Friday, May 11, 2012
Trying to Get a ReFi is Crazy
Argghh.
My bank, which shall remain nameless but has a lot of barbarians running around in their funny TV ads, keeps suggesting I refinance my mortgage.
Okay, fine. Any mortgage obtained nearly a decade ago, when mine was, is likely to be at a loan rate far in excess of current rates. Refinancing to a lower rate sounds like a wonderful idea. I save interest over the life of the loan, I don't have to do a full loan application because it's with the same bank, and my monthly payment goes down. Also, they claim they have a "no closing costs" loan. No closing costs, that's music to my ears. I don't have to comparison shop, just talk to my own bank. Sounds great.
I call the bank. I give them information over the phone, and I know they have access to lots more because I also have checking and savings accounts with them. So, right away, they know I am solvent, that I've been paying the mortgage on time for eight years, and that I even have cash sitting idly in a rainy day savings account. And then they ask me what my house is worth today.
THEY WANT ME TO GUESS WHAT MY HOUSE IS WORTH TODAY.
Ha-ha-ha. Guys, I'm not a real estate agent. I'm not a mortgage underwriter. I'm not a home appraiser. I have no blinking clue what my house is worth today.
People in my state are out of work and the industries that used to employ them have packed up and left. People in my state think they're doing okay if they live in a trailer they actually own. People in my state are making it day-to-day through the financial help of relatives.
What is my house worth today? Is the middle-class castle on the hill worth anything if the people down below are starving? I don't have the answer to this question.
The nice lady on the phone insisted that she could not pass my information on to a mortgage specialist until I gave her a guess at what my house is worth. Her computer wouldn't allow it. It wouldn't allow "zero," either. Finally, I just gave her the purchase price I paid.
I hope this bank knows what it's doing, but asking me to value my own home shakes my confidence in the refi process. And in its likelihood of success. I have this sinking feeling that the big smart bank does not have a clue about the value of my home and thus my potential loan-to-value ratio. In fact, the bank may just be in the business of taking applications hoping to get my application fee.
Hey! I thought it was a "no closing costs" loan. It is, but there's an application fee of close to $500. Oh.
Now I suspect refinances are just another category of modern banking craziness.
Friday, February 24, 2012
Why Apple CAN Improve Chinese Labor Practices
This NY Times article, The Dilemma of Cheap Electronics, about Chinese factory labor versus prices on Apple products deserves a reply and here is mine:
The answer is simple because each new piece of electronics gets priced at whatever the manufacturer chooses, and there are many new pieces of electronics year after year.
Apple can easily say the iPad 3 will cost $100 more, and make sure that $100 is in the cost of the factory labor. Because a new technology is being introduced, people will buy it regardless of the price. Yes, undoubtedly there is market research telling Apple at what dollar figure American consumers are price resistant, but of all the companies, Apple is the least concerned with price. Apple sets the new standard of pricing with each new product.
Work from this premise and you realize that every American company with factory workers in China can raise their prices easily. And that approaching Apple, the least price-sensitive company, is the right tactic.
The next part of the problem is to shake down the Chinese factory owners who are making huge profits off the backs of their workers. That's harder to control. No doubt the owners will want the same percentage of profit as in the past. In other words, $99 out of every $1 price rise, or whatever the outrageous figure is. Making that profit and loss statement look different is a much harder trick to pull off, but the threat of going somewhere else is Apple's great leverage.
Bottom line, Apple has the power, and Apple ought to be pressed to make things better. Why not? Every Apple product we buy means a number of Americans who don't have factory jobs. Apple owes its customers some portion of peace of mind about the people it does employ in factories.
The answer is simple because each new piece of electronics gets priced at whatever the manufacturer chooses, and there are many new pieces of electronics year after year.
Apple can easily say the iPad 3 will cost $100 more, and make sure that $100 is in the cost of the factory labor. Because a new technology is being introduced, people will buy it regardless of the price. Yes, undoubtedly there is market research telling Apple at what dollar figure American consumers are price resistant, but of all the companies, Apple is the least concerned with price. Apple sets the new standard of pricing with each new product.
Work from this premise and you realize that every American company with factory workers in China can raise their prices easily. And that approaching Apple, the least price-sensitive company, is the right tactic.
The next part of the problem is to shake down the Chinese factory owners who are making huge profits off the backs of their workers. That's harder to control. No doubt the owners will want the same percentage of profit as in the past. In other words, $99 out of every $1 price rise, or whatever the outrageous figure is. Making that profit and loss statement look different is a much harder trick to pull off, but the threat of going somewhere else is Apple's great leverage.
Bottom line, Apple has the power, and Apple ought to be pressed to make things better. Why not? Every Apple product we buy means a number of Americans who don't have factory jobs. Apple owes its customers some portion of peace of mind about the people it does employ in factories.
Monday, December 12, 2011
The Five Safest Places to Hide Big Cash
I had a lot of fun trolling the net reading people’s ideas about where to hide big money. Of them, the clear winner is the mason jar in the back yard. Unfortunately, according to most stories, it also usually ends in the money being lost because the person can’t remember where it is, or never tells anyone else.
We all would like to have some ways of keeping cash secure enough so a casual stranger won’t find it in five minutes of unsupervised snooping or outright burglary. Making the cash difficult to find is the aim. A safe bolted to the floor would outwit most short-time burglars, but here are some other ideas:
1. Books. Burglars do check bookcases if they have the time. They throw books on the floor to look behind them, and they will open some books looking for book safes. But if you own many, many books, chances are the burglar will give up the book-by-book search long before the money is found. Most burglars want to get in and out in five to ten minutes. Trouble is, a casual visitor to your home might pull out just the one book you’ve hidden the money in. Safe, or not so safe?
2. Clutter. Got clutter? Serious clutter? If you can’t find your valuable stuff, neither can a burglar. You’ve got bigger problems than burglary, though. Safe.
3. On your person, in a money belt or wallet. These are completely secure and invisible. Even if you are mugged, a mugger is not looking for big money, just whatever is in your regular wallet or purse. Very safe.
4. A bank account. It’s your money and they keep it for you. Simple. The down sides are: now the world knows you have this money, and possibly the account could be used by the bank to pay some other account or debt of yours or even frozen by some government entity. This can happen, but most people don’t have to worry about it. Very, very safe.
5. A bank vault. Unlike a bank account, the contents are not insured, not even by your home insurance policy. But you can put anything that fits into your bank safe deposit box and no one gets to know about it or have access. Choose a freestanding bank in a corner of a busy shopping center, or similar. With no contiguous building to tunnel from, and people always around, that vault is likely to stay safe. In a bank robbery, the bank employees would not have access to your box, so the robbers would have to blast. For various security reasons, they are unlikely to have the time to do so, or to rip through every safe deposit box, regardless of what you’ve seen in the movies. Safest of all, unless your bank is run by thieves who have duplicate keys.
If you truly do not trust banks and have significant money to hide, then the jar in the yard is your answer. Burglars who have unlimited time and aren’t just looking for $50 to $200 to fuel a drug habit will eventually find all your most cunning hiding places inside and around your home, but they don't usually arrive with metal detectors. You hope. On the other hand, are you really going to remember where you buried the jar? Of course using a mayonnaise jar with a plastic lid will make metal detecting useless, but then you still have the issue of remembering where the money is. Hmm...
We all would like to have some ways of keeping cash secure enough so a casual stranger won’t find it in five minutes of unsupervised snooping or outright burglary. Making the cash difficult to find is the aim. A safe bolted to the floor would outwit most short-time burglars, but here are some other ideas:
1. Books. Burglars do check bookcases if they have the time. They throw books on the floor to look behind them, and they will open some books looking for book safes. But if you own many, many books, chances are the burglar will give up the book-by-book search long before the money is found. Most burglars want to get in and out in five to ten minutes. Trouble is, a casual visitor to your home might pull out just the one book you’ve hidden the money in. Safe, or not so safe?
2. Clutter. Got clutter? Serious clutter? If you can’t find your valuable stuff, neither can a burglar. You’ve got bigger problems than burglary, though. Safe.
3. On your person, in a money belt or wallet. These are completely secure and invisible. Even if you are mugged, a mugger is not looking for big money, just whatever is in your regular wallet or purse. Very safe.
4. A bank account. It’s your money and they keep it for you. Simple. The down sides are: now the world knows you have this money, and possibly the account could be used by the bank to pay some other account or debt of yours or even frozen by some government entity. This can happen, but most people don’t have to worry about it. Very, very safe.
5. A bank vault. Unlike a bank account, the contents are not insured, not even by your home insurance policy. But you can put anything that fits into your bank safe deposit box and no one gets to know about it or have access. Choose a freestanding bank in a corner of a busy shopping center, or similar. With no contiguous building to tunnel from, and people always around, that vault is likely to stay safe. In a bank robbery, the bank employees would not have access to your box, so the robbers would have to blast. For various security reasons, they are unlikely to have the time to do so, or to rip through every safe deposit box, regardless of what you’ve seen in the movies. Safest of all, unless your bank is run by thieves who have duplicate keys.
If you truly do not trust banks and have significant money to hide, then the jar in the yard is your answer. Burglars who have unlimited time and aren’t just looking for $50 to $200 to fuel a drug habit will eventually find all your most cunning hiding places inside and around your home, but they don't usually arrive with metal detectors. You hope. On the other hand, are you really going to remember where you buried the jar? Of course using a mayonnaise jar with a plastic lid will make metal detecting useless, but then you still have the issue of remembering where the money is. Hmm...
Thursday, December 8, 2011
Four Reasons to Toss Out Something Today
1. Possessions can weigh you down and eventually suffocate you. Lighten the load. You'll feel a huge sense of relief.
2. Your donations will help others. People are prowling thrift stores looking for inexpensive holiday gifts or basics they can't afford to buy new. You can affect the lives of others positively if you donate your unnecessary items in good condition.
3. Recycling is good for the planet. You are the person best qualified to recycle your possessions. Whether you put metal out at the curb for the roving metal guys, or you carefully sort and haul your recyclables to special centers, every item you keep from the landfill helps.
4. Trash should not be kept for sentimental reasons. We all have items that no longer work and cannot be fixed. Their usefulness is long gone, and they should be, too.
You will never wear bell bottoms again. You will never find the match to that one winter glove. You will never fix that radio, glue that broken mug, or repair that bicycle. Send them all to the next best place.
2. Your donations will help others. People are prowling thrift stores looking for inexpensive holiday gifts or basics they can't afford to buy new. You can affect the lives of others positively if you donate your unnecessary items in good condition.
3. Recycling is good for the planet. You are the person best qualified to recycle your possessions. Whether you put metal out at the curb for the roving metal guys, or you carefully sort and haul your recyclables to special centers, every item you keep from the landfill helps.
4. Trash should not be kept for sentimental reasons. We all have items that no longer work and cannot be fixed. Their usefulness is long gone, and they should be, too.
You will never wear bell bottoms again. You will never find the match to that one winter glove. You will never fix that radio, glue that broken mug, or repair that bicycle. Send them all to the next best place.
Saturday, December 3, 2011
Five Reasons to Keep Some Cash in the House
1. If you are elderly, it is expected. Don’t buck the cliché.
2. You don’t have to go to the bank so often
3. It’s fun to open a drawer and find big denomination dollar bills.
4. Having cash you can see and touch makes you feel richer.
5. There are times when having up to $100 in cash in your home is a convenience.
A long, unexpected cab ride, for instance. Paying someone who plowed the snow off your driveway, for another. Forcing cash on a reluctant relative.
When I read that all older people hide cash in their homes, I was surprised. Then I remembered my mother told us she was hiding a little cash in her house, inside the flap of her hardcover copy of Dr. Zhivago. The dear doctor’s stash was used up long before her death. After she died, I found other hidden cash, under the dividers in her vanity table drawer, between the top and bottom of a cardboard box set inside another drawer, inside a sewing table, and more. They were never big dollar amounts by current standards. A five or a ten at most. Finding these little bits of cash was like finding Easter eggs. All good feelings.
2. You don’t have to go to the bank so often
3. It’s fun to open a drawer and find big denomination dollar bills.
4. Having cash you can see and touch makes you feel richer.
5. There are times when having up to $100 in cash in your home is a convenience.
A long, unexpected cab ride, for instance. Paying someone who plowed the snow off your driveway, for another. Forcing cash on a reluctant relative.
When I read that all older people hide cash in their homes, I was surprised. Then I remembered my mother told us she was hiding a little cash in her house, inside the flap of her hardcover copy of Dr. Zhivago. The dear doctor’s stash was used up long before her death. After she died, I found other hidden cash, under the dividers in her vanity table drawer, between the top and bottom of a cardboard box set inside another drawer, inside a sewing table, and more. They were never big dollar amounts by current standards. A five or a ten at most. Finding these little bits of cash was like finding Easter eggs. All good feelings.
Thursday, December 1, 2011
Five Reasons to Sell Your Stocks
1. If you’ve lost money in the market and it bothers you a lot, you’re not cut out to own stocks. Sell.
2. If your stocks are not making you money, find an investment that will produce a profit. Sell.
3. If you need to preserve your principal, the stock market is not a safe place to keep it. Sell.
4. If you are being killed by brokers’ fees or fund management fees, find an investment where the money flows toward you. Sell.
5. If you don’t understand why you’re in a stock or fund, find an investment you do understand. Sell.
The stock market is not for everybody. If you want to keep a few stocks just to feel you're still in the game, fine. But if anything on this list rings a bell, get out of the stock market now. You'll sleep better at night.
2. If your stocks are not making you money, find an investment that will produce a profit. Sell.
3. If you need to preserve your principal, the stock market is not a safe place to keep it. Sell.
4. If you are being killed by brokers’ fees or fund management fees, find an investment where the money flows toward you. Sell.
5. If you don’t understand why you’re in a stock or fund, find an investment you do understand. Sell.
The stock market is not for everybody. If you want to keep a few stocks just to feel you're still in the game, fine. But if anything on this list rings a bell, get out of the stock market now. You'll sleep better at night.
Wednesday, November 30, 2011
Three Reasons to Save
1. It feels great to have a few extra dollars.
2. You can use your savings to leverage better deals from your bank, or start an account.
3. When an emergency occurs, your first thought won’t be “Where will I find the cash to pay for this?”
Do we need more than three reasons?
2. You can use your savings to leverage better deals from your bank, or start an account.
3. When an emergency occurs, your first thought won’t be “Where will I find the cash to pay for this?”
Do we need more than three reasons?
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