Tuesday, November 2, 2010
Only 52 shopping days 'til Christmas! Give the gift that's always the right style, the right color, the right choice! A GCF Visa Gift Card is always the perfect gift for any occasion. Stop into any GCF branch to purchase a GCF Visa Gift Card for someone special!
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For a listing of our current deposit and loan rates,click here.
NEW OPTIONS FOR REVERSE MORTGAGES
Reverse mortgages are gaining popularity. Even those who planned carefully for their retirement years are finding themselves in a financial bind with this troubled economy. These loans enable them to seek medical care, stretch a portfolio to meet routine living expenses, and in some cases even stave off foreclosure.
A reverse mortgage allows homeowners over the age of 62 to draw equity from their homes. They can take the funds as a lump sum, monthly payments, line of credit or a combination of any of these. The money is not repaid until the home is sold, you move or pass away. Your eligibility amount is based on your age, value of your home and interest rate.
There are several drawbacks with a reverse mortgage. High origination fees and mortgage insurance premiums make them a costly option. Even more so with a rise in the monthly insurance premium for new loans, intended to protect the government and taxpayers from having to bail out lenders faced with falling house prices.
But a new product introduced last month by the Federal Housing Association (FHA) is changing that. So if you've considered a reverse mortgage in the past but thought twice, you might want to take another look.
The new Home Equity Conversion Mortgage (HECM) Saver cuts some of the upfront cost.
The HECM Standard is still around. This product requires an upfront mortgage insurance premium of 2 percent of the home's value. For a home valued at $200,000, the upfront fee is $4,000. The ongoing annual premium was raised to 1.25 percent from its previous 0.5 percent.
The HECM Saver charges an upfront insurance premium of 0.01 percent, or only $20. The ongoing monthly payments are the same as with the Standard version. But the amount offered is less than with the Standard.
If you're only borrowing a small amount, or plan to move in a short period of time, the new HECM Saver may be for you.
Some lenders are waiving origination fees to spur borrowing, so shop around before you sign.
No credit check or specific income is required to qualify for a reverse mortgage. And while you'll be free from making monthly mortgage payments, your real estate taxes and homeowners insurance premiums must be kept current.
These loans can be complicated. So much so that counseling sessions are required before taking out a reverse mortgage. Counselors must ask a series of questions to assure the homeowner fully understands what they're getting into before being granted a certificate required to proceed with the loan.
These counselors can also provide information on loan alternatives and tips on negotiating with a lender.
Do you have cash value in a life insurance policy that you no longer need? Any investments or real estate holdings you can sell? These may provide enough financial relief to forego a reverse mortgage.
Today's mortgage interest rates are at an all-time low. Is refinancing a better option for you?
If you live in an expensive area, it might make sense to relocate somewhere more economical. Or consider downsizing to a smaller home if you have more space than you need. Take potential health issues into consideration, too. You won't always be as mobile as you are right now. A smaller, ground floor home might make better sense than having to climb steps. Future maintenance issues should also be considered in your decision.
While the new HECM Saver is less costly than previous reverse mortgage products, there is still risk involved anytime you put your home on the line. Use this resource as an option of last resort.
TIPS FOR SAFE ONLINE SHOPPING
Every year, more and more people are shopping online. This holds especially true during the holiday shopping season, which is fast approaching by the way. Here are some tips to help you make sure that your online shopping experience is as safe as possible.
If you are directed to send your payment information via email, do not do it. Email is not secure.
Use a credit card to pay for your transaction. Many sites allow you to pay with a debit card, online check, gift certificate, stored-value card, or e-money. All of these are acceptable forms of payment, but remember two things.
First, if there is a problem with your purchase, most credit cards offer some type of purchase protection or extended warranty, including protection under the Fair Credit Billing Act (FCBA) which provides billing dispute guidelines for charges for goods or services that were not delivered as agreed.
Secondly, if someone steals your credit card information during the transaction, your liability for purchases made with the stolen card is limited to $50 by the FCBA. Debit cards offer the next best level of protection in the event of loss or theft. The Electronic Funds Transfer Act (EFTA) limits your liability to between $50 and $500, depending on when you report the theft. Other forms of payment may offer little or no protection in the event of loss or theft.
Also check out the company's "Contact Us" section of their web site to find out where the company is located. Be wary of stores with only a PO Box or foreign address listed as their location. It may be hard to find the seller in the event of a problem with your order.
Carefully read the description of what you are buying. What you think is a "new" item may actually be refurbished or reconditioned. Other words to be wary of are discontinued, replica, or close-out.
Be sure to print out your order confirmation. It should include: the confirmation number, what you ordered (item # and description), order date, price, delivery policy, and the seller's information (name, address, phone number). If it does not, go back and write down or print out the information for your records. You should also print out the company's return and cancellation policies.
These are just a few tips to keep you safely shopping online. For more information on safe online shopping, use the resources in the World Wide Web section of today's GCFlash.
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