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By Peter Anderson 13 Comments – The content of this website often contains affiliate links and I may be compensated if you buy through those links (at no cost to you!). Learn more about how we make money. Last edited April 26, 2011.

Over the past week or so I’ve been hearing rumblings from various talking heads that the government should consider, or has considered,  changing the rules when it comes to the Roth IRA and their tax free withdrawals at retirement.  In some scenarios some people would just like to do away with the accounts altogether. The reasoning?  They allow for too much tax revenue to be lost, and with government entitlements growing every day, they’re going to need more tax revenue.

While even a year or two ago I would have dismissed this type of thinking as it would represent a significant betrayal of savers and investors, the more I see our government spending, the more I’m inclined to not rule out the idea that the Roth IRAs as we know them may not always be around.  They’re just too tempting of a target for our politicians and their big spending ways.

So what are some of the ways that people are predicting that Roth IRAs could change in the future?

Roth IRA Become Taxable At Retirement For Some?

One of the ways that folks are suggesting that Roth IRAs could change in the future is that politicians could institute a tax of some sort on taxpayers over a certain income threshold, or those with what one writer in the New York Times calls an “excessive balance”.

So in one scenario,  say you make over $250,000, you’d be taxed 5% on your Roth withdrawals.  Or they could do something like charging tax on earnings through a capital gains tax of some sort.  The possibilities are endless.

At the most extreme end, the federal government might try to tax the earnings on a Roth after all, say through the capital gains tax, which is currently at 15 percent for long-term gains but could go up in the next few years. Or it might levy some sort of an excise tax on excessive balances, however those might be defined.

Roths are especially useful for estate planning purposes. Regular I.R.A. holders have to start taking money out once they reach the age of 70 and a half, but Roth owners don’t have to take money out during their lifetimes. Heirs of Roth holders, meanwhile, pay no income taxes when they cash out of the inherited account and can spread those distributions over an entire lifetime, allowing for decades more of tax-free growth thanks to the wonders of compound interest. Some part of this could certainly change.

So the author seems to thinks that some of the other benefits of a Roth IRA, including no required minimum distributions and inheritance provisions, could be phased out – or changed to include some sort of tax.

Forced Withdrawals From Roth IRA

Some say that the Roth IRA is a drag on the economy because the money can sit in the account indefinitely with no required minimum distribution.   An article in the LA Times yesterday says as much:

All of which makes Roths a perfect “fiscal Frankenstein.” In return for little more than ordinary upfront taxes, Congress waived untold billions in future Treasury receipts. Then, too, Roths could be a drag on the U.S. economy. Since no withdrawals are required, assets can lie idle indefinitely.

I can’t say I agree with that idea that because the money is in someone’s investment account growing – that somehow they’re a drag on the economy.  To me it speaks to the mindset that far too many have that somehow the government owns everything and is only being gracious and allowing us to have a little taste of our own money. I also don’t agree that having money site idle in the private sector is somehow worse for the economy than allowing the public sector to spend it all for us.  In the end most will be withdrawing it, and I think having the money in the private sector to actually have people purchasing things, creating jobs,  and creating more tax revenue that way is the better way to go.

Include Roth IRA Withdrawals In Calculating Tax On Social Security Benefits

Another idea that some have put forth is the idea that the government could change it to that people would have to  include their Roth IRA withdrawals in retirement as regular income when coming up with the tax due on their Social Security checks.  Of course this again would mean more taxes to the government.

Will You Continue Using The Roth IRA?

So with all this speculation out there, do you think that the government would ever go down this road of making Roth IRAs taxable at withdrawal, through capital gains taxes or by including it in social security income?   Does it give you pause when thinking about investing in a Roth, or will you continue to  invest there anyway because it’s all just speculation?

Tell us your thoughts on the Roth IRA and if they’ll ever end up making changes to make them taxable at the front end and back.

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Source: biblemoneymatters.com

Apache is functioning normally

This is the 2nd installment from my buddy Eric Moorman, who I consider to be a real estate investing genius. Be sure to check out his first post “How I make $250,000 a year investing in real estate“, in case you missed it.Also, if you want to learn more about real estate investing, be sure to subscribe to our free newsletter below.

It is no surprise; there are a LOT of Foreclosures in the Real Estate market right now.

It is also no surprise these houses can be bought at steep discounts.

In fact, Foreclosures, in my opinion, are the hottest thing going in Real Estate investing.

The market is full of them, and the banks are holding thousands back, so as not to flood the market even more. As most of you know, banks are not in the business of Real Estate. They are in the business of loaning money.

When a bank gets a Foreclosure, it is a toxic asset on the banks books. Now, more than any other time in history, banks are dumping these toxic assets for pennies on the dollar.

Before you quit your day job and decide you are going to get rich buying and selling Foreclosures, know this:

The word Foreclosure means several different things and has several different stages. Depending on what stage of Foreclosure a house is in will depend on the amount of risk you will take on. Let’s look at the different stages of Foreclosure and the positives and negatives to buying in each stage.

Before you read further, understand that each state handles Foreclosures differently. The timelines and examples I give below will not necessarily be the standard for where you live.

The Pre-Foreclosure

The first stage of the Foreclosure process is known as Pre-Foreclosure. This means the individual who owns the mortgage is behind on their payments. Depending on the bank, the payments could be between 3-12 months behind. Yes, some banks do not start the Pre-Foreclosure period for 12 months!

At this stage, the owner is still living in the house. Interest and penalties are accruing on their loan, but the only thing that is really happening is their credit score is going down (rapidly) and they are getting a lot of letters in the mail from the bank. The bank has not decided to go full blown foreclosure yet, as they are attempting to work something out with the home owner and save themselves the very high cost of the foreclosure process.

The positive to buying at this stage of the foreclosure process is you obviously have a motivated seller. Depending on their situation, they may be willing to sell their house very cheap, in order to avoid foreclosure and save what they can of their credit.

The negative is they may not have a lot of equity in the house, and therefore their motivation may not be a factor. It does not do an investor any good to buy a house when it is worth what the seller owes on it (or as is the case with many properties in this market, the house is not worth what the seller owes).

You look for motivation but you make purchases on equity.

Without getting too deep into investment strategy, know that in some cases it may be worthwhile to make up delinquent payments and purchase the house with creative financing. We will not discuss that in this post, but know it is a viable option and one we will discuss in future posts.

The Short Sale

The next stage in the Foreclosure process is when you can buy the house on a Short Sale. A Short Sale is when the bank is willing to take less for the house than what is currently owed on the property. There is no set time period for when a house goes from Pre-Foreclosure status to the bank being willing to do a short sale on it.

When the bank has decided it will take a Short Sale, it has basically come to the conclusion the current homeowner is not going to be able to make up their back payments and continue with the mortgage. The only reason a bank will accept a short sale is to forego the long process and high cost to Foreclose on the delinquent mortgage.

There are a few positives and a LOT of negatives to buying in this stage of Foreclosure. Some investors love to buy at this stage, but as you will see it is a lot of work, takes an extremely large amount of time and rarely produces a deal.

The positive to buying a house as a short sale is this, you can get a very steep discount…. That is about it!

The negatives are the following: The current homeowner has to apply for a Short Sale, sending in a lot of financial information basically convincing the bank they are no longer in a position to pay their mortgage.

This takes forever!

Once the house has been approved for a Short Sale, the current owner must agree to your price and then send it to the bank for approval. This process also takes forever (several months). A short sale can easily take 6-9 months to go through, and I have seen cases in which it took over one year.

Here is the scary reality of short sales, it may be to the very end and you think the deal you have been working on for months is about to go through and BOOM, the bank rejects it. There is money to be made in Short Sales, but it is definitely not a method to base your investment business around.

Going to the Auction

The third stage of the Foreclosure process is when the property is being auctioned at the courthouse steps. This is the most dangerous time to buy, and only seasoned investors should attempt to buy at the courthouse auction!

At this stage, the bank has gone through the legalities of the Foreclosure process and the house is going up for auction. The bank will send a representative to bid at least what is owed on the property, and anyone who is willing to pay above that can buy the house.

The positives of this are, if there is a ton of equity in the house, you may have a shot at getting a good deal. Here are the negatives. The individual often times may still be in the house at this stage! Even if you buy it, they may trash it as they are leaving. Hence, you have no way to calculate what your repairs will be on the house.

Also, at this stage, the bank does NOT necessarily remove all liens from the property. You may buy the house and discover there is a mechanics lien, a lien from the city or various other liens that YOU have now inherited.

Also, every state has a period of redemption for the previous homeowner to catch up the mortgage and all of the fees, after the auction sale.

Granted, this is VERY unlikely, but it is something to consider. Also, at the courthouse steps, the buyer is required to put a large sum of money down as a deposit, with a very small window to come up with the remaining balance.

If you are not a cash buyer, you will have a very hard time buying these properties. Once again, there is money to be made by purchasing homes at the courthouse auction but it is very dangerous, and there are several things you may discover once you purchase the property that completely change the financial outlook of the deal.

If the phrase “Buyer beware” was ever appropriate, it is when buying at the courthouse steps!

REO…Speedwagon? Not quite

The final stage of the Foreclosure process is my favorite. This is the point where the house becomes an “REO.” Once an auction on the courthouse steps takes place and no one bids more than the bank’s bid, the property goes back to the bank and becomes an REO or “Real Estate Owned” property.

At this point, the bank has been dealing with this toxic asset for quite a while, with no money coming in and only money going out! You must understand the bank’s costs, to understand why they are extremely motivated to sell these properties.

As previously stated, the bank has had this non-performing asset on their books for a long time. They have spent money on attorney’s fees, property preservation, insurance etc. Most big banks have thousands of these non-performing assets and they need them off the books badly.

The positives to buying at this stage are many. First, once the property is an REO, when the bank sells the property, they are required to deliver a clean title and remove all liens. Hence, you will not have any surprises once you have bought the house.

Also, no one will be living in the house at this point. The bank has seen that the previous owners have vacated the property, with no chance of redeeming their loan. The negatives to buying at this stage are, the previous owners often leave the house in poor condition. Depending on how you look at it, this may not be a negative at all. The worse condition a property is in, the better the discount. When you become good at estimating repairs, this is simply a factor that will go into your offer.

This may surprise you, but as investors, the house matters very little when it comes to getting a check.

I am not saying the condition of the property plays no role when deciding to pursue an investment, but the condition of the house is not the main factor.

My point is, do not stray away from houses that smell like cat pee or are in bad shape, there is money there! Many of the current houses on the market will not be financeable through a bank, due to their condition. This only serves as a bonus for you, the investor!

As of this writing, Fannie Mae, Freddie Mac and FHA (Federal Housing Administration) alone hold nearly 250,000 REO homes. As an investor, the foreclosure market is definitely something you should be paying attention too.

While there are various stages of foreclosure and each stage carries a different amount of risk, each stage also allows the opportunity to create a huge amount of wealth. While there are several avenues to focus on when trying to make money in Real Estate, in this market, few come close to the power of harnessing equity out of bank distressed REO’s.

Focus on your education and learn the foreclosure process, and then go make some money!

Want to know more about how to make money with real estate?

Sign up for our free newsletter so that you get the information as soon as it comes out.

Source: goodfinancialcents.com

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If you’ve been declined coverage from an insurance company, don’t assume that you can’t get the protection that your family needs. There are plenty of affordable insurance options.

For those who cannot get approved for a basic term life policy,  guaranteed acceptance life insurance is the solution to their problem. Being exactly what it sounds like, there is not a single person turned away or left uninsured if you want a guaranteed acceptance life policy. On paper, this sounds like an excellent option for insurance coverage.

Even if you’ve been declined in the past for life insurance, this may not be your only option, but it’s important that you understand all of your options and that you realize even if you have terrible health, you can still get life insurance coverage.

Smokers, those with medical conditions, and seniors over 50 seeking life insurance with health conditions are the majority who look to these types of life insurance policies, hoping to be able to leave something behind for their families.

Anyone who has a health problem or has any risky behavior is going to be classified as a “high-risk applicant,” which means higher premiums or possibly being rejected.

Many companies have a guaranteed acceptance life insurance policy available and a little searching will do you worlds of good in getting the best rates. A policy is only as good as the company that offers it, and knowing whether the company you choose is right will take a little time and some research, but can wind up saving you quite a bit.

Note: If you are considered to be a high risk individual, see here for more high risk life insurance quotes.

What You Need to Know About Guaranteed Issue Life Insurance

The first thing to know about a guaranteed issue life policy is that no medical examination, medical history, or tests are performed; simply apply and you’re approved. The lack of underwriting means you can be approved within minutes. Many clients considered ‘high risk’ will find this type of policy to be the only available to them, and it comes with a price.

See here for more information regarding term life insurance that does not require a medical exam.

With the majority of clients being ‘high risk’ the premiums you’ll pay on the policy are more expensive. Rates will vary from company to company, but you’ll always wind up paying more than you would for a simple term life policy. If you want cheap life insurance protection, then you’ll need to find a company that will accept you with one of their traditional plans.

Benefits of Guaranteed Acceptance Life Insurance

There are some obvious advantages to these guaranteed acceptance life insurance plans, the biggest one is that anyone can buy one of these plans. Anyone can purchase one of these plans and get the coverage that they want. Nobody should have to go without the insurance protection that their family needs.

Perhaps one of the most beneficial features of a guaranteed acceptance life insurance policy is that it can be whatever you need it to be, term life or permanent. With a term life policy, your rates are set and won’t increase with your age while a permanent policy will be there for the rest of your life. The freedom to choose what policy you want makes a guaranteed acceptance life plan unique.

Another benefit to these plans that you won’t find with other types of insurance coverage is how quickly that you can be accepted for the insurance policy. With a traditional life insurance policy, you’ll wait weeks to get life insurance, or even month. Guaranteed acceptance gives you coverage in hours.

Taking the time to search and compare premiums will help you find the best guaranteed acceptance life insurance policy available. Companies will be quick to offer free quotes and estimates, features that can help you find the right company faster. If you can’t find the information you need from their site then contact their customer service, someone in the company is sure to be able to help you.

What Questions Do They Ask?

For the most part, insurance companies will ask the same or similar questions for a guaranteed life policy. The trick is that some companies will decline you on specific conditions while others will not.

How do you know who to go through? That’s the good news. You don’t!

That’s what we’re here to do. 🙂

We just need to ask some basic questions about your previous conditions and we’ll help align you with the right guaranteed issue insurance company.

Does Guarantee Issue Insurance Offer Same Death Benefit?

In most cases, the answer is no.  Since the insurance company is taking on more risk by insuring higher risk individuals, the maximum amount of death benefit you can get is substantially lower.  Face amounts will range between $5k-$50,000.

There are some carriers that will issue higher amounts, just be prepared to pay exorbitant prices. For most applicants that are looking for life insurance protection, this isn’t nearly enough life insurance. The smaller plans would leave their loved ones with debt leftover.  Which means that if you’re looking for an insurance policy that is going to give you more coverage than that, you’ll have to go with a normal life insurance plan. The other option is that you can buy two smaller plans to get the coverage that you need.

Sometimes, too, you won’t have the same death benefit payout getting what’s called a “graded benefit”.  A graded benefit means that if you die within 2 years of taking out the policy, you’ll only get the premiums you paid plus a certain amount of interest. These graded benefit clauses are the way that the insurance company offset the additional risk.

The majority of no-exam plans are going to come with the graded benefit components. This shouldn’t keep you from purchasing one of these plans, but it’s something to be aware of. The only way that you would receive the full benefit is if you were to die because of an accident.

Getting you the information you need to make an informed decision will show you how dependable a company can be, and with something as important as life insurance you need a company you know you can trust.

Pros and Cons of Guaranteed Issued Life Insurance

Guaranteed Acceptance Life Insurance policies have both advantages and disadvantages. On the one hand, they do not require a medical exam or health questions, guarantee acceptance regardless of health status, and may be a suitable option for individuals with pre-existing medical conditions or those seeking only a small amount of coverage. The death benefit is typically paid out tax-free.

On the other hand, these policies are often more expensive than traditional life insurance policies, have lower coverage limits, and have a graded death benefit that limits the benefit payout if the insured dies within the first two years of the policy.

As a result, these policies may not be suitable for those who require a large amount of coverage for income replacement or other financial needs.

Pros Cons
– No medical exam or health questions required – Typically more expensive than traditional life insurance policies

– Guaranteed acceptance, regardless of health status – Lower coverage limits than traditional policies

– Can be a good option for people with pre-existing medical conditions or older individuals who may have difficulty getting traditional life insurance – Graded death benefit means that if the insured dies within the first two years of the policy, the death benefit may be limited

– Can be a good option for those who only need a small amount of coverage for final expenses or to leave a small legacy – May not be a good option for those who need a large amount of coverage for income replacement or other financial needs

– Death benefit is typically paid out tax-free – Before purchasing, it’s important to compare rates from different insurers and consider other types of life insurance that may be a better fit for the individual’s needs and budget.

How Much Life Insurance Do You Need To Buy?

It’s vital that you get the right amount of life insurance protection that you and your loved ones need to how the money that they need. Getting the perfect size life insurance policy is a delicate balance between not paying for more insurance than you need and buying enough coverage.

If you’ve already paid off your mortgage, and you don’t hold a lot of debt, you can consider getting a smaller insurance plan, like one of the guaranteed acceptance life insurance policy. They are built to give coverage for people who don’t have any major debts.

The next factor to consider is your salary. As long as you don’t have anyone who needs your paycheck, then you can buy one of these guaranteed issue plans and they will provide enough protection.

After that, you should also consider any future expenses that your family may run into. You can’t predict the future, but there are some bills that you know they will encounter. The best example of this is college tuition. When your children are heading off to college, your spouse will have to pay for those bills with only one income, which can be difficult.

There are more factors that you’ll need to look at based on your situation to determine how much life insurance you and your family need. Our independent insurance agents can help you decide how much insurance that you need, and they can also help you find the perfect plan to fit your needs. These guaranteed issued plans are a great way to get the coverage that you need, but they aren’t for everyone.

Is A Guaranteed Acceptance Life Insurance Policy Right For Me?

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Because there are so many different types of insurance policies, it can be difficult to decide which type of plan fits your needs. While these guaranteed accepted plans are an excellent option for anyone that’s been declined for life insurance policy, don’t automatically assume that they are your only option. If you have severe preexisting conditions, like heart problems or diabetes, guaranteed acceptance is one option, but not necessarily your only option.

Every insurance company is different, which means all of them are going to view your applicant through different medical underwriting. There are dozens of insurance companies that specialize in insuring high-risk applicants with various conditions and health problems. These companies have experience working with applicants that are in less than perfect health and they will give you a much greater chance of being accepted for life insurance and will deliver much lower rates.

Additionally, our agents have years of experiencing working in the insurance market, which means they know the companies that specialize in high-risk applicants and can get you the best chances of getting insurance coverage at an affordable rate.

Going with a life insurance plan that requires medical underwriting is going to be much cheaper than a plan that is no exam. These guaranteed issue policies should always be used as a last resort for life insurance, unless you have a specific reason for choosing one of these plans.

Source: goodfinancialcents.com

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Who needs hotels anymore? One of the internet’s greatest travel perks is that it’s  much easier for those looking for a place to stay to connect with someone who has a room to spare.

Rental sites like Airbnb.com let anyone put their spare couch, bed or house up for rent. The upsides for hosts: Greet people from all over the world, and pocket some cash for their efforts. The benefits for guests: Stay at unique places for a fraction of the price of a hotel room.

But staying at someone’s home isn’t quite the same as a hotel. There’s etiquette for both host and guest to follow so that both parties get the most out of the experience.

For Hosts:

Charge less first, then raise your rates, but be realistic. Figuring out how to price your place can be tricky. Charge too much and you won’t get any bookings; charge too little and you won’t be making as much as you could. Keep in mind that Airbnb earns its cut by doing a 6 to 12 percent markup on the listing price, so if you list a room for $100, Airbnb lists it for $106 to $112 and takes that extra money. But because it can be tough to get bookings on a site like Airbnb without a solid base of reviews, you may want to undercharge at first.

Jane Hodges, a business journalist whose new book about renting versus buying a house will be published this spring, listed the basement of her West Seattle home in April. Initially, she charged $55 per night and immediately got a ton of interest. Now her rate is $61, with a two-night minimum. She probably could charge more but the basement is not completely finished, particularly in the walk between the bedroom and bathroom, and she’s upfront with guests about that.

Chris Williams, a retired teacher in the former gold mining town of Nevada City, California,  decided to list the granny flat and a few spare rooms in her home on AirBnB to create extra income. She, too, started low on the pricing, but as her guests left rave reviews on the website, her rooms started showing up higher on the search listing, and she eventually had a full calendar of bookings. Still she keeps her rates lower than she could — $35 to $45 per room, with a two-night minimum – because the kitchen, living room and outdoor patio are all common areas, and she doesn’t serve meals. “I realize that the rooms aren’t as private as hotel rooms, so I don’t feel I can charge as much.”

Use the professional photographer. Airbnb offers to send one to new listings so that quality photos of your room appear on the site. Both Hodges and Williams had photographers who routinely shoot for realtors’ property listings come to their homes. Take advantage of that. Because the photographers know what they’re doing, they generally will do a better job emphasizing the assets of your home better than you can. Also, Airbnb-commissioned shots feature a “Airbnb.com Verified Photo” watermark on the site, which makes potential guests believe that your killer apartment actually exists.

Consider a two-night minimum. Of course, if you’re starting out as a new listing, it’s wise to go short to build up your list of reviews. Once you earn those, it’s better financially to go for longer-term guests. “I’ve turned down requests for people who need a place to stay for a night, will arrive at 11 p.m. and leave for the airport at 6 a.m. Ditto for people who want the place on the same day. It takes time for me to get the place ready — wash up, dust, vaccum, shop for breakfast” says Williams. It’s not worthwhile to do that day-in, day-out, especially if you’ve got a life, and daily maintenance will eat into those rental fees.

Ask guests to contact you first. At the top of your listing, ask that people send you a note inquiring about availability before trying to book.  This serves as a test for whether they actually read your listing before attempting to book, or were simply dashing off requests to everybody in a five-mile radius. It also allows you to communicate with potential tenants, so you can decide whether or not you feel comfortable taking them as guests. But respond to every message, even if it’s only to say that your place isn’t available. Airbnb tracks and publishes what percentage of messages you reply to as your “Response Rate,” so having a high number makes you look like a more receptive host, and it puts you higher up in the search rankings.

Fill out a detailed profile. That means a real photo of you (smiling, of course), and a bit of information about who you are. A filled-out profile reminds potential guests that you’re a real person. Also, make sure you list your neighborhood. Airbnb listings allow you to tag your place by neighborhood. It allow users who are searching for particular neighborhoods (say, the neighborhood of Williamsburg in the vast borough of Brooklyn) to find you.

Screen potential guests. If somebody who contacted you via Airbnb has no reviews or an incomplete account, ask them to send a bit of info about themselves. You want to know as much about a potential tenant as possible because you are letting them into your home, after all.

Also, you want to make sure it’s a good host/guest fit. Some hosts like to hang out with their guests and show them around town, other prefer that guests be as self-sufficient as possible. Williams is the former. She asks guests what brings them to town, so she knows what advice to give them to make their trip more fun. “I’ve found that just about everybody is happy to share that info. If they refuse or ignore the request, I consider that a warning sign, and I move onto the next person.”

Offer the basics. Good linens and towels (including washcloths) are a must. Hodges recommends good bedside lighting and a table or stand to put a book and a glass of water down on at bedtime. She also includes a coffeemaker and a cold breakfast of granola bars and fruit (cheap and easy to purchase). Williams puts hairdryers in every room, and takes mini bottles of shampoo and conditioners from her hotel trips to put in her guest bathrooms. “I can’t tell you how many guests told me that I just saved them luggage space. Anything you can do to lighten their luggage load is a plus, and makes them feel like they are staying in more of a hotel-like environment.”

For Renters:

Do not try to book without communicating first. Airbnb is not Expedia or Travelocity. Just because a date appears to be available on the calendar does not mean you can stay there that night. Message the host, introduce yourself , tell them what brings you to town, then ask politely if your requested dates are available.

Read the entire listing before messaging. Don’t waste the host’s time by asking questions with readily available answers like “are you near the airport?” or “do you have a kitchen?” You look like a undesirable guest and you’re far more likely to have your request rejected. “I don’t want to be their mom,” says Hodges. “If they book decently in advance and do research on the area, I am happy to fill out the cracks.”

It’s not a hotel. That means you should have some basic courtesy when it comes to cleaning up after yourself and making noise. Remember that your hosts have lives, too. One of Hodges’ biggest annoyances is guests who don’t say what time they’ll arrive. “Some people are not specific when they’re coming, so I’m stuck in the house waiting for them. Now when they book, I ask them to give me a two-hour window so I know what time to be here when they arrive.”

Williams’ pet peeve is guests who bring “extra guests” home at night. “You’re a few steps up from being a stranger in my home. I don’t want total strangers as well.”

Fill out your profile. The same rules apply to guests as hosts. “If your profile makes you look friendly and decent, I’ll usually allow you to book,” says Williams. That means a real (non-threatening) photo of you, and some information about who you are and where you’re coming from. More than anything else you do, this will raise the percentage of your reservation requests being accepted.

Vanessa Richardson is a freelance writer in San Francisco who writes about small business and personal finance.

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Now that Tarek and Heather El Moussa have joined forces in holy matrimony and in the business of flipping homes and in starring on their own show, “The Flipping El Moussas,” we figured it was only a matter of time before they took the next step that all reality star couples take.

Can you guess? They’ve embarked on selling their own line of home decor.

Pretty much all big-name reality TV stars hawk their own products, of course. Chip and Joanna Gaines peddle home accessories galore at Magnolia and Target. Property brothers Drew and Jonathan Scott launched a furniture line at Living Spaces. Dave and Jenny Marrs of “Fixer to Fabulous” have a slew of outdoor wares at Walmart. Even Tarek’s ex-wife, Christina Hall, has her own bracelet line. In short, the list of celebrity-endorsed products is nearly endless.

So it stands to reason that the El Moussas would also enter into the fray. Yet while I was excited to check out their offerings, I have to admit I was somewhat underwhelmed.

Is Tarek and Heather El Moussa’s home decor line a flop?

Home by Tarek & Heather currently offers only four products: two candles priced at $38, one candle priced at a jaw-dropping $249, and a dispenser of hand soap for $16.

The first Home by Tarek & Heather products

(HomebyTHEM.com)

All “smell lovely,” says Heather in a promotional video.

Heather and Tarek El Moussa check out samples from their new home decor line.

(HGTV)

Apparently, these four products are just the start, with more to come—at least according to the second episode of their show, when Tarek and Heather were celebrating the arrival of some samples. They are not only sniffing candle scents, but also plumping pillows and nuzzling what looked like whisper-soft throws.

Heather nuzzles a whisper-soft throw.

(HGTV)

Tarek describes their new line: “In all of our flips, we’re going to put in candles, we’re going to do floor mats, rugs, maybe blankets, like homey stuff. Like comfy rugs and pillows.”

“So when people walk in, they know it’s a home by Heather and Tarek—er, Tarek and Heather. Sorry,” Heather says with a laugh.

I’m sure I wasn’t the only one who immediately wanted one of those throws. Given my anticipation, I was sorely disappointed to scour their website with nary a throw in sight—just four freaking products, one of them a $249 candle.

Tarek and Heather announce their new line on Instagram.

(Heather Rae El Moussa/Instagram)

Could they have been overly eager to get to market, or just painfully naive about marketing home products? Tarek is known for selling homes, but selling home decor is a whole different game.

To find out what they might have been thinking, I reached out to consummate branding and marketing expert Klint Briney, founder and CEO of BRANDed Management. His company has worked with celebs, including Ed Sheeran, LeAnn Rimes, Mariah Carey, and Mark Cuban among others.

I asked him why the El Moussas launched so few products right out of the gate—shouldn’t they have waited until they had more to offer? Briney thinks not.

“By entering the saturated market of celebrity brands and home goods, a more risk-averse approach would be to initiate a small launch to test the market,” Briney says.

In other words, less is initially more when it comes to these lines.

“They chose two hero products that are both gender-neutral, accessibly-priced, and shelf-stable,” Briney continues. “In a time when most Americans struggle with decision fatigue, fewer offerings can often initiate higher conversion rates, as they are not bombarding the consumer with too many choices.”

I heard that. When I do a search on Amazon for one specific product and get 20 pages of results, I am usually overwhelmed by the choices and hold off on my purchase.

Tarek and Heather’s products haven’t been picked up yet by big-box stores like Target and Walmart, where their contemporaries have a presence? Is that a bad sign?

Not really, according to Briney.

Heather and Tarek enjoying their new products

(HomebyTHEM.com)

“It appears they are taking a more targeted and narrow approach upon launch, as it is critical for them to ‘win their own backyard’ before employing a more large-scale, blanketed rollout,” Briney continues. “Their items are strategically branded Newport Beach and Los Angeles, the two markets they work and reside in. This sort of data is great presentation material when meeting with mainstream retailers, which often leads to better terms.”

In other words, you start out small and targeted, prove your work in a niche area, then your business offers a lot more value to a big-box store.

“They can learn a lot by the recent acquisition of Aussie brand Aesop,” Briney adds. This producer of skin, hair, and body care products was recently “acquired by Loreal for $2.5 billion, the largest in company history.”

If they’re lucky, Tarek and Heather, after starting with a few candles and some hand soap, could end up with a billion-dollar deal with a major international corporation.

“In an era of cancel culture and the fast rise and fall of most celebrity careers, the fact that Tarek has had a show in production over 10 years, along with reinventing himself after a high-profile divorce, shows his marketplace viability,” Briney concludes.

Forget the throws. Maybe instead I should buy stock in the El Moussa company.

Source: realtor.com

Apache is functioning normally

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John Ulzheimer, a MintLife personal finance expert, is answering questions straight from fans of the Mint.com Facebook page. Here’s what he has to say about short sales and credit scores:

Q1: How exactly does short selling your home impact your credit and for how long?

A short sale is a more recently popular way to dispose of an underwater mortgage, which is a mortgage where you owe more than the home is worth. According to some sources, about 30% of mortgages are currently in this situation, including the mortgage belonging to yours truly, a humbled credit expert.

A short sale occurs when a buyer makes an offer on your home but that offer doesn’t cover the amount of loans taken against the house. So, if you owe $250,000 but are offered only $200,000, then you’ve been made a short offer. If your lender agrees to accept the offer to dispose of the home, then the home has been sold short. The good news is you’re out of the loan and don’t owe that $50,000 deficiency balance.

The news isn’t all good. Short sales are reported to the credit reporting agencies as a settlement, which is an accurate depiction of the loan. The lender settled for less than your really owe, hence the settlement credit reporting. And, yes, settlements are considered to be derogatory by credit scoring systems.

Don’t believe the marketing by real estate agents that short sales are better for your credit than foreclosures. That’s not true. Settlements will remain on your credit reports as long as foreclosures do and they have the same impact to your credit scores. The only difference is if the lender doesn’t report the deficiency balance along with your settlement. If that’s the case, then the impact to your credit scores isn’t quite as bad as a foreclosure.

Q2: Why does not paying our bills drop our credit, but paying them does nothing? I shouldn’t have to have debt to get credit, it seems stupid and backwards!

I appreciate your frustration when it comes to credit ratings/scores. They are maddening if you expect them to function like common sense suggests. This isn’t going to change your mind but credit scores are completely driven based on what’s predictive of your risk as a borrower. Some things matter and some things don’t.

Now, having said that, your comment about having debt being necessary to get credit is absolutely incorrect. In fact, not having debt is much better because of the infamous “DTI” ratio. DTI, or debt-to-income, is the amount you pay each month to satisfy debts, relative to your income. The fewer debts you have, the better your debt-to-income percentage and the more likely you are to be approved for large loans, like mortgages.

Additionally, I can assure you as someone who spent seven years with his hands deep inside the FICO scoring system, that paying your bills is handsomely rewarded by FICO. The most important factor in your FICO score is your payment history. The absence of negative information, which means you always pay your bills on time, is worth 35% of the points in your scores.

The issue of having debt in order to have a good credit score or get more credit is widely misreported, mostly by people who simply don’t understand credit scoring. You don’t have to have one penny of debt (or ever had one penny of debt) to have FICO scores well into the 800s. FICO scoring has no memory, so they don’t know what your debt was yesterday, the day before, or 5 years before.

Now, I know what you’re thinking: When you apply for credit you’re getting into debt. That’s incorrect. Every single credit card you have ever opened starts off with a $0 balance. And, if you pay your bill in full each month, then you never have credit card debt.

Taking out loans, such as mortgages, auto loans, student loans or personal loans, certainly does mean you’re getting into debt. However, this is certainly considered a very different type of debt than that vile credit card debt, which, incidentally, is much less as a country than our student loan debt. And, FICO weighs that installment form of debt very differently than it weighs credit card debt. It’s quite easy to have great FICO scores even with large amounts of installment debt.

John Ulzheimer is the President of Consumer Education at SmartCredit.com, the credit blogger for Mint.com, and a contributor for the National Foundation for Credit Counseling.  He is an expert on credit reporting, credit scoring and identity theft. Formerly of FICO, Equifax and Credit.com, John is the only recognized credit expert who actually comes from the credit industry. The opinions expressed in his articles are his and not of Mint.com or Intuit. Follow John on Twitter.

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