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New Financial Reform Bill

After much ado our political “leaders” have finally come to an agreement on the broadest regulatory overhaul since the Glass Steagal Act of 1933.

By a vote of 60-39, the Senate yesterday passed HR 4173: WALL STREET REFORM AND CONSUMER PROTECTION ACT. The House already gave their seal of approval so the legislation heads to President Obama’s desk where he is expected to sign it into law next week.

The bill includes several reforms aimed directly at the housing and mortgage industries. Instead of trying to translate the text into comprehensible English I chose to rely on the Mortgage Bankers Association’s outlines. Once again they came through in the clutch…

HERE is an indepth summary of the text. Below are some excerpts from the MBA’s overview.

Credit Risk Retention (Section 941) – Requires federal banking agencies and SEC to jointly prescribe rules requiring securitizers to retain economic interest of at least five percent of credit risk of assets they securitize. Regulations must include separate requirements for different asset classes, and may allocate the retention amount between originator and securitizer. HUD and the Federal Housing Finance Agency must participate in joint rulemaking process for residential mortgage backed securities (MBS) risk retention requirements. The statute requires an exemption for “qualified residential mortgages” which shall be defined by regulators based on statutory criteria to ensure sound underwriting and lower risk of default such as:

Documentation of borrower’s financial resources;
Debt- to-income standards;
Mitigating potential for payment shock on adjustable rate mortgages through product features and underwriting standards;
Mortgage insurance or other credit enhancements to reduce risk of default; and
Prohibiting use of loan features that have been demonstrated to exhibit a higher risk of borrower default.
Exempts loans insured or guaranteed by U.S. from risk retention requirements. For commercial MBS, regulators must give consideration to other types, forms and amounts of risk retention such as representations and warranties, underwriting criteria and first-loss positions. Within 90 days of enactment, requires FRB to complete study on combined impact of risk retention and accounting standards requiring securitizations to be brought on balance sheet.

Prohibition on Steering Incentives (Section 1403)

Prohibition: Prohibits mortgage originator from receiving from any person, or any person from paying mortgage originator, directly or indirectly, compensation that varies based on terms of loan (other than amount of the principal). With the exceptions below, generally prohibits a mortgage originator from receiving from any person other than consumer and any person other than consumer, who knows or has reason to know that a consumer has directly compensated or will directly compensate mortgage originator, from paying mortgage originator any fee or charge except bona fide third-party charges not retained by creditor, mortgage originator, or affiliate of creditor or mortgage originator. Intended to prohibit yield spread premiums or other similar compensation based on terms including rate that would cause originator to “steer” borrower to particular mortgage products.
Exceptions: Does not limit compensation to originator based on principal amount of loan. Also, does not restrict person other than consumer from receiving, or person other than consumer from paying, origination fee or charge if: (1) originator does not receive any compensation directly from consumer; and (2) consumer does not pay discount points, origination points or fees however denominated (other than bona fide third-party charges not retained by originator, creditor or affiliate of creditor or originator), except that Board may, by rule, waive or provide exemptions to restriction if Board determines waiver is in interest of consumers and public.
Regulations: Requires CFPB to prescribe regulations prohibiting mortgage originators from: (1) steering any consumer to loan that (a) consumer lacks reasonable ability to repay, or (b) has predatory characteristics or effects such as equity stripping, excessive fees or abusive terms; (2) steering any consumer from a “qualified mortgage” to “not qualified” mortgage when consumer qualifies for ”qualified mortgage;” (3) abusive or unfair lending practices that promote disparities among consumers of equal creditworthiness but of different race, ethnicity, gender, or age; (4) mischaracterizing the credit history of consumer or residential loans available to consumer, (5) mischaracterizing or inducing mischaracterization of appraised value of property securing extension of credit; or (6) if unable to suggest, offer or recommend to consumer loan that is not more expensive than loan for which consumer qualifies, discouraging consumer from seeking mortgage from another originator.
Rules of Construction: While expressly prohibiting any yield spread premium or similar compensation that would permit total amount of direct and indirect compensation from all sources to originator to vary based on loan terms other than amount of principal, expressly permits compensation to a creditor upon the sale of a consummated loan to a subsequent purchaser, i.e. compensation to lender from secondary market for sale of consummated loan. Also does not restrict: (1) consumer’s ability to finance at option of consumer through principal or rate, any origination fees or costs as long as fees or costs do not vary based on terms of loan or consumer’s decision to finance such fees; or (2) incentive
Definitions of Mortgage Originator (Section 1401) – Means any person who for direct or indirect compensation or gain: (i) takes residential mortgage loan application, (ii) assists consumer in obtaining or applying to obtain residential mortgage loan; or (iii) offers or negotiates terms of residential mortgage loan as well as any person who represents to the public that it will provide any of services in (i)-(iii). Does not include any person who: (1) performs purely administrative or clerical tasks; (2) is employee of manufactured home retailer who does not advise consumer on loan terms; (3) only performs real estate brokerage activities and is licensed or registered in accordance with applicable state law, unless such person or entity is compensated by lender, mortgage broker, or other originator or their agents; (4) person, estate or trust that provides mortgage financing for sale of 3 properties in any 12 month period provided loan is fully amortizing, where borrower has ability to repay and is either fixed or adjustable only after five years and meets other conditions; (5) is servicer or servicer employee, agent or contractor, including but not limited to those who offer or negotiate terms of residential mortgage loan for purposes of renegotiating, modifying, replacing and subordinating principal of existing mortgage where borrower is behind in payments, in default, or has reasonable likelihood of being in default or falling behind; and (6) Excludes creditor except the creditor in a table funded transaction under anti-steering provisions.

Consumer Financial Protection Bureau (CFPB) Established – Establishes CFPB as independent entity housed within FRB. Assigns CFPB broad authority to write rules to protect consumers from unfair or deceptive financial products, acts or practices and reassigns to CFPB responsibility for major consumer protection laws including RESPA, TILA, HOEPA, HMDA and more, detailed below.

Appraisals, AMCs and AVMs – Prohibits appraiser coercion and requires rulemaking by FRB, OCC, FDIC, NCUA, FHFA and the CFPB on appraiser independence. Requires: interim rules by CFPB within 90 days of enactment on appraiser independence to replace Home Valuation Code of Conduct (HVCC); physical appraisal for every subprime mortgage and two appraisals for subprime mortgage when there has been purchase or acquisition of property at lower price within 180 days; Appraisal Subcommittee of the Federal Financial Institutions Examination Council to monitor state and federal efforts to protect consumers from improper appraisal practices and unlicensed appraisers; FRB, OCC, FDIC, NCUA, FHFA and the CFPB to prescribe minimum requirements for appraisers, appraisal management companies and standards for AVMs.

CFPB Authority – Assigns CFPB regulatory and supervisory authority to examine and enforce consumer protection regulations respecting all mortgage-related businesses, large non-bank financial companies, and banks and credit unions with greater than $10 billion in assets. Makes CFPB primary regulator for nondepository lenders. Exclusions from CFPB authority for real estate brokers, persons regulated by state insurance regulators, auto dealers, accountants, tax preparers, and others.

CFPB Transfer Date – Requires Treasury, in consultation with FRB, FDIC, FTC, NCUA, OCC, OTS, HUD and OMB, to designate date for transfer of functions to CFPB within 60 days after enactment. Date generally must be between 180 days and 12 months of enactment. Authorizes Treasury to revise date after further consultation with agencies. If determined transfer of functions is not feasible within 12 months, Treasury must report to Congress.

Coverage of Mortgage Lending Provisions – Includes mortgage originators who take or assist applications and negotiate terms of mortgages. Excludes creditors (except creditor in table funded transaction for anti-steering provisions) servicer employees, agents and contractors, persons or entities performing real estate brokerage activities and certain employees of manufactured home retailers from “originator” definition.

Duty of Care – Requires loan originators to be qualified and licensed and registered, when required, and include on all loan documents the unique identifier of mortgage originator provided by the Nationwide Mortgage Licensing System and Registry (NMLSR).

Minimum Standards for Mortgages/Ability to Repay – Prohibits creditors from making residential mortgage loans unless creditor makes good faith determination, based on verified and documented information that, at time loan was consummated, consumer had reasonable ability to repay loan according to its terms, and all applicable taxes, insurance and assessments.

Presumption/Safe Harbor for Qualified Mortgages – Allows any creditor and any assignee or securitizer of “qualified mortgage” to be presumed to meet “Ability to Repay” requirements, although presumption may be rebuttable.

Qualified Mortgages – Includes loans that meet several requirements including that the income relied on to qualify borrowers is verified and documented, underwriting and ratios are consistent with statutory and regulatory requirements, and total points and fees payable in connection with loan do not exceed 3 percent of total loan amount.

3 Percent Limit – Applies definition in TILA with following exclusions: (1) up to and including 2 bona fide discount points depending on interest rate; (2) any government insurance premium and any private mortgage insurance (MI) premium up to amount of the FHA insurance premium, provided the MI premium is refundable on pro rata basis, and (3) any MI premium paid by the consumer after closing, e.g., monthly.

Liability for Mortgage Originators – Establishes mortgage originators are liable for violations of duty of care and anti-steering prohibitions up to greater of actual damages or amount equal to 3 times total amount of direct and indirect compensation or gain accruing to mortgage originator for loan involved, plus costs and reasonable attorney’s fees.

Discretionary Regulatory Authority – Grants broad discretionary regulatory authority to CFPB to prohibit or condition terms, acts or practices relating to residential mortgage loans found abusive, unfair, deceptive, predatory.

Prepayment Penalties – Prohibits prepayment penalties for “not qualified mortgages.” Restricts prepayment penalties to loans that are not adjustable and do not have APR that exceeds Average Prime Offer Rate (APOR) by 1.5 or more percentage points for first lien loans, 2.5 or more percentage points for jumbo loans, or 3.5 or more percentage points for subordinate lien loans. Also, requires three-year phase-out of prepayment penalties for qualified mortgages and prohibits offering loan with a prepayment penalty without offering loan that does not have prepayment penalty.

Average Prime Offer Rate (APOR) – Means the average prime offer rate for a comparable transaction as of the date on which the interest rate for the transaction is set, as published by FRB.

Arbitration – Prohibits mandatory arbitration for residential mortgages and open-end consumer credit secured by principal dwellings, except on reverse mortgages.

HOEPA Expansion – Expands coverage of HOEPA and its restrictions governing high-cost mortgages to purchase mortgages. Also lowers the APR triggers to cover loans with an APR more than 6.5 percent above comparable APOR for first lien loans (8.5 percent if the dwelling is personal property and transaction is less than $50,000) and 8.5 percent above for subordinate loans. Also, lowers point and fees trigger from 8 percent of the total loan amount to 5 percent (the lesser of 8 percent or $1000 for loans under $20,000).

Servicing – Requires escrows for certain mortgages and new escrow disclosures, shortens time frames for qualified written requests, establishes timelines for pay-off statements and crediting of payments, and limits late fees for high-cost mortgages. Requires monthly statements on ARM loans. Establishes new requirements for force-placed insurance including notices to borrower. Expands scope of Protecting Tenants at Foreclosure Act.

Counseling – Establishes Office of Housing Counseling within HUD headed by Director to carry out wide range of counseling related activities including research, public outreach and policy development as well as coordinating and administering HUD counseling related programs.

Reach of Bill – The bill directs certain provisions to all residential mortgage loans and other provisions to specified categories of mortgages, defined below, which include “qualified mortgages,” “not qualified mortgages,” “higher risk mortgages,” and “high-cost” or “HOEPA mortgages.”

Regulatory Authority – Provisions assign regulatory authority to FRB, CFPB, federal banking agencies – FRB, OCC, FDIC and NCUA–and other agencies under various sections of bill. Provisions assigned to FRB under title XIV are reassigned to CFPB, except for provisions relating to housing counseling and certain appraisal-related matters. Assigns HUD regulatory responsibility for housing counseling provisions.

Important announcement GMAC R E is now Real Living

Greetings, from Marcelo Parada:

I have the pleasure of announcing that GMAC Real Estate has combined with Real Living Real Estate to create a new residential Real Estate leader for the 21st century. The Real Estate industry was and is changing and Real Living is the new face of the industry and is poised to become one of the largest residential Real Estate companies in America.

Real living is bright, innovative and developed a package of services unparalleled in the industry, Real Living works closely with its brokers and agents to develop the tools and provide strategies that lead to growth.

This new name will help agents and brokers to use the modern tools, technology, training and strategies so we can serve you better.

Our new name, Real Living Evergreene Properties will help us to continue to serve our clients as we have over the years, we will work extra hard to maintain our current customer service rating of 97.45%. The office staff has not changed and is and will be always available to serve and help our clients.

My contact information has not changed, I can be reached at:

Office: 703-444-5454
Cellular: 703-798-8034
Efax: 703-552-1576
Emails: imarcelop@yahoo.com marcelo@marceloparada.com
Blog: http://wwww.marceloparada.com

Respectfully

Marcelo Parada
Realtor

How I survived the tough times

Remember when you were a little child trying to learn to walk? Maybe not, but I’m pretty sure it went something like this:

First you had to learn to stand: a process involving constantly falling down, then getting back up. You laughed sometimes and cried at other times. Somehow there was a determination and conviction that you would succeed, no matter what.

After much practice you finally figure out how to balance yourself, a necessary requirement. You enjoyed this new feeling of power – you’d stand everywhere you could – in your crib, by the couch, on someone’s lap. It was a joyous time – you did it! You were in control of you.

Now – the next step – walking. You’d seen others do it – it didn’t look that hard – just move your legs while you were standing, right? Wrong – more complexity than you ever imagined. More frustration than anyone should have to deal with. But you tried, again and again and again until you figured this out, too.

If people caught you walking, they applauded, they laughed, it was a, “Oh my God, look at what he’s/she’s doing”. This encouragement fueled you on; it raised your self-confidence.

But how many times did you attempt when no one was watching, when no one was cheering? Every chance you got. You had places to go, things to see, knowledge to learn. You couldn’t wait for someone to encourage you to take the next steps. You learned how to encourage yourself.

If we could only remember this about ourselves in today’s day.

Remember that we can do anything we set our minds to if we are willing to go through the process, just like when we learned to walk. We don’t need to wait for others to encourage us; we need to encourage ourselves.

If you’ve forgotten how to do this, or feel like your self-esteem needs a boost, take a short journey back through the your life – look at your accomplishments, no matter if they were large or small – you met the challenge and figured out a way to succeed.

Focus on all the things you thought you could never do, initially, and did. While going back, look for the little child you once were. Thank them for never giving up. As you wave goodbye, remember they will never give up on you. They have believed in you all of your life!

Now you need to believe in you too!

“Remember, today is the best day of your life because yesterday was and tomorrow may only be.”

Things not to do on facebook

7 Things to Stop Doing Now on Facebook
by Consumer Reports Magazine
Wednesday, May 12, 2010
provided by

Using a Weak Password

Avoid simple names or words you can find in a dictionary, even with numbers tacked on the end. Instead, mix upper- and lower-case letters, numbers, and symbols. A password should have at least eight characters. One good technique is to insert numbers or symbols in the middle of a word, such as this variant on the word “houses”: hO27usEs!

Leaving Your Full Birth Date in Your Profile

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It’s an ideal target for identity thieves, who could use it to obtain more information about you and potentially gain access to your bank or credit card account. If you’ve already entered a birth date, go to your profile page and click on the Info tab, then on Edit Information. Under the Basic Information section, choose to show only the month and day or no birthday at all.

Overlooking Useful Privacy Controls

For almost everything in your Facebook profile, you can limit access to only your friends, friends of friends, or yourself. Restrict access to photos, birth date, religious views, and family information, among other things. You can give only certain people or groups access to items such as photos, or block particular people from seeing them. Consider leaving out contact info, such as phone number and address, since you probably don’t want anyone to have access to that information anyway.

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Posting Your Child’s Name in a Caption

Don’t use a child’s name in photo tags or captions. If someone else does, delete it by clicking on Remove Tag. If your child isn’t on Facebook and someone includes his or her name in a caption, ask that person to remove the name.

Mentioning That You’ll Be Away From Home

That’s like putting a “no one’s home” sign on your door. Wait until you get home to tell everyone how awesome your vacation was and be vague about the date of any trip.

Letting Search Engines Find You

To help prevent strangers from accessing your page, go to the Search section of Facebook’s privacy controls and select Only Friends for Facebook search results. Be sure the box for public search results isn’t checked.

Permitting Youngsters to Use Facebook Unsupervised

Facebook limits its members to ages 13 and over, but children younger than that do use it. If you have a young child or teenager on Facebook, the best way to provide oversight is to become one of their online friends. Use your e-mail address as the contact for their account so that you receive their notifications and monitor their activities. “What they think is nothing can actually be pretty serious,” says Charles Pavelites, a supervisory special agent at the Internet Crime Complaint Center. For example, a child who posts the comment “Mom will be home soon, I need to do the dishes” every day at the same time is revealing too much about the parents’ regular comings and goings.

Consumer Reports has no relationship with any advertisers on Yahoo!

Copyrighted 2009, Consumers Union of U.S., Inc. All Rights Reserved.

FICO Credit scores good info

The FICO 5: The Components that Make Up a FICO Credit Score
by Jeremy M. Simon
Monday, April 19, 2010
provided by

Payment history and debt total are important parts but not the only factors.

In the land of credit scores, FICO is king. The bulk of banks in the United States use FICO scores to decide whether to offer credit to potential borrowers and at what interest rate. FICO has a major global presence, as well: According to the company’s testimony before a House Financial Services Committee, FICO scores are used in about 10 billion decisions worldwide each year.

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So how does FICO come up with its widely used score?

While the inner workings of the FICO scoring system are a closely guarded secret, the company is open about the general components of a FICO credit score. Using the information in a borrower’s credit report, FICO breaks that information into categories. Those five components each get different weights. “FICO scores give the most attention to how you have paid back lenders in the past and how much you are using of the credit available to you, as shown on your credit report. Those two factors contribute roughly two-thirds of a typical person’s FICO score,” says FICO spokesman Craig Watts.

Here’s a breakdown of the five elements of the FICO score:

1. Payment History: 35 Percent of the Total Credit Score

Based on a borrower’s payment history, making the repayment of past debt the most important factor in calculating credit scores. According to FICO, past long-term behavior is used to forecast future long-term behavior.

FICO keeps an eye on both revolving loans — like credit cards — and installment loans, such as mortgages or student loans. Although the weight of each loan varies between individuals, FICO indicates that defaulting on a larger installment loan like a mortgage will damage a credit score more severely than defaulting on a smaller revolving loan. One of the best ways for borrowers to improve their credit score as a whole is by making consistent, timely payments.

CreditCards.com

2. Debt Amounts — 30 Percent

Based on a borrower’s total outstanding debt. Revolving lines of credit, which allow a consumer to borrow as much or as little as desired up to a limit (versus installment loans where a set amount — say, $20,000 plus interest for a car — is determined at the outset), are more heavily weighted. Credit cards are a type of revolving account.

Since FICO views borrowers who habitually max out credit cards — or who get very close to their credit limits — as people who cannot handle debt responsibly, a borrower should maintain low credit card balances. Experts recommend that the amount owed should not exceed 30 percent of the individual’s credit limits. That 30 percent rule of thumb applies to each individual credit card as well as the overall level of debt.

The final components of a FICO credit score get less weight in the score’s calculation. “The remaining one-third of your score is determined by how long you have managed credit, to what degree you have pursued new credit recently and the variety of credit types you have successfully handled,” Watts says.

3. Length of Credit History — 15 Percent

Based on the length of time each account has been open and the length of time since the account’s most recent action.

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As a result, it is impossible for a person who is new to credit to have a perfect credit score. A longer credit history provides more information and offers a better picture of long-term financial behavior. Therefore, to improve their credit scores, individuals without a history should begin using credit, and those with credit should maintain longstanding accounts.

4 and 5. New Credit and Credit Mix — Each Comprise 10 Percent

Borrowers, even those new to credit, should avoid opening too many credit lines at the same time, since such behavior could suggest they are in financial trouble and need significant access to lots of credit. FICO suggests that borrowers only take on additional credit when they must have it or when it makes sense financially.

Credit mix, meanwhile, is somewhat of a vague category, but experts say that repaying a variety of debt indicates the borrower can handle all sorts of credit. According to FICO, historical data indicates that borrowers with a good mix of revolving credit and installment loans generally represent less risk for lenders.

Knowing the various weights given to components of a FICO credit score give borrowers a better idea where to focus their attention. “So to get a good score you mostly need a credit history with no reported late payments, as well as low reported balances currently on any credit cards,” Watts says.

Do we really need detergent for laundry? You’ll be surprised with the answer

Do-It-Yourself Laundry Detergent
by Stacy Johnson
Tuesday, April 20, 2010
provided by

While having clean clothes is obviously both hygienic and neighborly, how they get that way may be more open to imagination and experimentation than you may have considered. And consider you should, because as it turns out, the companies supplying the soaps you use to make your attire springtime fresh may be doing little more than taking you to the cleaners.

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According to soap super-seller Proctor and Gamble (their Tide label alone accounts more than 40% of all laundry detergent used in the U.S.) Americans are doing 1,100 loads of laundry every minute of every day. And it’s certainly possible that, thanks to new concentrates, many of those loads feature too much detergent.

As you’ve probably noticed, the latest twist in detergent is to sell us less product at a higher price with “ultra-new-and-improved” concentrates. “Use less soap, save the planet” is the basic idea. But smaller quantities mean more precise measuring is needed: fail to pay attention and you’ll pour too much, which doesn’t help the earth or your budget … but does benefit Proctor and other purveyors of these products.

To read more about the conflict over exactly what kind of green concentrated laundry detergents are really designed to produce, check out this article from the Wall Street Journal.

Then consider this dirty little secret the suds salesmen don’t want you to know: Some people get by with no detergent at all. Many others save 90% of the cost of store-bought by making it themselves.

Is Detergent Even Necessary?

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I recently did a TV news story showing people how to make their own laundry detergent for a fraction of the cost of store bought. (It’s right here on Yahoo!: check it out.)

As I said in my story, while it may sound impossible, laundry detergent may not even be necessary at all. The blog Funny about Money decided to forgo it completely as part of an experiment. Here’s a quote:

“By and large, all of the freshly washed clothing came out with an odor: It smelled of clean water!”

You might be surprised to learn that, while clothing has been around since the fig leaf, laundry detergent is relatively new. And yet, ancient people were presumably able to make their clothing at least somewhat clean. How?

As it turns out, something that may be even more effective than soap is agitation. Ancient people used rocks and rivers, but your modern washing machine can clean lightly soiled clothes by just pushing them around in water.

In other words, people actually do get away without using detergent at all. But if the idea of using nothing more than water to wash your gym socks sounds a little scuzzy, not to worry. You can still wring significant savings from your laundry money by making your own detergent. It’s not hard.

The Recipe

A quick search online will show you that there’s no shortage of homemade laundry soap recipes: Here’s one from The Simple Dollar. And we’ve got 10 more at Money Talks News. But below is one that seems to work pretty well. You’ll need:

• 4 cups of water.
• 1/3 bar of cheap soap, grated.
• 1/2 cup washing soda (not baking soda).
• 1/2 cup of Borax (20 Mule Team).
• 5-gallon bucket for mixing.
• 3 gallons of water.

First, mix the grated soap in a saucepan with 4 cups of water, and heat on low until the soap is completely dissolved. Add hot water/soap mixture to 3 gallons of water in the 5-gallon bucket, stir in the washing soda and Borax, and continue stirring until thickened. Let the mix sit for 24 hours, and voila! Homemade laundry detergent.

Of course, who’d post a recipe without trying it out first? I made and washed several loads of clothes with the homemade detergent. And I, like many before me who’ve traveled this road, couldn’t tell the difference between store-bought and homemade.

Total cost per load? In the neighborhood of 2 cents. Store-bought detergent, depending on what you buy and where you buy it, can cost about 20 cents per load — 10 times more.

So, there are at least two alternatives to the agitation of paying too much for laundry detergent: Ditch it altogether and use nothing more than water in your washer, or save to 90% by making your own laundry detergent.

And here’s a final idea for those who, like me, are unlikely to choose either of those options. Since doing this story, I haven’t started making my own laundry detergent. I still use the same store-bought concentrate I started with. But I’ve started using half the amount. Result? No difference at all that I can detect. Now we’re really talking green.

Maybe it’s time we all laundered a little money

Now this is honesty

Davis calls penalty on himself, gives up shot at first PGA win
By Jay Busbee

Follow Yahoo! Sports’ Devil Ball Golf on Facebook and Twitter.

Imagine standing on the edge of achieving your life’s dream. You make a small mistake that will cost you your dream — but if you don’t say anything, you might just get away with it. Would you own up to the mistake, or would you keep quiet and hope for the best?

Brian Davis isn’t the best-known name in golf — or even the hundredth-best-known — but after Sunday, he ought to move up the list a few notches. Davis was facing Jim Furyk in a playoff at the Verizon Heritage, and was trying to notch his first-ever PGA Tour win.

Davis’s approach shot on the first hole of the playoff bounced off the green and nestled in among some weeds. (You can see the gunk he was hitting out of in that shot above.) When Davis tried to punch the ball up onto the green, his club may have grazed a stray weed on his backswing.

So what’s the big deal? This: hitting any material around your ball during your backswing constitutes a violation of the rule against moving loose impediments, and is an immediate two-stroke penalty. And in a playoff, that means, in effect, game over.

Okay, you can think that’s a silly penalty or whatever, but that’s not the point of this story. The point is that Davis actually called the violation on himself.

“It was one of those things I thought I saw movement out of the corner of my eye,” Davis said. “And I thought we’d check on TV, and indeed there was movement.” Immediately after the shot, Davis called over a rules official, who conferred with television replays and confirmed the movement — but movement which was only visible on slow-motion. Unbelievable.

As soon as the replays confirmed the violation, Davis conceded the victory to Furyk, who was somewhat stunned — but, make no mistake, grateful for the win.

“To have the tournament come down that way is definitely not the way I wanted to win,” Furyk said. “It’s obviously a tough loss for him and I respect and admire what he did.”

Furyk took home $1.03 million for the win. Davis won’t exactly have to beg for change to get a ride home; he won $615,000 for second place. And he may have won much more than that by taking the honorable route.

To be sure, this isn’t quite in the same category as J.P. Hayes, the golfer who disqualified himself from qualifying school after learning — in his hotel room, all alone — that he had played a nonqualifying ball; or Adam Van Houten, who cost his team an Ohio state title when he admitted signing an incorrect scorecard. For starters, Davis’s shot was on television, and while he could have “not noticed” the movement, the TV cameras still did, and someone might have called him on it later on.

But the bigger deal is this — the guy gave away a chance at winning his first-ever PGA Tour event because he knew that in golf, honesty is more important than victory. It’s a tough lesson to learn, but here’s hoping he gets accolades — and, perhaps, some sponsorship deals — that more than make up for the victory he surrendered.

Cities going from bad to worse

Economic indicators in these metros have gone from bad to worse, with no sign of recovery.
Miami boasts a popular South Beach club scene, Art Deco Architecture, and perhaps the best Cuban food in the country. But residents don’t have much else to celebrate.

More than three years after the economy started its downward slide, the Miami metro area, like a handful of Sun Belt cities, still hasn’t begun to recover. Median home prices in Miami have fallen 38% since its market peaked in the second quarter of 2007; the city’s 11% unemployment rate is above the national average and has grown more than most of the 40 cities we surveyed.

List: 10 U.S. Cities In Free Fall
Cities in the “Sand States” of Florida, California, Arizona and Nevada, where overbuilding was rampant, are also in trouble, claiming nine of the top 10 spots in our list of cities in free fall. In Las Vegas, Riverside, Calif., and Phoenix, median home prices have fallen 50%, 44% and 37% from their respective peaks. Jobs are vanishing. Though country-wide, employers added 162,00 jobs last month, Riverside gained 13% fewer jobs in February 2010 (the latest numbers available by metro) than it did the same month three years earlier. Tampa, Fla., saw a 10% drop, and Los Angeles added 9% fewer jobs over the same time period.

These cities are also slow to absorb their glut of unsold foreclosed homes, keeping recovery at bay.

“These were highly speculative housing markets,” says Jonathan Miller, president of Miller Samuel, a Manhattan-based real estate appraisal firm. “In the markets that have unloaded a lot of foreclosed housing stock there’s still a lot more coming.”

Behind the Numbers
To find the country’s cities in free fall, we rated its 40 largest Metropolitan Statistical Areas (MSA) on six metrics.

We ranked each MSA on the percent its median home price has fallen since its individual peak, using data provided by Local Market Monitor, a housing market data tracker. To get an estimate for the number of new homes being built, we used data from the U.S. Census Bureau, which tracks how many building permits are issued. Roughly 98% of these permits become new home starts. We looked at the percent change in new building permits between February 2007 and February 2010.

We also wanted to know how many people were moving in and out of these metros, since a growing population buoys a local economy. We used the Census Bureau’s most recent population estimates to rank each metro on its net population change between July 2006 and July 2009. To judge each city’s productivity we also ranked each metro on its per capita gross domestic product in 2008, the most recent year available, using data from Moody’s Economy.com. Finally, we ranked the metros on the percent change in unemployment between January 2007 and January 2010 and the number of jobs they added between February 2007 and February 2010, with data from the Bureau of Labor Statistics. We averaged these rankings to arrive at a final score.

Sunshine State Stagnancy
Florida cities dominate our list, with Tampa, Orlando and Jacksonville joining Miami. Florida’s real estate market keeps falling even as some herald the start of a rebound. The state’s comparatively sluggish foreclosure process keeps those homes from getting easily flushed out of the market. Because every foreclosure must be approved by a judge, the procedure takes a minimum of five months to complete.

“In states with complex foreclosure laws, the recovery is clearly being delayed,” says Mike Simonsen, CEO of Altos Research, a Mountain View, Calif.-based real estate research firm, who adds that lengthy foreclosures may be driving away real estate investors in these cities.

A Trouble Spot in the Northeast
Picturesque Providence, R.I., is the only New England metro on our list. Economically, it’s struggling far more than other cities in the region. Although Providence saw a slower three-year increase in unemployment than some other major metros, it still has a high unemployment rate, at 14%. The city also added 9% fewer jobs in 2010 than three years earlier. Workers are getting the message and leaving town. Providence is the only city in our top 10 to see a net loss in population.

Grim News for the Golden State
California cities are struggling too. Riverside, Los Angeles and Sacramento are suffering because of the knocks they took after their inflated housing markets began to plummet. Unemployment in the City of Angels has nearly tripled in three years, to 12%. Riverside’s unemployment has also ballooned, to 15%. Meanwhile Sacramento saw a 75% drop in new building permits. These are troubling signs for Cali metros, but not surprising. The end of the state’s home-price climb triggered more than just a housing slump.

“In California, so many jobs were concentrated in construction,” says Michael Fratantoni, vice president of research at the Mortgage Bankers Association, the professional association for real estate financiers. “Jobs building single family homes wound up not being sustainable, and there were a lot of job losses.”

The long-term consequences of the housing crash in these cities are still playing out, and new factors that complicate a recovery keep cropping up.

“Places like Phoenix and Riverside may take even longer to recover because people might just pick up and leave to go to places doing better,” says Fratantoni. “It may make more sense to leave, rather than wait for jobs to return.”

Top 5 Cities in a Free Fall
1. Miami-Fort Lauderdale-Pompano Beach, FL
Net Population Change, 2006-2009: 1.47%
Per Capita Gross Domestic Product: $42,645.52
Change in New Building Permits, February 2007-February 2010: -77.46%
Change in Unemployment, January 2007-January 2010: 202.70%
Change in New Jobs Added, February 2007 – February 2010: -9.68%
Change in Median Home Price from Market Peak: -38%

2. Tampa-Clearwater, FL
Net Population Change, 2006-2009: 2.33%
Per Capita Gross Domestic Product: $42,562.92
Change in New Building Permits, February 2007-February 2010: -44.18%
Change in Unemployment, January 2007-January 2010: 235.90%
Change in New Jobs Added, February 2007 – February 2010: -9.87%
Change in Median Home Price from Market Peak: -32%

3. Riverside-San Bernardino-Ontario, Calif.
Net Population Change, 2006-2009: 4.40%
Per Capita Gross Domestic Product: $32,403.49
Change in New Building Permits, February 2007-February 2010: -65.69%
Change in Unemployment, January 2007-January 2010: 177.78%
Change in New Jobs Added, February 2007 – February 2010: -12.94%
Change in Median Home Price from Market Peak: -44%

4. Jacksonville, Fl.
Net Population Change, 2006-2009: 3.83%
Per Capita Gross Domestic Product: $16,035.65
Change in New Building Permits, February 2007-February 2010: -66.09%
Change in Unemployment, January 2007-January 2010: 227.03%
Change in New Jobs Added, February 2007 – February 2010: -7.74%
Change in Median Home Price from Market Peak: -23%

5. Phoenix-Mesa-Scottsdale, AZ
Net Population Change, 2006-2009: 7.85%
Per Capita Gross Domestic Product: $40,870.16
Change in New Building Permits, February 2007-February 2010: -83.61%
Change in Unemployment, January 2007-January 2010: 148.65%
Change in New Jobs Added, February 2007 – February 2010: -10.01%
Change in Median Home Price from Market Peak: -37%

Click here to see the full list of Ten U.S. Cities In Free Fall

Free treats and more for taxpayers

Smart Spending: Free treats and more for taxpayers
Smart Spending: Free or discounted cupcakes, ice cream, meals, coffee for taxpayers

Buzz up! 1126 Print

In this advertisement provided by McCormick & Schmick’s Seafood Restaurants, a Tax Relief Celebration for Tax Return Day, April 15, 2010, is shown.(AP Photo/McCormick & Schmick’s Seafood Restaurants)
Emily Fredrix, AP Retail Writer, On Wednesday April 14, 2010, 6:57 am EDT
NEW YORK (AP) — Few truths are more universal: No one likes to pay taxes, and everyone loves to get things for free.

Restaurants and other retailers are offering freebies to reduce people’s angst over their income taxes — which must be postmarked or e-filed by Thursday.

From cupcakes and pancakes to dinners and coffee, the offers are meant to help people feel better as they help companies drum up business. No paperwork or proof is required for most of the offers.

Ice cream chain MaggieMoo’s is giving away pieces of its new ice cream pizza in its second annual tax day giveaway. The company won’t say what it cost to give away thousands of free scoops of ice cream at its 160-plus stores in 2009, but a spokeswoman says such promotions bring in new guests and new sales.

“They’ll have free ice cream and then they’ll get a drink or a smoothie or something else or take home an ice cream pizza,” says Jenn Johnston, senior vice president of marketing for NexCen Franchise Management, the parent company of MaggieMoo’s, Pretzel Time, The Athlete’s Foot and other chains.

Here are some of the freebies and discounts on offer for tax season 2010.

— FREE COFFEE AND TREATS

CINNABON: Get two free bite-sized cupcakes from 6 p.m. to 8 p.m. Thursday at participating mall locations as part of “Tax Day Bites!” Flavors include Chocolate Passion, 24-Carrot Cake, Vanilla Bliss and Cinnacake Classic.

MAGGIEMOO’S: Get one free slice of ice cream pizza — ice cream with red frosting to look like sauce and white chocolate to look like cheese — at participating locations from 3 p.m. to 7 p.m. Thursday.

STARBUCKS: Get free brewed coffee all day Thursday if you bring your own mug, a promotion the cafe chain says is friendly to the environment as well as taxpayers.

— DISCOUNTED MEALS

BOSTON MARKET: For a “last-minute tax break” — one free meal for each one you buy Thursday through Sunday — show this coupon: http://bit.ly/d1YlRO

IHOP: Expanding on the tax deduction parents get for kids, the restaurant chain is offering free dinner for one child age 12 or younger with each adult meal purchased 4 p.m. to 10 p.m. all month long.

MCCORMICK & SCHMICK’S: The seafood restaurant is offering $10.40 dinner and drink specials in the bar on Thursday — a nod to the 1040 tax form. Bar guests who come in April 15 also receive a $10.40 gift certificate for a later visit. And professional tax preparers, who may have to work right until the midnight deadline Thursday, get their freebie Friday: dessert on the house plus a $10.40 certificate if they show a business card.

P.F. CHANG’S: Get 15 percent off food purchases for dine-in or take-out, excluding alcohol and happy hour food and beverages.

— STRESS RELIEF

HYDROMASSAGE: Get a free massage Thursday through Sunday at participating locations. The mall-based massage chain suggests calling ahead to book an appointment. Find a location at http://www.hydromassage.com/taxday.