Gunning Daily News
August 26, 2011 4:39 pm
Q: What is amortization and negative amortization?
A: When you amortize a loan, you basically pay off the principal by making regular installment payments. This typically takes place gradually over several years.
Negative amortization is when the mortgage payment is smaller than the interest that is due, which causes the loan balance to increase rather than decrease. Negative amortization only happens with adjustable rate mortgages (ARMs) with certain features, including an initial payment that does not cover the interest due, a feature that is supposed to increase the affordability of the loan.
With negative amortization, a persistent rise in interest rates reduces the equity in the house unless the negative amortization is offset by house appreciation.
Negative amortization has to be repaid, which means your payment will rise in the future. The larger the negative amortization, the more you will be required to amortize the loan in full.
August 26, 2011 1:39 pm
By Zoe Eisenberg
Get your home ready for the change of season with the following cleaning tips.
Wipe-out.You never know how dirty things really are until you give them a good wipe down. Cut up a couple of old t-shirts into rags (better for the environment than paper towels!) and start wiping down the places often overlooked--doors, window-ledges, cabinets, lighting fixtures and shutters. You will be amazed at the grime that you clear out.
De-clutter. No need to wait until the spring to get rid of junk. Go through your closet and, instead of merely packing summer clothes away for next year, get rid of anything you didn’t wear this season. Go through the garage and get rid of toys your kids have outgrown, and give away old exercise equipment, kitchen gadgets or other things you simply don’t use. Donate your old items to Goodwill or the Salvation Army, or hold an end-of-summer yard sale to score some extra cash.
Outdoor Details. Scrub outdoor accessories, like your grill or kiddy pool, before storing them for the winter. There is nothing worse than a grimy grill to put a damper on next year’s summer kick-off barbeque.
Stow Summer Gear. Wash your beach towels, shake out those beach bags, dry clean your sleeping bags, scrub camping equipment and knock the dirt out of those hiking boots. Store them for next season squeaky clean.
August 26, 2011 1:39 pm
The FDA reminds consumers to take precautions for storing water and ensuring the safety of their food and medical supplies for themselves and their pets during and after this weekend’s expected hurricane-related rain, possible flooding and power outages.
The agency also reminds consumers that it is important to have a plan in place for emergency medication and medical supplies for both people and animals. This is especially true for those with health concerns, particularly if the power goes out.
In general, FDA encourages consumers to:
• Do not eat any food that may have come into contact with flood water. If in doubt, throw it out.
• Do not eat food packed in plastic, paper, cardboard, cloth and similar containers that have been water-damaged.
• Discard food and beverage containers with screw-caps, snap lids, crimped caps (soda bottles), twist caps, flip tops and home canned foods, if they have come in contact with flood water. These containers cannot be disinfected.
• Check to ensure that the freezer temperature is at or below 0 °F and the refrigerator is at or below 40 °F.
• Keep the refrigerator and freezer doors closed as much as possible to maintain the cold temperature.
• Area health departments will determine whether local tap water can be used for drinking. If the water cannot be used or is questionable, and bottled water is not available, then use the directions in the next bullet to purify it.
• Boiling water will kill most types of disease-causing organisms that may be present. If the water is cloudy, filter it through clean cloths or allow it to settle and draw off the clear water for boiling. Boil the water for one minute, let it cool and store it in clean containers with covers.
• If you have to leave your home, take your pet with you if at all possible. You are the best person to take care of your pet.
• Pets should be contained in a carrier or on a leash.
• Emergencies can make pets display unexpected or uncharacteristic behaviors. It may take several weeks before your pet's behavior is back to normal.
• Allow your pet plenty of time to rest and get used to new surroundings. Provide familiar toys, if possible.
• If you have a "life-supporting" or "life-sustaining" device that depends on electricity, you should contact your healthcare provider for information on how to maintain function in the event of a loss of power.
• Keep your device and supplies clean and dry. If possible, notify your local Public Health Authority to request evacuation prior to adverse weather events.
For more information, visit www.fda.gov.
August 26, 2011 1:39 pm
As the East Coast braces for the arrival of Hurricane Irene, consumers are heading to home improvement stores to stock up on supplies, such as portable generators. With power outages likely during the aftermath of the hurricane, it's important to operate portable generators properly to protect your family from the dangers of carbon monoxide.
The same was true in 2003—the last time a major hurricane made landfall on the mid-Atlantic coast. Of the 40 deaths attributed to Hurricane Isabel, eight were caused by carbon monoxide. Moreover, dozens of people were treated for CO poisoning in the aftermath of the disaster.
Carbon monoxide is called the "silent killer." It is the leading cause of accidental poisoning deaths in America, according to the Centers for Disease Control. You can't smell it, see it or taste it. It kills more than 400 people every year and sends more than 20,000 people to the emergency room. It does not discriminate— it randomly destroys lives and forever haunts survivors.
When portable generators, gas/charcoal grills and candles are used improperly, these items can significantly increase the risk of a house fire or carbon monoxide poisoning.
Without a carbon monoxide alarm, you may never even know carbon monoxide is in the air, slowly doing its lethal work with every breath you take. Prevent problems before they happen. Here are some tips:
• Install battery-operated CO alarms on every floor and in sleeping areas to protect your family during power outages.
• Only operate the generator outdoors in a well-ventilated, dry area, away from air intakes to the home and protected from direct exposure to rain. Don't run portable generators on a porch, in an attached garage, basement or near an open window where wind could blow carbon monoxide fumes into the home.
• Follow the manufacturers' instructions when using generators. Use the appropriate sized and type power cords. Overloaded or covered cords could overheat and cause fires.
• Do not use a charcoal or gas grill inside your home or outside near a window where CO fumes could seep into your home.
• Never leave a car running in an attached garage, even with the door open.
• Ensure that storm debris hasn't blocked or sealed shut exhaust flues or ducts for appliances such as water heaters, ranges and clothes dryers, or blocked your vehicle's tailpipe, which could cause CO fumes to build up inside the vehicle.
• Extinguish all candles before going to sleep and when leaving the house or a room where a candle is burning for a long period of time.
For more information on Kidde and fire/CO safety during a storm-related power outage, visit www.kidde.com.
August 26, 2011 1:39 pm
Homeowners can create a new look for their rooms by changing the artwork, says Donna Hoffman, president of Interiors by Donna Hoffman which specializes in decorating ideas.
"If you're not in the market for a total makeover, but you want to jazz things up a bit, consider finessing the art in your house," says Hoffman. "Relocating or reframing an existing art piece or painting brings a strikingly fresh feel. One client recently agreed to update and reframe just 3 favorite pieces for their recent downsize and the results were stupendous. Still at other times, it's a question of adding more to a collection."
But there is one major interior design tip for buying art, she says.
"People get intimidated on the subject of art: Renoir or bust? Original or forget it? Frankly, there are no hard fast rules when it comes to purchasing art, except this one: Buy what you love and, if possible, buy it when you see it," Hoffman says. "Must it be museum quality, collector quality or cost tens of thousands of dollars? Absolutely not. Beauty and aesthetic pleasure are so individual," she adds.
To accomplish a winning interior design idea, the designer encourages clients to open their "art thinking."
"Think beyond simply prints or oils hung everywhere," she says. "You can also hang wonderful pieces of architectural salvage too—grates, grillwork, wrought iron, even heavily carved wooden doors with an ethnic bent.”
Expand your definition of art and you'll be surprised at what lends authentic beauty and memorable touches to great interiors.
"Frame meaningful items like black and white photos you took yourself. Create shadow boxes for collectible items like your grandmother's handkerchiefs - or a kimono you bought overseas. For a music room or library, frame old faded sheet music or book plates," Hoffman says. "Do try to avoid having every piece of art behind glass if possible. Oils, mixed media pieces and sculptures create much needed nuanced textures to offset a sea of glass. In other words, there's an art to art."
Additional information can be found at http://www.interiorsbydonnahoffman.com.
August 26, 2011 1:39 pm
Escrow company. A firm that specializes in handling the closing of a transaction.
August 26, 2011 1:39 pm
Q: What are subprime loans?
A: Subprime mortgages are made to borrowers, usually at a higher interest rate, who do not meet traditional credit criteria or who have unconventional borrowing needs.
Factors that can prevent someone from meeting the traditional criteria could be a high debt-to-income ratio, low reserves at settlement, as well as past credit woes – bankruptcies, defaults, foreclosures, or chronic late payments on debt obligations.
August 25, 2011 4:05 pm
With Hurricane Irene making its way steadily toward the United States, the Electrical Safety Foundation International (ESFI) is reminding residents that danger may linger in your home even after the storm has passed.
“As families begin to clean up following a storm or flood, it is important to be aware of potential dangers that result whenever water comes into contact with electricity,” cautions ESFI President Brett Brenner. “Before flipping a switch or plugging in an appliance, have a licensed electrician check the house wiring and appliances to make sure they are safe to use.”
ESFI offers the following safety tips to help you weather the storm and its aftermath safely:
Downed Power Lines
• Always assume fallen power lines are energized.
• Contact your utility company immediately to report downed power lines.
• Stay at least 10 feet away from a downed power line and anything it may be touching, such as a fence, tree limb or water.
• Never touch a person or object that is in direct or indirect contact with a downed power line. Instead, call 911 immediately.
• Never attempt to move a downed power line–leave it to the professionals. Do not try to move a downed power line with another object. Even non-conductive materials like wood or cloth that are slightly wet can conduct electricity.
• Do not return home until instructed by the appropriate local authorities.
• Return home during daylight hours, especially if power has not been restored.
• Take care when stepping into a flooded area, and be aware that submerged outlets or electrical cords may energize the water, posing a potentially deadly trap.
• If you smell gas, notify emergency authorities immediately. Do not turn on lights, light matches or engage in any activity that could create a spark.
Submerged Electrical Appliances
• Electrical equipment exposed to water can be extremely dangerous if reenergized without proper reconditioning or replacement.
• Do not use electrical appliances that have been wet until they have been examined by a qualified service repair dealer. Certain equipment will require replacement, while a trained professional may be able to recondition other devices.
• Electrical items, such as circuit breakers, fuses, ground fault circuit interrupters (GFCIs), receptacles, plugs and switches, can malfunction when water and silt get inside. Discard them if they have been submerged.
• Ocean water and salt spray can be particularly damaging to electrical equipment due to the corrosive and conductive nature of the salt water residue.
• Damage to electrical equipment can also result from exposure to flood waters contaminated with chemicals, sewage, oil and other debris.
• Portable generators can be a convenient source of temporary power during outages caused by storms, but they can also be dangerous if not used properly.
• Do not operate a portable generator in your home or in any other enclosed or even partially enclosed area. Generators can very quickly produce high levels of carbon monoxide, which can be deadly.
• Make sure that there is at least one battery-operated or battery backup carbon monoxide alarm in your home. Test it before using your generator.
• Do not connect generators directly to the household wiring unless an appropriate transfer switch has been installed by a licensed, qualified electrician.
• Always turn the generator off and let it cool down before refueling.
For more information about ESFI and National Electrical Safety Month, visit http://www.electrical-safety.org.
August 25, 2011 4:05 pm
Saving money has never been so trendy. Long gone are the days of irresponsible spending, so why be irresponsible with your homeowners insurance? Taking a little bit of time to research your options might just help you save a little in the wallet and put more in the bank.
Here are four tips from homeownersinsurance.net:
1. Shop around. Some insurance companies have been raising house insurance costs to recoup losses from the financial crisis. Others are competing for new customers by offering lower rates. By shopping around, people can find better deals on homeowners insurance.
2. Re-evaluate coverage amounts. Many policies have inflation protection provisions, which automatically increase coverage amounts. This was a good item in the years leading up to the crash, but today they should be looked at more closely.
3. Check personal credit reports. Homeowners insurance companies check credit history before figuring rates, similar to how lenders do. This is done to help them assess the risk of payment and likely individual responsibility. Check your credit report and make sure it’s accurate so you can get the best possible rate.
4. Small claims can become expensive. Homeowners should have the highest deductible they can comfortably afford and repair minor items out of pocket rather than filing a claim. Filing a claim for every broken window or leaky pipe can increase premiums by 10-15%.
August 25, 2011 4:05 pm
Owning a vehicle can be enjoyable, but it also comes with a cost. On top of the purchase price, gas, maintenance, repairs, and insurance costs can quickly add up. While insurance is mandatory for most people, overpaying for coverage can be avoided. InsuranceHotline.com presents seven tips that may lead to lower auto insurance costs. All it takes is a little time, and big savings could just be around the corner.
1. Look around.
Deal hunting online is widely used for electronics, vacations, and more; why shouldn’t insurance be included? With so many insurance companies on the market, it can be overwhelming to collect all the required information and make a decision. Often times, brokers only represent a handful of companies, limiting the pool of options. Online comparison sites can do the analysis based on the information entered to present quotes for over 30 companies and provide the lowest rate available through its network. There’s also no need to wait for renewal papers to arrive; sometimes the available savings may well off-set the potential penalty.
2. Review current coverage.
Most drivers are required to have liability coverage and many people choose to add comprehensive coverage. However, collision coverage may not be necessary for everyone. Collision coverage handles costs associated with damage sustained to the policy holder’s car. If the vehicle is very old, has high mileage, or is in poor condition, then it may not be worth the extra premium costs to receive this coverage.
3. Consider increasing the deductible.
The deductible is the amount car owners are responsible for paying when a claim is made. A higher deductible would mean the insurance company pays less in the event of a claim. This decrease in risk is then transferred to the consumer in reduced premiums. There isn’t one ideal number for this as it all depends on each consumer’s comfort zone. There may be a preference to save more now with a higher deductible, or to have increased financial security in the event of a claim with a lower deductible.
4. Research discounts.
There is power in numbers. The following are discounts that some insurance companies might consider when pricing a policy.
• Profession – By working in certain fields or holding a professional designation, there may be discounts available depending on the insurance company. The quickest way to find out is by contacting the association or a broker.
• Group Affiliation – Associations like alumni groups or trade unions may provide discounts on insurance to its members. They may be working with a specific provider in which case the association would be a key source of information.
• Auto clubs – CAA or other specialty vehicle clubs may have specially negotiated rates with certain insurers, thus offering lower premiums. Begin by checking the membership package, or contacting the current broker directly.
5. Combining insurance.
Purchasing home insurance from the same company that provides the auto coverage may result in a savings of 5-10% off both premiums. Furthermore, adding another vehicle in the household to the same policy could lead to further discounts. It’s definitely worth talking to an agent or broker to investigate the potential savings that can be offered by grouping policies together.
6. Installing winter tires.
For those living in harsh winter conditions, this is more a matter of safety. Taking precautions to decrease the likelihood of accidents during dangerous conditions should always be considered. In fact, some insurance companies will take this into account, and may offer a discount. However, keep in mind that living up to the promise is equally important. If winter tires were not in place when they should have been, it could be considered a fraudulent claim with potential consequences.
7. Accident forgiveness or similar benefits.
Even the safest driver is susceptible to threats on the road, from uncontrollable factors like other drivers. Accident forgiveness will eliminate the effects that the first accident-related claim would have on premiums. Unlike the other tips that result in immediate savings, this will probably cost extra in the beginning.
However, it may be well worth the additional cost so that effects on insurance rates are minimized in the event that you have an at-fault accident.
For the most part, insurance remains an uncontrollable cost. However, drivers do have the power to prevent unnecessary increases in premiums. For example, always drive defensively to keep a record free of tickets and accidents. If insurance premiums have become a significant financial burden, then changes in habits may be a viable option. These include carpooling, taking public transportation, or even living closer to the workplace.
For more information, visit www.InsuranceHotline.com.