scrapper asked:


my agent said if I lose a little bit of weight, then I could just reapply. But i’ve been reading that term life is relatively cheaper. Please help!

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topperdude asked:


Hi,

Bought a new house that is my primary residence. Paid loan origination fee of $x to mortgage broker (say BankA) and loan discount fee of $y to lender (say BankB). Both these fees are shown in section 800 of settlement statement. Per checklist in pub 936 and discussion w/ IRS agent, was told that I could take deductions for amounts $x and $y as points not reported on 1098 while filing taxes.

After hanging up with IRS agent, noticed section 200 of settlement statment showed “broker credit” paid by BankA equal to loan discount fee $y. In other words, BankA paid loan discount fee to BankB, essentially reducing my closing cost.

My confusion/question is whether I can include $y as deduction for points not reported on 1098?

Would appreciate any input.

Thank you,
-Topper

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dasielady asked:


I have been pre-approved for a mortgage through my credit union. The loan is a 5-year ARM for 80% of the value, and a 5-year Balloon for 17% of the value, and I am putting 3% down on the house. I am set to close 1 week from today. I have a loan commitment from the lender.

I read in the news today that the FED is considering curring interest rates for the money that banks borrow, (which to my understanding is how they set thier interest rates??) by .25 to .50 %.

If they do cut rates, would that affect a credit union? Should it lower the rate that I am being offered for my home loan? Would I be foolish to ask my lender (credit union) if my rate goes down?

What are your thoughts?

Thanks!

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Atlas asked:


I am buying a home and am comparison shopping among different mortgage lenders. The usual big names like Countrywide, Bank of America, Citibank etc have higher rates than the lesser known/unheard of places. How can you know which ones are reputable and which ones to stay away from? Specifically wondering about Liberty, Alpine, Quicken, Priceline etc. Is it important to go with a local, “known” lender or non-local lesser known ones?

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Gwynn T asked:


This loan will give you a choise between a 15 year payment, a 30 year payment, intrest only and a very very cheap minimum payment.

This is offer by a well known bank, not a greedy broker shop.

Do you want to know the details?

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Curioucity asked:


Each of the major investment banks appear to have burned serious money on subprime mortgages in the US. We in Australia are hearing of additional tranches of discount interest mortgages resetting to normal interest rates this year and next. Have the iBanks who bought these already written these exposures down (in the most recent reporting season) or will the write downs of these next few tranches only be revealed over the next year plus?

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Jentleman asked:


I have a friend who is buying a house. He is trying to get the best rate. There are mortgage brokers that are offering a rate that is 0.125% better than the banks. Right now, that is around 6.25% for a 30 year loan at 80% financing. Are mortgage brokers the best deal? Thanks.

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Ustun Inan Insurance asked:


He suggested the Mortgage Companies negotiate with homeowners, instead of forclosures.What he didn’t tell you is that everytime Mortgage companies negotiate new loans, there are new fees,commissions and other expenses, and those are added to the loan balances upfront, increasing what the homeowners owe. There are no magic way to solve this problem other than lowering the loan balances of the qualifying,deserving home owners to a level where they can afford to make their payments I think that is how the federal “Bail-out” money should be used,for a permenant long term solution.
You heard the old “Joke” about the tire shop owner throwing sharp nails in front of his store,and puts up a big sign who says
“I am on your side,come in and I’ll give you a big discount on
new tires”
Thanks for the answers! Of course it is “unthinkable” to create a legislation to stop the “Loan sharks” (this is not aimed to legitimate lenders) from making loans knowingly that their victims going to end-up in forclosures.
But it is insane to “bail them out” with Federal money, so they can make more bad loans. Federal money should go to their victims, don’t you think?

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mkostelnik@sbcglobal.net asked:


I own an elderly family members house and want to donate it to a nonprofit. There is some equity, but there is also a mortgage. Are there any nonprofit organizations that will accept donation of a house with equity, take over the mortgage and let the person in it live out thier life? It seems like a good chance for a nonprofit to get a property at a decent discount and without the need to make repairs (like at an auction).

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mission_viejo_california asked:


A batch of economy-wide stats was released Friday morning, covering retail sales, industrial production, import prices, and consumer confidence.

The verdict? It’s a 2 percent economy. Call it Goldilocks 2.0.

Might the current financial turmoil throttle back growth a little more in the next six months? Yes, perhaps. Will there be some negative earnings surprises, especially from financial companies? Sure.

But the bears would have us believe the sub-prime credit virus heralds the end of the world. They are wrong. Remember this: Our free-market capitalist economy is resilient and durable. It has proven time and again that it can take a punch.

Sure, recession probabilities have increased. But so what? We’ve had virtually uninterrupted prosperity for twenty-five years, going back to the supply-side economy and technological boom launched by President Ronald Reagan. Since then, we’ve experienced 93 positive GDP quarters and only 5 negative ones. That makes for a truly phenomenal batting average.

Consider this: Marginal tax rates are low. Inflation is low. Interest rates are low. And the world economy remains strong. The stock market — which I still believe is the best barometer of the health of business and the economic future — has behaved surprisingly well during this difficult stretch of turbulence. In fact, the sum total of the so-called “bear assault” is only a 4.5 percent correction from Dow 14,000 and other index peaks registered two months ago.

Yes, profits are getting sloppy. And yes, there are some credit shocks out there yet to be revealed. However, the Federal Reserve will reduce the cost of money by bringing down its basic target rate on Tuesday. President Bush will veto any Democratic tax hikes. And at the margin, the Iraq War story is taking a turn for the better. Meanwhile, American entrepreneurs are still working hard.

Speaking of next Tuesday, the best thing the Fed can do is deliver a big-bang, shock-and-awe rate cut that would bring the basic fed funds target 50 basis points lower to 4.75 percent. At the same time, it should lob a full percentage point off the discount lending rate, cutting it from 5.75 to 4.75 percent. This would be a confidence-inspiring move for all concerned: borrowers, lenders, businesses, consumers, and mortgage holders. Not only will slashing the cost of money add significant new liquidity to the economy, it will raise asset values across the board.

The Fed also might think about setting up a special facility for non-bank lending institutions that are experiencing a liquidity squeeze. Perhaps also a temporary liquidity facility for commercial paper lenders. The asset-backed commercial paper market is vital to funding many of the daily operations of businesses across the country, and it’s this market that has been hardest hit.

Such monetary front-loading would be very powerful, indeed. However, if the Fed goes small with only quarter-point reductions for fed funds and the discount rate, many investors will have an incentive to withhold money while they wait for interest rates to finally bottom at much lower levels later this year or next. In other words, a timid Fed action might actually prolong and deepen the economic slowdown.

This is not a time for small-ball. It’s time for Bernanke and Company to go big.

And let’s not forget that taxes are just as important as money. President Bush and Treasury man Henry Paulson should absolutely squash all the Washington rumors of tax hikes, in particular a cap-gains tax increase. If investors expect a hike in the cap-gains tax, they will have every incentive to launch a massive wave of stock market selling. Needless to say, this would be utterly calamitous for the whole economic picture.

The animal spirits may have had their wings clipped a bit by the credit crunch, but with the right tax and money policies there is still plenty of sizzle and juice in this story. It’s very easy to be totally pessimistic and bearish right now, but that’s precisely why I will avoid falling into that trap.

Optimists are winners. Pessimists are losers

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