from only two states were at first present, the members adjourned from day to day until a quorum of seven states was obtained on May 25. Through discussion and debate it became clear by mid-June that, rather than amend the existing Articles, the Convention would draft an entirely new frame of government. All through the summer, in closed sessions, the delegates debated, and redrafted the articles of the new Constitution. Among the chief points at issue were how much power to allow the central government, how many representatives in Congress to allow each state, and how these representatives should be elected--directly by the people or by the state legislators. The work of many minds, the Constitution stands as a model of cooperative statesmanship and the art of compromise.

On February 21, 1787, the Continental Congress resolved that:

...it is expedient that on the second Monday in May next a Convention of delegates who shall have been appointed by the several States be held at Philadelphia for the sole and express purpose of revising the Articles of Confederation...

The original states, except Rhode Island, collectively appointed 70 individuals to the Constitutional Convention, but a number did not accept or could not attend. Those who did not attend included Richard Henry Lee, Patrick Henry, Thomas Jefferson, John Adams, Samuel Adams and, John Hancock.

The 56 delegates ranged in age from Jonathan Dayton, aged 26, to Benjamin Franklin, aged 81, who was so infirm that he had to be carried to sessions in a sedan chair.   What they came up with is "The Declaration of Independence".  It reads...

     First Wave: 
Expiration of 2001 and 2003 Tax Relief 
 
In 2001 and 2003, the United States Congress  controlled by the GOP enacted several tax cuts for investors, small business owners, and families. 

These will all expire on January 1, 2011. 
Personal income tax rates will rise. The top income tax rate will rise from 35 to 39.6 percent (this is also the rate at which two-thirds of small business profits are taxed).  The lowest rate will rise from 10 to 15 percent.  All the rates in between will also rise.  Itemized deductions and personal exemptions 
will again phase out, which has the same mathematical effect as higher marginal tax rates.  The full list of marginal rate hikes is below: 
    * The 10% bracket rises to an expanded 15% 
    * * The 25% bracket rises to 28% 
    * * The 28% bracket rises to 31% 
    * * The 33% bracket rises to 36% 
    * * The 35% bracket rises to 39.6% 

    Higher taxes on marriage and family.  The "marriage penalty" (narrower 
tax brackets for married couples) will return from the first dollar of income.   

    The child tax credit will be cut in half from $1000 to $500 per child.  The standard deduction will no longer be doubled for married  couples relative to the single level.  The dependent care and adoption tax credits will be cut.

    The return of the Death Tax. This year only, there is no death tax.  (It's a quirk!) For those dying on or after January 1, 2011, there is a 55 percent top death tax rate on estates over $1 million.  A person leaving behind two homes, a business, a retirement account, could easily pass along a death tax bill to their loved ones.  Think of the farmers who don't make much money, but their land, which they purchased years ago with after-tax dollars, is now worth a lot of money.  Their children will have to sell the farm, which may be their livelihood, just to pay the estate tax if they don't have the cash sitting around to pay the tax.  Think about your own family's assets.  Maybe your family owns real estate, or a business that doesn't make much money, but the building and equipment are worth $1 million.  Upon their death, you can inherit the $1 million business tax free, but if they own a home, stock, cash worth $500K on top of the $1 million business, then you will owe the government $275,000 cash!  That's 55% of the value of the assets over $1 million!  Do you have that kind of cash sitting around waiting to pay the estate tax? 

Higher tax rates on savers and investors. 
The capital gains tax will rise from 15 percent this year to 20 percent in 2011.  The dividends tax will rise from 15 percent this year to 39.6 percent in 2011.  These rates will rise another 3.8 percent in 2013. 

Second Wave: 

Obamacare 
There are over twenty new or higher taxes in Obamacare. Several will first go into effect on January 1, 2011.  They include:  

     The "Medicine Cabinet Tax" 
 Thanks to Obamacare, Americans will no longer be able to use health savings account (HSA), flexible spending account (FSA), or health reimbursement (HRA) pre-tax dollars to purchase non-prescription, over-the-counter medicines (except insulin). 

     The "Special Needs Kids Tax" 
 This provision of Obamacare imposes a cap on flexible spending accounts (FSAs) of $2500 (Currently, there is no federal government limit). There is one group of FSA owners for whom this new cap will be particularly cruel and onerous: parents of special needs children. There are thousands of families with special needs children in the United States, and many of them use FSAs to pay for special needs education. 

Tuition rates at one leading school that teaches special needs children in Washington , D.C. ( National Child Research Center ) can easily exceed $14,000 per year. 

Under tax rules, FSA dollars can not be used to pay for this type of special needs education. 

The HSA (Health Savings Account) Withdrawal Tax Hike. 
This provision of Obamacare increases the additional tax on non-medical early withdrawals from an HSA from 10 to 20 percent, disadvantaging them relative to IRAs and other tax-advantaged accounts, which remain at 10 percent.

Third Wave:

The Alternative Minimum Tax (AMT) and Employer Tax Hikes.
When Americans prepare to file their tax returns in January of 2011, they will be in for a nasty surprise-the AMT won't be held harmless, and many tax relief provisions will have expired.

Some of The major items include: 

    The AMT will ensnare over 28 million families, up from 4 million last year.

According to the left-leaning Tax Policy Center, Congress' failure to index the AMT will lead to an explosion of AMT taxpaying families-rising from 4 million last year to 28.5 million.  These families will have to calculate their tax burdens twice, and pay taxes at the higher level. The AMT was created in 1969 to ensnare a handful of taxpayers.

Small business expensing will be slashed and 50% expensing will disappear.

Small businesses can normally expense (rather than slowly-deduct, or "depreciate") equipment purchases up to $250,000.  This will be cut all the way down to $25,000.  Larger businesses can currently expense half of their purchases of equipment.  In January of 2011, all of it will have to be "depreciated."

Taxes will be raised on all types of businesses.

There are literally scores of tax hikes on business that will take place.  The
biggest is the loss of the "research and experimentation tax credit," but there
are many, many others. Combining high marginal tax rates with the loss of this tax relief will cost even more jobs.

Tax Benefits for Education and Teaching Reduced.
 
The deduction for tuition and fees will not be available. Tax credits  for
education will be limited.  Teachers will no longer be able to deduct classroom expenses. Coverdell Education Savings Accounts will be cut. Employer-provided educational assistance is curtailed.  The student loan interest deduction will be disallowed for hundreds of thousands of families.

Charitable Contributions from IRAs no longer allowed.

Under current law, a retired person with an IRA can contribute up to $100,000 per year directly to a charity from their IRA.  This contribution also counts toward an annual "required minimum distribution."  This ability will no longer be there.

And worse yet?

Now, your insurance will be INCOME on your W2's!

One of the surprises we'll find come next year, is what follows - - a little
"surprise" that 99% of us had no idea was included in the "new and improved" healthcare legislation  . . . the dupes, er, dopes, who backed this administration will be astonished!

Starting in 2011, (next year folks), your W-2 tax form sent by your employer
will be increased to show the value of whatever health insurance you are given by the company. It does not matter if that's a private concern or governmental body of some sort.  If you're retired?  So what... your gross will go up by the amount of insurance you get.

You will be required to pay taxes on a large sum of money that you have never seen.  Take your tax form you just finished and see what $15,000 or $20,000  additional gross does to your tax debt.  That's what you'll pay next year.  For many, it also puts you into a new higher bracket so it's  even worse.

This is how the government is going to buy insurance for the15% that don't have insurance and it's only part of the tax increases.

Not believing this???  Here is a research of the summaries.....

On page 25 of 29: TITLE IX REVENUE PROVISIONS- SUBTITLE A: REVENUE OFFSET PROVISIONS-(sec. 9001, as modified by sec. 10901) Sec.9002  "requires employers to include in the W-2 form of each employee the aggregate cost of applicable employer sponsored group health coverage that is excludable from the employees gross income."...and congress and the president are exempt.  This is one form of example of taxation without representation.

- Joan Pryde is the senior tax editor for the Kiplinger letters.
- Go to Kiplingers and read about 13 tax changes that could affect you.  Number 3 is what is above.

Why am I telling you this?  The same reason I hope you forward this to every single person in your address book.

We the People have the right to know the truth.  Our elected representatives and senators gave us these "presents" some without reading most of them but made themselves and other "special" groups exempt.  As taxpayers we will pay their share and then some for these unjust and unnecessary taxes.  We, the People, must STAND UP and BE COUNTED!   We, the People, must STEP UP and BECOME A PART OF THE PROCESS and GET INVOLVED in OUR GOVERNMENT.  

One of the greatest attributes of America is that we do not have to totally agree on everything.  We do not silence dissent or disagreement.  The most important aspect of our democracy is after we the people speak,  we who hold this land and our freedoms dear, put our differences aside and work together to preserve, build, defend, and grow as "One Nation, Under God!"

May we work together to preserve, build, defend, and grow America, the Beautiful.   

What Can You Buy Now Days?

The United States of America is widely considered to be the land of opportunity. People from so many countries all over the world flock to the United States, which is widely considered as a greener pasture. The pasture which is made greener by the green of the dollar! But does the average American get paid well, or is the good life restricted to only those with villas in Beverly Hills?

• The United States of America is mostly owned by China, Saudi Arabia, and Germany in that they own our government bonds and notes.  We are currently $13+ TRILLION dollars in debt and that is growing every day.
• The United States of America economy is valued at $13.6 TRILLION dollars and going down hill on a minute by minute basis.
• The United States of America debt load is the equivalent of almost $60,000 USD per person per year.
• The average American income (mean) for both sexes combined and irrespective of race, color or education, whether earning or not earning and with the only constraint that the sample set consists only of individuals above 25 years of age, is $43,362. Breaking this number down, we'll see that the average American salary per month comes to around $3,613.50. And it is fairly understandable to assume that if we take people under 25 years of age in the sample set, this number will become lesser overall.  But as statisticians will tell you, the median is widely accepted as a more accurate way of representing data than the mean, so the median American income, given the same qualifiers is $32,140 each year.
• The interest rate on that debt load is the average equivalent of 4.5% and is due at the rate amount of $9.99 per day and this is not tax deductible.  This does NOT Include the amount of taxes, fees, costs that the government assesses you for income taxes, transaction taxes, sales taxes, inheritance or death taxes, gasoline taxes, transfer taxes, burial taxes, Social Security Taxes, Medicare Taxes, Obamacare taxes, vehicle license taxes, airline and transportation taxes, etc....etc....etc...etc....
• We have Social Security and Medicare expenses which is not Tax Deductible...and we are not counting in ObamaCare expenses yet...
  so we are looking at $2,651.55 per year as a median costs annually.
• We have Federal and State Income which is approximately $8918. per year ..and we are not counting in ObamaCare expenses yet...
• If you live in an apartment you pay an average of $589.00/monthly plus utilities unless you have children and then the average rental amount is approximately $793.12 plus utilities for a family of 4 in a 2 bedroom 1 bath apartment, which is $7,068 per year...plus utilities and is NOT Tax deductible.
• The average utilities of electric, natural gas, cable, interest, telephone, and cell phone is at an average of $326.25 per month  or $3,915.00 per year which is NOT deductible from your federal and state income taxes....Oops you are broke before the end of the year...
• You probably need to get to work either by driving, ride sharing, or riding the bus.  SO for simplicity sake we are going to take the lowest charge and average you transportation costs of $460.39 per month.  This is NOT Income Tax deductible either.... Oops you are broke...
• You probably want to eat.  We will go inexpensive and frugal for about $125.00 per month. This is NOT Income Tax deductible either....Oops you are broke...And we went CHEAP....
• And this is before we talk about any Retirement, any Savings, any Replacement costs, any family, and any Recreation or Vacation or EMERGENCIES....
• Do you think politicians are going to help you out.....?  They spend over $3.4 BILLION for all these nasty, negative, political ads.  I wonder want would be the results if they went out and did some good with that money and paid it forward.....
• So this was all about what is the average American income. But I would still ask you to take these figures with a pinch of salt. The recession over the past couple of years and the number of job cuts remains unaccounted for in these numbers, so in today's context, these numbers can be quite inaccurate!

The moral of the story is this... You must rise above the mean or average by looking at Main Street which is where more than 80% of the American economy comes from (Be an entrepreneur) and build for YOUR future while helping others.

You have the ability to let your voice be heard on Tuesday, November 2, 2010 and GO VOTE!

Will you?