More borrowers were able to buy their homes using FHA loans, and homeownership rates climbed over the next several decades. The agency covers 8 million single-family homes and almost 12,000 multifamily properties. The FHA loan program helped move homeownership rates in the U.S. to a high of 69.2% in 2004, but it fell 4.5 percentage points through the end of the Great Recession that was caused by the 2008 mortgage crisis....
In general, the jurisdiction imposing an indirect tax has a tax code governing the collection and remittance of the tax. This tax code may have rules pertaining to: Who is subject to the indirect tax What is subject to the indirect tax How one may pay the indirect tax How one may file a return for the indirect tax Often, indirect taxes are built into the price charged to consumers....
For example, you may add an insurance endorsement to cover expensive jewelry or art that would not be covered by your regular homeowners’ insurance policy. Alternate name: Rider How an Insurance Endorsement Works An endorsement is a policy change that can be added during the term without renewing the policy. Your premiums may change as a result of an endorsement. They’re often used on property and casualty policies. Riders can also make changes to health and life insurance plans....
For example, let’s say you’re buying a house for $300,000, but you qualify for an open-end mortgage worth $400,000. Until you take additional draws, you’ll only make principal and interest payments on the $300,000 you initially received. Then if you take a draw of $25,000, you’ll start making payments on that amount combined with the existing principal balance. The same goes for any additional draws you take in the future....
As an investor, it’s important to understand how a company’s authorized share capital affects you. This article will explain authorized share capital, provide real-world examples, and explain what it means for you as a shareholder. Definition and Example of Authorized Share Capital Authorized share capital is the amount of stock, both common and preferred, that a company is allowed to issue. A company’s authorized share capital is established in its articles of incorporation (also known as its corporate charter)....
Knowing the average propensity to consume is helpful for economists who monitor national spending patterns and behaviors. It can also be beneficial information for people who want to have a better understanding of where their money is going. Find out more about the average propensity to consume, its importance to a healthy economy, and what impact it can have on your savings. Definition of Average Propensity To Consume The average propensity to consume (APC) measures what percentage of after-tax or disposable income a household uses to buy goods and services....
Any business or individual can file for Chapter 11 bankruptcy protection. Businesses include everything from sole proprietorships to corporations. It’s commonly known by the public as a tool for large companies, so people are often surprised that individuals can file for Chapter 11, too. Chapter 11 is most often used by individuals when their debts exceed the limits allowed for a Chapter 13 bankruptcy: $394,725 for noncontingent, unsecured debts and $1,184,200 for secured debts....
You might have a second car that you don’t use to get to work. Owning it is a luxury. There’s no loan against it, and it’s worth $6,000. The trustee will sell it and apportion that money among your creditors. Alternate names: straight bankruptcy, liquidation bankruptcy How Chapter 7 Bankruptcy Works Creditors must submit proper claims to receive payment toward your debts, and the trustee can’t take and sell all that you own....
EmirMemedovski / Getty Images The rate of deflation can be calculated like this: How Deflation Works Deflation can be caused in a number of ways. It is often brought about by a fall in the total demand of goods and services, or an increase in supply. (( CPIc - CPIp ) / CPIc ) * 100 = Deflation Rate Deflation can also be caused by a lack of money supply....
PriceIncomeAssetsEmployment BackgroundDebt These inputs are used to calculate whether a borrower meets the standards for a certain loan. If the requirements are met, it will issue an automated approval. Desktop Underwriter sets the industry standard in underwriting mortgages. Since it’s automated, it allows loan originators to make decisions using logic and algorithms. It removes factors such as race, gender, or other prohibited matters. If you can’t get an automated approval through Desktop Underwriter, you may need manual underwriting to secure your loan....
If you’re looking for divorce insurance, you may have a hard time finding this exact type of policy, but there are a number of products that you can combine to help provide compensation for the cost of divorce and the legal fees that come with it. Does Divorce Insurance Exist? There is no product in common use today known as “divorce insurance.” You may come across a niche policy here or there, but for the most part, people don’t plan for divorce the same way they do for other major life events....
In contrast, unearned income is typically money made where the relationship between work and earnings is not as direct. Unearned income can include interest and dividends from investments, pensions, annuities, unemployment benefits, alimony, and child support. Both earned income and unearned income are taxable by the IRS. However, the tax implications are different for each type of income. For earned income, which you can make in a variety of ways, including your job, the following taxes apply: Consider this hypothetical example of earned income....
The biggest block to mobility is widening income inequality. And unfortunately, race has also been a factor over the years. As a result, the United States has lower levels of economic mobility than other developed countries. How Is Economic Mobility Measured? Mobility is calculated using earnings, income, or wealth. The measurement used will give different results. Earnings are wages and salaries from paid jobs and businesses, including farms. Income is revenue from all sources before taxes but after transfers....
Income shifting doesn’t work with earned income, that which is paid to you by an employer or as an independent contractor. Those payments are tagged with your Social Security or tax ID number from the onset. They’re reported to the IRS as your income on Form W-2 or Form 1099-NEC. You’re free to give the money away, of course, but it will first be taxed at your own tax rate....
To get a better understanding of long-term unemployment, it helps to know what the statistics say and what the causes and effects are. What Long-Term Unemployment Means for You The number of long-term unemployed persons as a percentage of all unemployed persons is an important tool used to measure the health of the U.S. economy. Events like the COVID-19 pandemic can temporarily displace millions of workers, but it spells even more trouble for the economy if these people remain unemployed....
Learn more about pay in lieu of notice; when organizations must provide pay; how much employees are entitled to receive; the impact on unemployment benefits; and legal guidelines for compensation when employment is terminated. Definition and Examples of Pay in Lieu of Notice Pay in lieu of notice is compensation paid to an employee when their employment has been terminated, and the employer has decided to provide pay instead of having the employee work during the notice period....
Alternate name: Senior debt, priority claim, senior expense Darren Nix, the founder of Steadily Landlord Insurance, shared an example of how settling preferred debts might work for a landlord. “Let’s say a landlord files for bankruptcy,” Nix said. “The first debts paid off (preferred debt) are frequently the primary residency. Other debts, especially those to investors and shareholders, are paid last in the bankruptcy.” How Does Preferred Debt Work? Contrary to what some might believe, bankruptcy doesn’t wipe away all of your debts....
Direct deposits Debit card transactions Automated teller machine (ATM) transfers Pre-authorized withdrawals from bank accounts Phone-initiated transfers How Regulation E Works To truly understand Regulation E, it’s important to get a good grasp on the Electronic Fund Transfer Act. Passed in 1978, the act requires financial institutions to clearly outline the amount they’ll charge consumers for EFTs. Essentially, Regulation E offers the framework to enforce the act. Both the Electronic Fund Transfer Act and Regulation E can help you as a consumer in a number of ways....
Definition and Example of Residual Interest Residual interest, also known as “trailing interest,” is the interest that accrues when you carry a credit card balance from one month to the next. This interest continues to add up from the time your current billing statement ends until your next payment is posted. Alternate name: Trailing interest For instance, let’s say your billing statement ends on the first of the month, and you paid your credit card bill when it’s due on the seventh....
Under stagnation, GDP growth is anemic. Unemployment is stable but remains at relatively high levels. Business owners are reluctant to expand because they don’t know if they will be able to make money from it. Consumers are reluctant to spend money on houses, cars, or appliances because they don’t know if they will be able to keep their jobs. The economy stands still. Alternate name: Secular stagnation Japan experienced a stagnation that lasted throughout the 1990s, a period known as “The Lost Decade....
