If you are a senior citizen considering a reverse mortgage at this time, it is natural if you are a bit fearful about moving forward with your decision, given the current conditions in the mortgage and credit markets. The loss of confidence in the financial markets these days is unprecedented.

However, your fear is not justified. Reverse mortgages and the lenders that provide them are not part of the sub-prime credit crises. This segment of the market did not participate in originating the risky loans that have created the chaos on Wall Street and the unprecedented number of foreclosures on Main Street. Reverse mortgage lenders are not in danger of having to write down huge losses on their reverse mortgage loan portfolios. Therefore, if you are in need of a reverse mortgage at this time you should not be deterred by scary sound-bites on the nightly news.

The issue though, is that the general public, especially seniors, are not differentiating between these two market segments. Recently I have heard several senior homeowners say things like; \”I would never think about getting a reverse mortgage now, with everything that is going on.\” Or \”I can’t get a reverse mortgage now and risk my home to foreclosure in todays’ market.\”

Thinking this way is like throwing the baby out with the bath water. Reverse mortgages are completely different from traditional conventional \”forward\” mortgages. A reverse mortgage and a forward mortgage are not at all the same thing. You should not dismiss out of hand, the idea of getting a reverse mortgage at this time, just because the product name has the word \”mortgage\” in it.

Firstly, reverse mortgages require no monthly payments or repayment of any kind, as long as the senior lives in the home. Consequently, you could never lose your home to foreclosure for lack of payment. The reality is that many seniors have actually saved their homes from foreclosure by getting a reverse mortgage to replace a traditional forward mortgage that they had a hard time making payments on. As long as you maintain your property and pay your property taxes, your home is virtually foreclosure proof if you take out a government insured reverse mortgage loan.

Secondly, if you get a HECM (Home Equity Conversion Mortgage) it is insured by FHA (Federal Housing Administration.) What that means for you, in light of the recent bank losses and hedge fund failures, is that if your reverse mortgage lender were to go out of business for any reason, the FHA insurance fund steps in to make sure that you continue to receive the money and benefits from your reverse mortgage.

A third safety feature of reverse mortgages, is that anyone interested in applying for this type of loan must first complete HUD counseling. HUD counseling is provided by FHA/HUD approved non-profit credit counseling agencies that are not owned by or affiliated with reverse mortgage lenders. The counseling covers the pros and cons of reverse mortgages and points out possible alternatives that seniors should consider instead of a reverse mortgage. HUD counseling is free of charge to the senior and can be conducted in person or by telephone. Seniors are encouraged to have adult children, trusted advisors or anyone that may help with their decision, attend the counseling session as well. After the senior completes the counseling, a certificate is issued which must be presented to the lender before an application for a reverse mortgage can be processed.

Even though it is understandable that the general public thinks that now is not a good time to consider any type of mortgage, it is definitely not true if the mortgage you are thinking about is a reverse mortgage. In fact, getting this type of loan sooner rather than later could actually be a benefit. The reason is that a key ingredient in determining how much money you can receive from a reverse mortgage hinges on the amount of equity you have in your home. If your home is declining in value due to the current housing and credit crises, you will realize a lower benefit amount from a reverse mortgage if your home is worth less in the future than it is today.

The bottom line is, don’t let fear or fear of the unknown prevent you from educating yourself about this unique financial planning tool if you think a reverse mortgage is something that could benefit you. Furthermore, do not let friends and neighbors influence your decision unless they are experts on the topic. Education and solid facts are how to make an informed decision. Do not listen to rumors or nay sayers if you think you might be able to improve your retirement lifestyle by obtaining a reverse mortgage.

About The Author:
N. Sioris manages the reverse mortgage information website; Let Your Home Pay You. It is a National resource for seniors and their families seeking comprehensive information about the pros and cons of reverse mortgages. Let Your Home Pay You provides facts about how these mortgages work, what the eligibility requirements for reverse mortgages are and things to consider before applying for this type of loan. They will provide a complimentary reverse mortgages quote and can refer you to industry professionals that specialize in originating reverse mortgage loans nationwide.

Banks are putting the squeeze on even their best long term card holders at a time when other sources of credit, such as home equity loans for example, are harder to come by. A lot of people are shocked to receive notices that their credit card rate has jumped to as high as 28% even though they’ve kept good credit and an excellent payment history.

With the soaring cost of fuel, food, and other necessities it means that a large number of Americans will be unable to cope with these higher card rates and are at risk of sinking deeper in debt.

As an answer, some people are tapping their retirement accounts to pay off their high credit card debt. Tapping one’s nest egg should be used only as a last measure, but for those who decide to go that route getting a 401(k) loan may be a smarter move than taking a distribution from an IRA or 401K and being hit with taxes and a 10% early withdrawal penalty. That’s because with a 401K loan:

There are no taxes and penalty on early withdrawal as long as the loan is repaid on time according to the loan terms.

The interest paid on a 401(k) loan is credited to the 401(k) account - so borrowers pay interest to themselves, not to a bank or other lender.

The 401(k) loan is set as low as prime rate, recently at 5 1/4%, is fixed for the 5 year normal term of a 401(k) loan.

Employees should ask their employer if their 401(k) plan allows loans. Those who are self-employed, such as independent contractors and individuals with their own business (part-time or full-time) can set up their own Self-employed 401k plan with a loan feature.

One can transfer funds from IRAs, 401k from a previous employer, SEP plan or other qualified retirement funds to a Self-employed 401(k) and borrow up to a maximum of $50,000 or 50% of the account balance, whichever is less.

A loan from a Self-employed 401(k) is easy to obtain because you are in effect borrowing from your retirement account, and repaying the interest and principal to your 401(k) account.

Make sure, however, to follow the 401(k) loan guidelines. A default on a 401(k) loan while not reported to the credit bureaus is reported to the IRS. You’ll have to pay taxes and a possible 10 percent tax penalty on any outstanding 401(k) loan balance.

About The Author:
Lamaute Capital, Inc., (http://www.InvestSafe.com). Lamaute Capital is an investment firm that specializes in setting up retirement plans for small business owners and non-profit organizations.

Many baby boomers are staring at retirement like a deer caught on oncoming headlights. They are not sure what to do or what else to do. They fear that whatever they have in savings just might not be enough. Less than 1 out of 5 workers felt very confident about having enough money for a comfortable retirement, according to the April 2008, EBRI Retirement Confidence Survey. And with good reasons, inflation is zooming at the same time that asset values are flagging.

By far the biggest assets of the Baby Boomers are the equity in their house and the balance in their 401(k) plan. Both of those have been going down lately. The median house price is already down 13% from last year and some like Goldman Sachs think that prices could fall by 30%, wiping out the equity for million of homeowners.

Meanwhile employees are growing more skeptical that their 401(k) will even keep up with inflation. According the Financial Times, between March 10, 2000 and January 31, 2008, the average annual return from the S

About The Author:
By Daniel Lamaute, Lamaute Capital, Inc., http://www.InvestSafe.com. Lamaute Capital is an investment firm that specializes in setting up retirement plans for small business owners and non-profit organizations.

Many, many thousands of people in the third world have achieved economic independence through the pioneering work of internationally revered Nobel prizewinner Muhammad Yunus. As the founder of the Grameen Bank, the world’s first lending institution to focus solely on providing unsecured start-up capital for the working poor, Professor Yunus has gained world-wide recognition and a slew of awards for his extraordinarily effective efforts.

Yunis’ work grew from an experience in his native Bangladesh some twenty-five years ago, when, as a young professor of economics he spoke to hard-working women who manufactured bamboo furniture in their homes. They lived in an out-of-the-way village and relied on a bamboo wholesaler to provide the raw materials on consignment. As a condition of this arrangement the women were obligated to sell the completed products to the bamboo merchant at an exploitive price that limited their incomes to 2 cents per day.

Professor Yunus found that a total sum of only $27 was all that was needed for these hard-working women to purchase the raw materials from another supplier at a lower cost. This would also allow the women to sell the finished goods for a much higher price and change the dynamic of their businesses so dramatically that their incomes would increase by a thousand percent.

Armed with this information Mr Yumas approached a bank on behalf of these bamboo furniture manufacturers: No success! He approached another bank, and another and yet another with the same result and always with same reason—-insufficient collateral. Not willing to take no for an answer, Professor Yumas advanced the money from his own pocket and so transformed the lives of 42 women from a small Bangladeshi village. He also started a revolution.

Importantly the newly empowered women repaid every cent, with interest, way before the loan due date.

When asked what motivated him to do it, Professor Yunis said that he felt ashamed to live in a society that couldn’t, or wouldn’t, provide 42 industrious, productive women with $27 to release them from lives of servitude.

Professor Yunis was so moved by the experience that he used his own money to make further unsecured micro-loans to village craftspeople. Every loan was repaid in full before the due date but still the bankers wouldn’t help unless the applicants could come up with collateral.

The answer? Start your own bank, and that’s exactly what Muhammed Yunis did when he founded the Gameen Bank some twenty-years ago.

He was subsequently interviewed by Stephen Covey, the author of \”The Seven Habits of Highly Effective People.\” Covey was so impressed with what Yunis had accomplished that he wrote a follow up book called \”The Eighth Habit of Highly Successful People.’ which he based on the Yunis quote \”Find Your Voice and Inspire Others to Find Theirs.\”

Covey went on to say that \”most of the world’s great leaders don’t get inspired by one burst of vision, but gradually develop their vision over time. The great among us sense a human need and respond to their conscience in trying to meet that need. When they meet that need they see another and meet that, and on and on. Little by little they begin to generalize this sense of need and then they start thinking of ways to institutionalize their efforts so they can be sustained.

In a subsequent interview Covey argued that most organizations still function as industrial age institutions rather than valuing the skills of employees. He also spoke about how most employees don’t really know their companies’ goals or haven’t been told why their jobs are an irreplaceable tool in reaching those goals.

Companies often tell employees how essential teamwork is but base rewards on individual performance. And most companies still rely on individual job descriptions rather than looking for people whose skills complement the groups.

But even can backfire if workers don’t have a voice in setting the goals, Covey said. \”Without involvement, there is no commitment.\”

The Grameen Bank now lends over $500 million per annum to unsecured applicants who use the money to start or expand small family businesses. The Bank also funds low-cost housing developments and other community projects that help people at the village level.



Micro-lending has grown virally into a multi-faceted industry offering many types of non-bank loans, using an array of underwriting criteria, to those without traditional security.

Options include short-term internet loans, payday loans, no credit-check loans and other loans that can be obtained without a credit check and without collateral.

About The Author:
Spotya.com is a website that bridges the gap between your paydays by giving you a small loan until your next paycheck. We offer the lowest rates on the web at only $15 for every $100 borrowed. Get up to $1000 with no credit check. We hope to see you soon, so come visit us at http://www.spotya.com

All too often, dealing with money matters within relationships is much like mixing oil and water. The two simply don’t mix. Whether we’re talking about family members, friends or others close to us, when money concerns enter into the relationship, all too often things turn out badly.

This is especially true when dealing with intimate relationships such as marriage. Issues involving money are presently recognized as leading causes of divorce. (It may also be argued though, that while finances are a significant issue in many breakups, money problems are often symptoms, not necessarily the root cause, of the problems in a relationship. But that’s another day and another article.)

Why is money such an issue? I think, two reasons. One, I don’t know many people who aren’t passionate and opinionated when it comes to money matters, and two, because as crazy as it seems, a great many individuals still fail to thoroughly discuss financial matters before they enter into close personal relationships.

You’d think that we’d be much more willing to discuss an issue that most of us have such strong feelings about, but that’s not often the case. We’re either too timid to discuss money, too hesitant to bring up what may be a sensitive issue or one that could possibly present some challenges (ya think?), or we’re just too naive to realize that things don’t magically fall into place simply because we’re in love.

Anyways, here are a few tips to help you to avoid unpleasantness in your relationships because of money:

Talk About Finances Before Jumping In - For heaven sakes, if you’re contemplating spending the rest of your life with someone, don’t you think it might be important for you to know more than a little bit about their financial condition? What debts are they bringing into the partnership, and just as importantly, what assets? How does this person feel about money? What are their attitudes about saving, spending, financial planning? Are they experienced in the aspects of money management? What were their parents’ attitudes towards money? What examples or modeling did they have in terms of money-related habits? Does money seem to \”melt away\” in their possession, or do they hold onto every penny like it was the last piece of money on earth? What financial goals do they have? What other goals do you each have that may be dependent on your financial condition?

Getting the answers to these types of questions is not prying, and if the person with whom you’re dealing feels that it is, then perhaps you’ve learned something about them already. These are all extremely important details to discuss with your partner before entering into any type of life-altering stage of a relationship, such as marriage. And if you’re contemplating co-habitating with someone without benefit of marriage, it is just as important an issue, if not more so. I cannot stress this point enough. No matter how squeamish or uncomfortable you may feel about discussing finances, do this before you get involved in a situation that will be difficult, at best, to undo if things don’t go well.

And just so you know, these are also important issues to discuss with friends with whom you are contemplating living, as well as roommates or family members who will be sharing the same living space.

Agree On A Plan, Work Together - Once you’ve gotten all of your financial cards on the table openly and honestly, then you have a good idea of what you have to work with, possible benefits and where potential pitfalls may lie. From this point, create a plan together to address how the finances will be handled. How and by whom will the bills be paid? How will you save money and for what purpose? How much will you save/spend within a given period (monthly budget)? What methods of investment will you use? What about an emergency fund?

Be Flexible, \”XXXX Happens\” - Okay boneheads, that’s \”LIFE Happens\”. In spite of our best efforts and planning, and whatever else anyone may tell you, life can neither be completely controlled nor predicted. Unexpected and unforeseen challenges are much of what life is about. So, when those unexpected circumstances present themselves, you need to be ready and willing to alter your financial plans to fit your current situation.

Once you have a plan in place, make certain that is isn’t so rigid that you are completely discouraged from following it. Make certain that your plan leaves room for flexibility. A financial plan should be a \”living\” plan, meaning that it should be developed so that it is easily altered, has room for growth and can accommodate the inevitable changes that will occur in your life and financial status.

Consult An Expert - Chances are you’re not a professional money manager. In order to give yourself and your partner the best chance you could possibly have to get the most benefit from your finances, consult with a professional. That doesn’t mean to simply hand over your fiscal responsibilities to someone else, but rather have someone (or preferably several credible resources) that you can rely upon to help you to see your financial situation objectively, help guide you around possible pitfalls and trouble spots, and steer you on a course that allows you to manage your finances to effectively accomplish your life goals.

Money matters don’t have to adversely affect your relationships. If you do the work to ensure an open and cooperative environment, especially in terms of financial matters, you place yourself and your partner in the best position to achieve financial success.

About The Author:
Kimberly Clay is a successful business woman with over twenty years of experience and success to her credit. She is an online entrepreneur with a passion for educating and helping others to develop online success and create wealth. For more information, visit her website at http://www.GetMyWealthNow.com or her blog at http://www.blog.GetMyWealthNow.com

As tax preparation time begins, many seniors are asking to include Medicaid asset protection as part of their tax planning strategies. For those of you not familiar with the 2005 Tax Reduction Act, some of the provisions address specific transfers by seniors under the new Medicare nursing home provisions. Under the new provisions, before a senior qualifies for Medicare assistance into a nursing home, they must spend-down their assets.

These new restriction have a 5 year look-back, used to be 3 years. And used to be that each spouse had a one-half interest in the marital property, it now appears that all the marital assets are to be spent-down. I have not seen specific regulations but it appears that the healthy spouse will be left without any assets if one of them gets sick.

Suggestions by seniors have been to transfer their assets to their children. Although this option is available, I’m not sure that it’s a good option. What if the child decides to use the asset for themselves, what if they get divorced and the judge awards assets originally intended for the parents to the divorcing wife’s decree, what if the child get’s sued?

There are also tax implications. If the assets are transferred to the child for less than fair market value, then it’s a taxable gift. Even worse, if this type of transfer to the child is completed before the 5 years-look back, is it a \”fraudulent conveyance?\”

Medicaid asset protection has to be done very carefully. Planning in this area is evolving. There are a lot of eldercare law firms popping up all over the place. I have been approached by such a firm to send them clients. They claim that they can structure a new deal whereby the nursing home won’t be able to attach assets even after they enter the nursing home.

I know this much, any method used to deflect assets from the original owner has to be done at it’s fair market value. For example you just can’t transfer your house from you to your child. There are tax consequences. Did you just sell your house? Or did you just gift your house? Who will determine the fair market value? Did you get a genuine appraisal? If therefore, it’s at less than fair market value (willing buyer and willing seller, neither under compulsion to buy or sell, each acting in their best interest) did you just create a more challenging problem?

Any method whereby there’s an element of strings attached, it’s revocable and therefore you have done nothing to disassociate yourself from your asset. One can challenge your intent, to divert assets for the purpose of defrauding a potential creditor and failure to have filed a gift tax return has statutory penalties, and interest, worse- if Medicare intended, criminal?

I am aware of only one method of disassociating yourself from your asset (personal residence, your CD’s, your investments, vacation spot) is to give it away. Period. You can gift it to your children, pay the tax and that’s it. The problem is that you no longer have any control and you are at the mercy of your child’s good intentions and a blessed spouse. Risky? You bet!

An irrevocable trust with an independent trustee (not related to you by blood or marriage) will fit the bill. An irrevocable trust is an irrevocable contract between you and the independent trustee to manage the assets for the benefit of all beneficiaries. You and your spouse can become beneficiaries along with your children and grand children.

Timing is extremely important. If the transfer (repositioning) of your valuable assets is done before the 5 years, chances are good that it will stand-up in court. What if it’s before the 5 years are up? Is your Medicaid asset protection plan still good? In my book it’s better to have done something than nothing.

About The Author:
Rocco Beatrice, CPA, MST, MBA, Award-winning trust and estate-planning expert 71 Commercial Street #150 Boston, MA 02109 tel: 508.429.0011 fax: 508.429.3034 Sign up for a FREE newsletter and learn how you can reduce your taxes, protect your assets and secure your privacy. Free consultation. No Obligation, no risk, no sales pressure. Click here: http://www.UltraTrust.com http://www.ultratrust.com/medicaid-asset-protection.html

Tired of paying from your bottomless wallet for gas prices that can double in no time? Commuting has grown beyond expensive for the average American household, leaving many Americans researching alternative fuel sources. Not only do these alternatives offer new tax breaks, but they can also save a great deal of money at the pump while having a less harsh impact on the environment.

Make way for the hybrid car, a vehicle with multiple fuel sources. Mopeds, combining gasoline and pedal power, and locomotives, combining diesel and electric power, are similar in concept to the hybrid car. Most of today’s domestic hybrids merge gasoline and electric fuel sources. Designed with advanced aerodynamics, more efficient engines and reduced body weight, they give drivers from 18 to 60 MPG of city and 21 to 51 of highway driving. Popular models on the market today include the Chevrolet Silverado, Ford Escape, GMC Sierra, Honda Accord, Civic and Insight, Lexus RX and Toyota Prius. Hyberid cars both improve your mileage and reduce tailpipe emissions, so you generate less pollution and Carbon dioxide.

Other alternative fuel vehicles include:

Electric Vehicles. These cars run on electricity, fueled by a charging unit typically built onto the side of one’s house. Electric-only vehicles can get about 50 miles of use per 12 kilowatt-hours of charge, are cleaner-running and can go from zero to 60 in about 15 seconds. Electric cars are available through individual conversion.

Liquid Hydrogen Vehicles. The BMW’s Hydrogen Record Car (HRC) is an extremely fast, aerodynamic, clean-burning vehicle. Because there is an unlimited supply of Hydrogen, and because it is a renewable source of energy, this vehicle is a strong alternative to gasoline.

While less popular than our petroleum oil counterpart, these alternative fuel vehicles are making a big impact in the news and on the consumer market. Before you make the switch, consider your personal commuting needs.

About The Author:
Copyright (c) 2006 Vasrue.com. All Rights Reserved.

Clinton Douglas IV writes about Travel. For more great articles on this subject, come back to http://www.Vasrue.com. Articles are published weekly on Travel, Real-Estate, E-business, Credit and a host of other great topics.

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Baseball coaches won’t make a player a designated hitter unless their batting average proves that they’re able to hit the home run! Likewise, banks and credit card companies won’t lend money to people unless there’s proof that they’ll repay the loan. Lenders look for that proof in your credit score, the \”batting average\” of your overall credit history.

What’s in your credit score? It’s much more than a number attached to your credit report. It’s an important piece of financial information that lenders look at when deciding whether or not you are a worthy investment. You need to build the highest credit score possible to prove to banks and credit card companies that you’ll repay the money they lend you well. Credit reports are scored on a scale between 350 and 850, and the closer your score is to a perfect 850, the higher likeliness your loan or credit request has of being approved!

Most credit scoring systems are calculated from all the different credit data in your credit report. This data is grouped into five categories:

Payment history. How well do you pay your bills on time?

Amount of debt. Do you owe lots of money on many accounts?

Length of credit history. How long have you had credit?

Types of credit. Do you have a healthy mix of credit (credit cards, installment loans, mortgage loans, etc)?

New credit. Are you taking on too much debt?


A credit score takes all these categories into consideration. No one piece of information or factor alone will determine your score, just as one hit alone doesn’t determine a player’s batting average. Remember that your credit score will change with credit report changes— if you stop paying a loan, your credit score will go down. Similarly, if you begin paying all of your bills on time, your score will increase, and you’ll qualify for a loan that’s the equivalent of a home run!

About The Author:
This article was written by Josh Pike at ACCION USA. ACCION USA provides business loans up to $25,000 to small business owners who need financing to expand their businesses: http://www.accionusa.org

Afraid of the big commitment? Home ownership is always an excellent investment offering discounts every year and guaranteed retirement savings. It can be one of the best investments anyone can make. Buying your principle residence is the only way you can ensure a rent- or mortgage-free lifestyle in 15- to 30-years. So you can retire in style. Passed down, property gives every generation to follow a much greater advantage.

Plus, the Internal Revenue Service offers incentives on real estate purchases to propel the American dream. Who wouldn’t like a break from Uncle Sam now and then? These write-offs and deductions can bring your seemingly high original mortgage payment down to lower, more comparable payments to renting. Plus, if you get a fixed-rate mortgage loan, your payments stay the same forever. So in ten years, when renters are paying 30 to 50 percent more in monthly payments, you’ll be pocketing that money.

Initially, the IRS gives taxpayers a break the year you purchase your home. Keep all of your settlement records during your purchase transaction. At year-end, you can deduct home interest, certain real estate taxes and points representing interest as long as you itemize. Home builders may pay these costs when purchasing the actual land or settling the mortgage. Real estate taxes are allocated between both homeowners that year. So you can deduct the portion of taxes paid by you during the months of ownership. Therefore, its most tax advantageous to purchase a home in December or January, so you can claim the full year.

Next, the IRS gives taxpayers ongoing financial advantages. At year-end, homeowners can deduct their interest, which is generally the bulk of each month’s payment at the outset, on your mortgage, home equity loan or line of credit. You can also deduct your property taxes, another large expense.

So if you still think renting beats ownership, do your math. It might be time to reconsider.

About The Author:
Copyright (c) 2008 http://www.Vasrue.com, All Rights Reserved.

Mark Felder writes about Real-Estate for the Vasrue website. Articles are published weekly on Travel, Personal Finance, E-business, Credit and a host of other great topics. All Vasrue articles are available to other webmasters through RSS feeds. Visit the Vasrue.com website often, to learn something new.