This year, there are some new things being added in terms of taxes. With regard to home mortgage loans, mortgage debt forgiveness tax relief is a solid fixture. And don’t forget that this year, you need to file a tax return in order to get your “economic stimulus” tax rebate. Even if you don’t normally need to file a tax return, this year it is necessary if you want your tax rebate.

Here are some Tax Day tips to help ensure that you are on the right track with your taxes:

• Double check your tax return. Before sending it in, have another look at your tax return. Better yet, have someone else double check your tax return. There are usually agencies and organizations in most towns that offer free tax help, or that will look over your tax return for a small fee.
• Make copies. You should make copies of your tax forms and all supporting documentation. Keep it in a safe place. This way, you have something to refer to if an audit happens. Note that Office Depot and Staples offer to make copies of your tax forms for free.
• Get help from the source. The IRS offers free tax help and Tax Day tips at its Web site, and also when you call 1-800-829-104o.
• Send your tax return (and/or payment) out today. My tax return was filed electronically, but I still have to send out payment. Tax returns and payment need to be post-marked by midnight tonight. Many post offices are open until midnight in order to make these accommodations. If you can’t get your tax return done by tonight, file for an extension to give you extra time.

And, of course, start now to prepare for next year!

Tags: tax day tips, tax rebate, home mortgage loans, mortgage loan blog,
pay taxes, economic stimulus, free tax help

It’s earnings time again, and once again subprime writedowns are wreaking havoc amongst financial sector companies on the stock market. The latest losses are being reported by Wachovia Corp (WB), which this morning announced that it will try to raise $7 billion in capital. This comes as Wachovia reports a $350 million loss this past quarter.

Many of the losses come as foreclosures mount in the US mortgage market. In many cases, securities that companies have invested in were backed by subprime loans. These mortgage back securities then fall in value as defaults and foreclosures ensue.

Wachovia is the fourth-largest bank in the United States, and had some investments in securities that included subprime loans. These relatively illiquid securities are causing all sorts of problems as analysts and fund managers try to figure out how much they are worth.

In the meantime, Wachovia has increased the amount it is setting aside to cover losses, reports BBC News:

Wachovia has set aside $2.8bn to cover current and future losses stemming from the housing and credit crises, the bulk of these arising from loans which will not be repaid.

The largest bank by far to express problems due to subprime writedowns is UBS, which is suffering a $37.4 billion loss. Other banks having problems include Citigroup ($21.1 billion) and Merrill Lynch ($22 billion). HSBC has also lost a significant amount to this crisis — $17.2 billion. Other companies’ losses remain somewhat limited, although even relatively small amounts lost, like Bear Stearns’ $3.2 billion, can have a big impact.

While there is some optimism that the credit crunch and the subprime lending crisis are coming to an end, it remains to be seen what further losses are seen, and which financial sector companies manage to recover.

Tags: Wachovia, WB, home mortgage loan, mortgage loan blog,
subprime writedowns, credit market crisis, mortgage lenders

A mortgage relief bill is moving forward in Congress right now. However, there is some sparring over how much the federal government should do for ailing homeowners. While there has been some compromise in some areas, there are still issues in other areas. And, of course, no one is bothering about how, ultimately, we’re going to pay for all of this.

Negative equity is a problem in many cases. According to the New York Times, that’s not really the issue right now with the mortgage relief bill:

Both the plan supported by Democrats and the administration’s plan seek to stabilize the battered housing market by allowing a homeowner, who may now owe more than his home is worth, to get out of an expensive adjustable-rate mortgage and refinance into a more stable and affordable 30-year loan backed by the federal government.

Other issues, though, are arising. Conservative Republicans are opposing some of the measures put forth by Democrats. The White House is threatening to veto a version of a Senate bill that offers a wide expansion of the existing FHA mortgage insurance program.

Democrats claim that their measures would help 1.5 million of the 2 million borrowers expected to go through foreclosure by 2009 (the Bush Administration disputes these numbers). Of course, even if Senate Republicans are on board with more expansive measures, House Republicans feel differently in many cases. On The Hill, a blog that includes posts written by members of Congress, Randy Neugebauer (R-Texas) points this out:

It is not the role of the federal government to create equity in a home. Yet the proposal we discussed yesterday would put the federal government in a position of determining a borrower’s equity and put the taxpayers on the hook for any further declines in that borrower’s equity or default.

A valid point.

But is it the role of the federal government to create share value for slumping stocks? What about putting the taxpayer on the hook for the JP Morgan takeover of Bear Stearns? Why aren’t these lawmakers concerned about this?

What do you think of efforts regarding a mortgage relief bill?

Tags: foreclosures, negative equity, home mortgage loan, mortgage loan blog,
mortgage relief bill, mortgage relief Congress