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Frederick, MD 21701
301-695-0000
March 15, 2010
Tips to Avoid Becoming a Victim of Mortgage Fraud
March 13, 2010—According to the Federal Bureau of Investigation (FBI), mortgage fraud is an escalating problem. It is the fastest growing white collar crime in the U.S. The FBI estimates annual losses of $4 billion to $6 billion in mortgage-related fraud, and the numbers are expected to increase. While there are legitimate programs to help ailing homeowners, there are also many scams that capitalize on these programs. Money Management International (MMI) offers the following tips to avoid falling into a foreclosure trap:
-Talk to your mortgage lender first. If you think you are unable to make a payment, contact your lender right away. They may be able to help you identify options to bring your loan current.
-Don’t pay upfront fees. Someone asking you to pay an upfront fee in exchange for help should be a red flag that the person or company may not have your best interest at heart.
-Get promises in writing. Oral agreements relating to your home are usually not legally binding. Protect your rights with a written contract signed by the person making the promise.
-Make mortgage payments directly to your lender or mortgage servicer. Do not trust anyone else to make your mortgage payments for you.
-Be careful about transferring your title. Foreclosure scams often require you to sign ownership of your home over to a third party. Never sign over your deed without seeking legal advice first. Understand the terms of the deal you are making. By signing over your deed, you lose rights to your home and any equity.
For more information, visit www.moneymanagement.org.
RISMEDIA, March 13, 2010—I recently joined many other individuals and agencies across the country celebrating National Consumer Protection Week (NCPW). Among the many informative programs and issues that were highlighted was an effort that focused on the many resources the Better Business Bureau (BBB) makes available to educate consumers about spending money wisely and avoiding being scammed by con artists.
Keeping with the theme of this year’s NCPW – Dollars and Sense, which emphasizes consumer education for every stage of life – from grade school to retirement, the BBB offered the following every day tips on how to manage money and be a savvy consumer.
If you need help finding a business you can trust, the BBB Accredited Business Locator can help you find businesses in your area that uphold BBB’s rigorous standards and have made a commitment to support the work of BBB (http://www.bbb.org/us/bbb-accredited-businesses). There are nearly 400,000 BBB accredited businesses across North America including retailers, contractors and online businesses.
If you want to research a business before you buy, the BBB maintains reports on nearly 4 million businesses across North America (www.bbb.org/us/Find-Business-Reviews). A business’s Reliability Report will tell you how many complaints the business has received, how they responded to complaints and their letter-grade rating reflecting BBB’s experience with the business.
If you have a dispute with a business, not only is BBB there to help educate consumers before they buy, it can also lend a hand if you have a dispute with a business. Every year BBB receives hundreds of thousands of complaints from disgruntled consumers and is usually able to help resolve issues quickly and easily.
If you have been cheated by a scammer, your complaint enables BBB to identify trends and warn other consumers and hopefully prevent them from being taken advantage of as well.
Check out all the online resources and tools BBB provides at www.bbb.org. More information and advice also is available on the National Consumer Protection Week website, year-round at www.consumer.gov/ncpw.
Homeowners: Most Profitable Remodeling Projects
RISMEDIA, March 15, 2010—Remodeling Magazine recently released its 2009-10 Cost vs. Value Report which covers 80 U.S. cities. On a national level, the project with the biggest improvement from 2008 was the attic bedroom addition, recouping 83.1% of remodeling costs compared to 73.8% in 2008. The only other interior project that landed in the top 10 was a minor kitchen remodel with 78.3% costs recouped.
Other exterior projects in the top 10 include midrange vinyl and upscale foam-backed vinyl sliding replacements, which returned more than 79% of costs. In addition, several types of window replacements–midrange wood, midrange vinyl and upscale vinyl–all returned more than 76% of costs upon sale.
Similar to last year’s report, the least profitable remodeling projects in terms of resale value were home office remodels and sunroom additions, returning only 48.1% and 50.7% of project costs.
Regionally, cities in the Pacific states of Alaska, California, Hawaii, Oregon and Washington once again outperformed the rest of the nation in terms of remodeling costs recouped upon resale. The West South Central region of Arkansas, Louisiana, Oklahoma, and Texas; the East South Central region of Alabama, Kentucky, Mississippi and Tennessee; and the South Atlantic region of the District of Columbia, Florida, Georgia, Maryland, North Carolina, South Carolina, Virginia and West Virginia also performed relatively well.
The regions that generally returned the lowest percentage of costs were New England (Connecticut, Massachusetts, Maine, New Hampshire, Rhode Island and Vermont), East North Central (Illinois, Indiana, Michigan, Ohio and Wisconsin), West North Central (Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota and South Dakota) and the Middle Atlantic (New York and Pennsylvania).
Even though they don’t usually return 100% of their cost, a remodeling job that remedies an extremely dated kitchen or bath can make the difference in selling your home. In most cases there will be some easy parts of the job that the homeowner can do on their own to save money. Painting is one example. Don’t look at a remodeling job only from the perspective of resale value. That’s a consideration that belongs in the calculation, but the enjoyment of an improvement is another important factor. If you plan to stay in the same home for the next five years or more, the difference between whether a project that you wanted to enjoy adds 50% or 80% to the resale value becomes less relevant.
Courtesy of the American Homeowners Foundation and the American Homeowners Grassroots Alliance, www.AmericanHomeowners.org.
March 12, 2010
Q: What is a hybrid loan?
A: Also called a fixed-period ARM, these crossbreed loans combine features of fixed-rate and adjustable-rate mortgages.
They start out with a fixed interest rate for a number of years – usually 3, 5, 7 or 10 years – and then convert to an ARM.
Initially, the interest rate for the fixed period of the loan is much lower than the rate on a fixed-rate, 30-year mortgage by about 1.5 percentage points. As a result, the hybrid allows borrowers to buy a lot more home than they can afford – but at greater risk.
The terms and fees for these loans vary widely and when the fixed-rate period expires, homeowners could end up paying considerably more than the current rate of interest.
Before considering a hybrid, pay close attention to the terms, fees, and prepayment penalties.
Tips to Protect Your Home from Termites
RISMEDIA, March 12, 2010—As the spring sun begins to shine, we all look forward to putting this season’s very wet weather behind us. According to pest experts, the wet winter will be a perfect breeding ground for pests, and termites are no exception. Long considered one of the most prevalent and damaging pests in the South, termites will cause more than $5 billion in property damage this year alone. And that damage, says Arrow pest expert Shay Runion, is not usually covered by homeowners’ insurance. Runion encourages homeowners to learn more about termite control to protect their most important investment.
Subterranean, drywood and Formosan termites are the most common termites found in the South. These termites usually become active in early spring, as soon as temperatures begin to heat up and continue throughout the summer. Once they enter the home, termites can tunnel 24 hours a day through cracks in concrete, wood, carpeting, floors and wallpaper.
Runion explains that while termite behavioral patterns have changed over the years, the absence of typical “swarming” signs doesn’t mean there is no activity happening in the soil below the foundation of your home. Evidence of mud tunneling in, over and under wood structures; darkening or blistering of wood; or damaged wood becoming extremely thin are all tell-tale signs of a termite infestation and require the immediate attention of a pest professional.
“It’s important for homeowners to understand that our below normal temperatures will not slow termite activity this spring,” says Runion. “Termites are always active in the spring, so it is imperative that homeowners get an inspection early. Once a termite infestation begins, they work quickly causing significant property damage.”
Steps to help prevent termites this spring:
-Eliminate moisture around foundations and divert water from the house by using proper downspouts and gutters.
-Seal cracks and holes including areas where utilities and pipes enter the home.
-Do not stack firewood or lumber near home and inspect it carefully before bringing it indoors.
-Keep tree branches, shrubbery and ground covering well trimmed and away from the house.
-Reduce humidity in crawl spaces with proper ventilation.
For more information, visit www.arrowexterminators.com.
Top Tax Rule Changes for 2009
RISMEDIA, March 12, 2010—As the deadline for filing taxes grows nearer, there are many tax rule changes that taxpayers should be aware of that could net them thousands of dollars in deductions or credits. Bills.com, one of the leading resources for free, personalized and expert money advice provides a rundown of the most important changes and some little known deductions that could add up to big savings.
Home Buyer Tax Credit
Through the combination of two rule changes, individuals purchasing a new home between January 1, 2009 and April 30, 2010 could be eligible for as much as $8,000 in a home buyer tax credit. Those who have not owned a principal residence during the past three years and who purchase a new home between these dates can qualify for the $8,000 home buyer tax credit. Those who have owned the same home as a primary residence for five consecutive years during the last eight years and who purchase a replacement home between November 6, 2009 and April 30, 2010 are eligible for up to $6,500 in a home buyer tax credit. Note that income and other limits apply to qualify for either credit.
Energy-Efficient Home Improvement Credit
There are two primary and distinct credits for energy efficient home improvements. The first covers general home efficiency repairs such as insulation, windows and doors and high-efficiency furnaces. This credit is 30% of the cost up to an aggregate of $1,500. The second credit covers larger-ticket improvements. Homeowners can take up to 30% of the total cost of installing solar hot water systems, solar electric generating equipment, wind energy equipment or geothermal heat pump systems with no fixed cap.
Government Retirees Credit
Government retirees could be eligible for a one-time 2009 refundable tax credit of up to $250 for an individual and $500 for a married couple filing jointly. To qualify, individuals must have received past government retirement benefits that were not subject to Social Security tax withholding at the time and they must be ineligible for the $250 economic recovery payment provided to certain government program participants.
Making Work Pay Credit
Working individuals can claim a refundable credit in the amount of 6.2% of their earned income up to a maximum of $400 for a single filer or $800 for a married couple filing a joint return. Self-employed individuals and those who have not already seen an adjustment in their withholding this year will have to adjust their liability on their 2009 tax return.
Unemployment Compensation Deduction
Generally, unemployment compensation counts as taxable income. However, new rules allow for a one-year exemption for the first $2,400 of 2009 unemployment compensation.
Vehicle Sales Tax Deduction
This is a new deduction for state and local sales or excise taxes paid on the purchase of new vehicles between February 17, 2009 and December 31, 2009. This covers new cars, motor homes, light trucks and motorcycles and is available on the first $49,500 of the vehicle purchase price even if you do not itemize deductions.
Job Search Expense Deduction
For those itemizing deductions, you may be eligible to write off expenses associated with a new job search during the last year.
Haitian Relief Donation Deduction
Congress has allowed deductions made to Haiti relief efforts between January 12th and February 28, 2010 eligible for 2009 write-offs. Qualifying contributions include those made by check, money order, credit card, charge card, debit card or even text message. Small donations require only a cancelled check or statement, while those over $250 require a receipt from a charity.
Gambling Loss Deduction
As hard as it may be to believe, gambling losses up to the amount you’ve won are eligible for a deduction. These losses must be documented through a written journal, receipts or betting stubs.
For more information, visit www.bills.com.
RISMEDIA, March 12, 2010—Huge numbers of American families live in geographic areas prone to natural disaster. But any neighborhood can unexpectedly fall victim to fire or other danger and it is vital for families to plan in advance to be ready for any emergency.
To develop a proactive readiness plan in your home, call the family together for a meeting. Even the youngest children in the family should be involved and aware of the plan.
Together, draw up a list of rules covering the following situations. When you are finished, give each family a copy to post in their own rooms – and post one prominently on the refrigerator or on the family bulletin board:
-Determine or review the preferred escape routes from the house to be used in case you need to evacuate quickly.
-Show everyone the location of the electrical box, the gas valve, the water main valve and the fire extinguisher if you have one. Young children may not be able to operate them, but they can show another adult where they are.
-Show everyone where health records and other important documents are stored.
-Make a short list of items that should be taken with you if time allows, such as necessary family medications.
-Review the location of your pre-packed emergency kits containing water, food, etc. If you do not yet have such a kit, prepare one now. Instructions for what to include can easily be found online.
-Be sure everyone knows how and when to report an emergency by calling 911.
-Designate someone who will be authorized to pick up the children from school in the event you cannot do so. Be sure this person knows he/she is the designee.
-Determine a meeting place where the family will reunite if separated during an emergency.
-As an alternative, designate a contact person in town and someone out of town who each family member should call as soon as possible after an emergency in case the family is separated.
-Make decisions regarding the safety of your pets.
March 11, 2010
RISMEDIA, March 11, 2010—When Americans set their clocks ahead on March 14th, they may not realize that Daylight Savings Time brings with it the season for increased property crime. According to the FBI, warm weather is often a predictor of increased criminal activity. Most residential burglaries also occur during daylight hours, specifically between 6am and 6pm. With longer days and spring weather around the corner, Security Choice, a leader in home security and safety, offers the following tips to keep your home safe.
Secure doors and windows - The most common points of entry for criminals are the most obvious. All doors and windows should be secured throughout the day to ensure maximum security. Sliding glass patio doors are particularly vulnerable and should be reinforced with a wooden dowel or a secondary blocking device.
Hide garage door openers – Garage doors are a common weakness in home security, as many people do not lock the door that leads from the garage to the house. An increasingly common tactic is to steal garage door openers from cars. Criminals use registration documents to find the address of the car owner and the garage door opener for easy access to the home. Keep garage door openers hidden and internal doors locked at all times.
Always appear to be home – Burglars are looking for an easy target. The biggest deterrent is a home that looks occupied. Extra cars parked in the driveway or street can often raise enough doubt to make burglars move to the next house. Keep blinds closed, and make sure delivered boxes, mail or newspapers don’t sit outside all day, as they are telltale signs that no one is home.
Landscape wisely – Spring brings new growth, and while hedges can serve as a deterrent, overgrowth can provide criminals a place to hide. Trim back unruly plants so they don’t provide cover for opportunistic burglars.
Use home alarm systems – Not much can match the increased security and peace of mind that comes with a home alarm system. Properly installed, alarm systems can be a potent deterrent for criminal activity. Look into trusted brands that offer audible horns and visible decals.
For more information, visit www.securitychoice.com.
RISMEDIA, March 11, 2010—Navigator Financial Partners (NFP), a leading wealth management firm catering to high-net worth individuals, announced a new study that shows individuals have high hopes for the U.S. stock market in 2010 yet are keeping their options open to better diversify their portfolios for long-term profits. The study was conducted by NFP during the week of February 15, 2010, to learn about views on investing in 2010. From a pool of more than 100 respondents, 69% of individuals are considering investing in alternative investments even though 43% of the same group feels the traditional options like the stock market will improve in 2010. While these results underscore Americans need to explore all their options, the majority (55%) of them do not know what those other options are besides the stock market and more traditional investment means.
“The survey shows Americans still desire to invest, but are interested in applying new mediums to do so based on the uneasy feelings the economy and stock market left them dealing with,” said Jason Wiltse, Principal and Investment Executive of NFP. “Many people’s investments were affected by our economic downturn and that is why our main objective at NFP is to help individuals become aware of smart traditional and alternative investments to better diversify their portfolios in order to reach their financial goals.”
Institutions and high-net worth families have used non-market correlating assets for decades to help diversify and reduce the volatility of their portfolios. NFP assists its retail clients in achieving the same type of success by adding hard-asset investments to more traditional portfolios. Real estate, for example, is an asset class that many individuals turn to, but retail investors are often left wondering how they can share in the potential benefits of owning real estate while still maintaining a diversified portfolio. As the financial landscape continues to evolve, NFP has made a commitment to its clients to help them seek opportunities both in the market and through more alternative investment structures.
Additional survey questions/results include:
Which of the following statements most accurately describes your feelings about the U.S. stock market in 2010:
Things will get better – 42.9%
Things will get worse – 13.3%
Things will stay the same – 33.3%
I don’t know – 10.5%
What statement best describes your feelings about your investment portfolio in 2010?
I won’t make money – 8.2%
I will lose money – 1.0%
I will make money – 71.4%
I don’t know – 19.4%
Which statement best describes your investment activity in 2010?
I have not invested and do not plan to – 3.1%
I have before, but no longer invest – 7.2%
I plan to increase it – 37.1%
I plan to decrease it – 2.1%
I do not plan to change it – 50.5%
Will you give consideration to alternative investments in 2010?
Yes – 69.1%
No – 30.9%
Have you ever invested in an alternative investment?
Yes – 35.1%
No – 64.9%
What statement best describes your alternative investment activity in 2010?
I plan to invest more – 25.1%
I plan to invest less – 8.3%
I plan to invest the same – 19.4%
I don’t know – 47.2%
For more information, visit www.yournavigators.com.
Q: Do I need to be at the inspection?
A: No, but it is a very good idea to be there. Following the check-over, the home inspector can answer your questions and discuss problem areas with you. This is also an opportune time to get an objective opinion about the home from someone who does not have emotional or financial ties to the property.
