Reverse Mortgages: Older Homeowners Cautioned

The Financial Industry Regulatory Authority urged homeowners over the age of 60 to carefully weigh their options before tapping into their home equity through reverse mortgages to obtain additional income for their retirement years.

The group, formed by a merger of the NASD and some regulatory functions of New York Stock Exchange parent NYSE Group Inc., warned that a reverse mortgage — an interest-bearing loan secured by the equity in a home — can jeopardize their financial futures.

With a reverse mortgage, a bank makes payments to a homeowner instead of the homeowner making payments to a bank. The loan is repaid, with interest, when the borrower sells the house, moves out or dies. Reverse mortgages have high fees — typically about 7% of the home's value — and they make it difficult for homeowners to leave the property to their heirs.

The warning notes that, in some cases, those who sell the mortgages may profit from the their sale, giving them twice the incentive to talk someone into a loan they may not need.

Reverse mortgages were originally designed as a tool for aging, low-income homeowners to keep their homes, but they have been used more often by retiring Americans as a way to finance a more-extravagant retirement lifestyle than they could otherwise afford.

Still, as foreclosure rates continue to rise amid the subprime-mortgage crisis, some homeowners who have built up equity in their home may consider reverse mortgages their best option against losing it.

We don't advocate anyone taking out a reverse mortgage… but welcome your thoughts and opinions on it.  Just use the comment link below to tell us what you think about Reverse Mortgages.  Your email address, although required in order to post, will never be published on this site.

Identity Theft: How to Stop It

Identity Theft is a crime so common that if it hasn't happened to you personally, you probably know a victim. So why are so many people still being victimized? Money Editor Stacy Johnson takes a closer look in this video. (Runs 1:36)

Have you been a victim of identity theft?  Know someone else who has?  Tell us about your experience…we'd love to get your feedback on this topic.  Just use the "comment link" below to sound off on this delicate topic.  Don't worry, your email address will never be published on our site to protect (at least that much of) your identity.

Pricing Your Home to Sell

Pricing your home is one of the most important items when choosing to sell your home and doing this wrong can be a costly mistake. You have to consider more than just the price to do this properly. The condition of your home, average market time for your area, availability for showings and the competing homes can all play a big role in choosing the proper price.

To accurately determine the right price for your home you need to find current prices for comparable homes in your area, as well as find recent comparable sales in your area, and know the demand for housing in your area.

Here are some helpful steps to help you select the appropriate price when selling your home:

Step #1: Measure Your Home

Measure your home against similar homes in your area that have recently been sold or currently are for sale.

Step#2: Compare Features

Find what features either make your home stand out against the comparable homes or maybe appear not as attractive. Items such as square footage, number of bedrooms, number of garage spaces and lot size can make a big difference. Buyers will be comparing your home to these others, so it's a good idea to do so yourself.

Step#3: Cosmetic Fix-Up's

Determine what cosmetic fix-ups you can complete to make your home more appealing than the competition but without spending too much. You don't want to invest money you will not recoup when you sell your home. This will highly increase the marketability of your home.

When Pricing Remember:

The right price is usually within 5% of the market value. If you select a price that is too high the home will have little interest and few showings. If the price is too low there will be many buyers and you will miss out on potential profit.

Gas Prices Continue to Spike

The average price of gasoline has jumped another 15 cents over the past two weeks to a national average of $3.62 per gallon of self-serve regular, according to a national survey.  That rise continued at virtually the same rate as the previous two weeks, and forecasts are, it will only get higher.

We'd love to hear what you think.  Do you think oil companies are just gouging us?  Or do you think it's wise to drop the tax on gasoline to help us consumers?  Use the comment link below to sound off on this gasoline price spike situation.  We'd love to hear your comments and feelings on this subject.  And don't worry, even though your email address is required to post a comment, that email address will never be published here for your protection.  So go ahead, tell us what you think about the high gas prices!

Cooling Bills: Cutting Costs This Summer

Air conditioning is an expensive way to stay cool, but there are ways to chill your house without burning up your bank account. Money editor Stacy Johnson takes a look at a few ways in this short video (runs 1:41).