Who is a Reverse Mortgage Candidate

By Spooni Vanrock

More commonplace than ever reverse mortgages are making their way into the senior community. Maybe it's famous spokesmen or basic financial trouble that expedites the process.

Regardless, people have and will continue to have financial difficulties which a reverse mortgage could be the solution as an excellent source of funds.

That being said, it has shortcomings and is not the best tool for everyone. I'm often asked by my prospective customers, "Do you think this is the right thing to do?"

It's amazing how trusting some people are. God bless them. I am, afterall, a loan officer who makes money only when the loan closes. If you are considering this as option get the facts and make up your own mind.

However, I'm a pretty honest cowboy and I answer back, "How long do you plan on staying in the home?" This is the most important thing to know.

Why? Reverse mortgage closing costs are high to the point that if the senior vacates and sells the home in the short term it makes getting the loan a very expensive proposition.

What I'm looking for is the customer to say, "when I leave it will be with tag on my toe." Now that's my kind of customer! The longer the loan goes on the less the loan costs the customer on an annualized basis.

The very minimum acceptable time period, outside of an emergency situation, is three years.

Being in the home for any length of time less than that would be prohibitively expensive, and i may suggest other financial alternatives.

Another point is to match the relationship of the borrower's income to the problem the customer is trying to remedy.

Incomes vary greatly. Fixed incomes, by nature, can't change to necessarily meet and beat some large or long-term financial obstacles. On the other hand if the hurdle is short term perhaps it can be worked out by some other means.

Here is your typical reverse mortgage customer... He plans on staying in the home at 3 years or longer. His income is fixed and can't change to meet his financial needs. The reverse mortgage makes sense for this man.

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Breaking Down Reverse Mortgage Cash Out to Borrower

By Eversemort Vanrock

As of last month the new law went into effect allowing reverse mortgage companies to loan based upon the new higher FHA reverse mortgage limits.

The new limits in most parts of the country are $417,000. This is an increase by as much as two times in many of these same areas. So, what does this mean?

Of the multiple factors entering the equation determining the value of the home, or the FHA insuraable loan limit, is of vital concern as the reverse mortgage lender uses this dollar figure and related equity as security for the mortgage.

Don't forget, the lender is using the house and it's equity as security for the mortgage. The value of the home, or the FHA insurable limit, is the first and most important determination as to how much a borrower can receive.

Two other important factors go into this determination: Interest rate and the youngest borrower's age.

It probably comes as no surprise but reverse mortgage companies use actuarial tables. Yes, it may seem cruel but knowing how long the borrower is going live helps them determine the dollar figure to lend. Age is the next most important factor.

The great fear is one day more will be owed than the home is worth. Clearly if the tables tell a mortgage company the borrower is going to live 4 years as opposed to 14, they will lend the older borrower far more than the younger.

Interest rates are thought of in a similar manner. The greater the interest rate, the quicker the accrual of interest will eat away at the security for the mortgage. Therefore, lenders lend more to prospective borrowers as rates go down than the vice versa.

People often say to me, "What percentage of my value am I going to get?" There is no percentage. All three variables need to be input into the formula and out will come the number.

For a rough guestimate, borrowers aged 90, would receive roughly seventy-five percent of the home's value or loan limits (the lesser of the two). The young sixty two year old would qualify at about fifty percent.

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Don't Claim Deductions without Knowing your Tax Deduction Limits

By Matt Brewer

There are many reasons why people should know the tax deduction limits when they claim IRS deductions. Most people would say that the main reason is obviously so that they will have to pay the least amount of taxes to the IRS. Usually, the more tax deductions they are able to claim, the less taxes they will have to pay and most people want to pay as little taxes as possible.

While some people are already aware that it is important to know tax deduction limits, some people are still unsure of what tax deductions are. There are many websites that explain what IRS deductions are. Basically, tax deductions are sometimes referred to as tax deductible expenses because they are qualified expenses that the IRS allows taxpayers to subtract from income taxes. That means, the more tax deductions a taxpayer can claim, the less taxes he or she will have to pay.

If a taxpayer wants to pay as little taxes as possible, it is important to know all about tax deductions and that includes tax deduction limits. Some people are eligible to claim more tax deductions than others so it is important to know what you can claim legally to avoid any problems that might occur in the future. One way to learn about tax deductions is to read IRS publications.

Tax deductions and tax credits are not the same thing. Tax deduction limits are also different from tax credit limits. A taxpayer with both tax deductions and tax credits will find himself or herself paying little taxes whereas a taxpayer with neither will have to pay more taxes. While a tax deduction lowers gross income, a tax credit can give the taxpayer dollars directly to the bottom line which is why a tax credit is more popular than a tax deduction.

Choosing the right type of IRS deductions can affect how much taxes a taxpayer owes the IRS. The tax deduction limits do not matter so much if the taxpayer chooses to claim the standard deduction. However, not everyone can claim the standard deduction. If they can, though, it is the easier option of the two and all you have to do is check the box on your tax return form that says 'standard deduction'.

When a taxpayer is not eligible to claim the standard deduction, he or she will have to claim the itemized deductions and pay particular attention to relevant tax deduction limits. The taxpayer, of course, has the option of not claiming anything at all but most of them do to lower their tax bills. Each tax deductible expense will have a limit of how much a taxpayer can claim in tax deduction.

If you do not know your tax deduction limits, you will not know if it is best for you to take the standard deduction or itemized deductions when you qualify for both. Most taxpayers figure out what they would owe the IRS both ways and then take the tax deduction route that gives them the lowest taxable income.

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Option Trade With Thinkorswim And Become A Billionaire

By Walter Fox

With ever-improving Internet penetrations and governments globally opening up their economies, many people from various social and economical strata have found a means of investing in the stock exchanges. Financial institutions and banks now provide solutions to users to invest in these stock markets. Most of these solutions have very favorable clauses.

As stock option trading has become very popular, new players started flooding the market thus making the trade very challenging one. Trading in the complex, volatile and liquid stock market is a very tough job and also a risky one. A new comer without sound knowledge may not survive in the market for long period.

Traditionally, trading was carried out at the stock markets. With online trading, many individual investors have got involved in the market transactions. With this small time traders entering the market, the dynamics of markets have become complex and demanding. Consequently, these new investors are now looking at tips and advice from other people who better understand the market. Exploiting this vacuum of experts, many stock broking firms have appeared on the horizon that come up with hints and tips for successful stock trading to aid the bewildered investor.

One such firm is the Thinkorswim brokerage from the US. They have an excellent suite of online programs to instruct people on trading. What's more these are live programs to give you real time assistance. Boasting of over seventy thousand institutional and individual customers, Thinkorswim is a dominant player in the futures and options trading domain.

Option trading tips from Thinkorswim brokerage are proved to be very useful for their customers for the last few years. They guide their account holders on number of categories of investments such as equities, exchange traded funds, bonds, futures and variety of mutual funds. The success rate of their customers in the stock market and the popularity of their option trading tips made them the best brokerage in NASDAQ as well as other prominent markets of the world.

In any rapidly developing market, and more so with option trading and forex trading, a variety of events can have an effect on the rates. A good trader would keep himself appraised with these challenges and respond wisely. A simple way for any investor to gain this advice and know-how is to approach a brokerage agency. While choosing a firm for yourself, look for features and services they offer so that you associate with the one that best meets your needs.

To make profit from the market, broker tricks, techniques, professional advisors are some of the additional resources which we can be utilized for a successful trade. And for an immature in the market, getting advice from a reputed agency like Thinkorswim is a best option.

The silver lining in this high profile cruel and merciless market in the form of trading friend is Thinkorswim who can guide in any difficult situation. With the restricted margin accounts of Thinkorswim, you can trade any complex option strategy. You can treat Thinkorswim as your friend in need.

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TheScienceOfTrading.com provides 90 free minutes of videos on option trading systems and provides a complete and detailed option trading course for beginners to experts.

Why You Need a Low Interest Business Credit Card

By Caressa Waechter

A varying assortment of financial issues face you when you are a small business owner. Probably one of the issues of greatest importance is keeping your personal and business monies completely separated from one another.

Having both a business bank account and business credit card is one of the easiest ways to keep your business and personal finances separated. You would then use your business accounts only for business purposes, and you would never, ever use your personal accounts for business expenses. Doing this keeps both the IRS and your accountant happy.

A critical part of your business finances is played by a business credit card. If you are a typical entrepreneur, you will find a frequent need to make use of a small business credit card. A business credit card is critical for such things as corporate travel, making purchases for your company, and paying bills.

There are many choices when it comes to picking a credit card for your business. It seems like just about every financial institution issues a credit card to consumers, and it is almost the same way when it comes to business credit cards. If you are looking for the best credit card offer, there are a fair number of good ones to choose from.

Finding a financial institution that caters to the business owner is the smart choice when it comes to choosing what small business credit card to choose. You want to use a business credit card that is issued by a bank who understands the needs of the business owner.

The good news is that there is a good selection of good banks that can issue your business a credit card. Case in point, if you went with a Citi Business Credit Card offer, or an Advanta offer, you would be doing business with a financial institution that specializes in dealing with the small business owner.

Make sure that you have a suitable business credit card in the name of your company. This will greatly help in keeping your business and personal finances separate, which will help keep your financial house in order.

Making the decision to use a business credit and settling on which issuer you go with are both equally important decisions to make as an entrepreneur. By choosing the right small business credit card, you are taking a step in the right direction to ensure the financial future of your company.

About the Author:

Author Caressa Waechter knows small business finances, which is why she thinks all businesses should use a low interest business credit cards. Get more information about the best Visa business credit cards by visiting her website.

Is there Good Debt?

By Michael Geoffrey

Yes, there is such a thing as good debt. There are only a few types of debt that fall into this category, but it's important to make the distinction. Some examples of good debt are:

* Debt incurred to buy a home - Owning your own home has numerous benefits. But the reason that this is considered a good debt is because a home is an investment. It gains value instead of losing it, so you're putting yourself at an advantage by going into debt as long as you keep your payments current.

Borrowing money for college is also an investment ? in your education. By educating yourself you give yourself more earning power. This is an instance when taking on debt is a wise choice.

If you obtain a start up loan for a business venture this can be good debt. Again you are borrowing in order to give yourself earning potential. Of course you are always taking a chance when going into business for yourself, but often it is worth the risk and the necessary debt incurred.

More often we talk about debt that is not so good. Some examples of this are:

Financing a car ? unlike a home your car depreciates rapidly. That means you are not investing your money with the potential for a greater return in the long run. The money you spend is gone.

Almost everyone has and uses credit cards and they are convenient. However credit card debt is considered bad debt. Typically the purchases made on a credit card are things that will not earn you money over time. Credit card purchases are rarely an investment.

Another bad debt is borrowing money for personal use such as to purchase higher priced items or maybe to fund a much needed vacation. These are at times necessary but will not earn you money in the long run. Since they are not an investment this is not good debt.

Good debt does not mean that it can not be harmful to us if we are not careful. Taking on good debt should be thought out carefully. The lender should not be the only one crunching the numbers to see if the debt is within our ability to pay. We have to take personal responsibility for counting the cost and being sure we will be able to make the monthly payments.

Also, bad debt is not always something to be avoided. To have a reasonable amount of what is considered bad debt is fine. We just want to keep it at a moderate level and not allow it to get out of control. Just like good debt we want to be sure we can handle the payments and only take on bad debt when necessary.

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No-one likes the idea of having a mortgage

By Rem

For many individuals, whether first time buyers or not, the prime consideration when looking at a fixed rate mortgage is the monthly repayment cost. Purchasing a home later in life means that many individuals need to have the mortgage paid off earlier. Although before signing any documents, there is a great deal to consider.

Over the course of the mortgage, it's fundamental to remember to make sure the rate of interest doesn't change. It is always wise to avoid arrangements that seem to too good to be true because they invariably are. The interest rate remains the same for long term fixed rate mortgages over the life of the loan.

Both my wife and I decided to research fixed rate mortgages when we began looking at homes for sale. Although it was important for us to pay off our loan as soon as we could, we didn't need high, unrealistic monthly payments which we would have a problem sustaining.

Looking at an even longer term mortgage was one option if we could not afford the monthly repayments on a 15 year plan. The problem was that we weren't very happy about having a mortgage still running close to when we both retired and hoped that a fifteen year fixed mortgage rate would still be accessible to us. There was obviously very good grounds to finish paying the mortgage off earlier if at all possible. Taking everything into account we finally went for the easier 30 year fixed mortgage rate plan instead.

My wife's donation to the monthly finances would in all likelihood be unreliable since she preferred to raise our child at home. The trouble we could see was the raised financial commitment with a higher monthly repayment if we had chosen for the shorter 15 year fixed rate mortgage. For us it just wasn't practicable as we would just be in over our heads and in all likelihood be worrying about money every month.

Despite the trepidation of having a longer term loan, the 30 years fixed mortgage rate did reduce the monthly installments considerably. During the year, if we have some spare cash, we can make additional repayments which helps to lower the amount owed. Just by making a handful of additional repayments throughout a one year period you can knock years off of your mortgage period.

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Home Mortgage Loan Guide

By John Bear

If you are considering buying a home, then you may be a little confused by all of the terms you hear about home loans. After all, lenders just throw around words like fixed rate, balloon mortgages and adjustable rate mortgages without a thought. What follows are the three most common types of home loans. Study it, and determine which one would be right for you.

The first type of loan is the Fixed Rate Loan. If you are planning to buy a home and stay in it until you pay it off, then you will probably want a fixed rate home loan. With this type of loan, you will be assigned a fixed interest rate, and that rate will not change for the life of the loan. If interest rates do skyrocket, yours will remain the same. On the other hand, if they plummet, you will be paying a higher rate.

The second type of loan is the adjustable rate mortgage or ARM wherein its interest rate goes along with the market. So when the interest rate goes low, your home mortgage rate goes low as well and if high, then your rate goes high too. Since the rate on a home mortgage loan affects your payments, you will not have any idea how much you will be paying for your monthly mortgage.

For starters, if you are purchasing a house for investment purposes and you plan to sell it quickly, you might take advantage of low interest rates by getting this type of loan, particularly if it looks as if they may go lower.

An ARM loan would prove to be beneficial when you buy a home on a time when the interest rates are very low. You can take an ARM and have it changed later to a fixed loan when the interest rates go lower.

The third type is the Balloon Home Loan. With this type, you will make monthly payments for a fixed amount of time, with a fixed interest rate. The difference is that at the end of the payment schedule, you will likely owe the unpaid balance in one lump sum. So if you use a balloon mortgage, you will find that the interest rates are much lower than either a fixed rate mortgage or an ARM.

Just one big problem for this type of loan is the large payment due at the end. On the other hand, if you plan to hold the house for just a short period of time, the balloon home loan might just suit you well.

It is essential to know and understand the different types of home loans so as to be more prepared when the time comes for you to decide which home mortgage loan would be more beneficial to you and your family.

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Military Retirement Calculators Help Plan For The Future

By Michael Geoffrey

People in the military usually have a much different retirement plan than ordinary civilians so they should use a special military retirement calculator when planning for an ideal retirement. Military retirement calculators should provide information that will help each person make important decisions. Usually military people are eligible for retirement earlier than civilians. This means that they might have to save more money faster to have a great retirement or plan to find another job after their retirement from the military. People in the military should consider these factors when working with a military retirement calculator to make their plans for the future.

Of course planning for your retirement from the military should start while you are still actively in the military. Your banking institution will be able to help you in finding a military retirement calculator that can help you start planning. Most people in the military are members of a credit union and that is always a great source of information.

The institutions that specialize in service to people in the military are usually keenly aware of the special circumstances of their clients. When military people start to plan for retirement, a military retirement calculator should make some important calculations that will make for the most perfect plans.

The Information You Can Expect

One of the unique circumstances of the military is that they do not stay in one place very long. While other people may continue to live wherever they have worked for years after they retire, a person in the military will have to think about where to live since he has probably lived in several places while he was working. The matter of where to live is going to have great impact on retirement planning.

Many benefits that a person receives while in active duty in the military continue after their retirement. They retain their military identification for shopping, medical care and other benefits. If a person wants to take full advantage of those benefits he would need to continue to live near a military base so that these benefits are close to home and available to him and his family.

The calculator does not do all the work. There are certain factors that only you know about and you have to input those into the calculator to get an accurate picture of your retirement. If you put in inaccurate or incomplete information you will receive inaccurate or incomplete results.

You have to tell the calculator what type of lifestyle you would like to enjoy once you retire. If you only give the calculator a location but don't input what type of house, car, etc. you would like to have in that location the calculator will be unable to tell you the information you need to be sure you save enough money for your retirement.

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