Six Tips to Put Your Financial House in Order

If you want to spend less time worrying about your money, then it’s time to get your financial act together. These six strategies can help improve your financial situation and simplify your life at the same time.

1. Put Your Savings on Autopilot

If you haven’t maxed out your 401k or other retirement plan at work, add an extra $50 or $100 every month. Increasing your contributions just a little can make a huge difference over time. By adding $100 per month when you’re 25, you’ll have an extra $330,000 in your 401k by the time you’re 65 if your investments return 8 percent annually, which is below the average long-term return for stocks. Since the investments are pretax, your $100 monthly investment will lower your paycheck by $75 if you’re in the 25 percent bracket. If your employer matches your contribution, you’ll get free money to help you save even more. And it’s the easiest way to save, since the money is automatically invested before you can touch it. If you’ve maxed out your 401k, invest $333 automatically every month in an IRA. Ask your IRA administrator to set up automatic payments.

2. Stop Worrying About Your Investments

Instead of poring over your investment options and wondering when -- and what -- you should buy and sell, have the experts do it for you. Most mutual fund companies, and quite a few 401k plans, now offer target funds that match your investments to your savings time frame. If you’re in your mid-30s, for example, you can invest your retirement money in a 2040 target date fund. This fund invests aggressively when you have more than a decade to go before retirement, then gradually gets more conservative as you approach retirement. These funds are diversified, so you don’t need to invest your retirement money anywhere else.

3. Pay Bills Automatically

Signing up to have your bills paid automatically from your bank account saves you monthly check-writing hassles and mail-delivery worries; it also protects you from costly missed deadlines. After one late payment, some credit-card companies boost interest rates beyond 31 percent and charge late fees of nearly $40. And some card companies raise your rate if you miss a deadline on another card, even if you have a spotless record with them.

4. Streamline Your Files

Go through your financial files and toss what you don’t need. In general, you should keep your tax returns forever, but you can get rid of supporting documents after three years (six years if you have self-employment income). You can also get rid of monthly investment statements after everything matches with your year-end summaries and ATM receipts as soon as the transactions appear on your monthly bank statement.

5. Protect Your Identity the Simple Way

Instead of signing up for expensive services that monitor your credit records for identity theft, do it yourself for free. You can now get a free copy of your credit reports from each of the three bureaus (Equifax, Experian and TransUnion) every 12 months. Stagger your requests so you get one report every four months. Review each one carefully for errors or unauthorized charges.

6. Get Out of Debt

The best thing you can do to improve your financial health is eliminate high-interest debt. Try to use any bonus, raise or tax refund to pay off credit cards in full. Even adding a few hundred dollars to your payments can make a huge difference, especially if you can get your credit card company to lower your rate. If your minimum payment is 4 percent of your debt, a $5,000 balance with an 18 percent interest rate would start with a $200 monthly payment, which would take 32 months to pay off and cost $1,314 in interest. If you pay $500 per month on a 5 percent card, you’ll cut your interest charges to $118 and pay off the balance in just 11 months.

How does this simplify your life? Once you’re out of debt, you won’t have to juggle minimum payments, and you’ll save a ton in interest, which frees up extra cash to reach the rest of your financial goals.

Millions trapped in 'underwater' mortgages

1 in 4 mortgages 'underwater'

Report shows 10.7 million borrowers are stuck with mortgages whose property values are less than what they owe. Las Vegas always wins the title for worst foreclosure rate in the country. But these 5 cities have the fastest-growing foreclosure rates. And they're not the usual suspects.

After losing their homes, these 4 families thought they'd never recover. They've found it difficult to rent and their credit is wrecked, but life is looking up.
-- In a sign that more foreclosures could be on the horizon, 23% of people with mortgages owe more than their home is worth, according to a report released Tuesday.
Almost 10.7 million U.S. mortgages were "underwater" as of September, said research firm First American CoreLogic.
Another 2.3 million homeowners are within 5% of negative territory, the report said. The two figures combined comprise almost 28% of all residential properties with mortgages.
Negative equity, also called an "underwater" or "upside down" mortgage, has become more common as home values plummet. The report is closely watched because borrowers who are underwater are more likely to be foreclosed.
State totals: The majority of underwater mortgages are heavily concentrated in five states that have particularly suffered from the housing bust: Nevada, at 65%; Arizona, at 48%; Florida, at 45%; Michigan, at 37%; and California, at 35%.
These five states have been especially beleaguered because of a high rate of prime loans that went bad. Many of those loans were option-adjustable rate mortgages, in which borrowers could choose to make minimum payments that were so low they did not even offset the interest being accumulated.
When that accumulated debt reaches a certain point -- usually 10% to 25% more than the original principal -- the option-ARMs loans are recast into fixed-rate mortgages. When that happens, many borrowers cannot afford the new payments.

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Brook Geisendorf
USA Realty – Broker. Owner
Direct: 702.521.9975
Email: Brook@usarealtylv.com
www.housesinlasvegasnv.com

Flipping Homes No Longer Profitable, Investors Pursue A Long-Term Strategy

Homeowners are facing an economic crunch from the housing crash, but investors often face even more severe repercussions. More than 1 in 3 foreclosures are of investment properties, and should the foreclosure epidemic worsen as forecast, that number is expected to rise as more investors walk away from mortgages.

During the real estate boom investors and speculators bought homes, fixed them up and many sold within months. But the real estate crash prevents them from doing just that. Living in a home intended to be an investment property has become the answer for some investors, while others select to rent the property. More than 240,000 homes sit vacant nationwide, according to the U.S. Census Bureau.

A key strategy of buying a home to flip has gone by the wayside as more and more real estate investors purchase properties for the long term. Just when and how long it will take to reap profits from their investments is an uncertainty with some economists saying that it could take more than 10 years for the market to become healthy enough to make a good profit.

In his book “The Millionaire Real Estate Investor”, Gary Keller, founder of Keller Williams Realty International, keeps a basic theme: “Buy real estate right, pay it down and pay it off.” The ultimate goal should be to own lots of real estate free and clear for maximum cash flow. That mantra is attracting millions of investors and wannabe investors back into the depressed housing market to invest.

Whatever the length of time, investors still seem ready, willing and able to take the leap into real estate. During the boom investors in Las Vegas, Nevada purchased thousands of properties, rehabbed them or didn’t even do any work to the structure, slapped up a for sale sign and sold the property before the first mortgage payment was due, drawing the criticism of owner occupants in neighborhoods all around Sin City. But those days have long passed and Las Vegas has the distinction of being the worst foreclosure market in the country.

Real Estate speculators typically buy property to make a fast buck without doing work to repair the property, and they are finding themselves in even more trouble these days. The practice paid-off big time during the boom but has landed many speculators in bankruptcy court.

The trouble has added to an over-abundance of property on the market, and is one of the main sectors compiling the record volume of foreclosures. Las Vegas is one community considering a proposal to out-law flipping all together, but whether the movement ever becomes reality is another question considering legal property rights. The FHA now requires a one year (seasoning) period for a home to be resold in order to get a new mortgage and other lenders are considering the same rule.

USA Realty - 702-521-9975

Washington Report: $8,000 Home Buyer Tax Credit

Quick passage by the House last week of a bill extending the $8,000 home buyer tax credit next year for military, diplomatic and intelligence personnel serving overseas increases the odds that Congress will agree to an extension, maybe even an expansion, of the entire credit program well into 2010.

The White House is also signaling that it sees the overall tax credit program -- currently set to expire November 30 -- as an important element in cutting the unemployment rolls and stimulating new jobs next year.

After an economic policy strategy meeting last week in the Oval Office involving President Obama, House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid, congressional aides said Democrats generally support an extension of the housing credit.

Reid already has made clear he wants an extension. He is co-sponsoring a Senate bill that would do so for six months.

Congressman Charles Rangel, chairman of the tax-writing House Ways and Means Committee, sponsored the one-year extension of the credit for military and other personnel serving overseas, and is reported by aides as favoring an extension for the entire program.

The White House has not publicly committed to an extension, but has confirmed that the President is seriously examining that option.

An unexpected development that emerged following last week's White House meeting was the possibility of opening up the credit to a broader group of buyers next year - people who sell their current homes and buy a replacement home.

Though details were scanty, Capitol Hill sources said one option on the table would be to provide a tax credit -- most likely at the $8,000 level -- to replacement home buyers whose incomes do not exceed some limit.

The current credit phases out for single taxpayers with incomes above $75,000, and married purchasers earning $150,000.

A politically sensitive issue hovering over the entire debate on extending the housing tax credit is its cost - what it would add to the federal budgetary deficit. Mark Zandi, chief economist of Moody's Economy.com, estimates that widening the credit to all buyers through next August could cost the government upwards of $30 billion.

Rangel's 12-month extension of the credit for service personnel is estimated to cost more than $300 million, but it's mainly being paid for through an increase in penalties levied by the IRS on taxpayers who fail to file corporate or partnership returns.

The New York Times reported that one possible solution to the cost problem would be to divert money not yet spent out of 2009's $800 billion stimulus legislation.

CityCenter condo prices cut 30 percent

The Veer Towers and the Mandarin Oriental are seen Sept. 11 at CityCenter in Las Vegas. Developers cut the price of the projects' luxury high-rise condominiums by 30 percent.
A much awaited 30 percent price reduction in CityCenter's luxury condominium offerings was announced Monday by developers of the $8.5 billion project.

The move comes as potential buyers of the 2,400 condominium units at three of CityCenter's projects threatened possible lawsuits against developers MGM Mirage and Dubai World. Prices that purchasers agreed upon a few years ago no longer reflect the current market, where sales of high-rise condominiums in Las Vegas have been on life-support.

The price reductions cover The Residences at Mandarin Oriental, Veer Towers and Vdara Condo Hotel.

"We believe that in this economic climate this price reduction is an appropriate step to take on behalf of our buyers so as to provide them greater flexibility in closing on their residences," said MGM Mirage chief design and construction officer Bobby Baldwin, who serves as the president and chief executive officer of CityCenter.

MGM Mirage Chairman and Chief Executive Officer Jim Murren hinted at a potential price reduction in interviews over the summer.

In quarterly financial statements, MGM Mirage said it expected earning $2.6 billion from condominium sales at CityCenter. The price reduction could lower that figure by some $780 million. MGM Mirage has already collected more than $300 million in deposits from CityCenter's condominium buyers.

About half of CityCenter's residential offerings are under contract with potential buyers who agreed to purchase prices from $500,000 for studio-sized units up to $9 million for the penthouse suites atop Mandarin Oriental.

Buyers were required to put down 20 percent of costs and, under Nevada law, could lose up to 75 percent of their down payments if they couldn't close the transactions.

Tony Dennis, executive vice president of the CityCenter Residential Division, said closings are scheduled to begin in January with buyers of the 227 units at Mandarin Oriental. Veer Towers, which has 670 units, are projected to begin closing in February. The 1,500-unit Vdara is expected to start closing sales in March.

Real estate analysts said a 30 percent reduction might be enough of a break to jump-start sales.

CB Richard Ellis Senior Vice President John Knott said CityCenter's condominium reservations began at the peak of the high-rise market. He said MGM Mirage realized prices would have to be dropped if any closings were to take place.

"Given what is being delivered to the market, if someone is getting a $1 million condominium for $700,000, I think they will be happy," Knott said. "Over time, that value is going to come back. It's a challenging market right now."

Union Gaming Group issued a report in August showing that high-rise condominium closings in Las Vegas were taking place at a rate of two units per month. The gaming analysis and research firm concluded MGM Mirage would have to cut the prices at CityCenter based on market conditions.

"As one might expect, our findings would certainly indicate a market that is anemic at best," Union Gaming Group principal Bill Lerner said at the time. He said a 30 percent price cut would help sales.

"The company will likely have some success at this magnitude relative to the consensus expectation of not creating any value from residential," Lerner said.

CityCenter will begin opening in phases starting Dec. 1 with Vdara, which is a nongaming hotel and condominium tower. The nongaming Mandarin Oriental, which has almost 400 hotel rooms, will open on Dec. 4. Aria, CityCenter's 4,004-room hotel-casino centerpiece development, will open Dec. 16.

Call USA Realty 702-454-3584

Home sales contracts in 7-month rally

Realtors' index rises 6.4% in August for 7th straight gain as tax credit deadline boosts activity.

Mortgage Rates

30 yr fixed mtg	5.10%
15 yr fixed mtg	4.58%
30 yr fixed jumbo mtg	6.09%
5/1 ARM	4.18%
5/1 jumbo ARM	4.73%

NEW YORK (CNNMoney.com) -- Homebuyers signed more sales contracts in August than in any month this year, boosted by the looming expiration of a homebuyers' tax credit, according to an industry report released Thursday.

The August Pending Home Sales Index from the National Association of Realtors (NAR) surged 6.4%, the seventh straight month-over-month improvement in the indicator. The increase far exceeded economists' expectations -- a panel of analysts surveyed by Briefing.com had forecast a 1% rise.

Pending home sales rose 3.2% in July.

Pending sales are considered a forward indicator of housing market health since contract signings precede actual closings, which typically occur two to three months later. August contract signings show up in October and November NAR statistics as existing home sales.

Housing markets have gained some ground recently as a tax credit for first-time homebuyers -- which is scheduled to expire Nov. 30 -- stimulated sales of starter, and other, homes.

"No doubt many first-time buyers are rushing to beat the deadline for the $8,000 tax credit, which expires at the end of next month," said Lawrence Yun, NAR's chief economist.

One problem in extrapolating future closings from contract signings, however, is that there are continuing problems obtaining mortgages that may scuttle many deals, according to Yun.

"The rise in pending home sales shows buyers are returning to the market and signing contracts, but deals are not necessarily closing because of long delays related to short sales, and issues regarding complex new appraisal rules," he said.

Those issues also could also lead to some double counting of previous pending sales as buyers whose earlier deals fell through may return to the market and sign new contracts.

Still, the oversized gain in pending sales will surely translate into some increase in closings, and the report added to several other positive recent indicators that housing markets are at least stabilizing, if not in full-blown recovery.

Not all economic and housing indicators have been pointing up. Initial jobless claims climbed this week, according to a Labor Department report, after three weeks of declines.

Foreclosure filings are still well above normal and they threaten to go far higher as the terms of many toxic mortgages, such as interest-only loans and option ARMS, reset over the next six to 12 months and send the monthly mortgage payments of homeowners soaring.

Another housing market question mark is the status of the tax credit for first-time homebuyers, with the industry fearing that home sales could drop sharply if it's allowed to expire.

There are, however, several efforts in Congress to extend the credit and even to expand it to all homebuyers, not just first-timers. That could turbo-charge home sales if it goes through.

Find the best mortgage rate

What you need to know

Finding the best mortgage rate can be tricky, whether buying your first home or trying to refinance your existing one. Here are some tips for getting the best rate:

Three major credit bureaus -- Experian, TransUnion and Equifax -- collect the information that makes up your credit history. This information is used to formulate your credit score.

You can improve your credit score through the following steps:

1. Know how much house you can afford before looking for a mortgage. Try Bankrate's "How much house can you afford?" calculator.

2. Find out your credit score. If it's a bit low, try bumping it up before applying for a mortgage. If your score is already good, keep it there by not closing any credit accounts and by not applying for new credit.

3. Check Bankrate's "Compare rates" feature to find the best mortgage rates in your area.

4. Get all necessary financial paperwork together before meeting with a lender, including:

• Tax returns for the past two years.
• W-2 income statements.
• Two most recent pay stubs.
• Most recent credit card statements.
• Most recent bank and investment account statements.
• Divorce decrees and child-support documents.
• Your budget.

The most important qualifiers for acquiring the lowest mortgage rate possible are to have:

• Good credit score.
• Low debt-to-income ratio.
• 20 percent down payment (if buying your first home).