Your rates of bank

Normally, I use this space to answer reader questions. However, today I’d like to discuss an issue that affects many American savers.- advertisement -

Beginning Jan. 1, the Treasury changed its annual limit on purchases of U.S. savings bonds. The new annual limit is $5,000 per Social Security number, but the limit applies separately to Series I and Series EE savings bonds, and for paper versus electronic bonds.

So, an individual can invest a total of $20,000 in savings bonds annually, as shown in the following table:

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What is the first thing borrowers should do if they are at risk of missing a payment?
Homeowners should begin by calling us and expressing their interest in keeping their home; the sooner a homeowner reaches us, the more options we have to find a solution.

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The homeowner should prepare for the call by gathering income and expense documentation that might be needed to consider a potential workout.

When should they call you

Editor’s note: Citi declined to answer Bankrate’s questions, asking instead that borrowers call Citi directly. They also referred Bankrate to a report on their Web site titled “Citi U.S. Mortgage Lending Data and Foreclosure Prevention Efforts.” Bankrate consulted the document and found answers to as many of the questions as possible. We have reported them here.

What is the first thing borrowers should do if they are at risk of missing a payment?

Distressed borrowers should contact Citi at one of the following numbers:

CitiMortgage: (866) 272-4749.Citi Residential Lending: (800) 211-6926 or (800) 430-5262.- advertisement -

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Lou Ferrigno is an imposing figure at 6 feet 4

The real estate industry suffered such a freefall in 2007 that even the most hopeful scenario was for the market to hit bottom by summer, or by autumn, or by Christmas. That turned out to be overly optimistic.- advertisement -

Four months into 2008, the bad news keeps rolling in, and most analysts agree the bottom everyone kept predicting remains elusive at best, and years away at worst.

“I think we are a ways from the bottom — and a long way from any indicators that would even hint at an upturn,” says Mike Simonsen, CEO of Altos Research, a real estate data firm based in Mountain View, Calif.

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Regis Philbin has the mannerisms and voice that launched a thousand parodies, but his ubiquity underscores his accomplishments. Think about this — in a society where television has played such a major part of our lives for the past half-century, Regis Philbin holds the Guinness-certified world record for the most hours logged in front of a television camera. (more…)

Every day, I get at least one e-mail from a reader who is stuck with a vehicle, owing more than it is worth — a situation known as being “upside down” on the loan.

I expect the volume of such complaints to pick up.

The main reason is that after more than 10 years of trucks, SUVs and minivans being the top-sellers in the U.S. market, the ride has come to an abrupt halt.

Now, buyers who took out six- and seven-year loans to buy big pickups and SUVs in the last few years are in even more dire straits than they normally would be with such long-term obligations.

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Get ready to add the word “feebates” to your car-shopping lexicon.

Several state legislatures, notably California’s, have toyed with proposals that could make it economically unattractive for buyers to opt for vehicles that produce above-average amounts of greenhouse gases.

The same proposals would reward buyers of vehicles that are more Earth-friendly.

Recently, the California Assembly was scheduled to vote on a bill called the California Clean Car Discount Act, which would have levied one-time registration fees of up to $2,500 on new vehicles that emit large amounts of carbon dioxide and other gases related to global warming.

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Dear Terry,
My future wife and I had purchased a truck in May 2005. We had to do a voluntary repossession in August 2006. This happened after we spoke to the finance company about trying to lower our payments by $100 per month.
We met with the repo man to give him the truck. Then, we did not hear anything until we received a letter stating that they had the truck. In January 2007, they called us and said we needed to pay $1,153.84.

I contacted them and requested documentation. The person I spoke to said, “I do not have to send you any documentation. You had better be ready to live in a tent because I am going to take you for everything.”

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Forgiven debt may be free from income tax
The first tax break concerns forgiveness of debt, which occurs when a lender forgoes repayment of principal and/or interest the borrower owes.

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Typically, discharged debt is considered ordinary income to the borrower for income tax purposes. The new law allows taxpayers to exclude this amount and thus escape the tax liability.

“When you’re worried about making your payments, higher taxes are the last thing you need to worry about. So this bill will create a three-year window for homeowners to refinance their mortgage and pay no taxes on any debt forgiveness that they receive,” President Bush said in his remarks upon signing the law.

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Rule No. 1: Don’t panic
The stock market’s gyrations can give even the hardiest investors a case of the jitters.

However, converting all your investments to cash is likely to cause you far more harm than good, says Joe Baker, CFP and president of Alcus Financial Group in Mount Pleasant, S.C.

“People are scared,” he says. “They’re asking, ‘Is the economy crashing? Should I move my 401(k) to a money market?’”

Baker answers: “Please do not, unless you need the cash tomorrow. You’d be making a huge mistake.”

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Dear Terry,
A so-called friend wanted to get a car and he couldn’t get approved for a loan. So, I did him a favor and co-signed for him. It hasn’t even been six months yet and he returned the car to me.

The dealership was so slick that they had put me as the main person on the loan, which I was told was just to co-sign for him. I don’t want this car and already have my own car loan. What should I do?
— Carlos

Dear Carlos,
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Cash-strapped employees are turning to their retirement plans as the credit crunch drags on and costs for everyday necessities continue their upward spiral. While hardship withdrawals from 401(k) plans are taken by a very small number of participants — about 1.5 percent at Vanguard — the giant fund company says hardship withdrawals have been increasing significantly; up about 17 percent in 2006 and another 9 percent in 2007.- advertisement -

“We would say from our data that the big uptick began earlier than the subprime crisis, which indicates to us that it wasn’t a lagging indicator, it was a leading indicator,” says Stephen Utkus, director of Vanguard’s Center for Retirement Research. “When people started to have difficult times, they started tapping their 401(k) plan for various hardships and then, later, the subprime crisis manifested itself. We fully expected them to be up a little in 2006 and then really up in 2007 when, in fact, the big growth rate occurred in 2006. This suggests to us it’s much more an issue of financially stretched households and not so much a subprime issue.”

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Bernanke testifies on economy and Fed actions

Bernanke testifies on economy and Fed actions

Fed Chairman Ben Bernanke was once again before the Joint Economic Committee of Congress to testify on the economic outlook. While his speech was titled “The economic outlook,” his remarks encompassed more than just the economy, but also recent Fed actions and the conditions in financial markets.

Here are some of the notable passages from Bernanke’s prepared remarks:

“However, beginning in mid-February, worsening liquidity conditions and reports of losses at the GSEs, Fannie Mae and Freddie Mac, caused the spread of agency MBS yields over the yields on comparable Treasury securities to rise sharply. Together with the increased fees imposed by the GSEs, the rise in this spread resulted in higher interest rates on conforming mortgages. More recently, agency MBS spreads and conforming mortgage rates have retraced part of this increase, and conforming mortgages continue to be readily available to households. However, for the most part, the nonconforming segment of the mortgage market continues to function poorly.”

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Is this the last Fed cut?

Monday, April 28
Posted 9 a.m. Eastern

Is this the Last Fed Cut?

The Federal Open Market Committee meets April 29-30 and by now you’re familiar with the drill — they’ll cut interest rates. But unlike recent Fed meetings that culminated with aggressive moves of the half-point and three-quarter point variety, the upcoming meeting is poised to produce a comparatively small quarter-point cut.

Exactly what will this mean to consumers? Rates for home equity lines of credit and variable rate credit cards will see further declines, though not all borrowers will benefit equally.

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Using a hypothetical example, we break out some of the cost savings of commuting on two wheels instead of four.

Savings on two-wheel commuting

50-mile commute, 150cc scooter20-mile commute, bicycle”Sam” is a 40-year-old man with a 50-mile per day commute in suburban Chicago. He replaces his Ford Taurus sedan that averages 20 miles per gallon with a 150cc scooter that averages 70 miles per gallon. Gas is priced at $4 per gallon.

Sam saves $60 per week, with $36 of that being gas savings. (Assuming 54 cents a mile to operate the car and 30 cents a mile to operate the scooter.)
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Fed cuts smack savers

Fed not doing savers any favors

Ben Bernanke made it pretty clear last week that the Fed intends to cut interest rates again. A poor employment report this Friday could prompt the Fed to cut rates immediately rather than waiting until the regularly scheduled March 18 meeting. I hope it doesn’t come to that, but an overtone of weakness to this week’s economic data could bring calls from Wall Street for the Fed to do something pronto. As we’ve seen, the Fed has been willing to cave to such pressure.

In addition to Friday’s employment report, tomorrow brings the ISM Services Index. That same index ignited the recession concerns a month ago when it plunged sharply, showing a contraction in the important services sector of the economy. A similarly poor reading this month would bring out the economic boo-birds calling for the monetary policy equivalent of a quarterback change … in other words, an immediate interest rate cut.

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1. What does your master policy say?
Owners of condominium units obviously do not own the entire condominium complex. Typically, they own their own unit outright and share ownership of the rest of the complex with all the other owners.

From an insurance point of view, that means all individual unit owners have a collective responsibility for insuring areas of the complex owned in common — building exteriors and hallways, the pool area, etc. A condominium association typically collects monthly dues from unit owners and uses a portion of these funds to insure common areas.

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