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Apache is functioning normally

June 24, 2023 by Brett Tams

I’ve decided to develop a budget.

This probably sounds strange coming from a guy who has been anti-budget all his life. Besides, haven’t I paid off all my debt? Don’t I have a positive cash-flow of over $1,000 per month? Yes, these things are true. But I’ve noticed something troubling: I’ve begun to experience that lifestyle inflation I’m always warning others about.

Lifestyle inflation is the natural tendency to increase our spending as our incomes increase. When we get a raise at work, we’re likely to spend more at home. A little lifestyle inflation is fine. But there’s a real danger of becoming too comfortable with increased spending. Once we become accustomed to a certain lifestyle, it’s difficult to cut back.

Cracks in the Foundation

On our flight home from Orlando, Kris and I talked about my spending. It has increased in recent months. Some of this is deliberate. I’ve made a conscious decision to allow myself to spend more money on Wants. I can afford it. The trouble is that I’ve begun to spend indiscriminately again, and I’m afraid that’s a slippery slope. I’ll buy random magazines at the grocery store, or pick up a game for the Wii that I’m only half interested in.

I’m certainly not spending beyond my means, but I’ve begun to make more impulse purchases. I want to correct this now — before it becomes a problem. In the past, I’ve used a spending plan to help me meet my goals, and more recently I’ve been following the broad outlines of Elizabeth Warren’s balanced money formula:

But sometimes broad outlines aren’t enough. In this case, Kris suggested that a budget might help curb my impulsiveness, and I think she’s right. With a budget, I can set specific goals. I can focus on the things I really want instead of just spending on random things that appeal to me in the moment.

So, I’ve decided to create a budget. Not a comprehensive budget — my Income, Needs, and Saving are all fine — but a budget for my Wants. I want to exercise discipline in this area so that I’m spending on things that are actually important to me instead of random stuff, stuff that ultimately turns into clutter.

Blueprint for Success

To start, I reviewed my discretionary spending from last year and compared it to the totals from the first four months of 2009. This is where tracking every penny you spend can prove valuable. By comparing my past spending to my present spending, I’m able to detect trends. It’s very clear, for example, that I am again spending too much on dining out. Time to cut back.

Next, I thought about my goals. What is it that I really want to do? Lately, travel appeals to me. Kris and I both would like to take a vacation to Europe in 2010. To make that happen, I need to save. This gives me a medium-term goal to save toward.

Finally, I allocated a specific amount of money toward my monthly Wants. Remember, because I’m self-employed, I have an irregular income that passes through my business account first. If I pull out $2500 per month (after taxes) to act as personal income, that gives me $750 to spend on my passions. That should be plenty.

Note:Based on my Income, Needs, and Saving, I can afford to allocate $750 for Wants. This might seem high to some GRS readers. It would have seemed high to me once, too. But because I’ve paid off my consumer debt, I have $750 per month to spend on the things that make me happy.

Building the Budget

After collecting the data and setting my goals, I made a first pass at a budget. This is what I’ll use for June and July:

Books: $50/month
Comic Books: $50/month
Entertainment: $50/month
Clothing: $50/month
Charity: $50/month
Dining Out: $200/month
Vacation 2010: $200/month (plus small windfalls)
Miscellaneous: $100/month

Obviously, you might make different choices. I know that many GRS readers are avid contributors to charity, for example, and I suspect few of you budget for comic books! These are the allocations that seem to make sense for me and my situation. I’m sure that I’ll make changes to this budget as I work with it in the real world.

Actually, I have a lot of questions about how a budget should work in the real world. Because I’m a budgeting novice, I could use some help. I’m hoping that you experienced budgeters can answer some of my questions:

How often do you re-evaluate your budget? Do you make monthly adjustments? Quarterly? Yearly?
If you go over budget for a month, what do you do? Do you make immediate adjustments? Or do you simply try to correct things the following month?
What if I go under budget in a category? Does that mean I get to carry that money into the next month? Can I use it for a different Want category? (Perhaps sweep anything extra into the Vacation fund?) Or does does that money go to Saving instead? Or should I donate it to charity?
How do you track your spending against the budget? If I used the envelope system, I’d allocate the actual cash to each account before-hand. But what if I don’t want to have that much cash around the house? Is there a good way to keep track of current spending in each category? Should I carry a notecard with my monthly spending on it? (That seems to be what Bargain Babe recommends.)
Do you try to further reduce spending on these categories? For example, should I try to drop my budget for Dining Out even more?

This is a strange new world for me. Over the past year, I’ve been pursuing more and more advanced personal finance subjects and concepts. Yet here I am, in better financial shape than ever, about to implement a basic skill I’ve never mastered before. That’s okay. I believe it’s important to continue focusing on the fundamentals even as we tackle more advanced topics.

My Discretionary Spending: Bits and Pieces

I want to talk about a couple of my spending habits. One is a worrisome trend, and one is a thing I’m doing right.

Food for Thought

Long-time readers know that Kris and I love to dine out. It’s one of those things we’re willing to spend on. We cut corners in other areas of our lives so that we can afford to make this happen. Still, I’ve been concerned about my restaurant spending for the past couple of years. It seems a tad excessive.

How’d I do last year? Well, my grocery spending dropped, but my restaurant spending went up again — a lot. Here’s a look at five years of data:

In 2005, we spent $1423.39 to dine out 100 times, for an average cost of $14.23 per meal.
In 2006, we spent $1869.58 to dine out 108 times, for an average cost of $17.31 per meal.
In 2007, we spent $2051.93 to dine out 84 times, for an average cost of $24.43 per meal.
In 2008, we spent $2628.08 to dine out 77 times, for an average cost of $34.14 per meal.
In 2009, we spent $3443.61 to dine out 69 times, for an average cost of $49.91 per meal.

Holy cats! Will you look at those numbers? We’re only dining out about ~~half~~ two-thirds as often as we were in 2006, but we’re spending nearly three times as much per meal. At the current rate of spending growth, we’ll be spending $300 per meal in 2015! Since I can afford our current spending — I’m not living beyond my means — the real question is: Am I getting my money’s worth? I’m not sure that I am.

If I’m honest, I have to admit that I don’t like the idea that we’re paying $50 per meal. I’d much rather return to our former habit: Dining out more often, but spending less each time. To that end, I’ve been brainstorming ways we can work to cut costs:

- We could do a better job of looking for discounts. We have an Entertainment book, and the local paper often features specials at local restaurants. We should take advantage of both of these. We used to do this, but have fallen out of the habit (primarily because we’ve become so used to eating at the same places again and again).

- We need to find more cheap places to eat. Half the fun of going out is just going out. Sure, we love the fancy restaurants, but we used to be happy with Dairy Queen. (This is lifestyle inflation in action!) The real problem is that the cheap places I know and love (Cha Cha Cha and Imperial Garden) aren’t Kris’ favorites. We need to find cheap places we both like.

- When we do eat in the same old haunts, we need to make an effort to reduce our spending. It’s okay to have an appetizer, entree, dessert, and drink all in the same meal now and then, but we could save money by cutting one or two of these from the mix each time we dine out.

- Finally, we should invite friends to our home for dinner more often. As soon as the book is done (getting close!), I’m going to make a habit of inviting one family to dine with us every couple of weeks. We used to do this a lot, but have fallen out of the habit. It’s fun and frugal to have folks over for dinner.

So, that’s one part of my financial life that still needs work. Next, let’s look at something I’m doing right.

Tangent: Portlanders, help me out. What are your favorite cheap places to eat around town? Bonus points for inner southeast, West of 39th from Hawthorne south to Oregon City.

A Waning of Want

Here’s something that amazes me: We’re twelve days into the year and I haven’t spent anything yet on personal expenses. I haven’t even felt the urge. I’ve bought gas for the Mini and groceries for home, and Kris and I went out to lunch last Friday, but I haven’t spent a dime on gadgets or books or games or toys or magazines.

“Big deal,” you might say. “That’s how it should be.” You’re right. But for me, this is a big deal. All my life, I’ve had the uncontrollable urge to buy Stuff. It used to be that I couldn’t go more than a day or two without buying something. Even while writing this blog, that’s been the case. (I’ve just learned to channel my desires into smaller, cheaper things.) Now, as last, I seem to have licked it.

I still want things — no question! — but I’ve become very good at ignoring the wants and moving on. How?

Sometimes, I just put down the thing I want, turn off my brain, and walk away. I force myself to stop thinking about it. (Usually by thinking about something else — like our upcoming trip to Europe, and how I need to save for that instead.)
If I still want the thing when I get home, I put it on my Amazon wish-list. For whatever reason, that’s often enough to satisfy the strange inner workings of my mind. I feel comforted knowing I’ve let myself put it on a list where I won’t forget it.
I’m very good about using the 30-day rule to control my impulse spending. My Amazon wish-list plays a role in that, but so does my mountain of index cards. (My life wouldn’t be complete without index cards.) I have a handful of cards on my desk filled with notes about the things I want. It’s amazing how many times I sort through this stack and end up throwing cards away because I no longer want the item I’ve written down.

These techniques help me deal with desire. They don’t quell it completely — nor would I want them to — but they do keep it in check. That last rule is probably the most effective. By delaying purchases 30 days, I don’t feel like I’m denying myself. I can still buy what I want if I want it 30 days later, but I’m not just giving in to impulse spending. (When 30 days rolls around and I do still want something, it actually feels pretty good to be able to buy it.)

My current spending moratorium isn’t permanent, and I know that. In fact, the new Dick Tracy anthology comes out tomorrow, so if nothing else, I’ll be shelling over $25 for that.

Remember: there’s nothing inherently wrong with spending money on things that bring you joy. Problems arise when you finance these purchases with debt. If you’re meeting your other financial goals and have money left over, it’s good to indulge your interests and passions. Just make sure you’re getting value for the dollars you spend.

A Look Back to Previous Years

I believe there are two components to building wealth:

Reducing costs
Boosting income

Doing one or the other can help you meet your goals, but to really succeed, you must do both. My goal has been to create a significant positive monthly cash flow. I’ve managed to do this. But as my income increases, so does the temptation to spend more. Have I been able to fight the urge? It’s time for the annual review of my largest sources of discretionary spending:

Comic Books (2005: $2810.52, 2006: $3202.91, 2007: $897.08, 2008: $550.51): Although I use comics as a prop for laughs at Get Rich Slowly, I’ve genuinely struggled with my spending on them in the past. Not this year. I made vast improvements in 2008, actually spending less on comics than I had planned. There are two reasons for this. First, I’ve narrowed my focus, collecting only those titles I most desire. I’m also making an effort to read all of the books I’ve bought but never finished. These two changes have helped me to spend less on this hobby.
Books (2005: $1049.91, 2006: $657.96, 2007: $702.73, 2008: $404.49): At one time, I spent over $200 a month on books. Now I spend less than $40. I’m content with this number, especially since many of these are for our monthly book group. One reason my inclination to buy books has decreased is that I’m able to purchase personal-finance books through Get Rich Slowly, the business. (Plus authors and publishers send them to me for free.) This gives me a never-ending source of reading material, and makes me less inclined to spend time in a bookstore. And again, I’m trying to read books I own but have never finished.
Entertainment (2005: $478.81, 2006: $543.55, 2007: $1094.83, 2008: $897.91): This number isn’t as bad as it seems. It includes two Decemberists concerts for me and Kris, and it also includes some of our television viewing. (Remember that Kris and I cut back to basic cable, and now we watch TV through Netflix and through the iTunes Music Store.) There’s also a one-time $236 event here that ought to have been a business expense. I’m not unhappy with my spending on Entertainment.
Pets (2005: $397.76, 2006: $471.03, 2007: $625.52, 2008: $378.75): Many personal finance writers view pets as an unnecessary expense. To me, $35 a month to keep four cats is a bargain. It only costs me about a quarter a day for each animal, and they bring much more joy to my life than that. If Kris would let me, I’d be the “crazy cat lady” on the block. (Are there “crazy cat gentlemen”?) Note that our actual pet expenses are greater. Kris pays for their food, and that’s not reflected in these numbers
Vice (2005: $1055.33, 2006: $768.95, 2007: $431.89, 2008: $924.79): This includes wine, liquor, pipe tobacco, poker nights, etc. I don’t smoke regularly, but I do smoke a pipe maybe a dozen times a year. Most of this expense is for alcohol at dinner parties and social gatherings. My alcohol consumption did increase during 2008, which is a concern, but that’s not the reason for the increased spending. For the first time ever, we bought a couple of cases of wine. This will actually reduce the “wages of sin” in the long run, but it bumped the number for 2008.

Although this report is interesting, there are problems with my methodology. For example, I’ve included my grocery spending above (although it’s not really discretionary), but have not included spending on exercise equipment (which is discretionary). Also, Kris pays for much of our grocery shopping. Because we keep separate accounts, her share of that expense isn’t reflected in these numbers.

In order to be consistent from year-to-year, however, I’ve elected to continue reporting the same expenses in the same ways. You’ll have to take my word that the figures here are representative of my spending as a whole. This annual report is sort of like tracking a stock market index, I guess. It doesn’t reveal nuances, but it’s still a useful indicator of the Big Picture.

So despite cutting back on the areas that are really important to me — books and comics — my spending increased. And most of that increase came from dining out.

How did you do on your spending goals last year? Are there areas where you wish you spent less? If so, what strategies do you use to keep yourself in check?

Source: getrichslowly.org

Apache is functioning normally

June 24, 2023 by Brett Tams

A House panel has passed a bill that would temporarily expand the standard tax deduction used by the majority of taxpayers by $2,000 per person for the next two years.

The Tax Cuts for Working Families Act (H.R.3936) recently approved by the tax-writing House Ways and Means Committee would temporarily boost the standard deduction by $2,000 for single filers and $4,000 for married filers for 2024 and 2025. The deduction would start to phase out for single taxpayers with $200,000 in income, or $400,000 for joint filers. A financial advisor can help you optimize your tax strategy and make sense of tax code changes.

“The vast, vast majority of my constituents use the standard deduction on their taxes every year,” said Rep. Carol Miller, R-West Virginia, adding that the measure will increase economic activity in local economies. “The bonus $4,000 deduction is a $100 billion tax cut for the working families and will go a long way to make sure that my constituents can make ends meet.”

Potential Impact of Standard Deduction Increase

Nearly two-thirds of households would get a tax cut in 2024 under the proposal, according to research from the nonpartisan Penn Wharton Budget Model. However, since the standard deduction lowers the amount of income subject to tax, the deduction isn’t refundable and wouldn’t provide cash to lower-income taxpayers. In fact, only a small percentage of the bottom 20% of households have enough income to get a tax cut under the proposal, the researchers from Penn concluded.

But those at the very top of the income ladder also wouldn’t see significant tax savings if the bill becomes law. Not only does the higher deduction phase out for incomes of $200,000 or more (or $400,000 for married couples), but a larger proportion of high-income households use itemized deductions.

“The poorest fifth of Americans would receive just 2% of the benefits of this provision, and on average, that means a tax break of just $30 next year,” said Rep. Richard Neal of Massachusetts, the committee’s ranking Democrat.

The change would also cost approximately $96 billion over 10 years, the Penn researchers found.

The standard deduction for 2023 will be $13,850 for singles and $27,700 for couples. The deduction nearly doubled as part of the 2017 Tax Cuts and Jobs Act, which expires in 2026. An increasing number of taxpayers have opted to claim the standard deduction, rather than itemize deductions for mortgage interest, charitable donations, medical costs and a host of other deductible expenses. According to the IRS, 90% of taxpayers opted for the standard deduction for their 2021 taxes.

Will it Help Ease Inflation or Make it Worse?

Sponsors of the temporary increase said the measure was intended to provide relief from inflation, which soared to 9.1% last June before dropping to 4% in May. The target inflation rate for the Federal Reserve is 2%, which mirrors the historical average.

That reasoning was criticized in an analysis by the conservative-leaning American Enterprise Institute, which pointed out that increasing the disposable income of so many Americans tends to make inflation worse, and would contradict efforts by the Federal Reserve to slow consumer spending by raising interest rates.

Bottom Line

An increase in the standard deduction on federal income tax would benefit most U.S. households but only a small amount of lower-income taxpayers would see any cut to their tax bills. Since the increase of the standard deduction in 2017, fewer taxpayers have been itemizing deductions on their returns.

Tax Optimization Tips

When it comes to saving and investing for retirement, taxes are a significant and complicated consideration. Saving in a traditional IRA or 401(k) gives you an immediate tax break since contributions are made on a pre-tax basis. A Roth account, on the other hand, is funded with after-tax dollars so your money grows tax-free. Here’s some additional guidance for late-career savers deciding whether to switch to Roth contributions.
A financial advisor with tax expertise can help you optimize your tax strategy. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.

Photo credit: ©iStock.com/Hispanolistic, ©iStock.com/sasirin pamai, ©iStock.com/Moon Safari

Source: smartasset.com

Apache is functioning normally

June 24, 2023 by Brett Tams

The Disney Vacation Club (DVC) is a type of timeshare program run by The Walt Disney Co. that lets members exchange Vacation Points — which they purchase — for hotel rooms, villas and suites at Disney resorts.

Some of the biggest Disney fanatics love it, as there can be outsized value for those who maximize redemptions at official DVC resorts every year of their contract. That said, it’s far from a good deal for most people. For instance, members have been caught off guard by annual dues increases that aren’t exactly well-advertised.

But it’s not all about money, and by providing opportunities and experiences that you otherwise can’t get anywhere else, DVC can offer benefits beyond just financial savings. So with that, here are the pros and cons of Disney Vacation Club.

Pros of Disney Vacation Club

The upfront costs (at least $32,550 in 2023) and risks are high, but even those who either breakeven or lose money might still come out “ahead” given the other DVC benefits, many of which are pretty underrated.

Rentals are large and luxurious

The Grand Villa, located within The Villas at Disney’s Grand Floridian Resort & Spa. (Photo courtesy of Disney)

Rooms, suites and villas are generally more spacious and have more amenities than standard hotel rooms.

Discounts and freebies on other Disney lodging

While NerdWallet doesn’t recommend redeeming points for Disney trips outside the official DVC portfolio, DVC members can find steep discounts if they book such trips in cash.

Discounts on dining, shopping, tickets and tours

A passenger wearing a Togruta headpiece sits at the holo-sabacc table in the Sublight Lounge onboard the Halcyon starcruiser in Star Wars: Galactic Starcruiser at Walt Disney World. (Photo courtesy of Disney)

DVC members get discounts at hundreds of restaurants and shops. Discounts are usually 10%, but they’re occasionally higher. DVC members can also find discounts at after-hours theme park parties, backstage tours, and on activities like golf and dessert cruises.

Surprise gifts

Disney occasionally surprises members with small gifts, like pins, buttons and beignets.

Access to DVC member lounges

The entrance to the first-ever Member Lounge at Disneyland Resort in California, named “Disney Vacation Club Star View Station – a Member Lounge.” (Photo courtesy of Disney)

DVC has a few members-only lounges sprinkled throughout Disneyland and Disney World. Perks vary by lounge, but you might find free refreshments, premiere views and rare Disney memorabilia.

Members-only events and trips

Disney’s H2O Glow After Hours transforms Disney’s Typhoon Lagoon water park into an energetic glow-filled party. (Photo courtesy of Disney)

You might snag a reservation to Moonlight Magic, an after-hours party limited to DVC members. There are also paid DVC-only trips including cruises, which often sell out.

Cons of Disney Vacation Club

Aside from the huge upfront cost, these other pitfalls don’t necessarily have a dollar figure associated with them.

Redeeming beyond DVC properties is a terrible deal

Since the non-DVC resort redemptions end up devaluing your points, such redemptions should be limited. If you love Disney but would rather get your fix at an international park, skip DVC.

Points expire

While you can bank and borrow points from either last year or next year, the process comes with its own rules and limitations. Generally speaking, plan on using your allotment of Vacation Points each year — as points otherwise expire.

You’re committed for decades

DVC contracts are long. You could give your contract to friends or family later in life, but it can be a hassle and warrant additional financial concerns.

Selling your contract typically comes at a loss

If no one wants your DVC contract “gift,” then you may be able to sell your DVC points. That’s also complicated. DVC reseller website DVC Resale Market has nearly 800 resale listings available, where many properties sell for discounts of 50% or more. Reselling also involves other selling costs (e.g., a licensed real estate broker).

Further, anyone who’s on the financing deal can only transfer ownership once their mortgage loan is paid in full.

Renting Disney Vacation Club points can be complicated

Perhaps you’re not vacationing this year. If so, you can rent out unused Vacation Points to someone else, as long as it’s not for commercial purposes (Disney has a policy against a “pattern of rental activity,” though rentals every once in a while are OK). There are plenty of third-party DVC rental websites, but while you’ll recoup some costs of unused points, you’ll still usually come out in the red.

After all, buyers expect to snag Vacation Points at a discount and these websites take a cut of profits. The going rate that major DVC rental websites pay owners tends to be about $18 per point.

Your heirs are likely saddled with paperwork when you die

If you want someone to inherit it (and they want it too), add that person as a joint owner. But adding their name after the initial contract was set up requires paying a title company or attorney to assist with recording a new deed.

If you die before adding someone to your contract, then your family will need a probate attorney.

Multiple people per contract can get messy

Multiple families might also share one contract to reduce upfront overhead costs and alleviate pressure to take every vacation at Disney (one family could use the points one year, while another family claims them the next).

But contracts binding multiple people can get messy.

Splitting up points in divorces or friend splits can be painful. Disney won’t let you divide your Vacation Points. Though you might divide points and payments in your own, separate agreement, it might be better to use an attorney if you can’t agree.

Have a contingency plan if one party stops paying their share, as you’ll still be on the hook for unpaid dues (Disney doesn’t care who flaked). If your contract’s balance is unpaid for long enough, Disney can foreclose on the deed, which can negatively impact your credit scores.

You might just remove their name from the deed, but that saddles you with their portion of the costs — and it also incurs a fee to change the name on the deed. Even if it doesn’t get to foreclosure levels, one party refusing to pay their share can bring interpersonal fallout, which might be the biggest cost of them all.

The bottom line

DVC is certainly for some people, but it’s not for everyone. NerdWallet got pretty, well, nerdy, with its calculations to understand how much a DVC point actually costs if you join today. Check out those figures over at NerdWallet’s guide to whether DVC is worth it to assess if you’ll find financial savings in joining DVC versus just booking future Disney vacations in cash.

But not every benefit of DVC is purely financial. So despite carrying its fair share of cons, the pros of joining DVC can alone be worth it for some Disney fans.

How to maximize your rewards

You want a travel credit card that prioritizes what’s important to you. Here are our picks for the best travel credit cards of 2023, including those best for:

Source: nerdwallet.com

Apache is functioning normally

June 24, 2023 by Brett Tams

Government models say Phoenix’s groundwater supply is drying up. Homebuyers will have to pay the price to fix it.

The Arizona Department of Water Resources announced June 2 that the state will no longer authorize developers to build outside municipal water sources with a supply of only groundwater. Developers and real estate agents alike say this will hike up already high home prices.

“We’ll have significant supply issues post this announcement,” Spencer Kamps, vice president of legislative affairs for the Home Builders Association of Arizona, said. “And that will significantly impact affordability.”

Phoenix is one of Arizona’s five Active Management Areas, regions regulated by the 1980 Arizona Groundwater Management Code. In AMAs, developers of subdivisions must have a 100-year Assured Water Supply, which means their water source can meet the area’s anticipated water needs for 100 years.

There are two ways to get an AWS. Developers can either get a commitment of water service from a designated provider — a municipal water supplier approved by the ADWR — or they can get a certificate of AWS from the department itself.

Developers building on the outskirts of Phoenix where designated providers don’t reach must now use the second option. The wells they would previously tap in that area no longer hold a sufficient supply of water to meet the 100-year test based on ADWR modeling.

The ADWR’s Phoenix AMA groundwater availability model predicted 4.86 million acre-feet of unmet demand for groundwater supplies over the next 100 years. One acre-foot of water supplies three Phoenix homes with water for a year, ADWR says. The department hopes to alleviate this strain by prohibiting new groundwater-based AWS certificates.

But there are 80,000 undeveloped lots already approved with the certificates according to Kamps. They’re not impacted by the decision, so that development will continue as normal. Trouble begins, though, when builders run out of these lots. Until they find an alternative water source, they can only build within the reach of designated providers.

“Essentially, we have a growth boundary,” Kamps said. “The land opportunity in those designated providers is finite — it will eventually end.”

Maricopa County, which includes Phoenix and its suburbs, has grown by 19% from 2010 to 2022 according to U.S. census data. The median residential home price has increased 240% over that time, from $135,000 in 2010 to $459,000 this year, according to the Arizona Regional Multiple Listing Service. Prices have been on a steep incline since the start of 2020, when the median price was $300,000. In just two years, it rose by 53%.

Sheryl Bowden, president-elect of the Phoenix Board of Realtors, said the local market was already struggling with high interest rates and low inventory. Maricopa County had a housing shortfall of 44,181 units in 2022, Common Sense Institute Arizona says.

“You have people that aren’t selling properties because they don’t know where they’re going to go,” she said.

The average 30-year fixed mortgage rate was 6.67% on June 22 according to the The Fannie Mae Primary Mortgage Market Survey. Bowden pointed to relatively high rates, up from 5.81% in the same week last year, as a reason for the shortage: homebuyers are “not going to sell their 3% mortgage on the existing house to go out and get a 7 or 7.5% mortgage,” she said.

Mortgage rates hit a historic low of 2.65% in January 2021. Bowden thinks homeowners are waiting for rates to reach similar levels again before they sell.

“I don’t know if that’s ever going to be sustainable,” she said. “People need to get comfortable knowing that these rates that we’re having are, if you go back historically, they’re not that bad.”

Bowden and Kamps both said the announcement would disproportionately affect development in quickly growing Phoenix suburbs like Buckeye, which has doubled in population since 2010, and Queen Creek, which has almost tripled.

“The designated providers are much more expensive to build in,” Kamps said. “Buckeye specifically is one of the most affordable markets in the Phoenix metro area. And if you take the opportunity to go build in those communities, that’s going to impact affordability.”

Both communities are searching for alternatives to groundwater so developers can keep building.

Queen Creek’s water resource director, Paul Gardner, said his town has been acquiring renewable water sources to supplement current and future groundwater pumping for years now: “We decided as a community that we had grown so large that we could control our own destiny,” he said.

Gardner said treated wastewater, called recovered treated effluent, makes up 20% of the town’s water portfolio. In the future, it’ll make up 35%.

Developing renewable supplies will increase housing prices in Queen Creek. How much, Gardner said, depends on which supply the city marries each future developer with. Garder said it might mean $5,000 or even $10,000 more per house.

“The cost will be the cost,” he said.

The city of Buckeye also assured residents their water future is secure, listing several changes they’ve made to their water management process. They called the ADWR’s announcement a “reactionary response to an exaggerated issue,” criticizing the GMA as outdated.

Kamps also called for changes to the GMA, since it only impacts subdivisions, developments of six lots or more. Other developments, like commercial and apartment buildings, don’t have to obtain an AWS before building.

Arizona Governor Katie Hobbs created the Governor’s Water Policy Council on Jan. 9 to do just that. The council’s first meeting was May 17. Kamps is an appointed member of the council.

If the GMA is not updated, Kamps said, “in the future, we won’t make any decisions based on efficiency. We’ll make decisions based on where the water is.”

Source: nationalmortgagenews.com

Apache is functioning normally

June 24, 2023 by Brett Tams

A majority of the housing market data on any given month tends to come out mostly on the same week. This was that week and the takeaway was that the housing market could be doing worse. Some might even argue that we’re seeing some resilience relative to the rate landscape.

Let’s refresh our understanding of the rate landscape first. The bond market (which drives interest rate movement) has been broadly sideways recently as investors wait to see how quickly inflation (bonds’ biggest concern) is subsiding. That “wait and see” approach prompted the Fed to hold its policy rate steady at last week’s meeting, but that was widely expected by the bond market and thus not worth much of a reaction.

Fed Chair Powell gave his regularly-scheduled congressional testimonies this week and had a chance to talk a bit more about where the Fed sees things going from here. We already knew the average Fed member saw about 2 more rate hikes before achieving a terminal “ceiling” level, assuming the economy evolved as expected, but Powell was able to clarify what “as expected” meant.

Interestingly enough, the additional hikes are not seen happening in response to some additional upward momentum in inflation or economic growth. Rather, the Fed’s baseline expectations call for continued cooling in the labor market, modest economic growth, and continued cooling in inflation. In other words, inflation and the economy have a very low bar to justify a few more rate hikes. Things would have to deteriorate pretty abruptly for the Fed to abstain. Moreover, if things improve a bit better than expected, we could be looking at more than 2 additional hikes.

The problem with these expectations and the actions predicated upon them is the elevated uncertainty about the outlook. Economic uncertainty is often reflected in sideways trading ranges in the bond market. Using 10yr Treasury yields as a proxy for other rates (like mortgages), we see clear sideways ranges in the short term.

And in the long term.

The longer term chart also serves as the best recap of the rate landscape. Specifically: rates are high–not as high as they were in late 2022 or even earlier this year, but certainly much closer to the higher end of the range over the past few years.

The rate surge in 2022 had predictable consequences for the housing market, but even though rates remain high, volatility has died down.

Lower rate volatility has helped housing find bottom. Essentially every housing report that came out this week told a different version of that same story. Some reports were downright upbeat, such as the surge in “housing starts” (a term that refers to the ground-breaking phase of new construction). Only 10 months have been higher in more than a decade.

This also marked a major reversal in the trend for new construction. Last month’s report showed the worst year-over-year growth in 14 years while the new report showed the best growth in more than a year–a shift of more than 20%.

This is a notoriously volatile set of data, but swings like this still send analysts looking for explanations. One of the most commonly cited mitigating factors is the larger and more stable role being played by multi-unit construction. Multi-family starts are right in line with their highest levels in more than 3 decades, and they were essentially unaffected by the 2022 rate spike.

The other “yeah but” is that the new home market is quite a bit smaller than the existing home market, and the latter is better described as “treading water,” even though the most recent number came out slightly higher than last month.

The “yeah but” to that “yeah but” is that inventory is holding the market back.

There are a few more of the big monthly housing reports yet to come in the week ahead. Most arrive next Tuesday morning with New Home Sales expected to stay fairly flat at an annual pace of 670k and the duo of home price indices from FHFA and Case-Shiller (both expected to show slower, near-zero price growth). Thursday’s Pending Home Sales index is expected to show 0.2% growth after holding steady last month.

Source: mortgagenewsdaily.com

Apache is functioning normally

June 24, 2023 by Brett Tams

Symetra Life Insurance Company boasts more than half a century of offering life insurance coverage to valued clients. Over time, this insurer has exceeded $35 billion in assets and 2 million clients throughout the United States.

Symetra has its headquarters in Bellevue, Washington, while the company sells its products in all states excluding New York.

Established in 1957, the insurer has made many strides in the insurance and financial industry. For example, in 1976, Symetra pioneered the medical stop-loss product – which today is a key product in the medical insurance marketplace.

In 1987, Symetra started selling its annuity products through the banking channel, and in 1999, exceeded the $30 billion mark of life insurance in force. In 2004, the insurer transitioned into an independent company – Symetra Financial Corporation, and in 2016, it joined Sumitomo Life, a global life insurer.

The products sold by Symetra Life Insurance Company are offered through brokers and financial advisors, banks, and a network of independent insurance agents.

The primary products provided through Symetra include life insurance protection, along with annuities, retirement, employee benefits, and medical stop-loss insurance coverage.

Symetra Life Insurance Company Review

Today, Symetra is owned by parent company Sumitomo Life – which is considered to be one of the most prominent life insurance companies in Japan. The parent company has been in operation for over 100 years. Both Symetra and Sumitomo Life have total assets surpassing $250 billion.

Symetra Life Insurance is currently recognized as a Top 3 seller of fixed deferred and fixed indexed annuities through banks. It is also a Top 40 U.S. life insurance company, based on admitted assets. In 2015, the company brought in roughly $2.2 billion in total revenues and nearly $147 million in net income.

In addition to offering insurance and financial products, Symetra is committed to the community. In 2015, Symetra contributed to nearly 900 charitable organizations, and its employees invested roughly 8,500 hours of volunteer service.

The company also does a great deal of advertising and sponsorship – including its Sports Illustrated Rising Stars campaign, The Symetra Tour – Road to the LPGA, the Symetra Heroes in the Classroom, and the “I Just Want to Fly,” highlighting the insurer’s commitment to helping people and businesses with reaching higher and flying further to attain their financial goals.

Symetra Life Insurance Company Ratings and Grades

A (Excellent) from A.M. Best. This is the 3rd highest rating out of a possible 16.
A (Strong) from Standard & Poor’s. This is the 6th highest rating out of a possible 21.
A2 (Good) from Moody’s Investor Services. This is the 6th highest rating out of a possible 21 and puts them in good company with Globe Life Insurance.
A (Strong) from Fitch. This is the 6th highest rating out of a possible 19.

Types of Life Insurance Available

Symetra Life Insurance Company brings a variety of life insurance products to the table.

This can be helpful for clients when fitting coverage to meet their specific protection needs.

The company offers term and permanent life insurance plans.

Term Life

Term life insurance provides pure death benefit coverage only. Because term does not include cash value, these policies are typically more financially feasible than comparable permanent coverage – all other factors being equal.

Term life insurance policies are purchased for a set period of time, such as ten years, 15 years, 20 years, or even for 30 years. The term plans offered through Symetra Life Insurance Company offer level premiums throughout the initial period. This can make these plans easy to budget for because the premium won’t budge during the initial policy’s term.

With these term policies, the policyholder may also have the option to convert the coverage over to a permanent life insurance policy without the need to prove insurability – or even having to answer any medical questions. Doing so can extend life insurance protection for the remainder of the insured’s lifetime – provided that premiums continue to be paid.

If the insured is diagnosed with a terminal disease, he or she may also be eligible to receive no more than 75% of the death benefit from their policy while still living – up to $500,000. This can allow the insured to pay for medical expenses or other outstanding bills and puts them ahead of Primerica life insurance for an all-encompassing term policy.

Symetra Life Insurance Company’s term life insurance policies also offer some additional riders that may be added to better meet an insured’s protection needs.

These riders are:

Insured Children’s Benefit
Additional Term Rider
Waiver of Premium
Accidental Death Benefit

Permanent Life

The permanent life insurance policies offered through Symetra Life Insurance Company provide an insured with a guaranteed death benefit, in addition to a cash value element. In other words, loved ones will be protected, while at the same time allowing tax-deferred build-up of savings within the policy.

There are a number of different permanent policies offered by Symetra:

Symetra UL-G Universal Life Insurance – The UL-G policy is a universal life plan. In other words, the policyholder has some flexibility when it comes to how much of the premium payment will go toward the death benefit, and how much will go toward the cash value component. Individuals who are between the age of 16 and 85 can apply for this plan, and it has a minimum death benefit of $50,000. There are also a number of optional riders available that may be added to fit the insured’s protection needs. Also, the amount of the premium may be reduced if the insured is between the age of 20 and 70, and he or she qualifies for Symetra’s GoodLife Rewards program.

Symetra SUL-G Survivorship Universal Life Insurance – The SUL-G is also a universal insurance policy that offers a guaranteed death benefit, in addition to ensuring that legacy planning goals are being met. This policy can also be a good option for estate planning and wealth transfer, as well as for business protection needs. It includes a lapse protection benefit so the policyholder can ensure the policy will be in force for as long as he or she would like.

Symetra CAUL Universal Life Insurance – This type of policy offers lifetime protection that can be tailored to an insured’s objectives, no matter if it is lifetime insurance protection or primarily cash value accumulation. This policy offers flexible premium payments and death benefit options, including the ability to use cash value as a future financial cushion for things like retirement income and/or paying off debts.

Symetra Universal Life Insurance (2008) – With Symetra Life Insurance (2008), an insured will get lifetime insurance coverage at a fixed cost. As a result, loved ones are now financially secure. This policy also offers several additional riders that can help with further customizing the insurance policy. It also offers an initial interest rate guarantee for 12 months from the date that the premium is received. In addition, this rate is guaranteed to be no less than 3%.

Symetra Successor Single Premium Life Insurance – With this form of coverage, the policyholder can designate a certain amount of money to his or her beneficiary exempt from federal income taxation. Plus, the financial worth of the insured’s estate will essentially go up the minute they purchase the insurance policy. With this plan, there is no need to worry about the policy expiring in the future. This is because it has a guaranteed death benefit that won’t terminate before the first policy anniversary following the insured’s 120th birthday. This policy also allows free annual withdrawals of no more than 10% of the accumulation value each policy year without a surrender charge.

Other Products Sold

In addition to just life insurance coverage, Symetra offers other products, too.

These include:

Annuities

Symetra offers a number of different annuity products. These can help individuals with saving for retirement, as well as ensuring they have an ongoing income that will last them throughout their retirement years.

Annuities offered by Symetra include the following:

Fixed Deferred Annuities
Fixed Indexed Annuities
Variable Deferred Annuities
Income Annuities

Employee Benefits

Symetra also offers employee benefits. The company’s knowledge of the marketplace, as well as its flexible policy designs, can help companies develop an employee benefit plan that best fits their business.

Stop Loss Insurance

Symetra is a pioneer in the stop-loss insurance arena. The company introduced the product to the market back in 1976, and it has worked to build one of the very best and largest medical stop-loss entities in the United States.

Source: goodfinancialcents.com

Apache is functioning normally

June 23, 2023 by Brett Tams

Nestled in a region known for its vineyards, farmland, and beautiful landscapes, Brentwood, California, has tons to offer the 66,000 people who choose to call it home. The city’s location offers a balance of calm suburban living with convenient access to the hustle and bustle of larger cities like San Francisco and Oakland. While its outdoor activities, community events, and the Mediterranean climate appeal to many, it’s crucial to consider all aspects of relocating to Brentwood.

But is Brentwood, CA, a good place to live? Luckily, we’ve got you covered. If you’re looking at homes for sale in Brentwood, apartments for rent, or are just curious about what the area has to offer, this Redfin guide is for you. To give you a taste, here are 10 pros and cons to consider before moving to Brentwood, CA.

5 pros of living in Brentwood, CA

There’s a lot to love about Brentwood, from warm weather to convenient access to nature and big-city living. Here are six benefits of living in Brentwood.

1. Location

Brentwood is located conveniently near untouched nature and major metropolises. It’s about an hour’s drive from San Francisco and even closer to Oakland, making it possible for residents to commute for work or easily enjoy their amenities. This gives people the ability to enjoy a quieter, more suburban lifestyle while still having easy access to big-city benefits like diverse dining options, cultural attractions, sports events, and shopping.

2. High-quality living

Brentwood is known for its luxury suburban homes and upscale neighborhoods, often with well-kept yards and beautiful landscaping. Housing options can vary from comfortable single-family homes to large estates, ensuring there’s something to fit a variety of lifestyle preferences.

If you’re looking for a luxury home in Brentwood, you’ll find plenty of options, ranging from $800,000 homes to multi-million dollar properties. Make sure to connect with a local Redfin Premier agent for knowledgeable, customized service.

3. Outdoor activities

Brentwood is nestled among several natural attractions, making it an ideal place for outdoor enthusiasts. Local parks, trails, and golf courses offer plenty of space for recreational activities. Particularly notable is the proximity to Mount Diablo State Park, which offers extensive hiking trails, opportunities for wildlife viewing, and stunning panoramic views at the summit. Other popular options include Marsh Creek Regional Trail, Contra Loma Regional Park, Round Valley Regional Preserve, and Big Break Regional Shoreline.

If you’re in the mood for parks in the city, consider checking out City Park, a popular community gathering spot located in downtown Brentwood, or Blue Goose Park, which is named after a historic train.

4. Wine culture

Brentwood and its surrounding areas boast a thriving wine industry, with numerous wineries and vineyards that add to the region’s charm. Residents have the unique advantage of being able to indulge in wine tastings and tours, immersing themselves in the artistry and craftsmanship behind winemaking.

Popular wineries and vineyards for tasting and touring include Tamayo Family Vineyards, Hannah Nicole Vineyards, and Vine + Grain.

5. Community and culture

Brentwood hosts a variety of community events throughout the year that provide entertainment for all ages. The Brentwood Farmers’ Market offers an array of fresh local produce and artisan goods, while festivals like the popular Brentwood CornFest celebrate the area’s agricultural heritage with music, food, and activities. If you like music, the city hosts Concerts in the Park every summer, bringing live music to the city during warm evenings.

5 cons of living in Brentwood

While Brentwood has many positives, there are notable downsides as well. Here are five to be aware of before making the move.

1. High cost of living

One major downside of living in Brentwood is its high cost of living. While many people may enjoy the luxury lifestyle that Brentwood offers, it’s prohibitively expensive for others.

Housing, in particular, can be costly. For example, the median sale price for a home in Brentwood is $816,000, nearly twice the national average. Apartments are also expensive, with a one-bedroom apartment costing an average of $2,525.

2. Traffic and commuting

While Brentwood’s location offers easy access to larger cities, commuting can be challenging. The freeways can become congested, especially during peak rush hour periods. While there are public transportation options, they can also be time-consuming. This means that if you live in Brentwood but work in San Francisco, for example, you will likely have a long commute each day.

3. Hot weather

Brentwood’s weather is generally pleasurable, but summers can become excessively hot. The city is in a hot Mediterranean climate, meaning summer temperatures frequently reach into the high 90s to over 100 degrees Fahrenheit. Heat waves can make this even worse. If you aren’t used to hot weather or don’t enjoy it, summers will be challenging.

4. Limited nightlife

Brentwood is a quieter city, so its nightlife options may seem limited, especially when compared to larger cities like San Francisco or Los Angeles. While there are restaurants and bars in the area, you won’t find a vibrant nightlife scene.

If you’re in the mood for good food, though, there are plenty of options, including Shirasoni, Chianti’s, and Baltaire.

5. Growth and development

Brentwood has experienced significant growth over the past few decades, with its population increasing nearly 300% since 2000. This has transformed the area from a small agricultural town to a more developed suburban city. While this growth has brought many conveniences, it also brought more traffic, pollution, and less charm. If you want to move to Brentwood for its small-town feel, you may be slightly disappointed.

Source: redfin.com

Apache is functioning normally

June 23, 2023 by Brett Tams

Mortgage lenders and Chancellor Jeremy Hunt have agreed that people should be given a 12-month break before repossession proceedings start amid soaring interest rates.

After the rise of the base rate to 5%, Mr Hunt met with leaders of financial institutions including Lloyds, NatWest, Barclays and Virgin Money.

They agreed that the repossession break should be introduced – similar to the one implemented during COVID.

Politics latest: Chancellor meets with mortgage lenders after interest rate hike

Mr Hunt spoke after the Downing Street summit about an option for people to go to their banks or lenders and speak about their options, if they are struggling with repayments, without it having an impact on their credit rating – although this had been mentioned as early as March this year by the Financial Conduct Authority (FCA).

He said that people who change the length of their repayment term or go on to interest-only plans can reverse their decision within six months without it impacting their credit rating.

But there was no announcement of support for people who rent, who are facing landlords hiking prices or selling properties from under them due to rising mortgage costs.

And Labour warned that without making the plan mandatory for all banks – the current agreement covers 75% of the market – around two million homeowners could miss out on support.

The chancellor said: “There are two groups of people that we’re particularly worried about.

“The first are people who are at real risk of losing their homes because they fall behind in their mortgage payments.

“And the second are people who are having to change their mortgage because their fixed rate comes to an end and they’re worried about the impact on their family finance since the higher mortgage rates.”

Chancellor’s mortgage plan might mitigate against chaos – but it will not prevent pain

Rob Powell

Political correspondent

@robpowellnews

There was never going to be an announcement on Friday about direct “bailout” style funding for those struggling with their mortgages.

Both the government and Labour agree that would risk fuelling inflation further.

So what we have instead is a beefing up of existing tools available to lenders and a reintroduction of some of the easements seen during the pandemic.

The difficulty may be that the sheer depth and length of this mortgage squeeze will likely still leave many wanting more from both the banks and the government.

Read Rob’s full analysis here

Similar repossession breaks were introduced during the pandemic.

An announcement several hours later included data from the FCA, showing 0.86% of residential mortgages were in arrears in the first quarter of 2023 compared with 3.32% in 2009 after the financial crash.

It added that the proportion of disposable income spent on mortgage payments is 5.4%, compared with 10% in the 1990s.

Listen and subscribe to the Ian King Business Podcast here

Martin Lewis, the founder of MoneySavingExpert.com, said; “I met the chancellor on Wednesday and reiterated that the minimum we needed was to ensure that when people asked for help from lenders, they knew that if things changed, it wouldn’t be detrimental to their financial situation and their credit scores would be protected as much as possible.

“I’m pleased to see it looks like the chancellor has listened and those measures are going to be put in practice by the banks. We need to make sure everybody knows their rights if they are in trouble with their mortgage, so they can feel comfortable speaking with their lender and understand the measures that they can request for help.”

Read more:
Mortgage rates largely unchanged despite shock interest rise
Jeremy Hunt rules out mortgage support and capping food prices
Labour unveils five-point plan for mortgage crisis

Banking leaders also offered their support for the measures, with HSBC chief executive officer Ian Stuart saying: “It’s important that customers feel comfortable contacting us if they feel they are getting into financial difficulty because whilst every customer’s situation is different we have a range of options that we can use to help them find their way through.”

But Labour leader Sir Keir Starmer said the public were looking for “actions, not words”, when it came to their mortgages.

He said there are “many mortgage holders, many families, across the country who are now even more worried about paying their mortgage”.

He said: “They know that the government’s been about for 13 years, they know the government crashed the economy last year.

“What they want, I think, is a much stronger sense that the government is gripping this; action, not words.”

Shadow chancellor Rachel Reeves also attacked the “government’s failure to make this set of measures mandatory”, and said there was “a big lack of clarity and certainty about the timelines”.

She said the Conservatives should “take responsibility” and adopt Labour’s plan, announced on Thursday, that would see all banks made to allow borrowers to switch to interest-only mortgage payments and lengthen the term of their mortgage period.

But a Treasury spokesperson said: “Today’s measures will offer comfort to those who are anxious about high interest rates and support for those who do get into difficulty.

“The chancellor is clear that he expects smaller lenders to sign up and to offer their customers similar flexibilities, and thinks it is the right thing to do – and we are aware several will be considering over the coming weeks.”

Source: news.sky.com

Apache is functioning normally

June 23, 2023 by Brett Tams

A new study claims homebuyers are often so mentally exhausted from home shopping that they rush the mortgage process and wind up with higher-risk loans.

A pair of George Washington University instructors identified the phenomenon as “cognitive resource depletion,” meaning individuals burn out on one activity and devote less time to a subsequent one, in this case, shopping for a home loan after finding a suitable property.

The findings are based on a test using two groups, one that participated in a home-shopping exercise followed by a mortgage shopping exercise, and one that only performed the latter.

Nearly half of those that performed both shopping exercises back-to-back selected higher-risk mortgages, while fewer than 20 percent who didn’t have to perform the home shopping exercise did the same.

I’m assuming higher-risk means adjustable-rate mortgages, and perhaps option arms, essentially those with lower monthly payments, at least initially.

While the study does make sense, it’s probably just one of many factors that determine what a borrower will end up with loan-wise.

There’s a good chance loan officers and mortgage brokers have a lot of influence, and debt-to-income ratio requirements may also drive loan program decisions out of pure necessity.

And once a home is ultimately selected, borrowers typically have to make quick decisions in order to obtain financing in a timely fashion.

All that said, it’s wise to study up on the wide array of mortgage programs out there before even searching for a home, and to get pre-qualified/pre-approved beforehand.

Aside from leading to a better choice of mortgage, it can help you avoid any nasty surprises late in the game that could crush your dream of homeownership entirely.

Source: thetruthaboutmortgage.com

Apache is functioning normally

June 23, 2023 by Brett Tams

The Federal Housing Finance Agency (FHFA) released data yesterday on Fannie Mae and Freddie Mac, comparing credit quality and performance of the loans they acquired (from 2001-2008) versus loans financed with private-label mortgage-backed securities.

As you can see, Fannie and Freddie’s loans were of much better quality, and performance followed suit.

Of course, because they held a much larger share of the mortgage market (and ignored risks), multi-billion dollar losses at the two firms still required a major bailout.

Fannie and Freddie:

84% of mortgages had Fico scores above 660
5% of mortgage had Fico scores below 620 (subprime by definition)
82% of mortgages had loan-to-value (LTV) ratios below 80 percent
88% of mortgages fixed-rate loans
Roughly 5% of fixed-rate mortgages and 10% of ARMs over 90 days delinquent before the end of 2009

Private Label:

47% of mortgages had Fico scores above 660
32% of mortgage had Fico scores below 620 (subprime by definition)
66% of mortgages had loan-to-value (LTV) ratios below 80 percent
70% of mortgages adjustable-rate mortgages
Roughly 20% of fixed-rate mortgages and 30% of ARMs over 90 days delinquent before the end of 2009

And most private label mortgages were only under 80 percent LTV because they had corresponding second mortgages to avoid paying mortgage insurance (combo loans).

The layered risk you see in the private label mortgages explains why things went so horribly wrong (what caused the mortgage crisis).

Fannie and Freddie’s share of total loans fell from above 90 percent in 2001 and 2002 to just above 60 percent in 2005, before rising to nearly 100 percent in 2008.

Source: thetruthaboutmortgage.com