This is the time of year that I usually give suggestions about the many ways to make your income tax return stretch and help you achieve your goals. This year is proving to be much different. Already strapped families are desperately in need of additional money and this year’s return is spent way before it is received. If you happen to be one of the lucky few that does not immediately need your income tax return to pay normal bills, I do have a few suggestions to make it last.
Ø Start an emergency savings account. 3-6 months of expenses used to be the rule of thumb, but saving 6-12 months would be a safe bet if possible
Ø Use your return to put a down payment on a income producing property like a duplex or rent house
Ø If you have debt, this would be a good time to pay it down or off
Ø This is also a good time to make improvements to your home that will add to the bottom line and increase value. Change the carpet, paint the rooms, add a deck, etc.
Ø Start or add to retirement savings in an IRA
Ø Put the money into a Cd, Money Market account, or purchase U.S. Savings Bonds
These are only a few suggestions, but whatever you decide to do with your money this year, saving it in some way seems to be the smartest investment in these economic times. These are only a few suggestions, but whatever you decide to do with your money this year, saving it in some way seems to be the smartest investment in these economic times.
Yet again, somehow, some kind of way, a particular face and a particular race has become the fall guy for the Subprime lending mess. I do understand that after any major event, an event that rocks the entire nation, an event that causes so much financial distress and turmoil for so many, some well placed blame needs to be directed at a villain of some sorts. This villain should be mortified and paraded in front on its victims. But who are the villains of the this big mess? Who has caused all of the lending problems, foreclosures, and the loss of countless jobs? Again, this morning Ann Coulter let me know that the villains are the many minority borrowers who knew they could not afford a home, knew their credit was shaky for a reason, and who have so carelessly and irresponsibly caused our financial ruin. Neither the problem, nor the cause is that simple. This mess was caused by a lack of responsibility taken by some of the borrowers, by the greedy investors, and banks. This mess is indeed great, and will require more education, money to help people in need and for all of us to spend less time pointing the finger more time figuring out how not to let this happen again.
Again, blame should not be placed on any particular race, but, if anyone’s curious the people who actually received a subprime loan are:
.4 %Native American
Just saying . . .
One of the checks included in your package to make an offer on a home is the option fee check. The option fee pays for the option period. This period is negotiable and is arranged by your realtor; I usually ask for at least 10 days option period. This option period is included as one of the terms of the contract and the period begins when the contract becomes executable or when parties, seller and buyer have agreed to the terms and signed the contract. This is the buyer’s think it over time, also during this period, a licensed inspector should perform an inspection on the home the buyer has offered to purchase. Once the inspection report is received by the buyer and he and his realtor have reviewed it, they can determine if they want to move forward with the deal or pull out. Pulling out of the deal can be from many reasons that may have nothing to do with the inspection report, e.g. the buyer found another home they want, death, divorce, proposal, etc. However, these life changing events must happen during the option period (10 days). This is a very important period and time is of the essence, most importantly because if the buyer pulls out at this time, he will receive his entire earnest money check back. If the buyer decided to pull out of the deal or the contract after the option period has ended, the earnest money check, which has been held at the title company, will be delivered to the seller. Basically, the buyer buys the option to pull out or think it over, and although the seller can still show the home, they cannot sell it to anyone else during your option period.
Often when speaking to first-time homebuyers during seminars, I am asked why the seller gets to keep the buyer’s earnest money. Most people hear only part of the process and do not understand why, in some situations, the seller is able to receive the buyer’s earnest money. When submitting an offer or bidding on a home, your realtor must deliver a complete offer package. This package usually consists of the contract, your approval letter from your lender, a copy of your earnest money check and a copy of the option fee check. Once the seller accepts your offer and the contract becomes executable, then the earnest money must be delivered to the title company listed on the contract. The title company holds this money until further notice or closing. The buyer has 2 options; he can pull out of the deal during the option period and receive his earnest money back or continue with the deal, and the earnest money will be credited to the buyer at closing. The title company would only release the earnest money, if the buyer pulled out of the contract outside of the option period and did not fulfill the terms they agreed to within the contract.