Housing by the Numbers

Are you looking to buy a house? Rent? Here are some important numbers to keep in mind as they may apply to you and your transaction.

Your credit score
While you likely know how important this little three-digit number is if you’re looking to buy a home (Zillow’s analysis of more than 25,000 loan quotes and purchase requests shows that you need a score of 740 or above to get the best mortgage rates), it’s also really important if you’re looking to rent — especially in a market that’s as competitive as the one we’re currently in. If you’ve got good credit, flaunt it! Use it, as well as your steady job, as a negotiating tool to get a better deal. After all, model tenants, who save landlords both time and money, are hard to come by.

Mortgage rates
Mortgage rates are hovering near two-year highs — currently 4.29 percent for a 30-year fixed loan, according to Zillow Mortgage Marketplace — and they’re only expected to continue to rise, particularly as the job market improves and the economy strengthens. Point being, if you’re interested in buying, and you’re thinking long term, you might want to get off the fence sooner, rather than later. After all, every 1 percentage point increase in mortgage rates makes a home about 12 percent more expensive for buyers.

Total costs of home ownership                         
Your housing costs — which include your mortgage, insurance and taxes — will vary significantly depending on where you live. It’s a good rule of thumb that costs should be no more than 25 to 28 percent of your monthly income. If you’re over these percentages, but are creditworthy, you can, of course, shrink your monthly costs by making a larger down payment.

Read more: http://www.foxbusiness.com/personal-finance/2013/08/02/housing-by-numbers/#ixzz2bsVwTKww


By Vera Gibbons

Why Banks Might Refuse to Take Your Money

People are being denied bank accounts based on what’s in reports that most of us never even knew existed. 

Most people are familiar with the idea of a credit score — usually a FICO score or a Beacon Score — that determines whether or not a lender will let you borrow money, and at what rate.

But there’s a lesser-known credit reporting system that dictates what you’re allowed to do with your own money. And in some cases, these little-known systems end up giving banks reason to turn down consumers who are trying to open up accounts.

In a new investigation, the New York Times chronicles the financial rabbit hole a growing number of Americans have fallen into: They’re locked out of mainstream banking for relatively minor slip-ups like overdrawing an account, or because of mistakes in a file they didn’t even know existed.

“Hundreds of thousands of Americans are being shut out for relatively small mistakes,”

Read more: http://business.time.com/2013/08/02/why-banks-might-refuse-to-take-your-money/#ixzz2bsUbKIxE

By Martha C. White

OPINION - Debt shouldn't be a four-letter word

There's no shortage of debt detractors out there, and with good reason. After a credit crisis brought the world's economy to its knees a few years back, the downside of debt is painfully clear.

But there's a bright side, too.

Case in point: In 2006, Muhammad Yunus won the Nobel Peace Prize for his idea to use debt — as little as $200 or less — as a path out of poverty.

Or consider a young, middle-class American named Barack Obama who took out loans for undergrad and law school. That investment in education seems to have paid off for him nicely.

Last, look at revolutionary electric car company Tesla (TSLA), which recently fully repaid its 2009 loan from the government. If we had to wait until an entrepreneur had enough ready cash to build out an automobile manufacturing company without financing, we would be waiting forever

The idea is simple: A handhold to opportunity that is out of reach becomes attainable when debt gives you a leg up.

I acknowledge this concept is downright offensive to some these days. Many insist that if you can't pay for it, you shouldn't have it — case closed.

Smiling "experts" hawk books on this topic; politicians cry crocodile tears about a federal debt they themselves created; and all manner of moralists try to point out how the evil practice of borrowing is akin to slavery.

These folks prefer the more sinister examples of debt use — credit card horror stories, out-of-work art history majors with $50,000 in college loans, a bankrupt Solyndra in place of Tesla.

But the important thing isn't trying to establish debt as either universally right or wrong. Because it is neither.

Debt is merely a tool. And like guns or sleeping pills or an Internet connection, there are a wide variety of results that can arise from its use.

What we need right now is simply a better way to borrow — not an end to borrowing.
We need to help young Americans get comfortable enough with debt to be responsible borrowers. I don't mean running up bar tabs, either; some young adults are forced to use a credit card to move for their first job or to take out a loan for their first car so they can commute to work.

I use the word "forced" because it's naïve and elitist to think everyone has easy access to a few thousand dollars to make their start in the world. Life ain't that great for Millennials in 2013, and those without well-off parents are often faced with the choice of borrowing or simply letting life pass them by.

We also need better regulations. The Consumer Financial Protection Bureau that was formed in 2011 after the financial crisis has a lot of work left to do when it comes to making contracts transparent and holding unscrupulous lenders accountable.

America can and must have an honest conversation about good debt vs. bad debt, and the proper circumstances for borrowing.

But the last thing we need right now is the misrepresentation of debt as categorically wrong, or the need to borrow as some kind of character flaw.

READ MORE:  http://www.usatoday.com/story/money/personalfinance/2013/07/28/debt-credit-crisis/2586671/

Jeff Reeves is the editor of InvestorPlace.com and the author of The Frugal Investor's Guide to Finding Great Stocks.

My Kid's Drowning in Credit Card Debt! What Do I Do?

If you trusted your son or daughter to keep track of their finances, and they slipped up, what in the world are you supposed to do?
Let's say they've racked up a big, nasty credit card debt -- to the tune of thousands of dollars. Should you pay off their debts to help keep their credit score above water? Or is it better to let them learn from their mistakes and suffer the consequences? Though each individual situation is different, here are your options, what's at stake, and a few pointers to help you plot your course of action.

A Personal Loan, With a Contract
If you have the means, think about whether or not you want to loan your daughter the money. Sometimes her debt is manageable enough that you can pay it off in the form of a personal loan to your daughter. You can charge her interest as well, so she learns just how much a high APR can cost her.
But you have to examine the situation from a lender's perspective, rather than simply write a check and expect she'll make payments. What is her employment situation? Will she be able to make payments to you without the security blanket of your relationship making her complacent? Has she typically been a responsible spender in the past, or does she impulsively purchase on a grand scale regularly? If you do decide to help protect her credit history, it's a smart idea to sign a contract with your daughter to make your agreement more official and binding.

If You Co-Signed, You're on the Hook

If you co-signed on your son's account, you're responsible for his credit card debt.
 READ MORE: http://www.dailyfinance.com/2013/07/25/child-credit-card-debt-parents-advice/

3 Reasons Leaders Should Laugh More
Believe it or not, workplace levity can be quite the lightning-rod topic in many organizations.
There are a few moments in my career I won’t soon, if ever, forget.
One took place at a former employer during a meeting when an executive looked at me — with a straight, if not disgusted, face mind you — and asked why having happy employees was really “that big a deal.” I laughed, out loud, in the middle of that meeting. I was the only one. To this day that remains one of the funniest moments of my life.
As more folks connect through social media, at conferences, and however else, some get all worked up about “creating a professional image,” or some similarly expressed notion, which simply means making something look or feel or sound like what’s expected. Or at least what is perceived to be expected by a particular group of people in a particular setting. Or what they wish was what was expected.
Sadly, this often results in sucky presentations, boring social media, run-of-the-mill advertising, dreadful workplaces, robotic interactions, etc. It may be “professional,” but when’s the last time you couldn’t get something out of your mind because of how “professional” it was? When’s the last time you couldn’t wait to do something because it was just so….”professional”?

READ more at: http://themojocompany.com/2013/07/3-reasons-leaders-should-laugh-more/?utm_source=rss&utm_medium=rss&utm_campaign=3-reasons-leaders-should-laugh-more#sthash.bmAFAqdY.dpuf