Gunning Daily News
January 27, 2012 2:28 pm
Q: What is a two-step mortgage?
A: Not to be confused with a biweekly mortgage, this type of home loan is also known as 5/25s and 7/23s. It has one interest rate for part of th
Two steps are 30-year mortgages. They can either be convertible or nonconvertible. The 5/25s have a fixed interest rate for the first five years and either convert to a one-year adjustable rate or a 25-year fixed loan. The 7/23 has a fixed interest rate for the first seven years and then converts to a one-year adjustable rate or a 23-year fixed loan.
The initial rate on the two step is lower than on a 30-year fixed mortgage, but higher than a one-year adjustable. Also, because the adjustment interval is longer, there is less risk initially than with an adjustable rate mortgage, or ARM e life of the mortgage and a different rate for the remainder of the loan.
January 26, 2012 5:26 pm
In the previous segment, we looked at reasons to consider a short sale. But in this segment, we'll hear from Charlotte, N.C. REALTOR® Jon Widdifield about what you need to know if you're considering buying a short sale property in 2012:
1. The list price may not be the sales price; the bank may ask for more than the list price.
2. The bank makes the final decision, not the homeowner.
3. The home will typically be sold as is. If the homeowner does not have enough to pay the mortgage, they probably do not have enough to do repairs.
4. A short sale is not owned by the bank. However the bank must approve the sales price.
5. A short sale is not a short process; it can take several months to get to the closing table.
6. There will be bumps in the road when purchasing a short sale; you must be patient if you plan on purchasing one.
7. You can get really great deals on a short sale; just keep in mind it can be an arduous process.
8. Do not set your hear on a particular short sale until the deal is closed; the deal can fall through at any time.
9. Don't give up. The process is difficult but these homes do get sold. And most importantly, if you're considering transacting a short sale in 2012, Widdefield says...
10. Make sure you have an agent that is experienced in Short Sales. You need someone that knows what to do to get the deal closed.
January 26, 2012 5:26 pm
If you’re just beginning to think about your 2011 income tax return, you’ve got a late start—but it’s still not too late to cash in on some savings.
Jessica James, CPA and author of Justice for None (www.AuthorJessicaJames.com), shares some tips for both 2011 and 2012 savings:
• Contribute to retirement accounts. If you haven’t already put money into your traditional or ROTH IRA account for 2011, you’ve got until April 17 to do it. If you have a Keogh or SEP (Simplified Employee Pension Individual Retirement Arrangement for businesses), and you get a filing extension to Oct. 15, you’ve got until then to make your 2011 deposits. The maximum IRA contribution for 2011 is $5,000, or $6,000 if you’re 50 or older by the end of the year. For self-employed people, the maximum for SEPs and Keoghs for 2011 is $49,000.
• Don't fear the home office deduction. In the past, many tax filers didn’t claim a home office deduction because it was seen as an IRS red flag. But the requirements and forms have been clarified so people can do that properly—and not make mistakes that can lead to an audit. Also, the rules have been expanded so more people can claim the deduction. If you use a home office exclusively for business, even if you don’t meet your clients there, you’re eligible. For instance, a handyman who does his work other people’s houses can claim the deduction if he does his paperwork at his home office. Another change is that, in the past, if you claimed 10 percent of your home as an office, that amount would not be included in the $250,000 tax-free profit from the home’s sale that’s allowed for an individual by the IRS. Be sure to make your claim reasonable, or it will get questioned; a $25,000 home office deduction for a business with $50,000 annual gross revenue is not reasonable.
• Maximize your Flexible Spending Account. The Health Care Act will limit the maximum you can put into these pre-tax medical expense accounts in 2013. So 2012 is the last year to use an FSA to pay for orthodontics and other large medical expenses using pre-tax earnings. A medical expense flexible spending account, or FSA, allows you to use before-tax earnings to pay for medical or health care expenses not covered by your health insurance. Assuming a 25 percent tax rate, you avoid $25 in taxes for every $100 you spend from your FSA.
• Need to sell an investment? Next year may be the time. The Tax Relief Act maintains the tax rate cap on capital gains and dividends at 15 percent through 2012. In 2013, the cap for capital gains will increase to 20 percent and for dividends, 39.6 percent. The Health Care Act also created a 3.8 percent Medicare tax on investment income, effective in 2013. Given those scheduled increases, plan to take advantage of the rates next year.
James is an author pseudonym used because she fears her novel may provoke IRS retaliation. It’s a fictionalized account of her experience as a minor player swept up in an IRS probe that included anyone associated with the primary target, a corporation. She says that, though she was innocent of any wrongdoing, she was coerced into accepting a plea deal by the IRS, which was bent on amassing adjudications of guilt to justify the investigation’s expense. She pled guilty to a count of falsifying a tax return and continues to work as a CPA.
Jessica James is a CPA and the author of a novel, Justice for None, about her experiences as a minor target in a major federal tax fraud case.
January 26, 2012 5:26 pm
If you're like most consumers, you've probably seen your health insurance premiums go up in the last year. According to the Kaiser Family Foundation, family health insurance costs for those with employer-sponsored coverage increased by nine percent in 2011.
Maybe it's time for a health insurance checkup. Take a look at what you're paying for coverage, think about which benefits you value most, and read the following five tips designed to help you save money on health insurance in 2012:
Review your options annually. Whether you get your health insurance coverage through an employer or purchase an individual policy, you should review your options at least once per year. Health insurance companies are bringing new, innovative options to the market all the time. Just remember that it's still possible to be declined for an individual policy due to a pre-existing medical condition. Don't cancel your current plan until you're officially approved for a new one.
Cultivate healthy habits. By taking care of yourself now, you may be taking care of your pocketbook in the future. A recent study conducted by eHealth Inc., found that of over 200,000 consumers with brand-name health plans purchased through www.eHealthInsurance.com, smokers paid 14 percent more on average for their monthly premiums compared to non-smokers. Policyholders with a body mass index in the "obese" range paid more than 22 percent more than those in the "normal" BMI range—an average annual savings of $444.
Try a plan with a higher deductible. If you're relatively healthy and rarely see the doctor, consider switching to a plan with a higher annual deductible and a lower monthly premium. Thanks to the 2010 health care reform law, some preventive care services will still be available to you with no out-of-pocket cost. Just be sure that you can afford to pay the full deductible in case of a serious injury or illness.
Consider splitting up the family. There's no law that says you need to have the whole family on a single health insurance plan. For example, some employers pay a substantial amount of employees' monthly premiums but little—if anything -—for their dependents. You may be able to save on your monthly health insurance costs by putting your dependents on a plan of their own.
Mix and match additional benefits. Even if your employer provides dental and vision benefits, it may be worthwhile looking into these plans on your own—whether for your whole family, or just for dependents. You may be able to save money and get benefits better matched for your family's needs.
January 26, 2012 5:26 pm
Healthy teeth and a healthy mouth give children more than just a beautiful smile. A healthy mouth supports overall health, and it can help children perform better in school. But far too many children have preventable oral health problems far too young.
Tooth decay affects more than 25 percent of American children 2 to 5 years old, and half of children 12 to 15 years old—that's more than any other chronic infectious disease, according to the U.S. Centers for Disease Control and Prevention.
Left untreated, tooth decay causes pain and infection, which can lead to problems in eating, speaking, playing, and even learning.
There is plenty that parents and caregivers can do to help prevent tooth decay and other oral diseases.
First Things First: The American Academy of Pediatric Dentistry (AAPD) says that children should have their first visit to a pediatric dentist no later than their first birthday. The first tooth usually comes in between 6 and 12 months of age -- schedule an appointment and get started on good oral health care from the beginning. The AAPD says that, in one study, children that saw a dentist before their first birthday had dental costs that were 40 percent lower in the first five years than costs for children who had not seen a dentist by their first birthday.
Establish Good Habits: Kids need help establishing good dental care habits. Make sure they brush twice a day, floss every day, follow a healthy diet and visit the dentist every six months for checkups and cleanings.
• Using a soft-bristled brush, kids should brush for at least two minutes. Some power toothbrushes have a built-in timer. Before teeth appear, clean baby's gums twice a day with a soft cloth or baby toothbrush and water.
• Parents should floss young children's teeth once a day, until they can do a good job themselves, at least until age 7 or 8.
• Make sure they eat foods with vitamin C, which helps gum tissue stay healthy, and calcium, for strong teeth.
Be Alert: Watch for signs of oral health problems. Talk to your dentist if you see warning signs such as:
• Changes in performance at school—listening, concentrating and learning.
• Sucking on cheeks or lips.
• Reluctance to smile.
• Problems chewing foods.
• Problems sleeping.
• Aching teeth or gums.
January 26, 2012 5:26 pm
Undivided interest. Ownership by two or more persons that gives each the right to use the entire property.
January 26, 2012 5:26 pm
Q: How do building codes work?
A: Building codes set minimum public-safety standards for such things as building design, construction, use and occupancy, and maintenance. The codes are established and enforced by local politicians and government officials, who also tend to modify them constantly. The codes are usually enforced by denying permits, occupancy certificates, and by imposing fines.
While codes vary from one state, county, city, and town to the next, specialized codes generally exist for plumbing, electricity, and fire. Each usually involves separate inspections and inspectors.
There are building codes for most remodeling jobs. So if you have done significant remodeling, make sure you save proof of the permits involved in the project. There is a good chance potential buyers may request them. Failure to obtain the appropriate permits before you undertake a project could later result in fines or other serious consequences, such as having a structure ordered to be torn down because it was constructed improperly.
January 25, 2012 5:08 pm
The holidays are over, it’s raining or snowing, and the kids are bored and grumpy. What can you do to keep them engaged and happy during the winter doldrums season?
“Take it from a librarian,” said Cincinnati children’s librarian Jeanne Untermeyer, “It’s easy to come up with indoor fun activities with just a little preparation.”
Untermeyer shares seven tips for making your home a little brighter even on the darkest days:
• Have a read-a-thon by the fire – Story telling is not just for bedtime. Build a fire, make some hot chocolate, and have the kids bring their favorite blankets and books for an impromptu story time in the afternoon.
• Stage a talent show – Kids love to come up with costumes show off their budding talents. Turn the living room into a stage, and invite the kids to rehearse and perform. Tip: Keep a trunk full of discarded clothing and accessories just for such occasions.
• Bake bread or cookies – Nothing smells better on a cold, rainy day than a kitchen full of tempting aromas. Even the youngest kids can punch down dough, stir ingredients, or decorate sugar cookies.
• Get out the board games – From Chutes and Ladders to Risk or Scrabble, games are a family mood-lifter. Select age-appropriate games—or puzzles!—and let the fun begin.
• Movie day – Make a selection of favorite family snacks and gather the kids in front of the TV—with you!—for a showing or even a double-feature.
• Arts and crafts – Smart parents keep a few craft sets in reserve to haul out when the kids are bored. But crafts can be fun with such simple supplies ad macaroni, glue, paper and crayons.
• Go camping – Is thunder and lightning too scary for the kids to sleep through on their own? Haul out the sleeping bags or blankets and put the family in front of the fireplace. You can set up a tent if you are so inclined, or a makeshift tent created out of chairs and blankets.
January 25, 2012 5:08 pm
Body language says a lot more than people realize. If looking for a job, be aware that your body language during an interview may be revealing things to a potential boss that you didn't know. The interviewer's body language also can reveal what he/she is thinking. Learning how to use and read non-verbal cues can give job seekers a clear advantage over other contenders.
"Job seekers invest a lot in preparation for an interview: new clothes; perfect hair and nails; company research, and role playing the interview so they have all the right answers. But knowing how to use non-verbal cues and communication to build trust and confidence is just as important," said Gil Shermeister, behavioral zoologist that 12 years ago co-invented the Body Language Cards, a method used in the training of executives, sales forces and professional security personnel.
Shermeister's top six interview tips include:
1. When entering, people tend to create an imaginary barrier to protect themselves by clutching a handbag or crossing their arms. To the interviewer this "says" insecurity. Keep an open body stance (no crossed arms or legs) and maintain eye contact.
2. Avoid making the upper hand handshake which indicates a need to dominate.
3. If interviewed by several people, always identify the decision-maker. This is the person others glance at when they are finished talking. Direct comments/replies to the decision-maker.
4. Under stress people instinctively tend to protect the main artery. In modern society it is manifested by touching the tie or playing with a necklace. Don't fidget with jewelry or garments in this way.
5. The interviewer may reveal a need for more information by putting an object in his/her mouth or motioning with a pen or the tip of the glasses. Take the cue and provide more details.
6. If the interviewer puts his fingers together, pyramid-like, this may indicate an attempt to "connect the dots.” Another good sign is when the interviewer rubs his hands together. Both gestures indicate satisfaction.
January 25, 2012 5:08 pm
Enforcing study-time is an important part of helping your child achieve great grades.
"Kids need a set of core learning strategies in order to help them achieve their goals and get more done in far less time," says Susan Kruger, founder of http://www.StudySkills.com and author of SOAR® Study Skills: A Simple and Effective System for Earning Better Grades in Less Time.
Here are Kruger's recommendations to improve study time and improve grades:
1. Visual networking: Turn the print in textbooks and on paper into pictures and visual images when reading. This is a simple, yet specific pattern to improve reading speed, memory and comprehension.
2. Manage papers and notes all in one binder: "One binder is shown to be 60 percent more efficient for storing and managing papers than traditional systems that require students to maintain a separate folder and notebook for each class," states Kruger. "The system and supplies are much less cumbersome and require far fewer steps to transfer across multiple locations such as home, school and classes."
3. Take Ten: In just 10 minutes you can maximize your brain and get rid of clutter while reducing study time. This is a 10-minute daily routine, organizing papers for two minutes and reviewing notes for eight minutes.
4. Power Down: Texting, surfing the Internet, watching TV and electronics are great, but they sabotage student efforts. Have your child Power Down all electronics and see how much faster homework can go.
5. Question Quest: Asking questions is a great way to maximize brain power. Create Jeopardy-type questions along with potential test questions using reading materials and notes.