UFREETV - FINANCIAL SECTION INFORMATION TO HELP YOU MAKE CRITICAL FINANCIAL DECISIONS
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WHAT IS THE DIFFERENCE BETWEEN A REVERSE MORTGAGE AND A HOME EQUITY LOAN? Difference Between a Reverse Mortgage and a Home Equity Loan Generally a home equity loan, a second mortgage, or a home equity line of credit (HELOC) have strict requirements for income and creditworthiness. Also, with other traditional loans the homeowner must still make monthly payments to repay the loans. A reverse mortgage generally has no credit score requirements and instead of making monthly mortgage payments, the homeowner receives cash from the lender.
With a reverse mortgage the amount that can be borrowed is determined by an FHA formula that considers age, the current interest rate, and the appraised value of the home. Typically, the more valuable the home, the higher the loan amount will be, subject to lending limits.
A reverse mortgage gives over part of your homes equity to a lender and they in turn give you a monthly payment (reverse of a normal mortgage) but you need to either own the home completely or have a very low balance and it is only for people over the age of 62. You don't have to pay the money back the balance you received is simply given back to the bank when the home is sold or property rights transferred. A equity loan is basically a second mortgage on a home, the property is used as collateral the bank gives you a certain amount either as a lump sum or line of credit and you make regular monthly payments.
To summarize the key differences, with traditional loans the homeowner is still required to make monthly payments, but with a reverse mortgage the loan is typically not due as long as the homeowner lives in the home as their primary residence and continues to meet all loan obligations. With a reverse mortgage no monthly mortgage payments are required, however the homeowner is still responsible for property taxes, insurance, and maintenance.
A reverse mortgage is a form of equity release (or lifetime mortgage). It is a loan available to home owners of retirement age, enabling them to access a portion of their home's equity. The home owners can draw the mortgage principal in a lump sum, by receiving monthly payments over a specified term or over their (joint) lifetimes, as a revolving line of credit, or some combination thereof.
In a conventional mortgage the homeowner makes a monthly amortized payment to the lender; after each payment the equity increases by the amount of the principal included in the payment, and when the mortgage has been paid in full the property is released from the mortgage. In a reverse mortgage, the home owner is under no obligation to make payments, but is free to do so with no pre-payment penalties. The line of credit portion operates like a revolving credit line, so a payment in reduction of a line of credit increases the available credit by the same amount. Interest that accrues is added to the mortgage balance.
Title to the property remains in the name of the homeowners, to be disposed of as they wish, encumbered only by the amount owing under the mortgage.
If a property has increased in value after a reverse mortgage is taken out, it is possible to acquire a second (or third) reverse mortgage over the increased equity in the home in some areas. However most lenders do not like to take a second or third lien position behind a reverse mortgage because its balance increases with time. It is rare to find reverse mortgages with subordinate liens behind them as a result. A reverse mortgage may be refinanced if enough equity is present in the home, and in some cases may qualify for a streamline refinance if the interest rate is reduced.
A reverse mortgage line is often recorded at a higher dollar amount than the amount of money actually disbursed at the loan closing. This recorded lien is at times misunderstood by some borrowers as being the payoff amount of the mortgage. The recorded lien works in similar fashion to a home equity line of credit where the lien represents the maximum lending limit, but the payoff is calculated based on actual disbursements plus interest owing.
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WHAT YOU SHOULD KNOW ABOUT TAXES: In the United States, a tax is imposed on income by the federal, most states, and many local governments. The income tax is determined by applying a tax rate, which may increase as income increases, to taxable income as defined. Individuals and corporations are directly taxable, and estates and trusts may be taxable on undistributed income.
Partnerships are not taxed, but their partners are taxed on their shares of partnership income. Residents and citizens are taxed on worldwide income, while nonresidents are taxed only on income within the jurisdiction. Several types of credits reduce tax, and some types of credits may exceed tax before credits. An alternative tax applies at the federal and some state levels.
Taxable income is total income less allowable deductions. Income is broadly defined. Most business expenses are deductible. Individuals may also deduct a personal allowance (exemption) and certain personal expenses, including home mortgage interest, state taxes, contributions to charity, and some other items. Some deductions are subject to limits.
Capital gains are taxable, and capital losses reduce taxable income only to the extent of gains (plus, in certain cases, $3,000 or $1,500 of ordinary income). Individuals currently pay a lower rate of tax on capital gains and certain corporate dividends.
Taxpayers generally must self assess income tax by filing tax returns. Advance payments of tax are required in the form of withholding tax or estimated tax payments. Taxes are determined separately by each jurisdiction imposing tax. Due dates and other administrative procedures vary by jurisdiction. April 15 following the tax year is the last day for individuals to file tax returns for federal and many state and local returns. Tax as determined by the taxpayer may be adjusted by the taxing jurisdiction.
A tax is imposed on net taxable income in the United States by the federal, most state, and some local governments. Income tax is imposed on individuals, corporations, estates, and trusts. The definition of net taxable income for most sub-federal jurisdictions mostly follows the federal definition.
The rate of tax at the federal level is graduated; that is, the tax rates of higher amounts of income are higher than on lower amounts. The lower rate on lower income was phased out at higher incomes prior to 2010.[clarification needed] Some states and localities impose an income tax at a graduated rate, and some at a flat rate on all taxable income. federal tax rates in 2009 varied from 10% to 35%.
From 2003 through 2011, individuals were eligible for a reduced rate of federal income tax on capital gains and qualifying dividends. The tax rate and some deductions are different for individuals depending on filing status. Married individuals may compute tax as a couple or separately. Single individuals may be eligible for reduced tax rates if they are head of a household in which they live with a dependent.
Taxable income: is defined in a comprehensive manner in the Internal Revenue Code and regulations issued by the Department of Treasury and the Internal Revenue Service. Taxable income is gross income as adjusted minus tax deductions. Most states and localities follow this definition at least in part, though some make adjustments to determine income taxed in that jurisdiction. Taxable income for a company or business may not be the same as its book income.
Gross income: includes all income earned or received from whatever source. This includes salaries and wages, tips, pensions, fees earned for services, price of goods sold, other business income, gains on sale of other property, rents received, interest and dividends received, alimony received, proceeds from selling crops, and many other types of income. Some income, however, is exempt from income tax. This includes interest on municipal bonds.
Adjustments: (usually reductions) to gross income of individuals are made for alimony paid, contributions to many types of retirement or health savings plans, certain student loan interest, half of self-employment tax, and a few other items. The cost of goods sold in a business is a direct reduction of gross income.
Business deductions: Taxable income of all taxpayers is reduced by tax deductions for expenses related to their business. These include salaries, rent, and other business expenses paid or accrued, as well as allowances for depreciation. The deduction of expenses may result in a loss. Generally, such loss can reduce other taxable income, subject to some limits.
Personal deductions: Individuals are allowed several nonbusiness deductions. A flat amount per person is allowed as a deduction for personal exemptions. For 2012 this amount is $3,800. Taxpayers are allowed one such deduction for themselves and one for each person they support.
Standard deduction: In addition, individuals get a deduction from taxable income for certain personal expenses. Alternatively, the individual may claim a standard deduction. For 2012, the standard deduction is $5,950 for single individuals, $11,900 for a married couple, and $8,700 for a head of household.
Itemized deductions: Those who choose to claim actual itemized deductions may deduct the following, subject to many conditions and limitations: Medical expenses in excess of 7.5% of adjusted gross income, State, local, and foreign taxes, Home mortgage interest, Contributions to charities, Losses on nonbusiness property due to casualty, and Deductions for expenses incurred in the production of income in excess of 2% of adjusted gross income. Capital gains: and qualified dividends may be taxed as part of taxable income. However, the tax is limited to a lower tax rate. Capital gains include gains on selling stocks and bonds, real estate, and other capital assets. The gain is the excess of the proceeds over the adjusted basis (cost less depreciation deductions allowed) of the property. This limit on tax also applies to dividends from U.S. corporations and many foreign corporations. There are limits on how much net capital loss may reduce other taxable income.
Tax credits: All taxpayers are allowed a tax credit for foreign taxes and for a percentage of certain types of business expenses. Individuals are also allowed credits related to education expenses, retirement savings, child care expenses, and a credit for each child. Each of the credits is subject to specific rules and limitations. Some credits are treated as refundable payments.
Alternative Minimum Tax: All taxpayers are also subject to the Alternative Minimum Tax if their income exceeds certain exclusion amounts. This tax applies only if it exceeds regular income tax, and is reduced by some credits.
Tax returns: Individuals must file income tax returns in each year their income exceeds the standard deduction plus one personal exemption, or if any tax is due. Other taxpayers must file income tax returns each year. These returns may be filed electronically. Generally, an individual's tax return covers the calendar year. Corporations may elect a different tax year. Most states and localities follow the federal tax year, and require separate returns.
Tax payment: Taxpayers must pay income tax due without waiting for an assessment. Many taxpayers are subject to withholding taxes when they receive income. To the extent withholding taxes do not cover all taxes due, all taxpayers must make estimated tax payments.
Tax penalties: Failing to make payments on time, or failing to file returns, can result in substantial penalties. Certain intentional failures may result in jail time.
Tax returns may be examined and adjusted by tax authorities. Taxpayers have rights to appeal any change to tax, and these rights vary by jurisdiction. Taxpayers may also go to court to contest tax changes. Tax authorities may not make changes after a certain period of time (generally 3 years).
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CREDIT CARD 101 The Credit card - You can use a credit card to buy things and pay for them over time. But remember, buying with credit is a loan - you have to pay the money back. And some issuers charge an annual fee for their cards. Some credit card issuers also provide “courtesy” checks to their customers. You can use these checks in place of your card, but they’re not a gift - they’re also a loan that you must pay back. And if you don’t pay your bill on time or in full when it’s due, you will owe a finance charge - the dollar amount you pay to use credit. The finance charge depends in part on your outstanding balance and the annual percentage rate (APR).
Charge card - If you use a charge card, you must pay the balance in full each time you get your statement.
Debit card - This card allows you to make purchases in real-time by accessing the money in your checking or savings account electronically.
The Fine Print When applying for credit cards, it’s important to shop around. Fees, interest rates, finance charges, and benefits can vary greatly. And, in some cases, credit cards might seem like great deals until you read the fine print and disclosures. When you’re trying to find the credit card that’s right for you, look at the:
Annual percentage rate (APR) - The APR is a measure of the cost of credit, expressed as a yearly interest rate. It must be disclosed before your account can be activated, and it must appear on your account statements. The card issuer also must disclose the “periodic rate” - the rate applied to your outstanding balance to figure the finance charge for each billing period.
Some credit card plans allow the issuer to change your APR when interest rates or other economic indicators - called indexes - change. Because the rate change is linked to the index’s performance, these plans are called “variable rate” programs. Rate changes raise or lower the finance charge on your account. If you’re considering a variable rate card, the issuer also must tell you that the rate may change and how the rate is determined.
Before you become obligated on the account, you also must receive information about any limits on how much and how often your rate may change.
Grace period - The grace period is the number of days you have to pay your bill in full without triggering a finance charge. For example, the credit card company may say that you have 25 days from the statement date, provided you paid your previous balance in full by the due date. The statement date is on the bill.
The grace period usually applies only to new purchases. Most credit cards do not give a grace period for cash advances and balance transfers. Instead, interest charges start right away. If your card includes a grace period, the issuer must mail your bill at least 14 days before the due date so you’ll have enough time to pay.
Annual fees - Many issuers charge annual membership or participation fees.Some card issuers assess the fee in monthly installments.
Transaction fees and other charges - Some issuers charge a fee if you use the card to get a cash advance, make a late payment, or exceed your credit limit. Some charge a monthly fee if you use the card - or if you don't.
Customer service - Customer service is something most people don’t consider, or appreciate, until there’s a problem. Look for a 24-hour toll-free telephone number.
Unauthorized charges - If your card is used without your permission, you can be held responsible for up to $50 per card. If you report the loss before the card is used, you can’t be held responsible for any unauthorized charges. To minimize your liability, report the loss as soon as possible. Some issuers have 24-hour toll-free telephone numbers to accept emergency information. It’s a good idea to follow-up with a letter to the issuer - include your account number, the date you noticed your card missing, and the date you reported the loss.Keep a record - in a safe place separate from your cards - of your account numbers, expiration dates, and the telephone numbers of each card issuer so you can report a loss quickly.
CREDIT REPORT FACTS: Since the slightest financial mistake can affect how much credit you qualify for, and the interest rates you will have to pay on your loan, times like these should make you want to monitor your credit more closely. And there are a number of companies out there that offer this service. You can get your credit report from - Equifax®, Experian® and TransUnion®.
Here are some examples of the information credit monitoring services provide that you won’t get on a free credit report: Making sense of reports. Each of the three major credit reporting agencies issue reports in different ways. They can be difficult to understand if you don't have a lot of experience reading credit reports. A monitoring service can help you synthesize that information in a way that's easy to read and decipher.
Access to all agencies in a single report. Not only do each of the major reporting agencies not compile reports in the same way, they also don't necessarily share data. So, while you might not have a blemish on one agency's report, one may appear in a report from a different agency. A credit monitoring service allows you access to reports based on data from all three agencies, so you can check them all for discrepancies. Because of the lack of formatting in the free credit reports, it can be difficult to impossible to compare and contrast the credit reports you receive from the different agencies.
Daily monitoring. Whenever you request a free report, the information you get back reflects your financial situation as it stands at the time of your request. So, where a one-time free credit report provides a snapshot in time of your credit history, credit monitoring gives you a more complete, moving picture. As you work toward improving your credit rating in order to make a major purchase, you can keep track of your progress and apply for financing when you feel most comfortable.
Alerts. In addition to giving you daily updates on your credit, you can and should pick a credit monitoring service that will alert you if certain changes are detected in your credit report. That way, if you become a victim of identity theft or other related fraud, you have the ability to deal with it immediately and keep your credit in good standing.
The bottom line is that by spending a few dollars to monitor your credit, you may end up saving yourself a significant amount of money in the long run because you'll be able to get a better interest rate on a mortgage or large loan. You also will have the added benefit of knowing when your credit has been compromised.
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DO YOU KNOW THE THREE C'S OF CREDIT EVALUATION? CAPACITY This refers to the amount of debt you can realistically pay given your income. Creditors look at how long you’ve been on your job, your income, and the likelihood that it will increase over time. They also look to see that you’re in a stable job or at least a stable industry. So when you fill out a credit application, make your job sound as stable and high-level as you honestly can. Are you a secretary, or are you an “executive assistant” or “office manager”? Present yourself in the best possible light, but don’t mislead or lie. Because employment history and income may not be included in your credit report, creditors may get that information from you, your records, and your employer.
Creditors do use your credit report to examine your existing credit relationships, such as credit cards, bank loans, and mortgages. They want to know your credit limits (you may be denied additional credit if you already have a lot of open credit lines), your current credit balances, how long you’ve had each account, and your payment history-whether you pay late or on time.
COLLATERAL Creditors like to see that you have assets they can take if you don’t pay your debt. Owning a home or liquid assets such as a mutual fund may offer considerable comfort to a creditor reviewing an application. This is especially true if your credit report has negative notations in it, such as late payments. A credit report won’t tell a creditor what assets you own. Of course, if your mortgage payments are reported, the creditor will know that you own a home and how much you owe on the mortgage.
CHARACTER Creditors develop a feeling of your financial character through objective factors that show stability. These include the length of your residency, the length of your employment, whether you rent or own your home (you’re more likely to stay put if you own), and whether you have checking and savings accounts. Credit reports will tell creditors how long you have maintained credit accounts and how long you have lived at your current address, and they may have employment information. Some specialty credit reporting agencies include information on whether you have bounced checks.
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UFREETV.COM™ encourages you to learn all the details of your financial contracts before signing any documents or making any decisions.
CITI-FORWARD THE RECOMMEDED CREDIT CARD FOR TEENS: CARD DETAILS BELOW: Citi Forward® Card Earn 5 rewards points for every $1 spent at restaurants (including fast food), books, music and movies; 1 point for every $1 on all other purchases* Up to 1,200 bonus ThankYou® Points per year for paying on time and staying under your credit limit Up to 2% Purchase APR reduction (which means you’ll pay less interest if you carry a balance) when you make a purchase, stay under your credit limit and pay on time 3 billing periods in a row†† 0% Intro APR on purchases for 7 months. After that the standard variable APR will be 13.99% - 22.99% based on your credit worthiness† Extra Protection Identity theft protection $0 Liability on fraudulent charges Cell phone protection More Great Benefits No annual fee† No co-signer required Manage your account online, on your Smartphone, or on your tablet. Citi® Dividend Card For College Students Enroll to earn 5% cash back on eligible purchases at Macy's, Electronics stores and Toy stores from October 1 through December 31, 2012. A full 1% cash back on all other purchases. Free enrollment each quarter for new categories that earn additional cash back. 0% Intro APR on purchases for 7 months. After that the standard variable APR will be 13.99% - 21.99% based on your credit worthiness1 Extra Protection Identity theft protection $0 Liability on fraudulent charges More Great Benefits No annual fee1 No co-signer required Manage your account online, on your Smartphone, or on your tablet.
ABC Family currently offers a slate of mostly reruns of contemporary comedies, such as Full House, 8 Simple Rules, Grounded For Life, Still Standing, What I Like About You, America's Funniest Home Videos, That '70s Show and My Wife and Kids, with the only off-network drama series on the schedule being Friday Night Lights (since moved to ESPN Classic due to low ratings and better audience compatibility) and Gilmore Girls (which resumed airing weekdays at 5pm ET in February 2012 as reruns of Secret Life performed under expectations). Since 2000, the network has aired several sitcoms that have aired on ABC's former TGIF block, including the Miller-Boyett produced Step by Step (one of the longest-running shows on the channel, running from 2001 to 2010), Family Matters (2003-2008), Two of a Kind (1999-2005), Sabrina, the Teenage Witch (2006-2011), with Full House and Boy Meets World the only two TGIF series that are currently airing on the network.
LIST OF SHOWS ON abc family:
Current original programs The Secret Life of the American Teenager (2008-present) Pretty Little Liars (2010-present) Melissa & Joey (2010-present) Switched at Birth (2011-present) The Lying Game (2011-present) Jane by Design (2012-present) Bunheads (2012-present) Baby Daddy (2012-present) Future original programs Beverly Hills Nannies
Former original programs 10 Things I Hate About You (2009-2010) Back on Campus Beautiful People (2005-2006) Brat Camp (2004) Da Möb (2009) Donkey Kong Country (1998-2001) Falcon Beach (2006-2007) Great Pretenders (1999) Greek (2007-2011) Huge (2010) Kicked Out Knock First (2003) Kyle XY (2006-2009) Las Vegas Garden of Love (2005) Lincoln Heights (2007-2009) My Life is a Sitcom Maniac Mansion Make It or Break It (2009-2012) The Nine Lives of Chloe King (2011) Roommates (2009) Ruby & The Rockits (2009) Slacker Cats (2007-2009) State of Georgia (2011) State of Grace Switched! Switched Up Schooled The Brendan Leonard Show The Home and Family Show The Middleman (2008) Amateur Hour (Revival) (1992) Three Moons Over Milford (2006) Trimphix Venus and Serena: For Real Scariest Places On Earth Wildfire (2005-2008) Syndicated programming
Current off-network syndicated programs The 700 Club (2001-present) The 700 Club Interactive (2001-present) 8 Simple Rules (2007-present) America's Funniest Home Videos (Tom Bergeron era, 2007-present) Boy Meets World (2004-2007, 2010-present) The Fresh Prince of Bel-Air (2008-present) Gilmore Girls (2004-present) Grounded for Life (2005-present) Still Standing (2010-late January 2012; March 12, 2012-present) That '70s Show (2008-present) Future off-network syndication programs The Middle (Fall 2013)
With more than a billion cards out there-around five cards for every American-it’s a safe bet that you’ve got at least one handy. Take a good look at it. What does it represent to you-a financial management tool or a burden? Do you receive many benefits from your cards, or is the lender the one receiving all the benefits, in the form of interest payments and fees from you?
Credit makes it easy to buy what we need and want, but in this society obsessed with obtaining all kinds of things, credit can become a crutch instead of a convenience. Still, credit cards have become virtual necessities in our capitalistic, technology-driven society. Try to rent a car without a card, and you’ll see what I mean!
With credit cards, shopping online is a breeze. What about reserving airline tickets? Ordering from a catalog? And mailing a check is almost a thing of the past. Using a credit card is faster, easier, and generally a more secure way of doing business.
What’s more, if you strategically use the right cards, you’ll get many other benefits from them, including generous gift certificates, airline tickets, and cash rebates. If you’re wondering how that can be possible, it’s largely because of competition. At any given time, typically thousands of competing credit card offers are targeting you. Card issuers want your business so badly that they’re willing to dangle all sorts of juicy carrots in front of you, chock full of tempting rewards and rebates.
Industry research indicates U.S. card issuers will spend $18.4 billion on rewards in 2010. In 2006, they “only” spent $10.3 billion. If they’re giving away that much to get and keep our business, imagine how much money they’re making! Still, isn’t it great that competition is so tough for them, they have to offer generous perks just to woo and keep us?2 If you “play your cards right,” you’ll become what lenders call a deadbeat, meaning you reap the rewards of your cards without paying any interest or fees. Or maybe you’re a cardholder with revolving debt, which means you don’t pay off your balance in full each month-and you do pay interest. If you fall into this category, you’re the credit card issuers’ ideal customer.
Whichever type of card user you happen to be, you can learn a lot about using credit wisely, getting out of debt, avoiding a high-debt lifestyle, and taking advantage of the benefits and rewards of card usage.
Choosing a Credit Card That Will Benefit Your Bottom Line Comparison shopping is the best way to find a card with the right perks for you. Before we get to fun subjects like deciphering the fine print in credit card offers, let’s quickly go over the basic characteristics of a credit card.
One of the easiest ways to understand how a credit card works is to compare it to a debit card. Even though a debit and credit card look the same, their functions are very different.
Credit Card Basics Every time you use a credit card, you’re actually borrowing money from a bank or other financial institution. When you charge something, the card-issuing bank pays what you owe to the merchant that accepted your card for payment. In turn, you pay the money back to the bank. By signing up for a credit card, you agree to pay back the money that you borrow, plus any interest or finance charges that accrue on the amount you owe until you’ve paid it all back. Put simply, credit cards are a type of loan.