Title Insurance

How To Save On Home Closing Costs

Scott Woolley, 05.19.09, 07:00 PM EDT

In a grim market, title insurance premiums and other costs are falling.

In Pictures: Eight Ways To Save When Buying A Home

During the housing boom, giddy home buyers rarely gave much thought to the myriad junk fees that got tacked onto the purchase prices of their new homes. After all, a few thousand dollars for title insurance and other dubious charges seemed trivial when home values were soaring. Today, as a new generation of thrifty home buyers takes a harder look at those costs, many are discovering new ways to save.

Much of cost-cutting comes thanks to entrepreneurs who hope to wring inefficiencies out of America's archaic system of transferring the title of a house. In the last two years, for instance, a company called Entitle Direct has received regulatory approval to sell title insurance directly to consumers in 32 states with a simple pricing strategy: Charge a flat 35% less than the going rate in the local market.

 

Full Article here...

Mortgage lenders pursue homeowners even after foreclosure

http://money.cnn.com/">

By Les Christie, staff writer , On Wednesday February 3, 2010, 3:21 pm EST

As terrible as it is to lose your house to foreclosure, at least it's a relief to put your biggest financial headache behind you, right?

Wrong.

Former homeowners may still be on the hook if there's a difference between what they owed on their mortgage and what the bank could sell it for at auction. And these "deficiency judgments" are ticking time bombs that can explode years after borrowers lose their homes.

It can even happen to people who got their bank to approve them selling their home for less than it is worth.

Vanessa Corey, for example, short sold her Fredericksburg, Va., home in April 2008. She and her husband built the house in 2004, but setbacks, both personal (divorce) and professional (housing bust), made it impossible for the real estate agent to keep her home. So she negotiated the short sale and thought that was the end of it.

"My understanding was that the deficiency was negotiated away," she said. "Then, last November, I got a letter from a lawyer telling me I owed my lender $65,000. I had to declare bankruptcy. There was no way I could pay it."

Many homeowners are now in the same boat. And not just those who took out bigger loans than they could afford or who did so called "liar loans" where they didn't have to verify their income.

Because of falling home prices, borrowers who always paid their mortgage but who have run into unforeseen circumstances -- like unemployment or a job transfer -- can no longer sell their homes for what they owe. As a result, they are being forced to short sell or foreclose and are getting caught up in deficiency judgments.

"After the banks foreclose, it's very common now to have large deficiencies with houses not worth the balances owed," said Don Lampe, a North Carolina real estate attorney.

Lenders mostly declined comment. Although Corey's lender, BB&T did indicate it was pursuing more deficiency judgments.

"They follow the rise and fall of foreclosures," said the spokeswoman, who would not discuss Corey's account.

Can they come after you?

Whether banks can and will pursue deficiency judgments depends on many factors, including what state the borrower lives in and whether there's a second mortgage or other liens. But if borrowers ignore the possibility of deficiencies, it could haunt them.

"Once they have a judgment, they can pursue you anywhere," said Richard Zaretsky, a board-certified real estate attorney in West Palm Beach, Fla. "They can ask for financial records, have your wages garnished and, if you fail to respond, a judge can put you in jail."

In the case of foreclosure, lenders can pursue deficiencies in more than 30 states, including Florida, New York and Texas, according to the U.S. Foreclosure Network, an organization of mortgage law firms.

Some states, such as California, are "non-recourse" and don't allow deficiency judgments. But, even there, if the original loan was refinanced, some or all of it may be subject to claims.

Deficiency judgments on short sales and deeds-in-lieu can happen in many more places. In these cases, extinguishing the debt is often a matter of negotiating with the bank.

But even when lenders are willing, many borrowers may not be aware that they have to ask for release. So, if you are pursuing a short sale, be sure your attorney asks the bank to release you from any further obligation.

"People shouldn't have a false sense of security that a deficiency judgment may not be later sought," Zaretsky said.

He expects many will be filed over the next few years, based on the fact that banks have sold many of these accounts to collection agencies and other third parties, at discount.

"The parties who bought those notes wouldn't have paid money for them unless they had the intention of acting," Zaretsky said.

Ticking time bomb

What can be scary is that the judgments don't have to be obtained immediately. Lenders or collection agencies may wait until debtors have recovered financially before they swoop in. In Florida, the bank can wait up to five years to file. Once the court grants a judgment, the lender has 20 years there to collect, with interest.

It doesn't have to be a large amount of debt for a lender or collection agency to come after borrowers. Richard Varno and his wife short sold their Nashville home back in 2004 after he lost his job.

It wasn't until 2008, when the second lien holder asked him for $25,000, that he realized he still was liable.

"I told them, 'Hey, you guys released the title,'" he said. "As far as I know, I'm off the hook."

He wasn't. Releasing title does not necessarily end the debt. It's complicated because of variations in state law, but, generally, a mortgage has two parts: a pledge of collateral, represented by the home, and a promise to pay off the loan.

Lenders may release property liens in order to facilitate short sales without releasing borrowers from their obligations to pay under the promissory notes. The secured debt can convert to an unsecured one after the sale.

Zaretsky had one client who was so relieved to have arranged a short sale that he signed every paper his real estate agent shoved at him, even a confession that clearly stated he still owed the debt.

"He had no idea what he was doing," said Zaretsky. "All the lender had to do was go to court to convert the confession into a deficiency judgment."

Lenders are also very inconsistent. One of Zaretsky's short-sale clients was ready, willing and able to pay, but the bank did not even ask; another lender always reserves the right to pursue the deficiency.

Strategic defaults

Sometimes lenders go after borrowers walking away from their homes if they have other assets, according to Florida real estate attorney Larry Tolchinsky.

"Banks are pulling credit reports to see if it's a strategic default," he said. "If you're behind on all your other payments, you're okay. But if you're not, they'll come after you."

If borrowers have any doubts about their risks, they should seek legal advice. Or, at least, call non-profit organizations such as NeighborWorks for advice. According to Doug Robinson, a NeighborWorks spokesman, its counselors always try to negotiate away deficiencies when they facilitate short sales or deeds-in-lieu.

"We don't favor any short-sale contracts that leave any deficiency that can be pursued," he said.

Robinson himself knows what can happen. He paid off a deficiency after his own New Jersey house went through foreclosure 11 years ago.

Copyright © 2010 Cable News Network and Time Inc. and their affiliated companies. All Rights Reserved.

credit cards

Fixing mistakes on your credit report

By Bankrate.com

-->

Table of contents

Chapter 1: Match card and lifestyle

• Chapter 1: Match card and lifestyle
• Finding ideal credit cards
• See all stories »

Chapter 2: Credit reports and scores

• Chapter 2: Credit reports and scores
• Checking your credit report
• See all stories »

Chapter 3: Costs and fees

• Chapter 3: Costs and fees
• How finance charges are figured
• See all stories »

Chapter 4: Managing your cards

• Chapter 4: Managing your cards
• Guide to reading your monthly statement
• See all stories »

Chapter 5: Using credit wisely

• Chapter 5: Using credit wisely
• Shop safely on the Web
• See all stories »

Chapter 6: Special-need card users

• Chapter 6: Special-need card users
• Getting your first credit card
• See all stories »

You do not send in the information that comprises your credit history -- your creditors do. However, you are responsible for the accuracy of the information contained in each of the three credit reports about your financial life.

Expect that there will be some problems. Statistics show that approximately 70 percent of all reports contain at least one error. These mistakes can sometimes cause you to be turned down for a loan or to be charged the highest interest rate on a credit card.

It's not difficult to get rid of mistakes, just time consuming. As the wheels of correction grind slowly, there may be weeks -- or even months -- of phone calls and exchanging of real mail or e-mail.

Steps to correct mistakes

There are standard procedures to get rid of mistakes on your credit report.

Report credit errors quickly. Even the smallest error could seriously dent your credit chances. If you find a mistake, send a separate letter to each agency where a mistake is found. Be sure to explain the situation in detail and include a copy of the credit report with the faulty information highlighted.

Any error that you find must be investigated by the credit reporting agency -- Experian, Trans Union or Equifax -- with the creditor who supplied the data. The credit reporting agency will remove from your credit report any errors a creditor admits are there. If you disagree with the findings, you can file a short statement in your record giving your side of the story. Future reports to creditors must include this statement or a summary of it.

The Fair Credit Billing Act requires creditors to correct errors promptly and without damage to your credit rating.

What is an error?

The law defines a billing error as any charge:

• For something you didn't buy or for a purchase made by someone not authorized to use your account.
• For something that is not properly identified on your bill or is for an amount different from the actual purchase price or was entered on a date different from the purchase date.
• For something that you did not accept on delivery or that was not delivered according to agreement.

Billing errors also include:

• Errors in arithmetic.
• Failure to show a payment or other credit to your account.
• Failure to mail the bill to your current address, if you told the creditor about an address change at least 20 days before the end of the billing period.
• Questionable items, or any item for which you need more information.

Once you have written about a possible error, a creditor must not give out information to other creditors or credit bureaus that would hurt your credit reputation until the matter is resolved. And, until your complaint is answered, the creditor also may not take any action to collect the disputed amount.

The law is on your side
Keep in mind, the law is on your side if information on your credit report is proven to be false but is not removed, according to the Fair Credit Reporting Act. Under the law, you are entitled to actual damages, plus punitive damages that the court may allow if the violation is proved to have been intentional. In any successful lawsuit, you will also be awarded court costs and attorney's fees.

If you feel that a credit bureau has not responded promptly and fairly to your situation, contact the attorney general of your state or the Federal Trade Commission in Washington at 202-FTC-HELP.

You may also sue any credit-reporting agency or creditor for breaking the rules about who may see your credit records or for not correcting errors in your file.

A person who obtains a credit report without proper authorization -- or an employee of a credit reporting agency who gives a credit report to unauthorized persons -- may be fined up to $5,000 or imprisoned for one year, or both.

Who can see your report?

But a lot of people can see that report -- including everyone to whom you have applied for a loan or credit. So be careful when applying for credit.

When the companies you apply to check your report they can find out who else has been checking your report and determine what, when and how you have been applying for credit. That means if you have been getting turned down and are desperately applying for credit all over town your potential creditors will know.

Now, discover how the information on your credit reports evolves in a credit score.

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Related Links:

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• Chapter 5: Using credit wisely
• Citi points for Haiti aid

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Posted: April 1, 2005

News Release January 28, 2010 Fannie Mae Announces 3.5 Percent Seller Assistance on HomePath® Properties

Incentive Part of Ongoing Effort to Stabilize Neighborhoods

WASHINGTON, DC — Fannie Mae (FNM/NYSE) announced today that people purchasing a Fannie Mae-owned HomePath® property will receive up to 3.5 percent of the final sales price to be used toward closing cost assistance or their choice of appliances. The offer is available to any owner-occupant who closes on the purchase of a property listed on HomePath.com before May 1, 2010.

"Attracting qualified buyers to the market and reducing the inventory of vacant homes is critical to stabilizing neighborhoods and helping the market recover. Many families are taking advantage of the federal homebuyer tax credit to buy a new home so this is a great time for Fannie Mae to offer some additional help," said Terry Edwards, Executive Vice President of Credit Portfolio Management. "Homebuyers have the option to choose between financial assistance toward closing costs or new appliances for their home."

Properties eligible for this incentive are listed on HomePath.com and most listings include detailed property descriptions, photographs, community and school information and more. In addition, many Fannie Mae-owned properties are eligible for special HomePath Mortgage and HomePath Renovation Mortgage financing which offers homebuyers an opportunity to purchase with as little as 3 percent down.

Fannie Mae exists to expand affordable housing and bring global capital to local communities in order to serve the U.S. housing market. Fannie Mae has a federal charter and operates in America's secondary mortgage market to enhance the liquidity of the mortgage market by providing funds to mortgage bankers and other lenders so that they may lend to home buyers. Our job is to help those who house America.

Fannie Mae Resource Center Telephone 1-800-7FANNIE
(1-800-732-6643)

The Most Common Tax Mistakes

by Keli Geldis
Monday, February 1, 2010

provided by

Protect Yourself From an Audit

You have your no. 2 pencil, a calculator and this year's W-2. Now what?

That's the thought that crosses many self-preparers' minds as they get ready to tackle their taxes. Veteran CPA Steve Duben says it's a tale as old as time. "The truth of the matter is that the law is complex and not easy to understand," Duben said. "The IRS claims that the average tax return self-prepared will take an individual 21 ½ hours to complete. This includes information gathering and understanding and preparing the return."

 

More from TheStreet.com: • Countries With the Most Vacation Time • 15 Tech Flops From the Past Decade • Trump on Jobs, Real Estate and Rosie

If you're willing and able to put in the time and effort to prep your own taxes this year, Duben gave MainStreet a list of the most common tax mistakes he's encountered and how to avoid them.

Forgetting to Report All Income

Did you do some freelance work while you were looking for the dream job you finally landed in September? You still need to reprot that income in your 2009 return.

"Some taxpayers feel that if they did not get a 1099 form then they do not have to report income received," Duben said. "The IRS has a long arm and seems to know what was and was not reported. To avoid this take your time and review all sources of income."

 

More from Yahoo! Finance: • How to Cut Your Taxes in 7 Easy Steps • IRS: Refunds in 10 Days for Online Filers • 10 Smart Tax Moves to Make in 2010 Visit the Tax Center

What's the penalty if you don't report all income? Duben says "The cost, besides the tax will be interest at 6% per year and penalties of up to 20%."

Accounting for Business Expenses

Did you buy a deluxe espresso machine and want to call it a "business expense" on your taxes since you run a business from home? Think twice.

"Business expenses need to be ordinary and necessary for the business. Taxpayers should also be able to substantiate the expenses and their business purpose if asked by the IRS or other taxing agency. If the expenses cannot be substantiated then they will be disallowed upon audit and ... the cost will include the tax, interest and possible penalties," Duben says.

Sorry, that americano probably isn't "necessary for the business."

It Has to be From 2009

Want to deduct moving expenses from when you switched jobs and moved to New York? Great, but didn't that happen right before New Year's Eve in 2008? Sorry, that's not deductible.

Duben says "Any deduction to be deducted on an individual's tax return needs to be paid (or charged on a credit card) during the tax year."

Next time, wait until Jan. 1 to book that flight.

Paying for Other People's Expenses

Even if you're a nice person, the IRS doesn't really care.

"Some taxpayers consider payments of expenses for another as their expense. The law only allows one to deduct his/her expense," Duben says.

Nice guys really do finish last.

Report Medical Expenses Net of Reimbursement

Health care expenses are a little too complex for us, so let's leave it to the experts.

In IRS Publication 502, it states "You cannot include medical expenses that were paid by insurance companies or other sources. This is true whether the payments were made directly to you, to the patient, or to the provider of the medical services."

Deducting Interest on Million-Dollar Mortgages

Some self-preparers might get excited to hear you can deduct the interest on your home loan. But, wait a minute, there's a catch.

Duben explains, "Interest on one's home is limited to loans of $1.1 million – any interest on a loan over this amount is not deductible."

Well, at least Uncle Sam is looking out for the little guy. Owning a home is tough nowadays.

Forgetting to Keep Track of Charitable Giving

Reciepts, receipts, receipts. We can't say it enough here at MainStreet. When it comes to tax time, good record-keepers will win.

As Duben explains, "Contributions over $200 require a letter from the charity to substantiate the deduction. Contributions in which something is received such as a dinner or merchandise can only be deducted to the extent the contribution exceeds the fair market value of goods or services received."

So, if you won a pair of tickets to the Super Bowl at a blind auction for charity, but only paid $20 for them, you're out of luck (and a deduction). Then again, you do have Super Bowl tickets.

Trying to Deduct Your "Time Donation"

Doing PR for a charity if your a PR professional is a really good deed, but it's still not tax deductible.

Duben says that donating your own time doesn't create a deduction for the value of the time donated. So, if you normally charge $60 an hour for your PR services and worked for 15 hours for the charity, sorry, but you can't take $900 off of your taxable income.

Not Taking a Reimbursement, Then Wanting to Deduct It

Say your employer offers to reimburse you for the conference you attended in the spring of 2009, but you turn it down because you'd rather have the deduction. Opps, not a good move.

"Employee-related expenses can be deducted if they are related to employment, required by the employer and not reimbursed or reimbursable. Not claiming a reimbursement from the employer if it is available does not create a tax deductable expense," Duben said.

Deducting Mileage Without Records

If you use your vehicle for business, you can deduct your mileage on your tax return, but make sure you've kept adequate records. If your log isn't exact, the IRS is not going to be happy.

Duben says it very simply: "Auto mileage needs to have a log to substantiate the amount claimed."

Claiming a "Dependent"

With so many "boomerang" kids coming home to live with mom and dad, it's no surprise that the definition of a "dependent" is very important this year.

If you want to claim a dependent on your taxes this year, but you aren't sure if the person fits the definition, make sure you visit the IRS Web site or ask a professional tax preparer. The IRS site has a really good tutorial on the ins and outs of who counts as a dependent.

Using the Wrong Social Security Number

When you file, don't forget to double-check the form before you submit it by mail or online. If you've accidentally switched two digits in your Social Security number, you could be facing trouble down the road.

Even the IRS says this is one of the most common errors they encounter. Just make sure you read over your forms before you file, and you should be all set.

Claiming New-Home Credits Too Early

If you want to make sure you get credit for that new home you just purchased, you better have closed escrow before Jan. 1, 2010. If you didn't, you're out of luck and you'll have to wait until next year to get the credit.

The IRS has a great little packet of tax information specific to homeowners of all types, whether this is the first time you've bought a home or you own a house for each season.

Using the Wrong Filing Status

Did you forget you were married? That's going to mess up your tax return.

This mistake is in line with using the wrong Social Security number. Just remember to look over your forms before you send them in.

Not Turning in Your W-2

This is a definite "d'oh" moment. Although the most obvious of all of the mistakes we've listed, this error could be costly.

Duben says this simple error could waste a lot of time. "Any of the above mistakes will cost additional taxes plus interest and possibly penalties. If a taxpayer is waiting for a refund the above errors can delay the refund for as long as it takes to correct the error. I have seen cases where it takes over a year to get things corrected."

Your W-2 is so incredibly important. Don't spend the time and effort to do your taxes only to find that you forgot to send in the paperwork.

Treasury wants to speed up mortgage modifications

Treasury hopes new documentation requirement will appease critics

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By Ronald D. Orol, MarketWatch

WASHINGTON (MarketWatch) -- With expectations for millions of foreclosures on the horizon, the Obama administration is making changes to its $75 billion mortgage-modification program to speed up the conversion of troubled loans into more-affordable permanent loans, the Treasury Department announced Thursday.

The changes come as lawmakers on Capitol Hill and housing advocacy groups pressure the Treasury Department to help more people faster. These groups argue the current program isn't working fast enough and it is not reaching a new group of troubled homeowners facing foreclosure -- the growing numbers of the unemployed.

To speed up the process, the Treasury will require borrowers to provide key documents, such as proof of income including pay stubs and an electronic tax form, before the lender evaluates the borrower's eligibility for modification program.

During the previous year that the program has been underway, many lenders began the modification process long before obtaining income documents.

As of Dec. 31, lenders have approved the conversion of more than 110,000 troubled mortgages from three-month trial plans into more-affordable permanent loans, the Treasury Department said two weeks ago. Roughly 66,000 borrowers have accepted the offer to convert from trial modifications under the program, known as the Home Affordable Modification Program, or HAMP. Roughly 902,620 homeowners are participating in the three-month trial program, where they have seen loan payments go down by over $500 a month.

"We want this to be about payment relief, not about chasing documents around everywhere," said Phyllis Caldwell, chief of Treasury's Homeownership Preservation Office, in a call with reporters.

Assistant Treasury Secretary Herb Allison said the problem has shifted, in part, from trying to get borrowers and lenders to participate in the program to helping borrowers convert to permanent loans.

"At the beginning the problem was outreach, we wanted to help as many people as possible," Allison said. "In many cases servicers were accepting income verification on the phone."

The program also seeks to clarify for lenders the proper procedure for converting borrowers who are current on their monthly payments into permanent modifications.

"This more robust requirement of upfront documentation will make it easier and quicker to convert trial modifications to permanent modifications and enable servicers to use their resources more effectively," according to the report.

Ronald D. Orol is a MarketWatch reporter, based in Washington.

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Serving better ads in Gmail

Wednesday, January 20, 2010 2:23 PM

Posted by Steve Crossan, Gmail Product Manager

Ever since we launched Gmail, we've tried to show relevant and unobtrusive ads. We're always trying to improve our algorithms to show better, more useful ads.

When you open a message in Gmail, you often see ads related to that email. Let's say you're looking at a confirmation email from a hotel in Chicago. Next to your email, you might see ads about flights to Chicago.

But sometimes, there aren't any good ads to match to a particular message. From now on, you'll sometimes see ads matched to another recent email instead. For example, let's say you're looking at a message from a friend wishing you a happy birthday. If there aren't any good ads for birthdays, you might see the Chicago flight ads related to your last email instead.

To show these ads, our systems don't need to store any extra information -- Gmail just picks a different recent email to match. The process is entirely automated: no humans are involved in selecting ads, and no email or personal information is shared with advertisers.

We've updated a help center article and a few faqs where we had specified that ads alongside an email were related only to the text of the current message. This doesn't change the Gmail privacy policy. We've also created this short video explaining the change:

We'll be rolling this out over the next few days. With this change, we hope you see better ads in Gmail -- more of what you're interested in and less of what you're not.

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Official Gmail Blog: Serving better ads in Gmail. Posted by Steve Crossan, Gmail Product Manager Ever since we launched Gmail, we've tried to show relevant and unobtrusive ads. We're always trying to improve our algorithms to show ...

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