The loss was the first of its kind ever recorded since the MBA began tracking loan production income in 2008.
The average $301 loss marked a major downturn compared to the previous leader, when mortgage lenders recorded an average profit of $2,339 per home during a record boom in US housing demand.
Mortgage lenders were impacted by a surge in loan rates that caused demand for purchase and refinance applications to plummet to their lowest level in decades, according to MBA vice president of industry analysis Marina Walsh.
“The stellar profits of the previous two years dissipated because of the confluence of declining volume, lower revenues, and higher costs per loan,” Walsh said in a statement.
Firms were unable to slash their expenses fast enough to offset the major drop in demand.
“Companies could not adjust their capacity fast enough,” Walsh added. “The number of production employees declined, but not at the same pace as origination volume. As a result, productivity in 2022 fell to a low of 1.5 closed loans a month per production employee.”
Mortgage demand hit a 25-year low last October as 30-year fixed loan rates topped 7%, pushing many prospective buyers and sellers to the sidelines.
Rates have since cooled slightly, though they are still running well above 6%.
Just 32% of firms active in the mortgage lending sector were profitable last year, according to MBA’s analysis.
That was down from 98% who turned a profit just two years earlier, during a pandemic-era housing boom.
The cost of mortgage lending ballooned to $10,624 per loan last year, outpacing gains in loan servicing.
The US housing market slowdown prompted waves of layoffs and reorganizations throughout the real estate sector.
In January, Wells Fargo, a bank that once had a dominant hold on the mortgage-lending sector, revealed that it would be paring back its mortgage business as conditions in the market deteriorate.
In another shakeup, Homepoint, one of the largest mortgage lenders in the US last year, revealed last week that it would be selling of its assets to The Loan Store.
“After careful consideration, and in light of current market conditions, we have decided to sell our wholesale originations business to The Loan Store,” said Willie Newman, president and CEO of Homepoint. “We believe this is the best decision for our company to continue to deliver value to Home Point shareholders.”
National lender honored for its excellence in helping low-income homebuyers
MERIDEN, Conn., May 17, 2023 /PRNewswire/ — Planet Home Lending has been named a 2023 winner of the Freddie Mac Home Possible RISE Award ®, which recognizes lenders that are making great strides in helping low-income homebuyers through the Home Possible® loan program.
The honor is especially meaningful as it recognizes Planet’s commitment to core values of supporting, strengthening and caring for people during the most important financial moments in life.
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Last week I was in Athens, GA guest lecturing at the University of Georgia . I’m up there once a semester speaking with senior students who are about to graduate and go out into the “real” world. And while my agenda is to talk about credit reports, credit scores, and how the whole financial services system works, it usually ends up becoming a fairly lengthy Q&A session about how best to establish and build your credit. Here’s the deal…you have one chance to establish credit, that’s it. You can either do it the right way or the wrong way, but you can never have a mulligan. For those of you who’ve already built credit and managed it poorly (for whatever reason), you’re not going to have to build your credit; you’re going to have to re-build it. Here are some of the more common methods for each, and their pros and cons:
Opening A Secured Credit Card
A secured credit card is a legitimate credit card issued by a legitimate bank. You make a deposit at the bank and they will issue you a credit card with a credit limit equal to your deposit. Since you’ve essentially fully secured any purchases you’ll make with a cash deposit, banks are more willing to issue these cards to either new credit users or those who are trying to rebuild their credit. Additionally, you can open a secured card for as little as a $250 deposit, so it’s a nice option for people who have limited cash flow. Secured cards aren’t a good long-term option,however; the fees associated with these cards and the interest rates aren’t very good. But, you have to remember that you’re opening the card for a purpose and that purpose is to get something good on your credit reports. After a few years of paying the bills on time you may be able to convince the card issuer to convert the account to an unsecured credit card and refund your deposit. And because this is a credit building strategy, you’ll want to make sure you choose a card issuer who reports their secured card accounts to the credit reporting agencies. Otherwise, you’re just wasting your time.
Being Added as an Authorized User
An authorized user is someone who has been authorized to use a credit card issued to another person. Most of the time, parents will add their children to one of their existing credit cards, which allows them to have a card in their name but doesn’t convey any sort of liability for payment of the balance. The good news is that the account history is reported to the authorized user’s credit reports and can almost instantly establish them a solid credit history. This is my favorite option, as it really has no downside. I call the authorized user strategy “having a credit card with training wheels.” As long as the account is managed properly, then it’s a positive addition to your credit reports. And, this is a great option for consumers who have limited (or zero) cash flow or are already working hard to get out of debt. If the account is mismanaged by your parent (or spouse, as this is also common among spouses) then all you have to do is ask that your name be removed from the account and it will also be removed from your credit reports. In fact Experian, one of the major credit reporting agencies, will automatically remove the account history from the authorized user’s credit report if it becomes derogatory, “because an authorized user has no responsibility for repayment of the debt”, according to Rod Griffin, Experian’s Director of Public Education. “We will also remove the account at the request of the authorized user.” The good news for authorized users is that the FICO scoring system gives you full benefits for a properly managed authorized user account on your credit report, as long as you have a legitimate relationship with the primary cardholder. A few years ago, credit repair companies were trying to take advantage of the authorized user strategy to boost the credit scores of consumers who had bad credit. FICO figured out a way to filter out the consumers trying to game the system, so they won’t get the same benefit as a legitimate parent/child or husband/wife relationship.
Co-signing For a Loan
Co-signing for a loan is when you sign the promissory note (the promise to pay back the loan) and accept equal liability for payments on someone else’s loan. The newly opened loan will likely end up on your credit reports and will help you to establish or re-build your credit. Co-signed loans are normally auto loans, personal loans, or mortgages. That’s where the good news ends. I don’t like this option for three reasons:
1) It’s unnecessary. You don’t establish credit any faster by obligating yourself to a huge loan than you do by opening a $250 secured credit card. Choose the path of least resistance!
2) You can’t change your mind. There is no such thing as “co-signing for credit only” although some consumers have tried to challenge this in court, unsuccessfully. When you co-sign you’re just as liable for payments as anyone else on the loan. If the payments start being missed, it’s your problem. You have to be prepared to make all the payments if you choose this option.
3) Missed payments will go on your credit reports. If the payments on the loan are missed then anyone who has signed for the loan (yes, including you) will have a record of those missed payments reported on their credit reports. And, if the loan goes into default any aggressive collection actions, including litigation, it will be targeted at you. I’m not a fan of co-signing for a loan EVER, unless you need two incomes to qualify for a mortgage.
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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Do you enjoy spending your hours at work in the office, or do you like to be outside? Do you find it fun and exciting when a deal is done, or are deals just more busy work for your day?
If any of those questions have got stuck on repeat in your head, then these real estate investment trusts might be a good career path for you.
The short answer: Real estate investment opportunities are plentiful and they come with varying degrees of risk and reward depending on what you’re looking for.
I know from experience that real estate investment trusts can be a good career path.
So if real estate investing sounds like something that might be right up your alley, keep reading!
What are Real Estate Investment Trusts?
Real Estate Investment Trusts, or REITs, are a type of investment that receive tax concessions from the government. This is because they are designed to promote the development and growth of the real estate industry.
Investors can put their money into diverse projects, such as hospitals, schools, warehouses, and hotels.
In addition, REITs are publicly traded companies that buy, sell, and operate cash flow-producing commercial real estate. There are some privately traded REITs as well.
Why REITs as an Investment?
REITs have many investors who make up their stock portfolio. These can be individuals such as retail investors like you and me or other businesses.
What’s more, is that REITs are trusts similar to mutual funds which offer stability for both short-term and long-term investments in property assets.
Finally, REITs offer investors a reasonable return on investment.
What are the different types of real estate investment trusts (REITs)?
Real estate investment trusts, or REITs, are a type of security that allows people to invest in real estate without actually having to own any property. They are similar to mutual funds, with the exception of their working procedure.
There are two major types of REIT: equity and mortgage. Each type has its own specific benefits and drawbacks.
Equity REITs
Equity REITs are the most common type of REIT and they generate their revenue primarily through rents, not by reselling properties. This makes them a relatively stable investment option and they are often used as a way to diversify an investor’s portfolio.
Mortgage REITs
Mortgage REITs are a type of real estate investment trust (REIT) that invests in mortgage-backed securities. They are similar to other types of REITs, but they tend to have a higher yield as they earn their income from the interest margin on the mortgages they own.
This makes them potentially sensitive to interest rate increases as it could reduce the spread between what they earn on loans and what they pay out in funding costs.
Hybrid REITs
Hybrid REITs use a combination of the two strategies. They own properties like equity REITS and use the money from investors to purchase mortgages like mortgage REITs.
How to Buy Real Estate Investment Trust
Real estate investment trusts, or REITs, are a type of security that allows investors to purchase shares in a company that owns and manages income-producing real estate.
There are three types of REITs: publicly traded, public non-traded, and private.
Publicly traded REITs are the most common and are listed on major stock exchanges. They offer liquidity and transparency but also come with higher risk.
Public non-traded REITs are not listed on exchanges but offer more liquidity than private REITs.
Private REITs are not available to the general public and have less liquidity than both publicly traded and public non-traded REITs. Private REITs can be sold only to institutional or accredited investors.
Pros and Cons of Investing in Real Estate Investment Trusts
When it comes to making money, real estate is always a sound investment. And with the popularity of real estate investment trusts (REITs), you no longer have to be a landlord or developer to invest in properties.
REITs are becoming increasingly popular because they offer investors diversification and liquidity- two key features that any good investment should have.
But like anything else, there are pros and cons to investing in REITs. Here are some things you should consider before you put your money into this type of trust:
Pros of REITs:
1) Diversification: Real estate is a very diverse asset class, and by investing in a REIT, you’re automatically spreading your risk across many different properties. This helps reduce the volatility associated with stock market fluctuations.
2) Liquidity: A key advantage of REITs is that they’re highly liquid- meaning you can sell your shares at any time without penalty. This gives you the freedom to take profits when the market is doing well or reinvest them when prices are down.
3) Professional Management: When you invest in a REIT, you’re essentially hiring professional property developers and managers to do all the hard work for you. This takes away the hassle of dealing with tenants, repairs, and other day-to-day tasks associated with owning property.
Cons on REITs:
1) No Say in Management: Unlike directly owning property, you have no say in how the REIT is managed. If you don’t agree with the way the managers are running things, there’s not much you can do about it.
2) Taxation: The tax laws surrounding REITs are a bit complicated, so make sure you consult an accountant before investing. In general, taxation is much easier than owning the property yourself, but it’s still something to keep in mind.
3) Fluctuating Values: Just like stocks, real estate prices can go up and down quickly. So if you’re looking for a stable investment that will always give you a return on your money, REITs might not be right for you.
How successful are real estate investors?
Real estate investment is a popular way to make money, but it’s not without its risks.
Those who are successful in this field often have a lot of money or access to money (private money, hard money, bank financing, self-directed IRA).
It can be a career if you’re willing to put in the work, but it’s important to think carefully before making that decision.
Real Estate Career Path
Many different real estate jobs offer high salaries and great opportunities for career growth. Plus you can match your experience to find the best real estate career path.
These jobs offer a variety of opportunities and allow you to work in a wide range of settings.
What are the Requirements of Managing a REITs?
Real estate investment trusts, or REITs, are a type of mutual fund that allow both big and small investors to pool their money together and invest in real estate. REITs offer a variety of benefits to investors, including an opportunity for capital appreciation as well as a strong income stream.
In order to qualify as a REIT, they must be registered with the SEC and meet certain other requirements.
1. Managed by Board of Directors or Trustees
In order to be a REIT, the company has to appoint a board of directors or trustees. The board is responsible for making sure the REITs comply with the regulations set by law and also exercise their fiduciary duties. Furthermore, the board approves important decisions such as changes in investment strategies, acquisitions, and dispositions.
2. Taxable Income Paid to Investors
One of the key requirements for managing a REITs is paying out at least 90% of its taxable income to the investors. This leaves limited room for the manager to use the REITs’ income for their own benefit and also minimizes taxes. As a result, it is crucial that a REITs manager has a strong understanding of tax laws and can effectively communicate with the investors.
3. Gross Income Generated from Real Estate Investments
In order to be a REIT, an organization’s income must come from at least 75% of its total assets in real estate. The other 25% may be invested in cash, securities, and other assets. This allows the company to grow without having to worry about being classified as a security corporation.
4. Number of Shareholders or Investors
Another requirement for managing a REIT is that there must be at least 100 investors and shareholders. In addition, no one shareholder can hold more than 50% of the shares (at least). This protects the interest of all shareholders and ensures that no one person or entity can control the REIT.
How to get started in the real estate investment trusts industry
There are many different ways to get started in the real estate investment trusts industry.
There is no one-size-fits-all answer when it comes to starting a career in this field. Every individual has their own strengths and weaknesses that they need to take into account.
One way is to start as an intern or apprentice and then work your way up the ladder.
You could get your business degree and find a career in REITs.
Another option is to become a real estate agent and specialize in commercial real estate.
There are many online courses and programs that can teach you about the industry, and there are also many books on the subject.
Whatever route you decide to take, remember that it’s important to do your research and learn as much as you can about the real estate investment trusts industry before jumping in headfirst.
How to Get Started as an Investor in the Real Estate Investment Trust industry
Real estate investment trusts, or REITs, can be a great way to invest in property and achieve your financial goals. However, in order to be successful, you will need cash to be able to invest in the REIT.
In addition, the cash must not be needed in the recent timeframe.
My favorite REIT platforms are:
What skills do you need to be successful in real estate investment trusts?
This section is specifically for those wanting to know… is real estate investment trusts a good career path?
First and foremost, you will need to have a degree in finance or another relevant discipline. This qualification will give you the basic analytical skills required for success.
In addition, experience in real estate is essential; it is one of the most complex and fast-paced industries around.
You will also need strong marketing skills. REITs are all about generating income through rent or capital gains, so you need to know how to market properties effectively.
Finally, good communication and people skills are important too; after all, you’ll be dealing with clients and tenants on a regular basis.
If you possess these skills, then real estate investment trusts could be the perfect career path for you!
In fact, if you keep using these good excuses to miss work, then a job change is probably needed.
The future of the real estate investment trusts industry
The real estate investment trusts (REITs) industry is rapidly growing and changing. In fact, REITS account for 2.9 million direct jobs (source).
As the world progresses, so does this industry, with new opportunities and challenges arising constantly. REITs offer a unique career path for those who are passionate about real estate and interested in making money.
Money should not be an issue in this sector, as REITs offer a rewarding career path for those who are willing to invest in it.
Check out the best paying jobs in real estate investment trusts.
Career Options within REITs
REITs offer the opportunity to be paid as an investor or career within the industry. Pay can vary depending on the company and its structure; however, most companies within this sector pay well.
If you work for a REIT, you can learn about investing in the real estate industry by being a part of it–an invaluable experience if you’re looking to invest personally into real estate yourself one day.
As the industry grows, so does the need for new people to enter it; companies are constantly looking for new people. In fact, they typically add 555,000 jobs per month (source).
Within the real estate investment trusts industry, there are various career paths that one can take.
Acquisitions
One common job within the REIT industry is acquisitions; which involves buying or selling real estate assets. This position requires a good understanding of the market and the ability to make quick decisions.
Analysts
In the real estate investment trusts (REITs) industry, analysts typically start out earning a salary of around $80,000 per year. With experience, they can move up to a management or executive role and earn a six-figure salary. Additionally, there are many opportunities for career growth in the REITs industry as it continues to grow.
Property Developer
In the real estate investment trusts (REITs) industry, the developers are the team responsible for building new projects from scratch. They identify potential investments, obtain the necessary permits and funding, and manage construction until completion.
This is an important role in the REITs industry as it drives expansion and innovation.
Property Managers
Property managers are famous for getting things done, and they are essential members of any REIT team.
There is no standard education background necessary for becoming a property manager; however, you need skills in project management and construction management.
Real Estate Agents
Agents typically earn more in commissions than their peers working in traditional real estate brokerages, making this a lucrative career path to consider.
Which real estate career makes the most money?
Real estate is a great way to invest and grow your money.
There are a variety of different ways to get involved in real estate, but one of the most popular ways is through real estate investment trusts (REITs).
REITs allow you to invest in a portfolio of properties without having to go out and find them yourself. This can be a great way to get started in real estate investing and build your wealth over time without day-to-day management.
Turn to Real Estate Career Pathway
Real estate investment trusts (REITs) are a good career pathway if you want to come up with better investment strategies. They can provide opportunities to learn about the market, make contacts and develop skills. However, it is important that you reflect on what skills you have, your resources, and where you align before entering this field.
There is a lot to consider when making the decision whether or not to pursue a career in real estate.
It is important to do your research, reach out to people in the industry, and reflect on what you’ve learned. Only then can you make an informed decision about your future.
It ultimately comes down to what you want and what you’re willing to do.
If real estate is your passion, then go for it!
But make sure you do your research and understand the risks involved. There’s no right or wrong answer, but be sure to weigh all of your options before making a decision.
Know someone else that needs this, too? Then, please share!!
Investment advisors help investors figure out their goals, create financial plans, and put those plans into action. There are a lot of them out there, too, meaning that finding the right professional for you or your family may seem daunting. But finding the best investment advisor for you can be a fairly painless process.
You’ll need to start with some basics, though, by learning the difference between an investment advisor and a registered investment advisor, what to look for when you hire an advisor, and more.
What Is an Investment Advisor?
An investment advisor is an individual or company that offers advice on investments for a fee. The term itself — “investment advisor” — is a legal term that appears in the Investment Advisers Act of 1940. It may be spelled either “advisor” or “adviser.”
Investment advisors might also be known as asset managers, investment counselors, investment managers, portfolio managers, or wealth managers. Investment advisor representatives are people who work for and offer advice on behalf of registered investment advisors (RIAs).
What Is a Registered Investment Advisor (RIA)?
A registered investment advisor, or RIA, is a financial firm that advises clients about investing in securities, and is registered with the Securities and Exchange Commission (SEC), or other financial regulator. While you may think of RIAs as people, an RIA is actually a company, and an investment advisor representative (IAR) is a financial professional who works for the RIA.
That said, an RIA might be a large financial planning firm, or it could be a single financial professional operating their own RIA.
An RIA has a fiduciary duty to its clients, which means they must put their clients’ interests above their own. The SEC describes this as “undivided loyalty.” This is different from non-RIA companies whose advisors are often held only to a suitability standard, meaning their recommendations must be suitable for a client’s situation. Under a suitability standard, an advisor might sell a client products that are suitable for their portfolio but which also result in a sales commission for the advisor.
RIAs generally offer a range of investment advice, from your portfolio mix to your retirement and estate planning.
What’s Required to Become a Registered Investment Advisor?
The following steps are required to become a registered investment advisor (RIA).
• Pass the Series 65 exam, or the Uniform Investment Adviser Law Exam, which is administered by the Financial Industry Regulatory Authority (FINRA). Some states waive the requirement for this exam if applicants already hold an advanced certification like the CFP® (CERTIFIED FINANCIAL PLANNER™) or CFA (Chartered Financial Analyst).
• Register with the state or SEC. If an RIA has $100 million in assets under management (AUM), they must register with the SEC — though there are sometimes exceptions to this requirement. If they hold less in AUM, they must register with the state of their principal place of business. This requires filing Form ADV.
• Set up the business. These steps require making a variety of decisions about company legal structure, compliance, logistics and operations, insurance, and policies and procedures.
How to Choose an Investment Advisor
Finding the right investment advisor is about finding the right fit for you. While personal preference plays a part, there are a variety of other things you might consider when you’re searching:
Start Local
Look to helpful databases of financial professionals that can help you pinpoint some advisors in your area. Here are a few to consider:
• Financial Planning Association. Advisors in this network are CERTIFIED FINANCIAL PLANNERS™ (CFP®s) and you can search by location, area of specialty, how they’re paid and any asset minimums that may exist.
• National Association of Personal Financial Advisors. All advisors in this database are fee-only financial planners, meaning they receive no commissions for selling products.
• Garrett Planning Network. All advisors in this network charge hourly.
Get Referrals
One of the best ways to find a financial professional is to ask friends, family, and acquaintances if they’ve worked with someone they can recommend. While there are ways to build wealth at any age, it may be beneficial to ask people who are in a similar financial situation or stage of life. For instance, if you’re relatively young with a lot of debt and very little savings, you may not want the same investment advisor who’s working with wealthy retirees.
Ask About Credentials
Ask investment advisors what certifications they have, what was required to get the certification, and whether any ongoing education is necessary to keep it. Some certifications require thousands of hours of professional experience or passing a rigorous exam, while others may only require a few hours of classroom time.
Other certifications are geared toward investors at a specific life stage or with specific questions. The Retirement Income Certified Professional (RIPC) certification, for instance, focuses on retirement financial planning. Those with a Certified Public Accountant (CPA) certification are probably good sources for tax planning.
Check Complaint History
Depending on who oversees the advisor or the firm, you should be able to check whether there are complaints on record. If FINRA provides oversight, you can research them on FINRA’s BrokerCheck tool. If the SEC oversees them, the SEC has an investment advisor search feature to find information on the advisor and the company. Remember: One complaint might not be a red flag, but multiple complaints might give you pause.
Find Out About Fees
Investment advisors may be paid, or charge fees, several different ways. They may charge a percentage of assets under management, meaning that the fee will depend on the assets they’re managing for you. For example, if the fee is 1% of assets under management and you’re having them manage $500,000, you’d pay $5,000 annually for their services.
Others may charge an hourly fee or a flat project fee for specific services. There are also advisors that are paid commissions from the products that they sell to clients. It’s important to understand how an investment advisor makes money and how much you’ll pay in fees each year, and then decide what you’re comfortable with.
Get Details on Their Work Style
Communication and working style may be just as important as credentials and expertise. For instance, how often do they want to meet with you? Would you be working with them directly or with a wider team of people? Do they like to communicate via phone call, email, or text? This is something else to consider.
Take a Test Drive
Many advisors will offer a phone consultation or in-person visit to see if you’re a good fit. You may want to take them up on it. Finding the right investment advisor is as much a matter of chemistry as credentials.
Questions to Ask an Investment Advisor Before Hiring Them
It can be a good idea to find out as much as possible about an investment advisor so you can make an informed decision. Here’s a list of questions you might want to ask:
• What are your qualifications?
• What type of clients do you typically work with?
• Are you a fiduciary?
• How are you paid? And how much will I be charged?
• Do you have any minimum asset requirements?
• Will you work with me, or will members of your team work with me?
• How (and how often) do you prefer to communicate? (Phone, email, text?)
• How often will we meet?
• What’s your investment philosophy?
• What services do you provide for your clients?
• How do you quantify success?
• Why would your clients say they like working with you?
The Takeaway
An investment advisor can help you think about investing for the future, plan to save enough for all your goals, and understand how to get it all done. Finding one isn’t hard, but it does take time and some research to connect with an investment advisor that meets your expectations and feels like a good match.
With that in mind, getting the right advice can be critical even before you start investing. Someone with experience in the markets helping guide you can be invaluable.
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Medicare covers a lot of services, but only when they’re medically necessary.
Medically necessary services are “health care services or supplies needed to diagnose or treat an illness, injury, condition, disease or its symptoms and that meet accepted standards of medicine,” according to the Centers for Medicare & Medicaid Services, or CMS
.
You can look services up online or talk to your health care providers to find out whether and how Medicare covers them. If Medicare won’t cover a service that you or your doctor thinks is necessary, you can appeal that decision.
How do I know whether a service will be covered?
ABNs are provided only to people with Original Medicare (Part A and/or Part B). If you have Medicare Advantage, you might get a different notice or form.
What makes a service medically necessary?
Medicare’s decisions about medical necessity happen at three levels, from most general to most specific
:
Laws. Federal and state laws can set requirements for what’s covered.
National coverage determinations, or NCDs. Using a public, evidence-based process, Medicare decides whether and how a certain item or service is covered for the whole country.
Local coverage determinations, or LCDs. If a particular item or service isn’t included in relevant laws or NCDs, Medicare contracts with local companies that make coverage decisions. LCDs don’t apply nationally — they’re geographically limited to certain areas according to Medicare’s contracts.
What does ‘medically unreasonable and unnecessary’ mean?
Medicare doesn’t pay for “medically unreasonable and unnecessary services and supplies to diagnose and treat a Medicare patient’s condition,” according to CMS
.
Here are a few examples of what CMS considers medically unreasonable and unnecessary:
Tests or therapies that aren’t related to a patient’s symptoms or conditions.
Getting more or longer services than necessary, such as staying in the hospital or continuing therapy too long.
Services provided at a hospital when they could have been provided in lower-cost settings.
Can I appeal if I’m denied based on medical necessity?
If a service or item is denied because it’s not medically necessary, you can appeal that decision.
You’ll receive a written notice that explains what was denied, the reasons for denial and how you can appeal. You then need to submit the necessary information before any appeal deadlines
.
If your appeal is denied, it’s not necessarily the end of the road. You can escalate the appeal to a higher level. As with the original denial, the written notice you receive about a decision on your appeal will include instructions for your next steps.
If you have additional questions about Medicare, visit Medicare.gov or call 800-MEDICARE (800-633-4227, TTY 877-486-2048).
By Peter Anderson5 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 December 21, 2010.
A few weeks ago I published my post called “75 Frugal Gifts You Can Give For Christmas“. The post was an extensive list of frugal gift ideas, gifts that people could buy or make for their loved ones, but not break the bank. One of my favorite gift ideas from the list was one that in my opinion is good for more than just one year, it is the gift that keeps on giving. What was it? The gift of stock.
When I wrote the post I was thinking of somehow buying a single share of stock or giving them a check to open a brokerage account or something along those lines. In the end the idea lacked something because it wasn’t very easy to implement, and it didn’t allow for the type of investing that I would prefer to do, via index funds.
A couple of weeks ago I found the answer to how you can give someone the gift of stock, but a bit easier. And it came from one of my favorite brokerage companies, ING ShareBuilder (review) . They also have one of my favorite bank accounts, ING Direct Online Savings (review)!
ShareBuilder Gift Of Stock
ShareBuilder released something this year actually called the “Gift of Stock“. Basically it’s everything you need to start investing included in the package. Who would this be a good gift for? A friend or family member that might need that boost to start investing, or it can be a great teaching tool to help your kids get interested in saving for the future.
Here are the contents of the package from ING:
$50 ShareBuilder Gift Card. Help friends and family start their own stock portfolio at ShareBuilder or become an investor yourself. The gift card is redeemable when opening a new ShareBuilder Individual, Joint or Custodial account, giving you or the gift recipient the chance to start off with $50 in their account. ShareBuilder has no account minimums.
Five Free Automatic Investment Plan Credits. Free trade credits allow you, friends or family to start building wealth. ShareBuilder’s Automatic Investment Plan allows investors to set up recurring investments with a dollar amount they can afford.
Five-part video series from The Motley Fool. Picking stocks can be easier than you think. The Motley Fool’s How to Buy the Right Stocks for Your Portfolio video series can help you develop the right financial portfolio for your financial goals.
It’s really that easy. When they get the package they can setup a new account at ING ShareBuilder, redeem their gift cards for $50 of stock and 5 free automatic investment plan credits, and start investing!
Gift Of Stock Price Drop!
Originally this gift of stock was retailing for $45 on the ING store, but as of this week the price has dropped to only $25. So get in on this hot deal now! You could even buy it for yourself to get started investing you want to! You’ll get a return for your money right out of the box since you get $50 in ShareBuilder credit for only $25!
Here’s my unboxing video of my own “Gift of Stock” package. Click to watch and see everything that’s included inside.
Want to open your own ShareBuilder account? Open your account here. (Get a $50 account bonus with promo code: 50ws10)
Can This SEC Rule Protect Your Crypto or Art Investments From Bankruptcy? | SmartAsset.com
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Your broker cannot use the funds in your portfolio. Not legally, at least.
While seemingly intuitive, this requirement comes from an SEC regulation known as “the custody rule.” It requires that all investment advisors and similarly-situated entities keep client securities and funds safe while those assets are in the advisor’s possession. Essentially, if you have an account with an investment advisor, trader or broker, the person has to keep your assets separate and apart from his own. The financial advisor can’t comingle your money with his or tap into it for the firm’s use.
The purpose of the custody rule is to protect client assets against adverse events like theft, misappropriation and bankruptcy. For example, a brokerage cannot use client assets to make its own investments, putting that money at risk if the investments go poorly. Nor can it use client money as operating funds, putting that money at risk if the firm goes out of business.
Recently, as investigators have picked through the wreckage of former cryptocurrency exchange FTX, they have found evidence of exactly the kind of theft and comingling that the custody rule is designed to prevent. This has prompted a reevaluation of the rules surrounding cryptocurrency and similarly situated assets.
Among the results is a proposed SEC regulation that would dramatically expand the scope of the custody rule.
For help managing your investments and understanding the implications of this new rule, consider matching for free with a vetted financial advisor.
What Is the Safeguarding Rule?
The new rule would be called the safeguarding rule, an updated and amended version of the existing custody rule. Most significantly, it broadens the scope of the custody rule to include far more assets than currently contemplated. As the SEC explains, the new rule would apply to “funds, securities, or other positions held in a client’s account and would include all other assets that investment advisers custody for their clients. The safeguarding rule would also explicitly include an adviser’s discretionary authority to trade client assets within the definition of custody.”
As the law firm Skadden Arps explains in a brief on the subject, this will give the custody rule a broad mandate. It will effectively, they write, apply to all assets of just about any kind held by a regulated entity. This would include “cryptocurrencies and other digital assets, contracts held for investment purposes, collateral posted in connection with a swap contract and physical assets, including real estate, artwork, precious metals and physical commodities, as well as ‘other positions’ that may not be recorded on a balance sheet as an asset (e.g., short positions and written options).”
In a small, but critical, detail the SEC has also stated that the term “assets” as it applies to the new rule will remain “evergreen.” This means that the agency intends for the updated safeguarding rule to automatically encompass new categories of investments and assets as they emerge without requiring a specific update. If a regulated entity holds some thing of value on behalf of a client, or if it has the authority to trade a given asset, the new safeguarding rule will apply.This is intended to address the issues created by cryptocurrency, where companies have evaded regulation for years by simultaneously insisting that crypto assets are both a great investment and securities subject to regulation.
What Does The Safeguarding Rule Mean For Investors and Customers?
For investors and customers, this means that advisors must keep many more assets safe.
When the custody rule applies, firms have to hold assets with third parties known as a “qualified custodian.” Generally this means that they have to put your assets on account someplace trusted, like a regulated depository bank or a brokerage. The idea is to make sure that a firm can’t do more or less exactly what FTX did, reaching for client assets whenever it needs capital or wants to make an investment.
Firms already need to do that with regulated securities and cash. Now, if SEC’s proposed rule goes forward, firms will also have to place virtually all assets with a trusted custodian. For example, if you place art, wine or valuable collectibles on account, they will need to make sure those assets are held by a trusted custodian.
The same will be true of cryptocurrency. All exchanges subject to SEC oversight will have to keep client assets separate, held by trusted custodians. This will dramatically change the way that much of the industry operates, as it is common for cryptocurrency exchanges to keep client assets comingled with the firm’s own assets and funds.
Firms will also need to insure the newly-covered assets, or at least to certify that their custodian carries insurance, so that clients are made whole if their assets are lost anyway.
To get a sense of the scope of this proposed rule, it’s worthwhile to consider the scope of losses due to failed and careless cryptocurrency exchanges over the years. Clients with FTX alone lost more than $1 billion when the firm went out of business. If properly applied, the new safeguarding rule would have prevented those assets from being placed at risk by denying FTX access to them and, failing that, clients would have been insured against those losses.
This isn’t the only example of a cryptocurrency exchange mishandling client funds. Investors have lost hundreds of millions of dollars due to exchanges going out of business, mismanaging their funds and (in some cases) simply misplacing critical security keys.
What’s Next For the Safeguarding Rule?
On May 8, comments closed for the safeguarding rule. This means that the SEC has gone through the process of soliciting public feedback on their proposed regulation. The agency will now review this feedback, making any updates to the proposed rule as it feels necessary. After that, assuming that no significant changes occur, it will likely pass the new rule.
Bottom Line
The SEC has proposed a new regulation called the safeguarding rule. It will require investors, broker and other regulated entities to keep all client assets safe in separate, insured accounts. While this will apply broadly, it will particularly change how many cryptocurrency exchanges do business.
Eric Reed
Eric Reed is a freelance journalist who specializes in economics, policy and global issues, with substantial coverage of finance and personal finance. He has contributed to outlets including The Street, CNBC, Glassdoor and Consumer Reports. Eric’s work focuses on the human impact of abstract issues, emphasizing analytical journalism that helps readers more fully understand their world and their money. He has reported from more than a dozen countries, with datelines that include Sao Paolo, Brazil; Phnom Penh, Cambodia; and Athens, Greece. A former attorney, before becoming a journalist Eric worked in securities litigation and white collar criminal defense with a pro bono specialty in human trafficking issues. He graduated from the University of Michigan Law School and can be found any given Saturday in the fall cheering on his Wolverines.
If you’ve had a heart attack, you might think life insurance is out of reach.
While your heart attack will definitely make qualifying more difficult, there are still many companies that would consider your application.
The key to getting insured is a smart application. Good preparation gives you a much better chance of getting a policy at a fair rate.
Finding life insurance can be a long journey. If you’ve had a heart attack, it’s going to be even more difficult, but we are here to help.
In this article, we’re going to take a look at the underwriting standards for someone with a heart attack.
Life Insurance Underwriting After A Heart Attack
Your insurance agent should ask a number of questions about your heart attack:
When was your heart attack?
What health problems led to your heart attack?
Did you have any procedures to prevent future problems like coronary angioplasty or a bypass?
Has your condition and health improved since the heart attack?
Do you have a family history of heart disease and have any close family members died of heart disease?
Are you a smoker?
What medications are you taking for your condition?
Common medications for after a heart attack include:
Beta Blockers
Cholesterol medication such as statins
Nitrates
Thrombolytics
None of these prescriptions are going to cause you to be declined depending on the rest of your health.
You want the insurance underwriter to get as clear a picture of your current health situation as possible.
The underwriter is much more likely to reject giving you a policy given your past health problems if you don’t give them all the info.
Life Insurance Quotes After A Heart Attack
When you apply for life insurance after a heart attack, insurance companies will want to thoroughly research your current health. This is because they want to determine whether you’re likely to have another heart attack.
It’s a good idea to wait a couple of years after your heart attack before applying for coverage. This gives your condition time to stabilize plus gives you a chance to improve your lifestyle. Each company has their own rating categories, but here are some basic categories you’ll see:
Preferred Plus: Impossible. A heart attack is just too serious a health problem for you to qualify for this rating.
Preferred: Also likely impossible. Regardless of how much your health improves, insurance companies will still be too worried about your past heart attack.
Standard: In rare cases, you might get this standard policy. To get this rating, your heart attack must have been very mild, it must have been several years since the attack.
Table Rating (substandard): Your most likely rating. The rating you receive will depend on the time since you had your heart attack, your current health at the time of your application, the treatments you took for the heart attack, and whether you have a family history of heart disease.
Declines: You should expect a decline if you’re a year or two of a heart attack Also, applicants that have a poor lifestyle, other health issues or have a family history of heart disease could be declined because of the high chance of future heart attacks.
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Life Insurance Case Studies After A Heart Attack
While your life insurance application always matters, it becomes particularly important after a heart attack. To help hammer this home, here are some stories of clients we’ve worked with in the past.
Case Study #1: Female, 66 years old, does not smoke, had a heart attack at 63, taking Beta Blockers and Statins, and no other pre-existing conditions.
She had a mild heart attack when she was 59. As soon as she got out of the hospital, she tried to buy a life insurance policy. She was denied because she applied too soon. The agent didn’t’ clearly explain why she was rejected so she just assumed she couldn’t get life insurance.
When she contacted us, we suggested she try again as more than enough time had passed since her previous attack. We also recommended she request an EKG to test the current state of her heart as the applicant was in fairly good health. By trying again, this applicant received a rated level 1 policy, the best level before a standard rating.
Case Study #2: Male, 64 years old, had a heart attack at 55 years old, former smoker, improved weight and overall health since the diagnosis, started regularly seeing his doctor at age 60.
This applicant was in poor health. He smoked, was overweight, and had high cholesterol and blood pressure. This lifestyle eventually caused him to have a heart attack at 55. For a few years after his heart attack, the applicant continued his bad habits. However, at age 60, he quit smoking, started seeing his doctor regularly, and dramatically improved his health.
His applications were rejected. We thought this was because insurers weren’t accounting for his better health. He was devastated, but we need the next steps to take. We told him to go to his doctor and ask him to write a note which described his improved health. We included the note with his application and was able to get a rated policy.
Before You Apply
While getting life insurance after a heart attack isn’t easy, it’s definitely possible. It all starts with a good application. To make sure you handle this process correctly, you can work with a qualified broker that understands your medical condition.
If you’ve suffered from a heart attack, you already have a red flag. The life insurance company will scour your application for any other risk factors. You want to clean up your application.
Before you apply for life insurance, you need to get in shape. If you’re carrying any extra weight, the insurance company sees you as a risk for another heart attack. They are going to jack up your premiums because of your weight. The lower the weight on your scale, the lower your premiums can be.
Another thing to do before you submit an application is to find a company that favors applicants with a heart attack. There are companies out there who offer lower premiums than other companies.
While agency loans have existed for decades—Fannie Mae® was first chartered by the U.S. government in 1938, and Freddie Mac was introduced in 1970—even experienced commercial real estate investors may not have used them.
“With bank and agency loans, one isn’t necessarily better than the other—it depends on the property, the client and their goals,” said Kurt Stuart, Managing Director of Commercial Term Lending Northeast at JPMorgan Chase. “Agency lending has different requirements and nuances than conventional bank loans. Any dedicated agency team is well versed in both.”
What are the main agencies?
The two main agencies are:
Fannie Mae, short for the Federal National Mortgage Association
Freddie Mac, short for the Federal Home Loan Mortgage Corporation
Both Fannie Mae and Freddie Mac are government-sponsored enterprises (GSEs). They’re private companies that operate under congressional charters to help stabilize mortgage markets and protect housing during stressful financial periods.
Fannie Mae and Freddie Mac each have two businesses:
Single-family housing: residential properties with one to four units, which isn’t offered through JPMorgan Chase Commercial Banking
Multifamily housing: residential buildings with five or more units; within this category, financing is available for affordable and market-rate properties
“In both markets, the GSEs are a countercyclical source of capital, increasing market share when the private market pulls back, as we’re seeing presently,” said Josh Seiff, Managing Director of GSE Agency Lending, JPMorgan Chase.
These agencies benefit the market in several other ways, including:
Providing standardization of loan terms through their underwriting standards
Bringing liquidity and transparency to the market by issuing mortgage-backed securities that carry their guarantee of timely payment of principal and interest
Encouraging lower rates, greater transparency and more consistent availability of capital for housing
How does the agency financing process work?
GSEs don’t originate or service their own mortgages. Instead, approved private lenders—such as JPMorgan Chase—make loans to borrowers. Fannie and Freddie buy those loans from lenders, which they may hold in their portfolios or combine with other loans as mortgage-backed securities that can be sold on the secondary market. Lenders use the funds from these mortgage sales to originate more loans.
“Prior to the global financial crisis, the GSEs kept much of their risk on their balance sheets,” Seiff said. “Today, they securitize and distribute nearly all of their production to institutional investors, such as mutual funds, banks, insurance companies and pensions.”
What are the benefits of agency lending?
Agency loans provide many benefits for borrowers.
Consistent source of capital: GSE lending provides borrowers access to capital regardless of their location or exposure. Agencies also typically remain active during economic downturns and recessions.
Rates and proceeds: By securitizing and selling their guaranteed mortgage-backed securities to the investor market, the agencies can consistently offer borrowers competitive rates—and often higher proceeds.
Loan terms: Fannie Mae and Freddie Mac most commonly provide 5- to 10-year fixed-rate balloon loans, with interest-only options often available. Both GSEs also offer floating rate loans with terms between 5 and 30 years.
Favorable loan-to-value (LTV) and debt coverage ratio: The LTV may be up to 75% with 1.25% amortization. Most agency loans are less than 70% LTV, but higher leverage may be available for certain property types and situations.
Nonrecourse financing: With most agency loans, borrowers don’t have personal liability for the loan. If there is evidence of fraud or other unethical behavior, however, there can be recourse.
Assumability: If the borrower sells the property before the loan term ends, the property’s buyer may be able to assume the loan.
What types of clients and properties can take out agency loans?
Stabilized property acquisitions and refinances are well suited to agency loans. Likewise, institutional and third-party property management clients can benefit if they:
Are rate- and proceeds-sensitive
Have long-term hold expectations
Are comfortable with prepayment penalties and ongoing reporting in exchange for the best terms
“Understanding the needs of the client upfront is the key to a successful transaction with a customer and a good client experience,” Stuart said. That understanding is especially critical when discussing financing options.
“If you’re looking to do a long-term execution and you want really efficient pricing, then an agency execution is a great way to go,” Stuart said.
“But if you need to access anything in the asset over the next 10 years—if you need to redo the roof, for example, and you want to access equity to do that—a balance sheet loan is going to be much more amenable to those types of strategies,” he said.
The best financing option also depends on the asset and where it is in its lifecycle. For example, agency financing can be an excellent choice for a stabilized multifamily property. But bank financing may be better for new acquisitions or buildings with capital-intensive work, such as extensive renovation or deferred maintenance.
What are the key differences between agency and bank loans?
Borrower vs. property focus: Bank and agency loan servicers perform due diligence on the borrower and property. But bank loans generally focus on the borrower, while agency loans place that focus on the property. As a result, bank loans may also take a much deeper dive into the loan’s guarantor and require specific documentation from the borrower, including a personal financial statement and schedule of real estate. Agency loans often require detailed third-party evaluations on the property, engineering and environmental reports.
Flexibility of terms: Agency and bank financing offer flexibility in different ways. For example, agency loans allow borrowers to keep their cash deposits and property operating accounts at their bank of choice. Bank loans often require borrowers to place those funds with the bank providing the loan. Bank loans may offer flexibility elsewhere. For example, agency loans may have steep prepayment penalties compared to bank loans.