The elusive nature of shadow inventory

By Marcie Geffner - California Real Estate magazine

The term "shadow inventory" evokes scary images, armies of darkened houses hidden in the foothills ready to march across the land, bringing destruction and misery to everyone in their path.

The notion is fanciful, but does a shadow inventory really exist, and if so, what are its implications for Realtors?

One useful definition comes from CoreLogic. Sam Khater, a senior economist at the property data and analytics firm in Santa Ana, says shadow inventory is "the pending supply of distressed property that will hit the market."

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Rapid rescoring: 'black art' or legitimate service?

By Marcie Geffner -

Credit bureaus typically take up to 30 days or longer to correct an error or resolve a dispute in a consumer's credit report or file. But suppose there was a way for you to speed up that process and get your credit history -- and credit score -- updated in just a few days. Well, there is.

Such services, known as rapid rescoring, do exist, and they're legit, according to Anthony Sprauve, a spokesperson for, a consumer information website operated by FICO, which invented the FICO credit score used by most mortgage lenders.

When prepaid cards make sense

By Marcie Geffner -

Prepaid debit cards have gotten a bad rap and with good reason. No doubt the cards are convenient, but high fees make them a controversial choice for anyone who has access to a checking account and the self-discipline to avoid overdrafts.

Yet the use of prepaid cards is on the rise, increasing 21.5 percent from 2006 to 2009, according to a Federal Reserve study of noncash payment methods.

That suggests that at least some consumers prefer to use prepaid cards rather than checks, credit cards or bank debit cards. And indeed, there are a few situations in which the benefits of a prepaid card may outweigh the disadvantages.

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How we saved a lot of money

By Marcie Geffner -

Many people struggle to save money. But others find saving allows them to finance their biggest goals without the added interest expense of debt.

Here, three big savers tell how they socked away money for a goal: $15,000 for a new car, $85,000 for a condominium and $5,000 for five rooms of new carpeting.

Elle Green, 35, a recipe-testing and development consultant in Memphis, Tenn., makes a mean sweet potato cake, and that's "mean" in a good way. In fact, Green's cakes are so popular that her hobby of baking them for family and friends enabled her to save $15,000, which she used to buy a new car.

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Refinancing? Use this document checklist

By Marcie Geffner -
If anything about refinancing your mortgage might be described as "fun," it would have to be locking in your new lower interest rate. But once that's done, you'll have to deal with the decidedly not-fun part: gathering the documentation you'll need to support your loan application.
To get started and stay organized, it's helpful to have a checklist of which documents you'll need. While each loan officer or mortgage broker might have their own specific checklist, here's a look at generally what you can expect:
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Expiring short sale tax relief could cost home sellers

By Marcie Geffner -

A federal income tax break that benefits people who sell their home in a so-called short sale is set to expire Dec. 31, potentially exposing these sellers to higher tax bills. Sellers have little control over the matter, though being financially insolvent might help, if Congress doesn't come to the rescue.
The tax break at issue is the ability to exclude certain mortgage debt forgiven by a lender from ordinary income. For example, if your mortgage balance was $150,000, you sold your home for $120,000 and the lender wrote off $30,000, you might owe income tax on that amount.

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Is your house a scam magnet?

By Marcie Geffner -

Magazines. Meat. Home repairs. Vacuum cleaners. Asphalt paving. Those are but a few of the many products that are sold door-to-door in some parts of the U.S.

Door-to-door sales aren't new, but consumer complaints about scams in such solicitations are on the rise , according to Katherine Hutt, a spokesperson at the national Council of Better Business Bureaus (BBBs) in Washington, D.C.

"Unscrupulous marketers sometimes trick consumers into paying hundreds of dollars for items they don't want or can't afford. Oftentimes, their presentations are so slick consumers aren't even aware they've actually made a purchase," Hutt says.

High-pressure sales tactics
Your front door is attractive to scammers for much the same reasons it appeals to legitimate salespeople, explains Susan Grant, director of consumer protection at the Consumer Federation of America, an association of nonprofit consumer-advocacy groups in Washington D.C. In both cases, Grant says, the aims are to catch you off-guard, quickly establish rapport, play on your politeness and create a sense of urgency to get you to say yes.

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How mortgage needs change over lifetime

By Marcie Geffner - Bankrate

People of different generations tend to be best served by specific types of mortgages.

While any home loan might be the right choice for any age, a homeowner's mortgage needs tend to change over a lifetime. Here's a look at which loans appeal most to people who are just starting out, approaching or hitting middle age, getting ready to retire or moving beyond their career days.

First Home Loan

Many of today's young people are well-positioned to buy their first home, says Jim Pomposelli, a mortgage banker at The Federal Savings Bank in Chicago.

"We're dealing with a generation that's much more responsible," he says. "These are people who have great credit and solid, stable income. They just don't have the down payment, and they have student loan debt, which is a huge burden."

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A Guide To the Good Faith Estimate or GFE

By Marcie Geffner - Bankrate
How much is this new loan going to cost me?
That's a question most people naturally ask when they borrow money to buy a house or refinance their existing mortgage.
An approximation of the final figure can be found on the Good Faith Estimate, or GFE, a three-page government-mandated form mortgage brokers and lenders are required to give prospective borrowers within three days of a loan application.
Here's a section-by-section dissection of the form:
The top two sections on Page 1 explain why the form is important. First, it's a summary of the loan terms and estimated settlement charges, and second, it can be used to shop and compare the terms and charges offered by multiple lenders or mortgage brokers. It's that simple.
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What happens to dead person's credit

By Marcie Geffner -

Smart consumers know the value of good credit. But what happens to that credit record and score when someone dies?

Answer: The individual's credit accounts and files should be flagged with a so-called death indicator to protect against misuse of the information, including fraud and identity theft.

That flagging can occur in several ways, says Anthony Sprauve, a spokesman for, a consumer information website operated by FICO, which invented the FICO credit score.

The most direct way is for the executor of the deceased's estate to notify the three credit bureaus -- Experian, TransUnion and Equifax -- of the person's death.

"That essentially prevents a FICO score from being created or a credit report from being pulled for that person," Sprauve says. "It shuts the process down."

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Dial 'M' for mortgage help

By Marcie Geffner -

If you're having difficulty making your mortgage payments -- and many homeowners are -- you're probably wondering who you should call for help. Experts say the worst thing you can do is ignore the problem. Here are five phone calls to make if you need mortgage help:
No. 1: Your loan servicer. The most important call will be to your loan servicer, the company that collects and manages your payments for your lender.
Calling your servicer is paramount because no one else has the power to make a decision as to what will happen with respect to your mortgage.

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Bottom line on small business credit cards

By Marcie Geffner - Bankrate

A small-business credit card can be a perfect financial product for a small-business owner. But "can be" doesn't always mean "is." Rather, owners must consider their needs, weigh the costs and risks, and read the small print before they decide.

Business credit cards offer some nice benefits, according to Janet Zablock, global head of small business at payment processing giant Visa in San Francisco.

Specifically, she explains, these cards can help owners separate their business and personal expenses, get better views of their operating costs, bridge the gap between receivables and payables by periodically revolving business debt, establish a business credit history and take advantage of discounts offered through a business credit card program.

"The key is keeping personal versus business separate and making sure they're responsible in managing the financial end of the business," she says.

American Express, Bank of America, Chase, Capital One and Citi all offer small-business credit cards, as do many smaller banks and other financial institutions. Some cards have no annual fee. Others charge $59 to $95 per year or more. The first-year fee is often waived as an inducement to new customers.

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11 dumb excuses not to save money

By Marcie Geffner - Bankrate

It's easy to come up with reasons not to save money for an emergency, job loss, retirement or other need or goal, but not saving can cause considerable financial pain down the road. That's why it's smart to regularly put money in a savings account where it's available for whatever happens in the future.

"Saving is about mindset," says Bob Morrison, principal at Downing Street Wealth Management LLC, a financial planning firm in Littleton, Colo. "It doesn't matter whether you make minimal dollars or a significant amount, you should save a certain percentage and learn to live within that income because you have a responsibility to provide for yourself and your goals for the future."

With that in mind, here are 11 lame excuses not to save money and why they don't work:

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Why homeowners decide not to refinance

By Marcie Geffner -
If you're like many other homeowners, you might have at least two compelling reasons to refinance your mortgage: To lower your interest rate and to slash your monthly payment. But despite those benefits, you still might not be in a position to refinance.
Mortgage specialist Joe Metzler at Mortgages Unlimited in St. Paul, Minn., says he gets calls every day from people who are convinced they can refinance, but turn out to be misinformed about loan programs or overconfident about their ability to qualify for a new loan. He tells them "the big bold lettering looks awesome, but the details are in the small print."
In other cases, you may qualify for a refinance, but still decide not to do so.

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Why we put up with rock-bottom CD rates

By Marcie Geffner - Bankrate

Once upon a time in the U.S., people could purchase long-term bank certificates of deposit, or CDs, that paid interest rates of 10 percent or more per year.

That might sound like a fairy tale, but in fact it's true.

In the mid-1980s, five-year CD rates topped out near 12 percent, according to a Bankrate CD rate chart of national averages. Since then, however, long-term CD rates have tumbled so precipitously that investors today can find five-year CDs with rates ranging from less than 0.5 percent to perhaps 2.35 percent at best at some credit unions. The typical payout for a five-year jumbo CD ($100,000 or more) is 1.6 percent to 1.8 percent, a premium of about 1 percent compared with shorter-term CD rates, according to Bankrate's data.

Investors might well wonder why long-term CD rates are so low and why the premium for a longer term is so small. Arlen Olberding, founder of Guidepost Financial Planning in Fort Collins, Colo., suggests some trends that affect CD rates.

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BPO speedwagon

By Marcie Geffner - California Real Estate magazine

Broker price opinions, or "BPOs," can be an attractive opportunity for Realtors.

Some turn these valuations, which fall between an appraisal and comparative market analysis, into a lucrative sideline. Others say BPOs are a break-even activity, but lead to listings of bank-owned homes or market intelligence that helps them put together other transactions.

Bill De Ridder, broker/owner of Quality First Real Estate in San Diego, has farmed out more than 350 BPOs to approximately 50 California real estate agents since September 2010. The agents complete the assignment and return the information to De Ridder, who forwards it to his clients, which include banks, loan servicers and attorneys representing banks in homeowner bankruptcy cases.

"It seemed like an easy avenue to explore," De Ridder says.

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How to pay off a mortgage more quickly

By Marcie Geffner - Bankrate

A lot of homeowners want to pay off their mortgages before the end of the loan term. This is especially true for borrowers who want to repay their home loans before retirement. There are a number of ways to accomplish a mortgage payoff.

The two easiest ways to put more money toward a mortgage are to set up automatic payments from a bank account or use the lender's website, explains Jerald Banwart, senior vice president of customer operations at Wells Fargo Home Mortgage in Des Moines, Iowa.

"For those who have a plan to pay off their loan, we will go out and withdraw the money from your account to make your payments … or you can go online anytime on our website," he says.

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Who needs an EMV credit card

By Marcie Geffner - Bankrate

In the year since the first major issuer debuted an EMV credit card for U.S. consumers, a handful of national banks and credit unions have rolled out their own versions. These credit cards, outfitted with microchips for better security and widely used abroad, aren't exactly taking the country by storm.

But the spate of new offerings raises interesting questions for those who have lived EMV-free so far: Who should get an EMV credit card, and how would someone get one?

More than 1.34 billion EMV cards dot the globe, according to EMVCo, the U.K.-based, industry-owned organization that manages the EMV chip standard. (EMV is an acronym for Europay, MasterCard and Visa -- the developers of the standard.) But the U.S. rollout of chip cards has been slow; issuers mostly have offered cards with a magnetic strip.

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Protect yourself from mortgage fraud

By Marcie Geffner -

Mortgage fraud might seem like a deliberate, straightforward action: either you did it or you didn't. But in fact, any inattentive borrower could get caught up in a scam and later be accused of fraudulent activities.

That warning comes from Curt Novy, president of Corporate Mortgage Advisors, a mortgage fraud analysis firm in San Diego. Novy says he's seen plenty of dicey situations in the 150 or so fraud cases he's worked on in the last five years.

"There are borrowers who didn't know the mortgage broker was committing fraud," he explains. "They didn't understand there were illegal activities, yet they're under the microscope and may have some liability. Did they know or did they just believe what the broker told them?"

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Occupancy fraud: more risk than reward

By Marcie Geffner -

"Do you intend to occupy this property as your principal residence?"

The question, indicated by check boxes on most mortgage loan applications, might seem straightforward. But if you misrepresent your intention, it is a crime known in real estate lingo as "occupancy fraud."

Occupancy fraud occurs when a borrower says he or she plans to live in a home, all the while knowing the property will be rented out, according to Curt Novy, president of Corporate Mortgage Advisors, a mortgage fraud analysis firm in San Diego.

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"Best in Business" Award earned its sixth "Best in Business" national award from the Society of American Business Editors and Writers (SABEW) for its special package, "Financial Regulation, One Year Later." SABEW honored in the Feature Category, Digital Division for Large Websites.

The editorial team is led by editor-in-chief Julie Bandy and managing editor Katie Doyle. Senior editor Steve Pounds oversaw the award-winning "Financial Regulation, One Year Later" package. Senior banking reporter Claes Bell, staff reporter Janna Herron and freelance contributors Marcie Geffner and Katherine Lewis also contributed to the package, which focused on the aftermath of the landmark Dodd-Frank Wall Street Reform and Consumer Protection Act.

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The Future of Housing

By Marcie Geffner - California Real Estate

It's no secret that most of California's housing markets have been in a prolonged slump. So what would it take for housing to reverse course and enter a sustainable rally?

The answer involves economic, political and social factors, all of which revolve around an end to the uncertainty that has characterized so much since the national housing crash began.

With that in mind, here's a look at five areas that would make a difference: demand, supply, equity, financing and policy.

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How foreclosures affect buyers and sellers

By Marcie Geffner - Bankrate

If anything is certain about the foreclosure crisis, it's that it isn't over. That fact has important implications, not only for people losing their homes, but also for those planning to sell or buy a home this year.

As of October 2011, some 3 million properties were in foreclosure, headed that way or already owned by banks, according to CoreLogic, an information, analytics and business services company in Santa Ana, Calif.

Approximately 1.6 million of those homes were believed to be within the so-called shadow inventory, a supply of foreclosure properties not yet listed for sale. It's a major stumbling block to a housing recovery, says Mark Fleming, chief economist of CoreLogic.

"It puts downward pressure on home prices, which hurts home sales and building activity," Fleming said in a statement.

Given that prelude, here's what sellers and buyers can expect.

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Save money by paying off mortgage early

By Marcie Geffner - Bankrate

Paying off your mortgage might sound like an ambitious New Year's resolution, especially if you have recently refinanced into a 30-year term. But it's still smart for homeowners to give some serious thought as to how they'll pay off their home loan; if not in 2012, then sometime.

An early mortgage payoff can net substantial interest savings compared to making scheduled payments for 15 or 30 years.

Paying more quickly reduces your housing cost, freeing up that money for other needs and wants, says Ronit Rogoszinski, a wealth adviser at Arch Financial Group in Garden City, N.Y. You'll still be responsible for property taxes, homeowners insurance, and home maintenance and repairs, but your mortgage payment will disappear.

"Once that money can remain in your pocket, you control that money," Rogoszinski says. "It's yours. It's not going to someone else."

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Don't let investment fees strangle profits

By Marcie Geffner - Bankrate

Investors are understandably eager to earn high returns. But nothing erodes that eagerness or kills the investor's confidence in his or her advisers like a plethora of investment fees that eat away at those gains.

That's one reason investors are paying a lot more attention to fees these days, according to Ram Subramaniam, head of products at TD Ameritrade, an online stock brokerage firm in Omaha, Neb.

"Any fee is getting more scrutiny, partly because the market returns aren't as attractive as they were," he says. "People are conscious and aware of what they're paying. What you pay in fees eventually impacts your return."

Here's what investors need to know:

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How three homeowners fought their property tax bills

By Marcie Geffner - Bankrate

Declining house values create great opportunities for homeowners to contest their property tax bills and potentially save big money.

Each jurisdiction has its own rules, procedures and deadlines to appeal property taxes. The bottom line is that a little research, communication and patience can pay off when you fight a property tax bill.

To prove the point, here are three real-life stories of homeowners who have fought -- or are fighting -- their property tax assessments.

Best comps win

Michael Garard, a real estate broker at Garard & Associates in Highlands Ranch, Colo., has contested the property tax assessment on his house three or four times in the last 10 years with mixed results. Most recently, he scored a big win: a drop in the valuation from $535,000 to $480,000 that will cut his tax bill by about $300 a year for at least two years.

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How to divorce your mortgage

By Marcie Geffner -

A house is often a major point a contention when a married couple decides to divorce. But whereas spouses once fought mainly over who would own the house, some experts say arguments today are more likely to zero in on who will be responsible for the mortgage.

"We see more and more nowadays that if the mortgage exceeds the value of the property, neither spouse wants that obligation," says Carl Palatnik, a principal at the Center for Divorce and Finance, a financial planning firm in Melville, N.Y. "It's a very difficult issue."

If you're keeping the house, the best way to deal with the mortgage is usually for one spouse to refinance, Palatnik says.

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6 new year's resolutions for homeowners

By Marcie Geffner -

The start of a new year is a popular time to make resolutions: promises to yourself to achieve specific goals and objectives. Financially speaking, you might want to pay off debt, build up savings, prepare for retirement or better manage your daily spending in 2012.

Those are good goals to have, and if you're a homeowner or intend to become one this year, your house might give you some great ways to bring your goals to fruition.

With that in mind, here are six New Year's resolutions to put on your list.

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4 tips for holiday-season home sellers

By Marcie Geffner -

Conventional wisdom says the holidays are the worst time of the year to try to sell your home. But a new survey suggests this so-called wisdom might be wrong.

In fact, 60 percent of real estate agents polled by said they advise homeowners to sell during the holidays. Another 30 percent said they recommend a December sale if the seller is motivated to move quickly.

Why do so many agents favor December sales? A cynic might say they're eager to encourage any home sale at any time, regardless of the seasonal pros and cons.

But the Realtors themselves cited other specific advantages.

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Homeowners benefit from mortgage interest deduction

By Marcie Geffner - Virginia Association of Realtors

The federal mortgage interest deduction, known as "the MID," is one of the greatest means to encourage homeownership and promote healthy housing markets not only in Virginia, but throughout the nation. That's why all homeowners, including those who don't take the deduction, should be concerned about recent proposals in Washington, D.C., to cut back this important benefit.

Homeowners who don't have a mortgage or don't itemize their federal tax deductions might well question the MID's value. After all, if you own your home free and clear, you don't pay any mortgage interest that you can deduct, and if you take the standard deduction in lieu of itemizing, any mortgage interest you pay won't affect your tax bill.

But the fact is that homeowners who don't take the deduction still benefit from it.

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Lower loan limits could constrain home sales

By Marcie Geffner - Virginia Association of Realtors

Home buyers will face greater difficulty obtaining relatively larger mortgages when maximum loan sizes shrink Sept. 30, 2011. This new constraint on credit is expected to be yet another hardship for housing markets and, consequently, homeowners.

These maximum sizes or amounts, known as "loan limits," apply to two types of mortgages: conforming loans lenders can sell to Fannie Mae and Freddie Mac and FHA loans insured by the Federal Housing Administration (FHA). Fannie Mae and Freddie Mac are two quasi-government entities that purchase loans to be securitized and resold to investors.

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The skinny on checking accounts for teenagers

By Marcie Geffner -

Many banks are so eager to sign up teenagers as new customers that they've introduced special starter checking accounts specifically for these young people.

A teen checking account can be a good choice, says Luke Reynolds, chief of outreach and program development for the Division of Depositor and Consumer Protection at the Federal Deposit Insurance Corp.

"If a consumer is receiving income and paying bills, he probably wants to open up a checking account so he doesn't pay the enormous fees that unbanked and underbanked people pay," Reynolds says.

Before a teen opens a checking account, he or she should first consider these points.

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6 ways to score discount movie tickets

By Marcie Geffner -

Waving a magic wand and calling out, "ticket price reducto!" may not help you score discount movie tickets.

Fortunately, there are other ways to save money at the movie theater box office.

As ticket prices can top $15 in some cities, you need to have strategies to help you keep your entertainment costs under control. Here are six winners.

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5 reasons to get a new mortgage

By Marcie Geffner -

Mortgage interest rates are near all-time lows and are likely to remain attractive throughout 2012. That means the new year will continue to offer good opportunities for homebuyers who need a new mortgage and homeowners who want to refinance an existing obligation.

With that opportunity in mind, here are five reasons why you might want to get a new mortgage this year, and what you should know about the benefits and hurdles of accomplishing this goal.

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5 ways to save a home sale

By Marcie Geffner -

Home sales get hung up for all sorts of reasons. Sometimes, a buyer can't secure approval for a loan, or a seller won't make repairs the buyer insists are necessary. Appraisal issues often result in delays or failed deals. So do complexities arising from short sales.

These problems are commonplace, judging by a National Association of Realtors survey that found 33 percent of Realtors had experienced one or more contract failures in October 2011. That figure was up from 8 percent a year earlier.

These problems can be stressful and, granted, some sales are doomed never to close. But others can be saved with a little creativity and a lot of patience. Here's how.

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