Feb 27
In the March issue of Smart Money, there was an article “10 Things Your Tax Preparer Won’t Tell You,” which, like many articles in this series takes a shot at the least reputable people in a given profession. What caught my eye reading this story was this one sentence “On average tax preparers make more mistakes, and costlier ones, than Josie Taxpayer does.” I quickly Googled “Josie Taxpayer” and found two results, both referencing Joe and Josie Taxpayer, as the Smart Money story had not hit the web yet. I found the avoidance of the phrase Joe Taxpayer interesting, as I’m sure it was intentional. Just my random observation today.
JOE
written by JOE
\\ tags: Finance, foreclosure, mma, Mortgage, mortgage acceleration, pre-pay, Real Estate, sub-prime loans
Feb 11
This month’s Consumer Reports has an article “Your mortgage, It rarely pays to prepay“. They think it doesn’t, suggesting that since the stock market (measured by the S&P) has averaged 10% per year over the last 20 years, that it would make financial sense to choose investing in the stock market over pre-paying your mortgage. On one hand, there’s a neat logic to this. But, as I posted in my blog article Disappointing Results, we see that despite the 11.8% return of the S&P cited by the study, the average equity fund investor only saw a return of 4.3%. In that case, CR might rethink their numbers and their blanket statements offering what may be unsound financial advice.
Whatever you decide, the decision has to be based on your individual situation, your risk tolerance, and investing style.
JOE
written by JOE
\\ tags: Finance, foreclosure, mma, Mortgage, mortgage acceleration, pre-pay, Real Estate, sub-prime loans
Feb 01
I’ve finished up another article for my main site, this month titled BiWeekly Mortgages. I’ll give you the punchline here. I have no objection to paying one’s mortgage down faster if the rest of their investments and debts are in order. Why pay down a 6% or 7% mortgage faster when you owe money on a 15% credit card?
What I do object to is paying a third party or your bank an extra fee plus monthly service charges when you can do this your self. I mention other mortgage acceleration programs such as Money Merge Accounts, which I’m still researching and will discuss here or on the main site in the near future.
JOE
written by JOE
\\ tags: Finance, foreclosure, mma, Mortgage, mortgage acceleration, pre-pay, Real Estate, sub-prime loans
Nov 09
A homeowner owes $200,000 and for whatever reason, finds he can no longer pay the mortgage. The bank accepts the deed in lieu of foreclosure and sells the house for $150,000. The homeowner breathes a sigh of relief to be out, but in January receives a 1099. He now has taxable income for the amount of money he cannot afford to pay the bank. Surely the tax on $50,000 is a better deal than the whole $50,000, but for the guy who couldn’t come up with the $1500 mortgage payment each month, where is he supposed to find the $12,500 (I’m assuming a 25% tax bracket) to pay the tax due?
Congress is considering legislation that would change the law that taxes the loan amount which goes unpaid, but that’s not likely to happen overnight.
Enjoy the weekend,
JOE
written by JOE
\\ tags: Finance, foreclosure, Mortgage, Real Estate, sub-prime loans
