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Are You In The Tax Gap? Print E-mail

If You Are In It, The IRS Wants You!
In the budget submitted to Congress, The Internal Revenue Service is again requesting an increase in their enforcement funding.  The goal is to reduce the tax gap.  The Tax Gap is defined by the IRS as “the difference between the amount of tax that taxpayers should pay and the amount that is paid voluntarily and on time.  The tax gap can also be thought of as the sum of non-compliance with the tax law.”
For the year of 2001 (which are the latest figures I’ve seen) that sum is 345 billion.  According to IRS Commissioner Mark W. Everson; “The magnitude of the tax gap highlights the critical role of enforcement in keeping our system of tax administration healthy.”  The IRS is determined to improve tax compliance “through increased  and better targeted enforcement and through increased taxpayer service and outreach efforts.” 
According to the IRS 80% of the tax gap is due to underreported taxes.  “Nonfiling and underpayment of tax comprise the rest of the tax gap.”  Audits in 2005 totaled 1.2 million which was a 20% jump from the year before.     04/07, Kazwell Newsletter

 
 
Study Shows Mortgage Brokers Can Be More Cost Effective than Banks Print E-mail
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  Mortgage brokers are more cost effective then banks for many borrowers according to a joint study done by economists at George Washington and Oklahoma State Universities.  The study analyzed loans closed By brokers and “traditional lenders” (banks) between 1995 and 2003.  It focused on the “sub-prime borrowers” which are those who have any situation which is considered less than ideal.  These situations can include matters of employment, self employment, divorce, credit history, bankruptcy and much more.
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BEWARE OF LAZY LOAN PROFESSIONALS Print E-mail
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Not all loans are created equal.  For that matter, neither are loan professionals.  Picking the right person to help you with your mortgage needs can make a difference whether your loan closes or not.  This is even more true in these troubled times. 

We recently received a phone call from a newly divoriced woman trying to buy a home.  This was her second attempt.  It seems that the loan officer she originally called had pre-qualified her over the phone and she was all set to move.  At least this is what she thad been told.  On the day of closing, however, she was informed her that her loan would not close. When she called us she was frantic.  The very first thing she did was request to be prequalified for a mortgage.   but she was told we did not work that way.  There are to many variables and we need to know what they are before we start promising.  Simply stated, being pre-qualified for a mortgage is worthless.
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Don't Have a Heart Attack On The Weekend Print E-mail

It May Be Hazardous To Your Health. . .  A new study suggests that it’s best not to have a heart attack on the weekend.  It seems that the quality level of health care is lower on the weekends and the incidents of death are greater.    04/2007,  Kazwell Newsletter
 
Some Brokers Warned About Option ARMS Print E-mail
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Many mortgage professionals have been chastized for over-promoting option ARM loans before the mortgage meltdown.  Mortgage brokers have been particularily scandalized over the issue and many indeed minimized the risks while playing up the positives.  Nonetheless, not all lenders and brokers were guilty of such wrecklessness.  A case in point the the following article which appeared in the February, 2007 issue of the Kazwell Newsletter.

Take Caution With
1% or 2.9 % Mortgage Ads

I have two words for you, negative amortization.  Personally, I find those words to be very scary.  I’ll explain in a minute.  You’ve probably  seen the advertisements touting “1% Interest” or “Pay only 2.9%”. They go by different names and are very popular these days.  They certainly sound attractive. .  .  “Pay as little as $643 (1%) a month on your $200,000 mortgage.”  While that is technically true, it is only part of the truth!  Even people who understand them well can find themselves in a lot of trouble.  They are neither illegal nor immoral and are fabulous for certain circumstances.  They can also be very treacherous for many borrowers.  Here’s the deal.  Let’s say you have one of these mortgages that gives you the option of paying just 1% or $643 on your $200,00 loan.  Wow, that’s great.  Your mortgage however will be charged at a higher rate, maybe 6.5% interest.  The payment due on a 6.5% interest rate on a 30 year loan is $1264.  $1264 principal & interest due  -$643  1% minimum payment =$621  differance.  This is where the term  negative amortization comes in. 

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Decide The Why and How Before You Start Remodeling Print E-mail
  So you are thinking about doing some remodeling.  That is a great idea.  It is part of the fun and work of having your own home.  It can be very rewarding and profitable.  Depending on what and how you do it, it can also be a mistake.  Before you start, it is important that you understand why you are remodeling.
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Real Estate News

MortgageDaily.com News

  • Wells Adds 6,000 Servicing Jobs in 6 Months

    In August 2009, Wells Fargo Home Mortgage reported that its U.S.-based servicing staff stood at 11,500.

    At the time, the company noted that it was staffing up to handle a backlog of pending loan modifications.

    As of February, Well Fargo's servicing staff climbed to more than 14,500 employees, according to data reported by Moody's Investors Service.

  • Berkshire Unit Settles With NC

    A settlement with Vanderbilt Mortgage and Finance Inc. was announced by the North Carolina Office of Commissioner of Banks.

    The state alleged numerous violations of North Carolina law.

    Vanderbilt was included in the 2006 acquisition of Clayton Homes Inc. by Berkshire Hathaway.

  • AMCs, BPOs and Appraisal Compliance

    Coester Appraisal Group reported that its survey of more than 1,500 licensed and certified appraisers found that average turnaround on appraisals was two to three days regardless of whether the appraisal was ordered through a third party or not.

    An alternative to broker price opinions was released last month by Valligent.

    Global DMS announced its appraisal process management software is up-to-speed with the new Federal Housing Administration appraisal requirements and guidelines.

  • Risk of Default Drops

    A report announced by the University of Michigan's Ross School of Business indicated that the risk of mortgage defaults declined between the fourth-quarter 2009 and the first-quarter of this year.

    It was the lowest point for the index since 2005.

    The index reportedly measures the risk of default on newly originated mortgages by tracking local and national economic conditions.

  • Fifth Third Expanding in Tennessee

    Fifth Third announced plans to expand in Tennessee.

    The company said Geoff Hill was tapped to oversee the expansion as head of a new Tennessee mortgage division.

    A spokeswoman told MortgageDaily.com in an interview that the bank entered the market with its 2004 acquisition of another bank.

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