Debt relief program may be translated in many ways like debt management, credit counseling and many others repayment plans. Your unsecured debts include credit cards, medical bills, legal fees and many more. Now you have to decide whether you should opt for debt relief program or not. In other words do you really require debt relief program?

If your situation is such that you are unable or finding really difficult to pay the minimum amount of payment then indeed you need debt relief program. Several options are available now a day to get relief from debts. You are to choose the appropriate option for you. After finding the right option, do some market research about that particular service providing companies whether they are the best company to assist you. To know about the company and their services or complaints you can search them in BBB (Better Business Bureau) website. Then compare the service with the other similar debt relief companies.

By opting debt relief program you don’t have to file for bankruptcy because of non payment of dues. Many creditors are interested in getting a good portion of their lending money from you rather than nothing. This interest of your creditors will help you to plan for debt relief program.

When you have decided to opt for the option of debt relief plan, you will be the candidate of getting the benefits like lower rate of interest, lower monthly payments, no late payment fees etc. Here you will also be advised to live within your means and learn how to economize your daily life.

You must remember that debt relief program can’t assist you if you can’t assist yourself. That means you must have to control your spending habits to move forward in life. You need to make a budget before going into shops to buy goods. You should remember that every dollar you save will help you avoid harassing calls from creditors and collection agencies. Another thing, this saving habit should continue for life time otherwise after few years you will find yourself in the same position from where you have come up.

In our previous article we looked at mortgage interest deductions. Now we go through the details of whether points paid are also deductible or not and if they are, would the full amount of points be deductible in the year they are paid.

But let us first start by looking at what are points. Points generally are the charges paid or treated as paid by borrower to get a mortgage. These are also called as loan discount, maximum loan charges, discount points or loan origination fees.

A borrower can fully deduct points in the year they are paid if the under mentioned conditions are satisfied. If all these conditions are not met then borrower has to deduct them equally (ratably) over the term of the loan only if certain other requirements are fulfilled (we will look at those requirements in the following sections).

Points deduction allowed in the year they are paid if –

1. Paying points is a common business practice in the area where the mortgage was made.

2. Borrower uses cash method of accounting. It means that borrower reports income in the year it is received & deducts expenses in the year they are paid (a good percentage of individuals use this method).

3. The mortgage is secured by borrower’s main home. (Main home is defined as the one in which borrower lives in most of the time)

4. Points paid are not more than what are normally charged in the area borrower lives.

5. Funds borrower provides before or at closing plus any points seller pays, are at least equal to the points charged. Funds borrower provides need not be applied to the points. It can be used for down payment, earnest money, escrow deposit or other similar funds borrower pays for before or at closing. But these funds cannot be borrowed from mortgage broker or lender.

6. Points were not paid in place of fees which are ordinarily stated separately on settlement statement, like, title fees, appraisal fees, attorney fees, inspection fees, & property taxes.

7. Points paid are computed as a percentage of mortgage’s principal amount.

8. The amount is shown on settlement statement as points charged for the loan. It is however allowed to show the points as paid from either seller’s or borrower’s funds.

9. The mortgage is used by borrower to build or buy his main home.

If all the above mentioned conditions are met then borrower can select between either deducting them over the term of his mortgage or fully in the year they are paid.

Now what happens if the mortgage was taken for home improvements, a second home or if it was a refinance mortgage?

• Borrower can fully deduct the points in the year they are paid on a mortgage taken for home improvements if the first six conditions mentioned above for “points deductions allowed in the year paid” are met.

• For a second home borrower cannot fully deduct points the same year they are paid. These can only be deducted over full term of the loan.

• Points paid to refinance a mortgage cannot be deducted in full in the year they are paid. However, if part of the proceeds of the refinanced mortgage are used to make home improvement & the first six above mentioned conditions are fulfilled then borrower can fully deduct that part of points which is related to the improvements in the same year they are paid from own funds. Rest of the points will have to be deducted ratably over the term of the mortgage.

If a borrower cannot meet the conditions to be able to fully deduct points in the year they are paid, mortgage is not taken for home improvements or he selects not to deduct them in the same year, then those points can be deducted equally over full term of the mortgage if following conditions are met:

a) Mortgage is secured by a home (need not be the main home).

b) If mortgage if for more than 10 years, then loan terms are same as those for other loans offered in borrower’s area for same or longer periods.

c) Borrower uses cash method of accounting.

d) Mortgage period is not more than 30 years.

e) Mortgage is for $250,000 or less, or number of points is not greater than –

i. 4, if mortgage is for 15 or less years, or

ii. 6, if mortgage is for more than 15 years.

Many borrowers think of certain amounts charged by a lender for specific services like, notary fees, VA funding fees, appraisal fees, mortgage insurance premiums, and preparation costs for the deed of trust or mortgage note as part of points. But it is not true; these amounts cannot be deducted as points in the year they are paid or over the term of the loan.

Whether you have a budget formally laid out or not, everybody budgets their monthly finances in one way or another. This system can work for you for quite some time, but if you have a financial emergency that can spell disaster for your budget. However, there are tools that you can utilize in a responsible manner and still make your monthly budget work such as payday loans or a cash advance.

When it comes to needing money on demand to supplement their monthly budget, consumers typically have two options. One is to get a traditional loan via a bank or credit union and the other is to get a cash advance or payday loans. What consumers should keep in mind is that if you need a long term loan, a traditional loan is more your speed. If you need a smaller amount of money quickly payday loans are a good alternative.

One important step to making sure that a short term loan works for you and doesn’t become another expensive burden of debt is to ensure that they pay the loan off within the specified amount of time. Payday loans are designed for short term use and the interest you are charged simply becomes too high when you begin to roll these loans over and extend them. The more you extend the loan the more expensive it will become. These loans are intended to help you get out of a financial bind, but just like any other loan, they can quickly add to your debt.

While debt can be a hard obstacle to avoid, doing little things each day can make a big difference. Try to consolidate all your debts, if possible, to once source and make one payment at the lowest interest rate. You can also downsize on everyday services such as cell phone plans, land lines to your home, cable or internet bundling, or simply having coffee at home or at the office instead of picking it up at your local coffee store. It may not seem like much at first, but over time it will add up and can get or keep you in debt.

It’s always been important to have accurate financial tracking and to be in the right track, it is necessary to get appropriate snapshot of credit reports. But now a day it has been found that many people are having a particular problem of Identity Theft. It is essential for you to know the dangers of this particular problem and its possible solution.

According to FTC’s final rule identity theft can be defined as

“a fraud that is committed or attempted, using a person’s identifying information without authority.”

According to the non-profit Identity Theft Resource Center, identity theft is

“sub-divided into four categories: Financial Identity Theft (using another’s name and SSN to obtain goods and services), Criminal Identity Theft (posing as another when apprehended for a crime), Identity Cloning (using another’s information to assume his or her identity in daily life) and Business/Commercial Identity Theft (using another’s business name to obtain credit).”

Millions of people became victims of it in the last few years. It can also be called as “Phishing”. It occurs something like that, when you receive an email from companies saying they are legitimate company and asking for your credit card information or your contact information. In this way they will have your important personal information. Your awareness can be the best solution of this problem. You need to know the methods how these scams happen. It is happened mainly through emails. They will send you bogus emails requesting personal information like, SSN (Social Security Numbers), bank details, passwords etc. But mind it don’t ever give these information although it seems that everything looks genuine. Real organizations don’t require you to send these details by the way of emails. These fraudulent companies use fake bank logos and images to convince people that they don’t look fraud. They also use similar looking website URL and email address but it is not the actual one. It will redirect you to another website. Suppose you are having this problem, then it will be better for you to ring up the bank or financial company to double check. But never give out your important personal details via email.

How fraudulent companies gather your personal information:

• Stolen or lost credit cards
• Larceny from your mailbox
• Through unsolicited emails
• Fake phone solicitation
• Going through trash
• Searching personal records

Identifying Theft

Identifying signs of fraud can vary, but generally the following points are the indicators or fraud:

1) Email, letters or incoming calls stating that your application have been approved or denied to which you never applied for;

2) Creditors inform you that they have received an application for loan from you; they will say your Name and SSN also.

3) Receiving credit card statements in your address with your name which you never applied for;

4) You are not getting statements of your credit card;

5) You are not receiving all mails which is delivered to you;

6) False purchase entries in your credit card statements that you are unable to recognize.

7) Any collection agency tells you that they are in the process of collecting money for a defaulted account with your identity that you never opened.

Free Methods to protect these scams:

• Review credit card or bank statements for fraud.
• Destroy credit card receipts or other financial papers
• Check your credit reports regularly
• Be secure about your SSN and never give it.

Find Identity Theft complaint form here:
https://rn.ftc.gov/pls/dod/widtpubl$.startup?Z_ORG_CODE=PU03

If you are thinking about selling your house but are concerned about the capital gains tax you may have to pay on profit made from sale then there is some good news for you.

You might not have to pay any tax on the profit made if certain conditions are fulfilled. In the following sections we will look at how you can retain the total amount of profit made from sale of your house without having to pay any taxes.

When a person sells his house and makes a profit then this profit can be exempt from taxes up to the maximum exemption limit of $250,000 if:

• He meets the use of house requirement and

• The ownership requirement, and also

• Had not used capital gains tax exemption in the last two years before the house is sold.

The exemption limit is $500,000 if:

• The seller is married & files a joint return and

• Both he and his spouse meet the use of house requirements and

• Either he or his spouse meets the ownership requirement, and lastly

• Neither he nor his spouse had used the exemption in the last 2 years before the house is sold.

Now let us look at what these, use of house and ownership requirements are.

To avail the exemption, during the five year period ending on the date house is sold a person must have –

1. Lived in the house using it as his main house for at least two years and

2. Owned the house for at least two years.

Let me add here that the two years of use & ownership during the five year period need not be continuous.

A person would meet the requirements if he can show that he owned & lived in the house using it as his main house for either twenty four full months or 730 days (365 x 2) during the five year period.

The exemption laws are somewhat different to accommodate the special needs of members of foreign services or uniformed services.

Members of foreign services or uniformed services can select to have the five year requirement period for use & ownership remain suspended during any period that such person or his spouse serves on qualified official extended duty.

It means that the person will be able to meet the two year use of house requirement even if, due to service requirements, he is not able to live in the house for the required two years during the five year period before the house is sold.

The suspension period cannot be more than ten years. Together, the five year requirement period & ten year suspension period can be as long as, but not more than fifteen years. In addition to it, the five year period cannot be suspended for more than 1 property at a time.

For applicability of this special rule, uniformed services & members of foreign services are defined as;

Uniformed services –

1. Commissioned corps of the Public Health Service.

2. The Armed Forces (Army, Navy, Air Force, Coast Guard & Marine Corps) and

3. Commissioned corps of National Oceanic & Atmospheric Administration.

Member of Foreign services –

1. An Ambassador at large.

2. A Chief of mission.

3. A Foreign Service officer.

4. A member of Senior Foreign Service.

5. Part of the Foreign Service personnel.

So by properly planning the house sale to keep note of how many years you have lived in it before it is sold & whether it was used as the main house for specified years, you can keep all of the profit made from sale without having to pay any tax on it.

If you have a good negotiation strategy in your mind then Real Estate negotiation process can be an exciting experience. There should be some basic rules by which you can identify that you are going in the right direction and doing fair deal in time of negotiation of buying property.

• Target Price Determination: You must fix up a target price in your mind in the time of negotiation to make the deal effective. But you need to quote your price by balancing the current market price and your capacity. If the price that you have quoted is fair enough then you can definitely be strict on it at the time of negotiation.

• Offer less than your expectation: You should always give lesser quote than your expectation in the time of negotiation. If you don’t know anything about negotiation or you never heard of negotiation strategy then also this process of making lesser price always helps to reduce the respective price by some percent.

• Bracket your offer price: This means you have fixed up your mind for the negotiation and obviously the price that you are going to quote. You should quote the price low in the opening position. It can be understood by an example, if the asking price is $60000 and you have targeted a price of $50000, then you should bracket your price at $43000 rather than $45000. In this way you have greater chance of obtaining the property at below or at your target price.

• Splitting the difference: Never split the difference in your offer. For example if you are making an offer of $80000 and the other party (seller) asking $120000, here the result of effective negotiation should be around $100000. But if you split the difference of your offer too quickly, then the negotiation will be between $100000 and $120000. Here the result may come around $110000. That means you are losing $10000.

• Gain something beyond price: Once you have finalized the price, see is there any possibility to gain anything more out of the deal. A unique way can fetch something for you.

Try to negotiate with the sellers when you buy property following the above mentioned rules. It will help to get your targeted property at low price.

Are you in seek of remortgages? This site http://www.badcredit-mortgages.org.uk/ may help you.

To begin with let us first look at what a real estate appraisal means.

Simply, it is a judgment of property value. This value is arrived at by a certified or licensed appraiser by following process of analytical comparison along with use of comparable sales and information regarding the property that is appraised, its neighborhood & community.

Why an appraisal is needed?

There can be many reasons that a person need to know value of his property. Let us look at some of the most common reasons for which an appraisal is sought:

• Appraisal is necessary to validate property’s purchase value for obtaining a mortgage.

• Taxing authorities like Internal Revenue Service (IRS) require appraisal for establishing estate’s value when a death occurs.

• Appraisal is essential to contest annual appreciation increases asked by insurance companies if such an increase in insurance coverage leads to unrealistic premium amounts.

• Sometimes insurance agents also order appraisal if their standard cost service manuals are found inadequate for a typical home or structure.

• At times, a government entity may need land owned by an individual for public use. An appraisal is ordered and landowner is offered purchase of his land for the value indicated in the appraisal.

• Property owners who feel that their property is being assessed too high by taxing authorities can order appraisal by a qualified appraiser to contest such property assessment.

• When buying the house with owner carrying the loan, it is important to get appraisal done to make sure that buyer does not pay more than what the property is actually worth.

The appraisal report provides an objective judgment of property’s market value. Normally appraisers compute the market value by using one of the three approaches:

1. The Sale Comparison Approach
2. The Cost Approach
3. The Income Approach

Let us now look at these three approaches:

1. The Sale Comparison Approach

In this appraisal method price of properties having similar size, location and quality recently sold are examined. And price is adjusted to take into account the differences between comparables and the appraised property for determining the correct value. The sales comparison approach is considered as most reliable when adequate comparable sales data exists.

2. The Cost Approach

It was formerly known as summation approach. In this appraisal approach it is considered adequate to sum up land value & depreciated value of improvements to arrive at the value of any property. The abbreviation RCNLD is used to refer to the value of improvements where RCNLD stands for replacement cost new less depreciation. Replacement cost means the cost of building the house or making improvements which have the same utility but are done using modern design, materials & workmanship.

Mostly the methodology in use for cost approach is a hybrid of cost & sale comparison approach. As an example, the replacement costs for constructing a building can be ascertained by adding material, labor & other costs; depreciation and land values have to be arrived at from analysis of comparable data. This method is considered reliable if used for new structures, but it tends to become less reliable if used for older properties.

3. The Income Approach

The income approach is used to value investment & commercial properties. It provides an objective estimate to an investor about what he will have to pay based on the net income the property produces.

Where a property produces commercial income this appraisal method capitalizes an income stream into a present value. This is done by using single year capitalization rates of NOI (Net Operating Income) or revenue multipliers. The NOI is GPI (Gross Potential Income) less Vacancy & Operating Expenses (but excluding depreciation charges that are applied by accountants).

To know more about real estate appraisal you can visit wikipedia.org.