Servicer Incentive Payments and Pay for Success Fees:

Borrower Pay-for-Performance Success Payments:

"I CAN SEE CLEARLY NOW, THE RAIN IS GONE..." Johnny Nash hit number one on the charts with this classic tune in 1972...and 35 years later, Fed Chairman Big Ben Bernanke is singing the same tune, mentioning in comments last week that the Fed would be more transparent so we all can see their policies clearly.

The new, improved, and more transparent Fed is a far cry from the days of "The Cryptic One"...Former Fed Chair Alan Greenspan, who was famous for his hidden messages. After a Greenspan speech, many traders were left scratching their heads and wondering what exactly was said. In sharp contrast, Bernanke has been very clear and easy to understand.

More importantly, Ben has done a good job of keeping inflation under control. The latest read on inflation was tame for last month, as a large jump in energy costs were offset by meek automobile, housing, and clothing prices. This suggests that higher oil prices haven't yet pushed up the prices of other goods overall.

But one topic that is still cloudy is the Fed's next move on December 11th. The latest chatter from the "more transparent" Fed indicates that the Fed will not cut - but traders in the pits are betting the ranch on another quarter-point cut. One thing is very clear - this topic will be debated right up until the Fed makes the announcement.

Bonds and home loan rates saw quite a bit of activity in the holiday shortened week, but ended up exactly where they started.

THANKSGIVING WITH ALL THE TRIMMINGS IS RIGHT AROUND THE CORNER...WILL YOUR WAISTLINE END UP EXACTLY WHERE IT STARTED? READ THIS WEEK'S MORTGAGE MARKET VIEW FOR SOME INTERESTING TABLE TOPICS.

What little economic news we'll have during this Thanksgiving Holiday shortened week takes place this Tuesday and Wednesday...and the market is scheduled to close early on Wednesday and Friday with a full-day close on Thursday.

The most interesting news of note for the coming week will be the latest housing data, coming with Tuesday's release of the Housing Starts and Building Permits report. Also on Tuesday, the Fed "unplugged"...the Minutes from the last Fed meeting will be released, providing the commentary and discussion between both voting and non-voting members. This may provide additional insight into the Federal Reserve's recent decision to cut rates by another quarter percent - and any unexpected comments could cause some movement in Bonds and home loan rates prior to the Thanksgiving Holiday.

In general, Bonds and home loan rates have improved in recent weeks - and until a catalyst arrives to knock Bonds and home loan rates off the "Up Escalator" of improvement, we will likely continue to see more of the same.

A DAY OF THANKS

Thanksgiving is upon us! This popular autumn holiday traces its roots back to a three-day feast held in 1621 to celebrate the blessing of a bountiful harvest. It took more than 240 years, however, for Thanksgiving to become a national holiday. In 1863, President Abraham Lincoln finally proclaimed the last Thursday of November as a national day of thanksgiving. Years later, President Franklin Roosevelt stated that Thanksgiving should always be celebrated on the fourth Thursday of the month--as opposed to the occasional fifth Thursday.

Mmmm... Eel and Seal. My favorite!

What exactly did the pilgrims eat at the first Thanksgiving? According to food historian Kathleen Curtin, the answer may surprise you. In addition to wild turkey, other popular sources of meat that were likely served include eel, clams, lobster, wild goose, eagles, venison, and seal...yes, seal. Peas, beans, and carrots were probably on the table, but sweet potatoes and corn on the cob weren't. And although pumpkins were likely consumed, pumpkin pie wasn't...because no such thing existed at that time.

Talking Turkey...272 Million Turkeys!

The popularity of turkeys during the holidays and throughout the year has turned turkey farming into a big business. In fact, the USDA National Agricultural Statistics Service estimates that 272 million turkeys will be raised in the US this year alone. That's an increase of 4% over 2006!

Weighing In on What We Eat

Ever wonder how many cranberries, pumpkins, and other Thanksgiving Day foods we go through each year? The US Census Bureau has the skinny! According to their research, the US produces some serious poundage when it comes to these holiday favorites, including:

• 690 million pounds of cranberries

• 1.6 billion pounds of sweet potatoes

• 1 billion pounds of pumpkins

• 841,280 tons of snap green beans

No wonder we feel so full after those holiday meals!

Can Turkey Really Make You Tired?

Here's how the story goes. Turkey contains tryptophan...which helps the body produce niacin...which then helps produce serotonin. And serotonin is the key to this theory because it calms the brain and induces sleep.

The problem with that theory is that tryptophan actually works best on an empty stomach-which most of us don't have after our Thanksgiving feast! So, it's more likely that the heaviness and the high carbohydrate content of the entire Thanksgiving meal are responsible for that sense of lethargy you feel, as your body works to digest it all. Add a glass of wine or a cocktail to your meal, and you'll increase that sense of sleepiness even more.

Here's to another happy Thanksgiving Day for you and yours! As always, if you have any questions or need any assistance, please don't hesitate to call.

Economic Calendar for the Week of November 19 – November 23

DING-DING-DING!! When the bell sounded at the end of the trading day on Friday, traders trudged off the scenes like defeated boxers at the end of a grueling match. Stocks got pummeled last week with a 600-point decline on the Dow, during a week that was full of subprime home loan related headlines. Write-downs of the value of these holdings spooked the financial sector, which led the Stock market on its slide lower.

Normally, Mortgage Bonds and home loan rates find improvement when money is flowing out of Stocks - that money being pulled out needs somewhere to sit, and Bonds are generally the glad recipient. And while some Bonds did enjoy a great week - like Treasury Bonds - Mortgage Bonds actually worsened because of their relation to the issue at hand, fears of the credit quality of these Bonds, and home loan rates worsened slightly as well. And if the Stock market had not sold off so hard, sending money into all types of Bonds, Mortgage Bonds and home loan rates would certainly have been much worse off.

BUT REGARDLESS OF MARKET UPS AND DOWNS - SLOW AND STEADY WILL WIN THE RACE TO YOUR COMFORTABLE RETIREMENT. READ THIS WEEK'S MORTGAGE MARKET VIEW FOR A FEW EASY WAYS THAT YOU CAN ENSURE YOUR OWN PLANS STAY ON TRACK.

With the market closed on Monday in observance of Veteran's Day - the rest of the week will roar into action with a packed economic calendar, including a look at retail sales numbers, consumer and producer inflation, and the manufacturing sector too.

Remember that when Bond prices move higher, home loan rates improve - and you can see in the chart below that despite some ups and downs, Bond prices have overall been trending higher over the last few months, meaning home loan rates on conforming loans have improved in general. Any weak or negative economic news arriving this week should help money flow into the safe haven of Bonds, helping Bond pricing move higher and home loan rates move lower. And the chart also shows some nice technical "floors of support" that may help Bonds continue their overall trend of improvement.

But lingering concerns on the credit quality of Mortgage Bonds could hamper their road higher - so this week could be volatile, depending on the flavor of the headlines on this topic. And in this week's planned economic releases, any scent of inflation in the reports will be very bad news for Bonds - which deliver a fixed return that is eroded by the effects of inflation - so that would spell bad news for home loan rates as well.

DID YOU KNOW...

That if you wait until you're 45 years old to start investing for retirement, you'll need to save about $24,000 per year just to reach a reasonably comfortable retirement level? But if you start when you're 25, you can reach that same level by saving just $4,000 per year. So starting as early as possible is important - but even if you didn't, you can use the simple tips below to get on track right away.

Give Your Retirement Plan a Raise

The more you make the more you spend...so the next time you get a raise or a bonus, break the cycle! Set aside that extra money and invest it in your future. You will not even notice it now...but you will in the long run.

Make a Big Impact Without Denting Your Budget

If you're about to pay off a car, student loan, or some other monthly expense, you can make a huge impact on your investment plans by simply adding that extra money to your retirement account. You're already used to living without it, so it won't impact your monthly spending money at all.

Out of Sight, Out of Mind Investing

Don't forget to make your investments automatic. It's much easier--and a lot less painful--to have that money simply deducted from your paycheck and electronically deposit. You'll save the same amount every month...and save yourself the trouble of writing that check!

Eliminate High Rates

Want to earn a 17%, 18% or even 19% return right away? It's easy...put together a plan to pay off your credit cards faster, starting with the highest rates. By paying it off quickly--and keeping it paid off--you'll eliminate the high interest charges that tighten drain budget and often put people into a downward spiral of debt.

Make the Most of Matching Contributions

If you have access to a 401(k) retirement plan, make sure you are using it - especially if you get matching contributions from your employer. See how much you have to contribute to earn the full matching amount from your employer - and if you can't contribute that much right away, start small and steadily increase your contribution over time until you reach it. You'll double your money with the employer's match...and your contributions are generally taken out of your check pre-tax, so your savings costs even less in real, after tax dollars.

It's NOT All or Nothing

Don't feel like you have to jump in with everything you've got. The most important point is to get started right away...not next month or next year, but right now with whatever amount you can. You can always increase the amount you invest...but you can never get back the compounding interest you'll lose by waiting.

And remember, if you have any questions - including how a mortgage can be structured to jumpstart your retirement plan or a recommendation to a great financial planner - please don't hesitate to call!

Economic Calendar for the Week of November 12 – November 16

"Time is on my side...yes it is" - Rolling Stones. Mortgage prices were jostled and bounced around throughout a wild week of economic news and Fed moves. But in the end, time was on the side of those who were patient, as pricing finished the week right about where it began, leaving fixed home loan rates unchanged.

Last week's highlights included a quarter point Fed rate cut, which brings the Fed Funds Rate down to 4.5%. The Prime Rate now stands at 7.5%, which is good news for home equity lines, consumer and business loans. Additionally, those who have adjustable type loans should see some benefit. But because a Fed cut can stimulate the economy and bring some inflation, fixed home loans tend to worsen a bit after the Fed cuts rates.

The latest read on Inflation was right in-line with the Fed's target. A 1.8% annual Core Inflation rate was reported, which is within the 1%-2% Fed comfort zone - good news for bonds.

Help wanted! Well at least it was for 166,000 Americans during October. This was the best report since May and twice the forecasted amount. The Report showed the rate of unemployment at a very respectable 4.7%. This type of strong report often leads to trouble for bonds, but a look deeper into the numbers showed the Hourly Earnings figure to be less inflationary than expected. The markets are concerned about wage based inflation, but Average Hourly Earnings increased by just 3 cents to $17.58 per hour.

PEOPLE OFTEN WISH FOR MORE TIME. AND THIS WEEKEND THAT'S JUST WHAT WE WILL GET - AN EXTRA HOUR TO CATCH UP ON THINGS OR MAYBE SOME EXTRA SLEEP. FIND OUT THE DETAILS ALONG WITH SOME WILD EVENTS THAT CAN HAPPEN WHEN WE CHANGE TIME, IN THIS WEEK'S MORTGAGE MARKET VIEW!

Have you ever flipped through all your TV channels to find nothing on? Well, that's how market traders will likely feel this week as they flip around for some economic news releases. But the news calendar takes a well deserved rest next week with mostly lower to mid-level reports scheduled. That means bonds will probably trade inside the range illustrated below - unless stocks bust a major move. If stocks rally sharply higher, bonds will be sold off to raise the cash needed to chase stocks, causing home loan rates to rise. Should stocks slump on more fears about credit quality, the proceeds from the stocks sold will be parked into bonds - bidding them up and helping home loan rates improve.

Turning Back the Hands of Time

This weekend, the sun sets on another season of Daylight Saving Time. In case you hadn't noticed, Daylight Saving Time (DST) was actually extended this year by an entire month--it began earlier last spring and ran longer into this fall. But, alas, all good things must come to an end...and this year Daylight Saving Time ends Sunday, November 4th.

The extra month that we enjoyed was actually the result of the Energy Policy Act, which was enacted by Congress back in 2005. Originally, the bill was written to extend Daylight Saving by two months, but some very verbal opponents fought the change. Farmers say that DST has a negative impact on their livestock in general--as it is tough for them to adapt to the time change, and they consequently produce less milk, eggs, etc. Because DST is not followed uniformly around the world, airlines claim that it might mean many missed international flight connections. Additionally, TV and Cable stations argued that they would lose viewers and advertising revenue, simply due to less time spent in front of the television because of more time spent outdoors in daylight.

So a compromise of one additional month of DST was reached. However, Congress did retain the right to revert back to the old dates if the change proves to be widely unpopular, or if the energy savings aren't significant.

Why the change?

After making the adjustment to getting up an hour early, Americans overwhelmingly like Daylight Saving Time. There is simply more sunlight in the evenings to enjoy the outdoors and get things done. Additionally, there may be emotional benefits, as we typically feel better with more daylight. Plus, additional hours of daylight can help save energy on a national scale. Less electricity is needed, as fewer lights are turned on as early in the evening...and with energy costs so high, even a small amount of savings is very welcome.

And brighter is safer--studies have shown that the DST shift reduces traffic accidents. An increase in accidents in the dark mornings is more than offset by the evening decrease in accidents, due to the increased visibility gained with more sunlight. Halloween is also arguably safer. Child pedestrian deaths are four times higher on Halloween than any other night of the year. This year, however, trick-or-treaters were able to spend an extra hour gathering treats while it was still light out. Candy manufacturers are happy too, as they've lobbied for years to have DST extended through Halloween.

A study by the US Law Enforcement Admin also determined that crime is consistently lower during DST, with violent crimes down as much as 10% to 13%. For many crimes, like mugging, darkness is a factor--so more light in the evening hours reduces these types of crimes.

And throughout its long history, Daylight Saving Time has had a remarkable and sometimes unexpected impact.

A man was actually able to avoid the draft for the Vietnam War using a Daylight Saving Time loophole. When he was born, it was just after midnight, DST. When he was drafted, he successfully argued that in his home state of Delaware, standard time--not DST--was the official time for recording births. So he was technically born on the previous date--which had a much higher draft lottery number - and he was able to avoid being drafted.

In September 1999, the West Bank was on Daylight Saving Time, while Israel had switched back to standard time. A group of West Bank terrorists prepared some timed bombs--but misunderstood the time change--and the bombs exploded early, killing the terrorists themselves, rather than the intended victims--two busloads of innocent citizens.

In the 1950s and 60s, each state and locality was permitted to choose start and end DST dates as they desired. During 1965, Minneapolis and St. Paul--which are considered one metropolitan area--didn't agree on start dates, and for a period of time, these Twin Cities had a one hour time change between them. And on one Ohio to Virginia bus route, passengers technically had to change their watches seven times in 35 miles!

To keep to their published timetables, Amtrak trains cannot leave a station before the scheduled time. So when the clocks "fall back" in the fall, all trains that are running on time actually stop at 2:00am--the official time of DST change--and wait one hour before resuming their routes. In the spring, the routes instantaneously become one hour behind schedule, but they just keep going and do their best to make up the time.

So Daylight Saving Time sure can have some unexpected impact.

In particular, be sure to double-check all of your electronic devices and confirm that the time is correct. Although you may be accustomed to your computer and maybe even your digital clock in your car automatically updating, the recent change of dates for Daylight Saving Time may require that these devices be manually changed, as they now may NOT be ready to update to the correct time on the correct date!

Economic Calendar for the Week of November 05 – November 09

THINGS COULD BE WORSE...much worse. While last week's news showed some weakness in housing and a few assorted economic reports, the Stock market seemed to fare pretty well with good reports recently from big bellwethers such as Apple and Microsoft. And home loan rates were stable to slightly improved for the week overall. But let's look back in time to exactly 78 years ago today, October 29th, 1929.

This day saw such crushing damage for the Stock market that it lives in history as "Black Tuesday", and is generally thought of as the day that sent the US into the Great Depression, where unemployment rates rose to a whopping 25%. Imagine one out of four of your neighbors, friends, and family members all being unemployed! So while last week's readings on housing, manufacturing and general consumer sentiment came in a bit weaker than expected - things could certainly be much worse.

And many of the soft economic reports helped confirm the market's general belief that the Fed will again cut the Fed Funds Rate at their upcoming meeting. But what will this mean for home loan rates? Read on to find out what even the media consistently seems to get wrong.

ONE THING YOU WON'T WANT TO GET WRONG IS EXAMINING THE OPPORTUNITY TO INVEST IN A 401K...BUT DO YOU KNOW WHAT KIND TO SELECT? THERE ARE SOME NEW OPTIONS THAT MAY BE AVAILABLE TO YOU - SO DON'T MISS THIS WEEK'S MORTGAGE MARKET VIEW.

They say to be careful what you wish for...and with Halloween just around the corner, kids aren't the only ones wishing for a "treat". This Wednesday, October 31st, The Fed will decide if the financial markets will get a treat of their own with another cut to the Fed Funds Rate. It is very fitting that the decision on whether or not the Fed cuts rates happens on Halloween, because the "treat" may be a bit "tricky".

A Fed rate cut typically helps the economy and the stock market, but inflation hating Bonds and home loan rates usually have a negative reaction to a cut. This was evident last month, when the Fed's .50% cut sent Stocks soaring, but caused Bonds and home loan rates to worsen.

So should the Fed deliver another cut, Stock prices should enjoy a nice start to November, which is already historically the best performing month for Stocks since 1990. But it isn't a party for all, as rates on savings accounts will decline and home loan rates will likely blip higher. Additionally, Adjustable Rate home loans may be more in vogue, as the initial start rates will offer bigger discounts compared to Fixed Rate options.

A look at the chart below shows that Mortgage Bond prices are almost exactly where they were before the last Fed cut in September. Notice how Bond prices dropped right after the cut, which caused home loan rates to worsen. And should the Fed cut on Wednesday, it is quite possible that in response, home loan rates will worsen once again.

A NEW 401(K) OPTION...

Last year, Congress authorized a new twist to the standard 401(k) plan that most employers offer. The new option, called a Roth 401(k) is just what it sounds like, a blend of the standard 401(k) and a Roth IRA.

So what's the difference?

As opposed to the standard 401(k) plan, where the initial contributions are not taxed, but your future withdrawals will be taxed, the Roth 401(k) allows for the opposite, which means that your contributions will be taxed today, but your withdrawals will not be taxed.

Of course, you do not pay tax on either type of account on an annual basis, as opposed to the capital gains taxes that are imposed on investments held outside of retirement accounts.

Which is the better option?

First and foremost - regardless of which option you choose - it is always a good plan to be investing for your retirement, especially when you are able to achieve tax benefits as a result.

You can select the best option for you by anticipating if your tax rate will be higher when you retire than it is today. If you are younger and just starting your career, it is likely that your current tax rate is lower than it will be in your retirement. Conversely, if you are in the height of your earning years, the reverse is probably true--your retirement income will likely be lower than your current earnings. The wild card is that the government may change the existing tax brackets by the time you retire.

So will taxes 20, 30, 40 years from today be higher or lower than current rates? While no one has a perfect crystal ball, and wanting to avoid a political discussion about economics, it would probably be safer to assume that taxes will be higher in the future than they are today. And if taxes withheld from your retirement are less, then it will give you more to spend.

Availability

At this time, only about 20-25% of employers are offering the new type of plan, but the number of participating companies is expected to grow steadily - so ask your human resource department about it if you are interested. Also, note that any payroll match that you receive from your employer will be based on the standard 401(k) plan and be taxed at withdrawal.

Economic Calendar for the Week of October 29 – November 02

"I'VE HEARD PEOPLE SAY THAT TOO MUCH OF ANYTHING IS NOT GOOD FOR YOU...BUT I CAN'T GET ENOUGH OF YOUR LOVE, BABE." BARRY WHITE And that's exactly the song that Mortgage Bonds appear to be singing to the 200-day Moving Average recently. In fact, they've touched this level on twelve of the past sixteen trading sessions - and just can't seem to get enough. But why do Bonds continue to linger around this level, and how much will be enough?

The 200-day Moving Average has historically acted as a very strong "floor of support" or "ceiling of resistance" for Bonds, meaning that Bonds generally decidedly trade above or below this line. And the current tap-dance that Bonds are doing all over this level shows that there is a bit of uncertainty in the markets - and it will take a series of economic reports that are either very strong or very weak to propel Bonds to move away from the 200-day Moving Average. Remember that strong economic news tends to move Bond prices lower, causing home loan rates to improve - and weak economic news tends to move Bond prices higher, causing home loan rates to worsen.

And last week's news just didn't provide enough impetus for Bonds to make a decisive move one way or the other. Retail Sales were much better than expected yet Consumer Sentiment was lower than expected, while reads on Producer Price Inflation were a bit mixed. All in all, home loan rates stayed generally flat for most of the week.

FLAT OR FIZZY, DID YOU KNOW THAT AMERICANS CONSUME TWICE AS MUCH SODA POP AS WE DID JUST 25 YEARS AGO? IN FACT, WE WE JUST CAN'T SEEM TO GET ENOUGH, SPENDING $54 BILLION A YEAR ON IT...WHICH IS TWICE AS MUCH AS WE SPEND ON BOOKS! THAT'S A WHOLE LOTTA SODA DRINKING GOING ON - DOES IT FIT IN YOUR BUDGET? READ THIS MONTH'S MORTGAGE MARKET VIEW, FOR A QUICK WAY TO ANALYZE YOUR MONTHLY SPENDING, AND SEE IF YOU NEED TO TRIM BACK, OR IF YOU CAN AFFORD ANOTHER COKE AND A SMILE.

So could this week's slate of economic reports hold enough information for Bonds to decide they've had enough of the 200-day Moving Average - and cause home loan rates to make a move? The upcoming calendar features reports on Manufacturing, Housing, and Consumer Inflation...so it could get juicy, depending on the flavor of the reports.

The report that has the potential to cause the most action is the Consumer Price Index, which is simply a measure of the price levels we as consumers are paying for our goods and services. Last week's Producer Price Index was somewhat mixed, but had a pretty hot "headline" or overall read on Producer Inflation - which sparked some chatter and concern in the Bond trading pits, because Bonds hate any kind of inflation. So if this week's Consumer Price Index has the scent of inflation - Bond prices will likely move lower, and cause home loan rates to rise.

"THERE WAS A TIME WHEN A FOOL AND HIS MONEY WERE SOON PARTED...BUT NOW IT HAPPENS TO EVERYBODY." Adlai E. Stevenson

The latest Retail Sales numbers showed the consumer is still out there spending...but many of our expenditures have gone up right under our noses, without us getting any extra enjoyment out of them. Rising gas prices, increased interest rates for borrowed money, higher minimum monthly credit card payments...expenses are getting higher every day, and it may be crimping our normal monthly spending style. And not knowing where your money is going each month often gives you a general sense of unease when your head hits the pillow at night...and may eventually cause you a major financial hardship.

There are many phenomenal budget programs available for your computer, such as "Quicken" or "Money", but starting with even a little simple planning can put your mind at ease and allow you to spend, knowing that you have control of your monthly income and expenses. Don't worry if the word "budget" gets you feeling uneasy and makes your palms sweat - hey, relax. Just think of a budget as you would a healthy diet. You don't have to starve, but you may just have to cut back on a few tasty expenses to accomplish your goals. And who knows...you may actually be better off than you thought, and can splurge a little. Let's take a look.

A good budget is written down and includes as much information as possible. Start by determining your current monthly income. Use the net income (amount received after taxes and any insurance benefits are deducted) and anything additional such as part time work, interest, rental, or bonus income. Next, determine your monthly expenses. Obtain and keep a receipt for every item purchased, especially if you frequently use cash for purchases. Receipts should include everything from groceries to Starbucks coffee...even minor purchases can add up quickly. Although you usually need to have some pocket cash on hand, many people choose to use debit or credit cards more often than cash, purely to have a better record of money spent. At the end of the month grab the receipts, your checkbook, and any credit card statements and start categorizing your expenses.

Expenses should be classified into the following categories:

• Household - this would include rent or mortgage, utilities (gas, electric, water, etc.), cable television, Internet, phone, and any additional items such as a housecleaning service or pool service. This category could also include the many things you frequently buy for your home such as paper towels, cleaning products, plastic baggies, lawn and garden supplies and the like.

• Food - separate food expenses by groceries and dining. Dining out would include lunch and dinner expenses for every member of the family.

• Transportation - this would include all expenses related to an auto (e.g., auto payment, insurance, fuel, and maintenance). Additionally, include public transportation, tolls, and parking expenses.

• Healthcare - include monthly health care fees such as medical, dental, prescriptions, and insurance co-pays.

• Looking good - all of the items that make you, you. Clothing, shoes, dry cleaning, toiletries, haircuts, manicures, etc.?

• Entertainment - include all of the "just for fun" items. Movies, concerts, vacations, subscriptions, sporting event tickets, and hobbies.

• Miscellaneous - include all additional monthly expenses such as banking fees, credit cards, savings, education, gifts, donations...and don't forget pet expenses.

Need a simple, free, easy to use monthly budget sheet that can be used by you or your children? Just hit this link: Sample Budget

It is important to note, some expenses will vary on a monthly basis and an average will need to be calculated. For example, utilities can change each and every month. To come up with the average, simply add the actual amount paid for twelve months and divide the total by twelve to create a monthly average - and adjust as needed over time. Additionally, any expenses such as insurance premiums that are paid annually should be divided by twelve to create a monthly average as well.

Once all items have been categorized and listed, simply total the income and subtract all of the expenses. The remaining number will clearly determine if you are coming up short, breaking even, or have money left over. If you have money left over, meet with your financial planner and discuss investment strategies that will maximize those extra dollars.

If you come up short or barely break even, it is important to determine areas that you can trim expenses. Look at trimming dining out, entertainment, or looking good expenses. Although it may sting a little in the short run, you'll know that you are on the path to a great financial future.

If cutting expenses still does not provide enough cash flow to help you sleep better at night, contact me for a complimentary loan and financial analysis. We can work together and decide if a referral to a great financial planner who can help you with your budget is a good fit right now, and there are also many great loan options available, which may help provide the cash flow plan that will put your mind at ease and allow you to build your financial future.

Economic Calendar for the Week of October 15 – October 19

MEASURE TWICE...CUT ONCE. And like this old saying advises, Fed Chairman Ben Bernanke and his Federal Open Market Committee probably measured their decision quite a few times before making their recent .50% cut to the Fed Funds Rate. But if the Fed's history of making cuts and hikes in cycles continues - this cut is probably not a "one and done".

Here's what the Fed had to say as they announced the cut: "Economic growth was moderate during the first half of the year, but the tightening of credit conditions has the potential to intensify the housing correction and to restrain economic growth more generally. Today's action is intended to help forestall some of the adverse effects on the broader economy that might otherwise arise from the disruptions in financial markets and to promote moderate growth over time." This means that the Fed will take whatever steps are necessary in terms of rate cuts to try and prevent a possible recession, so long as inflation remains in check.

Initially, both Stocks and Bonds rallied on the comforting words from the Fed - but as Bond Traders analyzed the potential future impact of the Fed cut over the following days, they started selling off Bonds with both hands, causing fixed home loan rates to rise by .125 to .25%, actually higher than where they stood before the Fed Rate Cut. What happened?

Traders realized that a Fed Funds Rate cut could encourage increased spending by consumers and businesses, as borrowing costs will now be cheaper for Home Equity Lines of Credit, consumer loans like car loans and credit cards, and business loans as well. In turn, increased spending can translate into increased inflation in the long run - and inflation is bad news for Bonds. Bonds deliver a fixed rate of return, and the value of that return is eroded by inflation. So Bond Traders sold, the price of Bonds moved lower, and home loan rates moved higher as a result. Counterintuitive to many...but its reality, and now you understand what many do not - including much of the mainstream media.

AND WHILE THE FED MAKES A BID FOR LOWER RATES, EBAY SELLERS HOPE TO SELL TO THE HIGHEST BIDDER. WHAT ARE SOME OF THE HOTTEST TIPS TO GAIN THE MOST AND HIGHEST OFFERS WHEN SELLING ON EBAY? READ THIS WEEK'S MORTGAGE MARKET VIEW.

An action packed economic calendar is ready to unfold for the week, with a look at Consumer Confidence and Sentiment, New and Existing Home Sales, GDP, Manufacturing - you name it, this week has got it. But many of the week's reports will pale in comparison to Friday's big enchilada, the highly anticipated Personal Consumption Expenditure (PCE) Index. Why is it so important? Because this is the report the Fed watches most carefully to gauge consumer inflation.

And we know that the Fed feels inflation is presently under control, giving them the green light for the recent cut to the Fed Funds Rate. So will this important report show a tame read on inflation, and confirm the Fed's move to cut? Fed Chairman Bernanke and his fellow inflation-fighters at the Fed certainly hope so. Inflation-hating Bonds would also appreciate news of soft inflation, and home loan rates could improve as well. But what if the report shows stronger than expected consumer inflation? If it does, inflation-hating Bonds will react negatively, and home loan rates will move higher in response.

The chart below shows how Bond prices are fighting to stay above the 200-day Moving Average, which could continue to act as a nice "floor of support" if Bonds can hold their ground. Remember that when Bond prices move higher, home loan rates improve...so staying above this floor of support would be a very positive sign. But with the plethora of economic news and headlines arriving during the coming week, capped off by Friday's high impact PCE, Bond pricing and home loan rates will likely continue on their volatile path.

GOING ONCE...GOING TWICE...SOLD ON EBAY!

The garage sale season is coming to an end, but if you haven't had a chance to clean out your closets or spare rooms yet, don't fret. One of the most powerful sales is taking place right this minute...actually every minute of every day...on eBay!

The online auction site has quickly become a convenient way for consumers to buy the goods they're looking for--and for sellers to actually make money by auctioning off items they don't need or want. Even though listing and selling items may be easy, the tips below can help you increase the number and size of the bids you receive!

What You See Is What You Get. Believe it or not, many buyers won't even look at your ad if you don't provide a picture of it...they still want to see what they're buying. To increase your number of potential bidders, make sure you include a quality photo for every item you're selling.

How Low Can You Go? It sounds a little counter-intuitive, but the lower you start the bidding, the more money you may get. In fact, starting the bidding at 99 cents--versus a dollar or more--attracts a larger number of bidders. This larger pool has two powerful impacts. First, the more bidders you have, the more new bidders will be drawn to your ad, believing that you've got a red-hot item. Second, many bidders will continue the bidding game once they've begun it, which means they may bid more in their third or fourth round then they would have been willing to offer if you started that high in the first place. Finally, remember that your profit isn't just determined by how much you sell your item for...you also have to consider how much you will have to spend in order to sell it. By listing your item at 99 cents, you'll qualify for the lowest eBay listing fee.

Don't Get Carried Away With Shipping. In order to receive an item, the buyer must pay for shipping in addition to the winning bid amount. Those shipping fees aren't determined by the post office...they're actually determined by you. To make sure you don't drive buyers away, clearly list the shipping fees that apply. And don't get greedy and run up those fees. Smart shoppers will know you're trying to take advantage of them and they'll walk away. So, be clear and be fair!

Consider the Alternatives. Potential buyers will find your ad through searches. To make it easier for them to find it, consider alternative spellings--such as "videogame" and "video game." Also, once buyers find your ad they may have questions. To make sure they can contact you, consider providing a second e-mail address, in case your primary one is only checked while you are at work.

Everybody Loves Options. Some buyers prefer paying for their online purchases through a secure Internet payment service; others prefer using credit cards. Increase the number of bidders interested in your item by offering a variety of payment options.

Know When to Post 'Em and When to Hold 'Em. The day that you post your ad makes a difference. For instance, if you post a 10-day ad, the best day is Thursday. That way, your auction will end on a Sunday...which happens to be a big day for eBay bidding. Plus, your ad will be up for two full weekends, thus increasing your exposure on active bidding days. If you're getting ready to list an item, take a minute to consider how the listing day will impact your sale. It's better to wait a few days and get a better price in the long run, rather than rush into a situation that might mean fewer--and consequently lower--bids.

Follow these tips, start off small and work your way up to more expensive items, and have fun watching buyers bid!

Economic Calendar for the Week of September 24 – September 28

Sep 18, 2007

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"THE BEST WAY TO MAKE MONEY IS TO AVOID LOSING IT." Yogi Berra Yep, it is hard to go broke taking profits off the table...and this is exactly what Bond Traders did last week, pressuring Bond prices lower and causing home loan rates to rise by about .125%, as money moved out of the Bond Market.

Remember that conforming home loan rates are tied to Bonds or "Mortgage Backed Securities" - so when Traders sell off Bonds, it causes the Bond price to go down, which in turn causes home loan rates to rise. And although most of last week's economic news was "Bond-friendly", and should have resulted in higher Bond prices and lower home loan rates, Bond Traders decided to sell some holdings and lock in their recent gains instead, ahead of what could be a volatile week of market action.

The Federal Reserve is meeting this coming week, and will release their highly anticipated Interest Rate Decision and Policy Statement on Tuesday at 2:15pm ET. So do you know what is expected from the Fed, and how their actions might save you money right away? Read on and learn, in the upcoming Forecast for the Week.

SPEAKING OF SAVING MONEY...DO YOU KNOW WHY MARCH IS THE BEST MONTH TO BUY A TELEVISION? DON'T MISS LEARNING THIS AND MORE IN THE MORTGAGE MARKET VIEW. YOU'LL GET THE SCOOP ON TIMING YOUR PURCHASES TO SAVE THE MOST, EVEN ON GAS, CLOTHING, AND FURNITURE.

The economic calendar thickens up considerably this week, giving a read on manufacturing, inflation and housing...but many of these reports will take a back seat to the Fed's Policy Statement and Interest Rate Decision, to be released on Tuesday afternoon. Traders are forecasting a 100% chance of a Fed rate cut. About half the traders are expecting a cut of ¼%, and the others expecting a cut of ½%. Of perhaps greater importance is tone of their highly analyzed Policy Statement. Comforting words about inflation will help bonds and home loan rates.

Remember that a cut to the Fed Funds Rate would impact the Prime Rate, which affects Home Equity Lines of Credit, credit cards, business loans, car loans and the like - but does NOT have a direct correlation to home loan rates. For example, if the Fed should cut the Fed Funds Rate by .25%, you would likely see a change to your Home Equity Line of Credit by .25%, if it is tied to the Prime Rate as most are - but do not expect regular home loan rates to drop correspondingly, as the Fed's take on inflation will guide the way.

Stock prices have a history of doing well after the Fed begins to cut rates. Since 1985, there have been seven initial rate cuts by the Fed. During the year following the initial Fed rate cut, the S&P 500 has gained an average of +13.7%.

TIMING IS EVERYTHING...ESPECIALLY WHEN IT COMES TO SAVING CASH!

Did you know that the fiscal year for Japanese companies ends in March? Do you care? You SHOULD...if you want the best deal on a new television for your home theater system.

That's because new models and products are scheduled for release at the beginning of the new fiscal year--which for Japanese electronics companies is April. And the release of the new models means...you guessed it...huge discounts on the previous year's models. So if you're shopping for a television, stereo or other electronics, your best bet is to watch for sales in spring.

Looking for Even More Savings?

You can save on just about every item you need...if you know what season or day of the week to purchase it. Below are some tips to help you save the most on your shopping list.

Airplane Tickets: Your best chance for saving is Wednesday morning. That's because airlines introduce their savings over the weekend and during the first few days of the week, subtle price wars begin. By early Wednesday, the savings have usually hit their peak...and there are still plenty of seats left for you to capitalize on.

Furniture: Unless you need to replace your sofa or dining room table right away, those "HUGE" weekend and holiday sales aren't the best time to buy. Instead, you should plan ahead and do your furniture shopping in October or April. That's when new lines of furniture are unveiled at industry trade shows...which means you can save big on the in-store stock that needs to be sold before the new inventory takes a seat on the showroom floor.

Cars: You probably already know that you can save on car purchases in early fall when new models are released and the current models go on sale. And you may also know that your best chance to negotiate a better price is at the end of a month when car dealers need to make their monthly quotas. But did you know you can drive home a great deal early in the week, especially during the morning? At that time, the dealerships aren't overflowing with shoppers like they are on the weekend, so you'll get more personalized attention. Plus, salespeople are more likely to negotiate when they don't have three or four other buyers waiting in the wings to pay full price.

Gas: We've all seen gas prices jump as travel weekends approach. It's a common occurrence...but it can be avoided. Whether you're planning to travel or not, the best time to top-off your tank is early Thursday morning. Then, watch the prices rise and calculate your savings!

Toys: The winter holiday season is a no-brainer for toy sales. But you can also save some serious dollars at the end of summer. Think about it...department stores only have so much room to store their merchandise. And by the end of the summer, they're starting to stock up for the big holiday push...which means they have to get rid of their current inventory of fun. So for savings of 60 percent off and more, try toy shopping as summer winds down in August.

Clothing: By the time the weekend rolls around, just about every dressing room is filled...and the best deals have been picked over already. Why? It's simple. With the large number of special promotions to be marked and shelves to be stocked, most clothing stores get started early. And savvy shoppers, like you, can get the best deals and the best selection by Thursday evenings. As an added bonus, the stores, dressing rooms, and checkout lines aren't nearly as crowded--so you save on stress too!

The moral of the story--plan ahead on your purchases and you'll be rewarded! And be sure to forward on this article to your family, friends, and coworkers too - they'll thank you for it!

Economic Calendar for the Week of September 17 – September 21