Online Financial Tips

Archive for June, 2011

Every senior retiree needs insurance to protect them from the high costs of nursing homes and long term care health care costs. As of today it does not look like the federal government will be passing any sweeping health care reform. The private option is the only current option. Most people have never heard of “Asset based Long term Care.” Let me give you a brief description.

Most retirees buy traditional insurance, they may have monthly or annual premium payment and in return for their premium payment they receive some insurance benefits.

Comprehensive long term care insurance pays a daily benefit, it could be $50.00 a day, it could be $200.00 per day, the more you pay the higher the daily benefit. You could have unlimited daily benefit coverage but you will pay very high premiums.

You then have a policy benefit maximum, it could be 1 year, 2 years 5 years or lifetime coverage. Again, you choose and the higher the policy benefit maximums the higher the costs.

Your policy could cover just Nursing homes, or it could cover assisted living or Home health care, again you decide, the cost is based on how comprehensive you want your plan to be.

Now with all insurance it depends if you ever have to use it. If you don’t use it you must still continue to pay your premium each and every year. Just like your home owners insurance, automobile and life insurance. You pay every year again and again regardless.

So what is asset based Long Term Care? This is an insurance policy that only requires a one time deposit and based on how much you deposit you would pick up all of the nursing benefits discussed in this article.

The real benefit and difference is that you make no annual or monthly premium payments.

The could be a very attractive alternative because if you don’t use the nursing home benefit it carriers a death benefit to your heirs which is a tax free death benefit which is higher than your original deposit, based on your age at issue, it could be twice as much as your one time deposit. So if you don’t use it, you don’t lose the money you paid as a one time deposit.

The other really nice benefit, if you ever need your deposit back, the insurance company will refund your deposit 100%, if the government would ever overhauls the health care system in the future and we don’t need private pay insurance anymore you could get your money back. These policies carry a “money back guarantee.”

This concept of asset based long term care insurance may be an idea whose time has come.

In the event that an earthquake was to strike your condo, do you know if you are covered through earthquake insurance? Knowing about the Condo Association policy held by the unit owners or renters could let you know if you are covered for this type of insurance.

If the condo association has purchased a separate policy of earthquake coverage then you can be certain that you are insured. The typical master policy insurance only covers the structure of the actual building and the surrounding public areas inside and out. Usually condo owners are required to purchase their own separate insurance policies for belongings, liability, and earthquake insurance.

If the earthquake were to damage the structure of the building, there would be a deductible that would needed to be paid for rebuilding. Knowing the cost per unit owner beforehand can aid to put aside that amount before the disaster strikes.

Learning later after the big one hits your condo is not an excuse for not having the right amount of coverage or the money to pay. The condo or building may be ruined due to the size of the quake leaving you with the loss of a home.

The condo insurance for earthquakes if purchased by the association may be a higher deductible with low premiums or a low deductible with high premiums. If you do not have the money set aside when an earthquake hits, it could be possible that you may have to endure legal action for the association to obtain the money to pay for rebuilding.

In the case there are around 8 condos that have taken out a $2,000,000 policy of earthquake insurance, the condo association has to come up with around $200,000 – $400,000. This is contingent on the deductible for the policy and is an estimated figure. With the deductible being so high, each unit would have to pay between $25,000 – 50,000! That is why it is necessary to know the deductible and have the money set aside in the event the big earthquake happens.

Here are a few ways that this could be taken care of with regards to paying the deductible.

- CEA loss assessment – In the event that the owners of the units have purchased the loss assessment policy either through the Master policy or individually, they would only need to pay a smaller portion of the deductible. This CEA assessment policy would pay the rest for the loss. This type of add-on insurance is a nominal fee each year depending upon the insurance company and other factors. Any condo owner can purchase this extra policy in order to protect themselves in this event.

- Pay the Deductible – the entire amount could be paid if the owner had it stored in the bank or through loans that would need to be paid back.

- Borrow Money – the Condo association can borrow the money for all of the owners who do not have the loss assessment coverage. The money borrowed would require collateral and the condo owner would then have a lien put upon their unit. Once the loan has been paid in full or the condo sold, the debt would be relieved.

- Foreclosure – In the case that the owner could not afford the amount for the deductible nor could the association borrow the money to pay, the bank would have to foreclose. The bank would then pay the amount owed to fix the unit for resale.

When we seek medical attention for whatever ailment we suffer from, we trust that our doctors will give us reasonable care. We are putting our health in their hands. The doctors or medical professionals that provide the treatment we need are human, however, and mistakes do happen. Medical malpractice laws are in place to hold the doctors, hospitals, and other medical professionals liable for any harm they may cause us.

What Should You Do?

If you believe you have been a victim of medical malpractice, you should keep all records of any medical treatment you have received, as well as any medical bills. You should also contact an attorney as soon as possible. Medical malpractice laws can be difficult to interpret and only an attorney can advise you as to whether you have a legal claim, and what you should do next.

Insurance Companies

If you do decide to go forward with a medical malpractice case, the doctor’s malpractice insurance company will contact you. They will try to convince you that making a statement is in your best interest and that you should speak with them. First, if you have retained an attorney do not say anything except to direct them to contact your attorney. You are not required to speak to them by law, and more often than not any statements you do make will hinder your case.

The insurance adjustor may even make you an offer. Always consult your attorney before accepting any offer, and also bear in mind that the insurance company is striving to pay you as little money as possible to get your case to go away.

Insurance companies survive by paying as little as possible in any claims. They will not offer you a fair amount and you should never accept any offer they make to you without the advice of your attorney.

The effects of medical malpractice can be catastrophic and life changing. After being a victim of a doctor’s negligence, you have enough to worry about. Let an experienced medical malpractice attorney deal with the insurance adjustors.

A good number of banks continue to report “having tightened standards” on commercial real state loans, according to an April, 2010 Federal Reserve Board survey of 53 domestic banks. But the number of U.S. banks reporting stricter lending standards has dropped since the last survey was conducted in January, 2010. The Federal Reserve survey also asked banks if commercial loan extensions were in use. “Sizable fractions of both domestic and foreign respondents reported having increased their use of CRE loan extensions over the previous six months”, according to the Federal Reserve board’s website.

As a wave of commercial mortgages become due, many borrowers will not be able to refinance because of tightened underwriting guidelines. Reports also indicate an increase of delinquent commercial mortgage loans. On a good note, the survey said there was an increase in the use of extensions by banks. Banks may approve extending the reset period or maturity date of the loan as part of the commercial loan modification.

During the early 2000′s, billions of dollars worth of commercial mortgages were originated with 5, 7 or 10 year reset periods. After the reset period ends, the total loan amount in the form of a balloon payment is due. Lenders added the balloon payment feature to limit their risk exposure. Problem: almost half of all commercial real estate properties are underwater, meaning that the property value is less than the mortgage balance. Along with stricter lending standards, this is the reason why many commercial property owners can’t refinance.

As part of the commercial loan workout process, commercial loan modifications can increase, or in some cases eliminate the maturity date. Commercial loan workouts are encouraged by federal regulators to help commercial borrowers avoid foreclosure. This new policy will help banks who were hesitant in the pass to provide commercial loan workouts to proactively offer solutions to distressed commercial property owners. FDIC Chairperson Bair said the Prudent Commercial Real Estate Workouts policy “emphasizes that restructured loans will not be subject to adverse classification by examiners solely because the value of the underlying collateral has fallen. In fact, institutions are encouraged to implement prudent, loan workouts based on an updated picture of the borrower’s financial condition.”

These new guidelines are designed to help banks and borrowers alike, due to the present state of the economy. “Solid loan workouts that are based on the documented financial capacity of the borrower and the long-term prospects of the underlying project” Bair said.

Key to a successful commercial loan workout is the borrower’s ability to repay the restructured loan or workout plan. If banks can’t document this, then the commercial loan workout is a “no-go”. If a commercial loan workout is denied, other alternatives may exist for borrowers to avoid foreclosure.

A “short sale” allows the borrower to sale their commercial property for less than the actual mortgage balance. But a financial hardship must be documented. Another alternative: “Deed in lieu of foreclosure”. A deed in lieu of foreclosure grants the property owner the right to convey their commercial real estate to the bank to avoid foreclosure. But it would be wise to consult with a legal and/or tax advisor before considering these options, due to possible tax consequences.

Having your own online business saves a lot on your start up and operational costs as compared to business with a physical location. Most businesses these days accept credit cards online to expand customer base and increase sales volume. Businesses that accept credit card payments online have sales that are 50-400% more than businesses that do not accept credit card payments.

In case you decide to accept credit card payments online, you’ll have a choice to apply for a traditional merchant account at any of the local bank and get accepted or you can use one of the numerous credit card processing companies that operate online and are looking for online businesses. Many of the card processing providers you can use online allow you to set up your website for accepting credit cards with no set up fees.

When you just start an online business, you are probably not ready to get any credit card processing provider that requires you process a minimum number of transactions each month. It is better to pay a slightly higher per-transaction fee than to pay a higher monthly fee in exchange for a lower per-transaction fee based on a minimum number of cards processed each month.

Benefits that you will get when you accept credit card payments online:

Sales will increase: Credit card customers buy 2.5 times more merchandise than customers who pay cash. To attract the impulse buyer: credit cards give the customers freedom to spend for previously unplanned merchandise. To move expensive merchandise: Credit card customers are often less conscious of slight price differences, and will seek out the businesses that offer credit rather than the discounter or wholesaler who does not offer credit purchases. Larger volume: Offering Credit Cards helps you achieve higher unit sales and extra orders. Steadier sales: Offering credit cards can help smooth out the business ‘ups and downs’, cash shoppers tend to buy heavier only on paydays and just before holidays; credit customers buy whenever the need arises. Credit card issues: Of around 280 million North Americans, 150 million have Visa, 95 million have MasterCard, 40 million have Discover and 25 million have American Express. 80% of all Credit Cards are Visa and MasterCard.

Debt settlement is commonly known as debt negotiation. It is one of the debt solving methods for people who are burdened with huge debt. This kind of settlement involves the negotiation with creditors with the main purpose of reducing the pay off amount to resolve the outstanding balances.

There are many benefits of having this solution. Firstly, the debtors will be able to relieve themselves from financial hardships. The creditors and debt collection agencies will stop disturbing them with non stop phone calls and reminder letters. There is no more legal action being taken by the creditors. In other words, the debtors will not be sued for bankruptcy and they don’t need to worry that they will lose their assets.

Secondly, the debtors are in fact standing at a better financial position. MONEY is the most solid benefit they can gain from debt negotiation. Through the negotiation process with the creditors, the debtors are able to settle their debt by paying a lesser amount of the actual debt. Saving a substantial amount of money is indeed possible. Some good debt settlement companies manage to assist their clients to save about 50% of their money.

Thirdly, there is definitely great news for debtors as they can improve their credit history through debt settlement. They can actually delete the negative information on their credit reports with the consent of the creditors. This can be done through negotiation. The debtors’ credit report will no longer show an open delinquent item after the debt is settled. In other words, debt settlement helps to minimize the credit damage of a person.

By looking at these 3 key benefits, it is indeed worthwhile for people with huge debts to proceed for debt settlement. Isn’t it great to be debt free in a faster way?