Buy or Lease? Which is Best?

It’s the classic dilemma that faces every auto-consumer out there: Pay cash upfront or forego the ownership and pay monthly settlements instead? Buy or lease for a new set of wheels?


As is the case with every other common dilemma, there is no slam-dunk answer. Each option has its own benefits and drawbacks, and it all depends on a set of financial and personal considerations.


First, your finances. Affordability is clearly key, and you need to ask the question of how stable is your job and how healthy is your general financial situation. The short-term monthly-cost of leasing is significantly lower than the monthly payments when buying: you only pay for “the portion” of the vehicle’s cost that you use up during the time you drive it. 

If you have a lot of cash upfront, then you can opt to pay the down payment, sales taxes - in cash or rolled into a loan - and the interest rate determined by your loan company. Buying effectively gives you ownership of the car and that feeling of “free driving” that goes on providing transportation. If, say, you want to get into luxury models but can’t afford the upfront cash of purchasing the vehicle than you’re a good candidate for leasing.

Unlike buying, it gives you the option of not having to fork out the down payment upfront, leaving you to pay a lower money factor that is generally similar to the interest rate on a financing loan. However, these benefits have a price: terminating a lease early or defaulting on your monthly lease payments will result in stiff financial penalties and can ruin your credit. You need to make sure you carve out the monthly lease payment in your budget for the foreseeable future, at least for the duration of the lease. 

Besides the financial aspect, making a buy or lease decision depends on your own particular lifestyle choices and preferences. Think about what the car means to you: are you the sort of person to bond with the car or would you rather have the excitement of something new? If you want to drive a car for more than fives years, negotiate carefully and buy the car you like. If, on the other hand, you don’t like the idea of ownership and 
prefer to drive a new car every two to three years then you should lease. 

Next, factor your transportation needs: How many miles do you drive a year? How properly do you maintain your cars? If you answer is: “I drive 40,000 miles a year and I don’t really care much about my cars as I don’t mind dealing with repair bills”, then you’re probably better off buying. Leasing is based on the assumption of limited-mileage, usually no more than 12,000 to 15,000 miles a year, and wear-and-tear considerations. 

Unless you can keep within the prescribed mileage limits and keep the car in a good condition at the end of your lease, you might incur hefty end-of-lease costs.

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Stay-At-Home Spouses May Get Credit Cards With CFPB Help

(Photo credit: Wikipedia)

The Consumer Financial Protection Bureau(CFPB) is proposing a new rule to make it easier for stay-at-home spouses to obtain a credit card.

The CFPB proposal allows the stay-at-home spouse or partner to rely on shared income when applying for a credit card account, rather than individual income.

"When stay-at-home spouses or partners have the ability to make payments on a credit card, they should be able to obtain a card in their own name," said CFPB Director Richard Cordray in a statement. "Today the CFPB is proposing common-sense changes that would facilitate credit access for spouses or partners who do not work outside the home."

A 2009 CARD Act provision currently mandates issuers look at a consumer's individual income, rather than their household income, when deciding to approve that consumer for a credit card. The rule originally tried to prevent young adults from using their parents' income to obtain a credit card and subsequently ringing up too much debt in their own name. The unintended consequence of this provision is that it hurt the stay-at-home spouse that generates little or no income.

Is this a positive move forward?

When partners or spouses are denied credit because they do not have the income needed, it makes sense to deny them a credit card. But what if the partner or spouse can share their credit worthy status and show that their income will be the source of the ability to pay back debt. Would that make sense.

It could work if the spouse with the income would take responsibility for the debt to be paid if the account went into default. This works when a cosigner is need for a car note. If the borrower defaults the creditor goes after the cosigner. I works there so why not use it with credit cards.

What are the problems with the CFPB proposed rules?

When credit card issuers issue credit they have a reasonable expectation that when someone applies they are not overstating income. The reason why the rules are the way they are now is because household income is different than individual income. If one spouse applies for a credit card and indicates they make $50,000 in income, the credit card company issues an amount of credit based on credit history and other debts.

Now the spouse who doesn't have an income also applies for a card and indicates $50,000 as household income under the proposed CFPB   rules. The spouse probably doesn't have any debts, so the credit card looks on the applicant as a good risk not knowing about the any debt. This can't work.

In other words, allowing applicants to list shared income and personal debts is a recipe for disaster.  Considering the rate at which we’re incurring debt now, the last thing we need is to open the floodgates by diluting the effectiveness of underwriting.

The Solution

Instead of reversing course and allowing consumers to list shared income on credit card applications, the CFPB should first require that all credit card issuers accept joint applications.  This would enable couples to apply together, listing both of their Social Security Numbers as well as their combined incomes and debts, thereby allowing underwriters to make truly informed approval decisions and giving both applicants the ability to build independent credit.

Instead of reversing course and allowing consumers to list shared income on credit card applications, the CFPB should first require that all credit card issuers accept joint applications.  This would enable couples to apply together, listing both of their Social Security Numbers as well as their combined incomes and debts, thereby allowing underwriters to make truly informed approval decisions and giving both applicants the ability to build independent credit.

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7 Methods for Making Money for Those Over 50

 (Photo credit: thinkpanama)

Being on the back-nine of your life doesn't mean you have to take it laying down. There is still much to do and money to be made. Let the younger generation beat themselves to a pulp trying to get ahead in life while you reap the benefits. How can you capitalize on the younger generation without extensive physical effort?

1. Real Estate - Investing in real estate is a great way to put a few dollars in your pocket. Depending on your goals, you could easily amass an empire from rentals to those younger folks who need homes.

2. Stocks - While buying stocks could be risky at times, preparing yourself could yield a handsome retirement bonus. Research methods to help you achieve your goals by using the Internet. The information is yours for the taking.

3. Forex - Trading currencies on the foreign exchange is similar to the risks in trading stocks. Essentially, you are betting that one type of currency will out-perform another. This could pay off in excessive amounts of money, or tap everything you put into it.

4. Business Ventures - There are many people across the globe looking for someone to invest in his or her business. If you have the finances to back a business, you could turn yourself into a successful entrepreneur as well.

5. Take 1 - Did you know that you could make videos of demonstrating your favorite hobby or career choice for money? By posting videos on YouTube of you performing or explaining a subject you're knowledgeable in, you can monetize the videos and generate ad revenue from Google.

6. Instructional Website - Much like the YouTube suggestion above, you could create a website based around your knowledge or expertise in any given subject. This can be used for ad revenue, affiliate sales, and more depending on what your website is about.

7. Learn - It may be difficult to see yourself going back to school, but education could open doors you never thought were there because of your age. With the nature of online courses, you could even earn a degree from the comfort of your own home.

When it comes to making money, your age is never an issue. Age just alters the methods that are available to you. While physical restraints will prevent you from becoming a star athlete, your mind will always be your greatest asset. Out-think the competition and you'll succeed at anything.

Author Bio:
Jack Meyer is a regular contributor for http://www.nannybackgroundcheck.com/. As a detective he wants to spread the knowledge of terrible things that can happen when people don’t fully verify the credentials of a caregiver or any employee. He also writes for various law enforcement blogs and sites.

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Hard Money Lenders – The Common Policies You Need to Know

Finance - Financial injection - Finance (Photo credit: @Doug88888)

Before you apply for hard money loans, you need to make sure you understand your lender’s policies and underwriting procedures. Most of the lenders have these policies on their websites. Here are the sorts of things you might expect to find… 

Borrower down Payment 
Generally, the finance providers will expect you to put at least 20% down. Most borrowers are required to put down 25%, although those who need $250,000 or more in funding may be required to put down 30% or even more, depending on the lender’s underwriting procedures. Keep in mind that this is cash equity, not “created equity” such as a commission carry-back. 

Loan-To-Value Percentage 
You may be able to secure up to 100% of the funding you need. However, generally the finance providers won’t finance more than 60% of the value of the property. This is referred to as the LTV, or loan-to-value percentage. 

Improvement or Repair Draws 
Usually you can’t get hard money funding solely for the purpose of making improvements on a property. However, lenders may, at their discretion, allow you to include home improvement funds as part of your regular loan, provided you don’t exceed the LTV percentage. 

TIP: Generally, the hard money services put time limits on the repairs. For example, you may need to show proof that the repairs were made within three months after you secured your loans. 

Concentration Limits 
Another common underwriting procedure for the lenders is to create concentration limits. Basically, this is the limit on how many loans and funding any individual, group of individuals or business can receive. Generally, the lenders put a concentration cap of 5%, meaning one individual or a group of related individuals can’t hold more than 5% of the lending company’s total portfolio. 

Collateral Quality Control Because hard money loans are asset-based loans, the hard money lenders will usually install policies that help ensure these assets aren’t damaged, devalued or destroyed. For example: 

• The lenders may limit the type of properties they fund. For example, most hard money lenders will fund residential single-family homes. However, many lenders who’re offering hard money financing will NOT fund mobile homes, vacant lots, construction projects, partially constructed properties, and similar types of loans. 
• The lenders may limit the areas they’ll serve. Generally the hard money lenders will fund properties within a certain geographical limits, and any other areas at their discretion. However, these lenders tend to avoid funding properties in high-crime areas. 

Bottom line… 
Even though many hard money finance providers tend to have similar underwriting procedures, the point is that you need to thoroughly read and understand these policies before you apply for a loan and secure funding. 

Bio line – Philip is a guest blogger writing informative contents related to Finance on behalf of Active Funding Group LLC. For more information please explore Arizona hard money loans on their website.

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What to Do After a Head Injury

 …’a CT scan of the head showing an empty space marked by the arrow were the damage originally occurred’… (Photo credit: Wikipedia)

If you or any member of your immediate family has been affected by head or brain injury the first thing to do is deal with the injury and start on the road to recovery. The next step on that potentially long road is to either personally seek advice from a specialist head injury solicitor, or for your next of kin to seek professional advice. Almost every incidence of head injury or brain trauma is the result of the action, inaction, negligence or criminal activity of a third party. If you are unsure in any way who to turn to in order to seek legal advice, the person treating the victim for head injuries is often a good place to start. 

Head injury advice and where to get it

The first place anyone who has been affected by head injury and brain trauma should seek advice from is the person involved in the immediate treatment and aftercare. They are involved in dealing with incidents of head and brain injury every day and probably have details of a specialist law firm to hand which can offer head injury advice.

I say a specialist law firm because brain trauma advice and head injury advice are way above the normal personal injury claim, and require specialist knowledge and a strong legal team behind the claim. Not only will the entire team have specialist training, they will also have the backup of specialist accident and injury investigators. Investigating the exact cause and reason for the injury isn't enough.

Investigating the lead up to the injury, the circumstances surrounding the events which caused the injury and the after events are all crucial to any subsequent compensation claim. Not only should the head injury advice from the care team be taken into consideration but expert witness statements from specialists such as neurosurgeons  psychiatrists and nursing and after care experts such as physiotherapists, can all add weight to a valid claim for compensation for injuries.

Long term care and ongoing costs

Many victims of head injury and brain trauma make a full recovery but there are also a vast number of victims whose injuries mean their lives are irrevocably changed. They may be unable to return to their job because the injuries preclude them from physical work as a result of injuries and subsequent disability. It may be that the injuries sustained have changed their personality and they are unable to concentrate, are reduced to outbursts of anger or maybe worse. The victims of head and brain trauma are individuals and the ways in which injuries affect one person are as unique as the person affected.

Ongoing costs for care and medication are also compounded by the routine of everyday bills and living expenses, especially if there are mortgages to pay, children to educate and the myriad costs the average person has to face during their lives. No amount of financial compensation can turn back the clock, but it can take the worry out of what may be an uncertain future.

Graham Green is a freelance writer and has frequently written about and investigated the myriad circumstances which cause head and brain injury in the hope that head injury advice offered helps the victims face the future with confidence.

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How the Affordable Care Act will Affect Seniors

During this presidential election, both candidates seem to have all the answers about how to improve the healthcare system, and so much attention has been placed on Medicare that some people have begun to panic. In all the political fireballs that have been thrown around about how much each candidate's plan will cost seniors, there has erupted a kind of "mediscare" – that isn't really necessary. 

Making Sense of the Costs

Medicare is a social insurance program that spreads the financial risk associated with illness. The government created Medicare in 1965 in order to guarantee health insurance to certain groups of people who were more vulnerable to medical conditions – such as Americans past the age of 65 or those with disabilities. Before Medicare, for-profit private insurers could hike premiums or deny coverage to people who were older or who had poor medical histories, leaving many people uninsured.

Today, Medicare faces major financial challenges, but any claim that Medicare is going bankrupt is a big exaggeration. Seniors can expect to see changes in Medicare over the next decade, but will not be stripped of coverage. Politicians have proposed a variety of options to balance the Medicare budget, most of which include cutting spending as well as raising taxes.

In order to insure some high-risk Americans who choose to receive services via private plans through Medicare Advantage, the government has been paying extra subsidies to private companies. This, in turn, has created a higher cost for seniors. The $716 billion dollars that the ACA will cut from the Medicare budget can be found in the 14-20% that the government is currently overpaying to private companies.

This reduction will occur over 10 years as the government decreases payments to drug companies, hospitals and other providers; but does not cut payments to Medicare beneficiaries. In fact, the plan promises to lower Medicare costs and premiums through implementing these cuts. Though this approach makes healthcare more affordable to the consumer, some are anticipating that hospitals and clinics will begin restricting its services for Medicare patients.

It is, in fact, Medicare's hospital coverage (Part A) fund that is depleting the most rapidly. Medicare's hospital fund is financed through payroll taxes; and the history of Medicare has seen an almost constant increase on the workforce and employers to maintain the fund. The Affordable Health Care Act will add a new tax on high-income earners that will contribute to the fund. Beginning in 2013, single taxpayers with an income of over $200,000 and married couples with a combined income of $250,000 will pay an additional 0.9% in payroll taxes in contribution to the Medicare fund.

Resources:

A Campaign Full of Mediscare

Whose Plan Destroys Medicare – Obama's or Romney-Ryan's?

A cut or Savings? The $716 Billion Question

Keeping People and Companies Accountable

The Affordable Health Care Act is making changes to protect the consumer from insurer abuses. The ACA requires that insurance companies use 80% of premiums on medical care and quality. Those companies who fail to meet the criteria will be obligated to return the difference to the American public in the form of rebates. This law was created in response to the increasing premium rates that have been fueled by rising administrative costs within the insurance industry, such as marketing and CEO salaries. The law regulates the industry's focus to a contribution to the care of patients and the health of consumers.

The ACA also hopes to bridge the gap in quality of care by providing financial incentives to hospitals. Currently, almost 20% of Medicare patients are readmitted within 30 days, which results in billions of wasted funds on preventable hospital readmissions. Hospitals that reduce these rates will receive some form of financial incentive. An additional measure to promote quality is a new regulation that will require rates of infection developed in hospitals to be disclosed to the public.

Though the ACA works to keep companies accountable, it has no set policy to keep fraudulent claims at bay. Jim Capretta, Director of e21's ObamaCare Watch Project, cited the Government Accountability Organization statistics that reveal the annual cost of fraud and abuse in the Medicare system at $60 billion. Though the Centers for Medicare and Medicaid Services are currently working to develop a system that combats fraud, the GAO has released reports that say progress has been made, but that more needs to be done. Thus, seniors and all beneficiaries of Medicare could expect stricter regulations in terms of identity protection and claim legitimacy in the future.

The ACA also includes an Elder Justice Act that will provide community education programs that will help seniors identify local scams or online fraud. This piece of legislation will also provide for victim assistance for abused or neglected elders. The ACA will provide funding for the prosecution of those who victimize seniors through fraud or by overcharging for services.

Resources:

The 80/20 Rule: Providing Value and Rebates to Millions of Consumers

Does ObamaCare cut or save $716 billion in Medicare? Depends on who you ask

Affordable Care Act: What you Don't Know could Help You

Managing Prescription Costs

A report released in August by the U.S. Department of Health and Human Services cited 5.4 million Medicare patients had saved more than $4.1 billion on prescription drugs in 2011. These savings came from a 50% discount on covered brand-name drugs and a discount on generic drugs. The initiative is the first step of a 10-year course that will provide 100% of prescription drug coverage for seniors on Medicare. This course of action is referred to as "closing the donut hole".

Resources:

People with Medicare Save More than $4.1 billion on Prescription Drugs

Understanding the IPAB Board

Recently, the IPAB Board has come under scrutiny of those who oppose the ACA. This new government agency is the Independent Payment Advisory Board. It was created in accordance with the ACA in 2010, and its primary agenda is to regulate Medicare spending without affecting coverage. The IPAB Board is explicitly restricted from recommending rations to healthcare. It cannot decide to raise premiums, increase deductible, coinsurance or co-payments. It also cannot change eligibility requirements, restrict benefits or make recommendations for revenue accrual.

So what can this board do? The IPAB board will make broad policy decisions that will affect Medicare's overall cost. The board can reduce how much the government pays health care providers. It can reduce payments to hospitals with high readmission rates. The board can also recommend ways to cut wasteful spending.

The IPAB has the big task of keeping Medicare on budget while also keeping the quality of care up to par. The IPAB can, in no way, determine what types of services or treatments are offered by Medicare. The anticipated issue continues to be that by restricting payment to doctors and hospitals, these institutions will lose money and will resist receiving Medicare patients. This means it may become more difficult for patients to find a hospital that accepts Medicare.

Resources:

Paul Ryan said "15 Unelected, Unaccountable Bureaucrats" could "Lead to Denied Care for Current Seniors”

Brenda Watson is a former HR coordinator who currently writes for healthinsurancequotes.org. When she's not writing, you can find Brenda quilting or baking casseroles. To reach Brenda, you can leave her a comment! She loves hearing from readers.

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