Tax Quirk Could Make Your Home More Attractive to Buyers

Photo: garryknight

If you're selling a home, here's how to make it more attractive to potential buyers: Throw in some cash and an income tax deduction.

The Internal Revenue Service allows the seller to pay points -- that's a fee some homeowners pay to lower their mortgage rates -- on the buyer’s behalf. Then the buyer gets to deduct the points as mortgage interest.

Depending on the home buyer's marginal tax rate, a deduction of $2,000 in seller-paid points could result in $500 in free money.

Get the details in my article, Tax Quirk Could Make Your Home More Attractive to Buyers.

How Getting A Raise Affects Your Taxes

Photo: Ben_in_london

You've finally received a hard-earned raise. Unfortunately, that raise has bumped you into the next tax bracket. Does that mean you should tell your employer you don't want the raise after all?

If all of your income is going to be taxed at a higher rate, with your new raise, you're actually going to take home a smaller paycheck. Right?

Fortunately, this statement isn't true, but it's a common misconception about how our progressive federal income tax system works. While people are taxed at higher rates when they earn higher levels of employment income, only a portion of their income, not all of their income, is taxed at the higher rate.

Learn how the system really works in my Financial Edge article for Investopedia, How Getting A Raise Affects Your Taxes.

Credit Cards For Kids

 Photo: wsilver

Should you give your child a credit card?


Credit cards are an increasingly common payment method in today's world, so the sooner your child learns to manage credit responsibly, the better.

Can you teach your child to manage credit responsibly, and can your child be trusted to put those lessons into action? Learn about the pros and cons of handing over the plastic so you can decide when and how to take this step in my Financial Edge article for Investopedia, Credit Cards for Kids.

Don't Count On An Inheritance

Photo: Andrea_44

If you've struggled to get ahead financially for most of your life, you might see an inheritance from your parents as your best chance for becoming financially comfortable or even wealthy.

However, counting on an inheritance to solve your financial problems is a bad idea. Receiving an inheritance requires the death of people you love, and you might not even get the windfall you were expecting. Find out why in my Financial Edge article for Investopedia, Don't Count on an Inheritance.

How to Spot a Predatory Lender

Photo: Lee Cannon

Yes, predatory lenders are still out there. Although underwriting practices have tightened and government regulations for mortgage lending have increased, it's difficult to force unethical lenders to put consumers' best interests first. It's still your responsibility, as a consumer, to look out for yourself.

Let's look at some warning signs that the mortgage you're considering, whether it's for a purchase, refinance or home equity loan, might end up hurting you in my Financial Edge article for Investopedia, How to Spot a Predatory Lender.

Easy and Practical Ways to Save for a Vacation

Photo: Moyan_Brenn

Did you skip going on a vacation last year because money seemed too tight? When you look back over the year, does it seem like there might have been room in your budget for a trip after all, if only you had been more careful with your money? If so, it's time to make some changes to your habits so you can easily afford a much-deserved vacation this year. My Financial Edge article for Investopedia, Easy and Practical Ways to Save for a Vacation, will show you how.

2011 Social Media Stocks Review

Photo: nan palermo

2011 was a big year for social media stocks. Investors saw initial public offerings of companies like LinkedIn, Groupon and Pandora, and these IPOs drew new attention to existing social media stocks.

But how did these stocks perform over the year? Should investors consider buying any of them now? What might these stocks' performance tell us about the IPOs promised for the near future, like Yelp and Facebook?

Find ou in my my Financial Edge article for Investopedia, 2011 Social Media Stocks Review.

The Economics of Discount Airlines

Photo: The-Lane-Team

Operating an airline is both capital- and labor-intensive. The airplanes, maintenance, fuel, regulatory fees, pilots, crew, agents, baggage handlers and other key components of airline operations aren't cheap.

With such high expenses, airlines typically earn profit margins of just 1 to 2%. Keeping costs down is essential to maintaining those profits and staying afloat in a bankruptcy-ridden industry.

Learn how discount airlines are able to make a profit while charging airfares consumers can afford in my Financial Edge article for Investopedia, The Economics of Discount Airlines.

How To Protect Your Smartphone From Identity Theft

Photo: zimpenfish

Smartphones contain much of the same personal data that we store on our laptops. While most of us feel compelled to closely guard our computers, it's hard to feel the same threat of loss about a phone. 

From the time cell phones first came out, the worst we had to fear from losing, breaking or having a phone stolen was the cost of replacing it, the hassle of rebuilding a contact list and possibly a battle with the phone company over unauthorized charges racked up by a thief. 

Now, with all the information phones can store, so much more is at stake. Learn How to Protect Your Smartphone from Identity Theft in my Financial Edge article for Investopedia.

When Is the Best Time to Take Your Vacation?

Photo: merfam

At first glance, it might seem like the best time to go on vacation is when you can get the best prices. However, even if you're retired and are free to travel whenever you want, price should never be your only consideration when planning a trip.

If you insist on going to a popular destination at a popular time, your best bet is to plan for crowds and take steps to avoid them. Wake up extra early so that you’re near the front of the line for the first attraction of the day. Don’t eat lunch or dinner at peak dining hours. Take a break during the busiest part of the day and extend your sightseeing right up until closing time, when some people will have already tired themselves out and returned to their hotels. Call ahead to find out when large tour groups will be visiting any museums you want to see and plan to avoid those times. Get a tour book that will advise you on potential problems like free admission days that make an attraction extra busy so you don’t get caught in an unexpected crowd. 

Learn more about how seasonal considerations, school schedules and work schedules should factor into your vacation plans in my Financial Edge article for Investopedia, The Best Times to Take a Vacation.

The FHA's Minimum Property Standards

Photo: somegeekintn

Homebuyers intending to finance a home purchase with a Federal Housing Administration (FHA) loan may be surprised to learn that they won't be allowed to purchase a particular property because it doesn't meet FHA requirements. 

Requiring that the property meet minimum standards protects the lender. When a homebuyer gets a mortgage, the property serves as collateral. In other words, if the borrower stops making the mortgage payments, the lender will eventually foreclose on the borrower and take possession of the house. The lender will then sell the house to get back as much of the money it lent as possible.

Minimum property standards mean that the property should be easier to sell and command a higher price if the lender has to foreclose. At the same time, a borrower is more likely to stay in a home that meets minimum standards, because he or she will not be burdened with expensive home repair bills from the start. Also, borrowers will try harder to make payments during difficult financial times if the home is a pleasant place to live.

To learn more about why the FHA's minimum property standards exist, what they are, and whether a problematic home can be remedied so that buyers can purchase the homes they want, read my Investopedia article, The FHA's Minimum Property Standards.  

How Moving Can Affect Your Finances

Photo: rustejunk

If you live in a one-bedroom apartment in New York City, you might have fantasies of moving to a five-bedroom, three-bathroom house in Kentucky on four acres of land. Would a move like this actually bring you the quality of life improvement you're expecting? If you're weighing such a decision, read my article, How Moving Can Affect Your Finances, to learn about the factors you need to consider to determine whether your move will pay off.

Whose Fault Is Identity Theft?

Photo: _gee_

In many situations, we have little control over how our personal information is used and who can gain access to that information. Our identifying information is stored in dozens of databases with government agencies, doctors' offices, creditors, banks, lenders, schools and more. Providing personal information like a Social Security number is a precondition of obtaining any number of services. So even though we feel like we shouldn't be giving this information out, we often have no choice. If your identity has been stolen, learn who the culprit might be in my Financial Edge article for Investopedia, Whose Fault Is Identity Theft?

Undo a Bad Refinance with the Right of Rescission

Photo: Kamoteus

A federal consumer protection measure known as the right of rescission, which is part of the Truth in Lending Act, protects consumers from ill-intentioned lenders and from their own poor decisions.

If you discover that you've made a bad decision after signing the closing documents for a mortgage refinance, you have until the midnight after three full business days to get out of your contract.

The rescission period also explains why your loan will not fund the same day you close. Loan proceeds cannot be disbursed to the consumer until the rescission period has expired.

Learn more about the right of rescission and how it works in my article, Undo a bad refinance with the right of rescission.

Real estate apps make home shopping easier

Photo: Landscape Design Advisor

If you've ever shopped for a home, you know the prep work that goes into house-hunting.

It used to be that you had to look up properties for sale, decide which ones you wanted to see, organize them by location and print up directions to each one. You also needed to bring a camera and a notepad to help you remember each home.

Not anymore. Now, if you have a smartphone, you can skip most of this planning by downloading a handful of real estate apps.

Anytime you’re out and about and have some extra time, you can look up properties and go take a look. If you drive by an open house, apps can help you decide if it’s worth your time to check it out. Even if you’re on a planned Saturday outing full of showings with your agent, apps can help you make decisions about properties to look at or whether you should make an offer. 

Learn about 5 real estate apps that can help you house-hunt in my article, Real estate apps make home shopping easier.

How Grocery Store Price Matching Can Save You Money

Photo: Rex Roof

If you want to get the best sale prices for the week at each of your local grocery stores, but you don't want to make multiple shopping trips, there's good news. Price matching can allow you to consolidate all of those trips into one without missing any deals. Here's how to do it. Learn how in my Financial Edge article for Investopedia, How Grocery Store Price Matching Can Save You Money.