The latest version of MoneyToys™ Free Loan Calculator is new available for download from MoneyToys.com.

Version 5.0 adds the ability to calculate and compare two loans at once. For more information or to download this free, Windows-based loan calculator, visit the Free Loan Calculator web page at MoneyToys.com.

For more information: MoneyToys.com Free Loan Calculator

FHA Tightens Requirements for Home Buyers

CNN reports in “FHA loan requirements will make it harder to get mortgage” that the Federal Housing Administration (FHA) is tightening requirements for home buyers. While I can’t find anything about the changes on the FHA web site at www.hud.gov, the CNN article reports the FHA is taking the following steps:

• increase the up-front mortgage insurance premium from 1.75% to 2.25%.
• require home buyers to have a credit score of 580 or higher to qualify for the FHA’s 3.5% down payment program. If you do not qualify for the 3.5% down payment, you will pay at least 10%
• sellers can provide only 3% of a home’s price to home buyers to help with closing costs instead of 6% as in the past

Perhaps the most practical step the FHA is taking to help fix the mortgage maket is to seek legislative authority to require lenders to assume liability for all the loans they originate and underwrite.

In “Wall Street CEOs defend pay practices” you will read one of the best similes for what Goldman Sachs did when it sold mortgage-backed securities and then bet against them in the market.

Phil Angelides is Chairman of the Financial Crisis Inquiry Commission which is investigating the causes of the financial crisis of 2007–2010.

“I’m just going to be blunt with you,” Angelides told Lloyd Blankfein, CEO of Goldman Sachs. “It sounds to me a little bit like selling a car with faulty brakes and then buying an insurance policy on the buyer of those cars.”

DebtDasher, Personal Debt Management Software, is a new, debt consolidation calculator available from http://www.debtdasher.com

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DebtDasher, debt consolidation calculator for Windows®-based computers, is a comprehensive financial tool and includes the following integrated calculators:

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• Create a Budget Calculator

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One thing that concerns most people who live and work on Main Street is that Wall Street’s greed is sucking money out of small towns across America. After being bailed out by those who live on Main Street, Big Banks continue to flout the rules of fair play.

Just last week The Washington Post reported “AIG executives’ promises to return bonuses has been largely unfulfilled“. Today, one reads “GMAC Said to Discuss U.S. Aid Package of $3 Billion or More“, which would be a third bail out of GMAC, Inc. And just last week, reports surfaced that Citibank was able to buy it’s way out of TARP because the US Government granted it a $38 billion tax benefit, “The Mother of All Tax Breaks“!

If you have money in one of Wall Street’s banks, it’s clearly time to rethink where you keep it.

“Move Your Money: A New Year’s Resolution” describes a movement afoot in this country for people who live on Main Street to move their money home. Nearly every community in this country has one or more local, community banks or credit unions. Unlike Wall Street banks, community banks and credit unions tend to be very involved in their local communities. They make loans based on conservative lending standards and they tend to keep money in their community.

Learn more about this movement by reading “Move Your Money: A New Year’s Resolution” or by visiting the Move Your Money web site at: http://moveyourmoney.info/ The Move Your Money site has a video and a quick way to find financially sound community banks located near you.

If enough people do this, it may be the one thing that simultaneously helps your local community, sends a message to Wall Street and gets the attention of the U.S. Government.

Paul Farrell, of MarketWatch.com offers what may become the classic editorial indictment against Goldman Sachs. “Goldman’s secret moral pathology: 15 symptoms of a Wall Street disease destroying democracy and capitalism” details 15 ways Goldman may be ripping the heart out of the American financial system and the Federal government.

If you want to see an eye-opening, visual presentation of the spread of unemployment across the United States, take a look at “The Decline: The Geography of a Recession“.

It’s a perfect example of how a graphic presentation, in this case an unemployment map, can explain a phenomenon so much better than words.

Home Selling Calculator, $29.95 USD, has been updated to version 2.1. Home Selling Calculator, which shows how the time a house spends on the market impacts the net profit received by the home owner, accepts a homeowner’s financial values related to selling a home, calculates the monthly carrying costs and determines how long a house can stay on the market at a range of sales prices while allowing the seller to make a profit.

In a down market, determining a home sell price may require counter-intuitive thinking. While no home seller wants to start low because it is difficult to raise an asking price, it may be better to start with a lower asking price when selling into a slow market.

Home Selling Calculator shows clearly how these monthly carrying costs eat into expected profits from selling a house. While it will not tell a home seller what price to set on a house, it shows the consequences of carrying costs on the sales price over time compared to other sale prices.

Home Selling Calculator, 2.1, is Windows®-based and runs on Windows 2000, XP, and Vista. Home Selling Calculator includes a Home Inspection Form to help you understand what buyers may be looking for when they look at a house and a Mover’s To Do List which helps a home seller prepare for their move into another home.

Home Selling calculator may be purchased for $29.95 USD at http://www.homesellingcalculator.com. Site licenses and volume discounts are also available for real estate professionals. This release of Home Selling Calculator is a free update for registered users.

A fully-functional evaluation version of Home Selling Calculator may be downloaded from http://www.homesellingcalculator.com/home-selling-calculator-setup.exe.

Kudos to the U.S. prosecutors of financial crimes and to the agent who remembered wiretaps!

David Glovin, David Scheer and Bob Van Voris authored the article, “Galleon Insider Case Ushers in Wiretaps for Finance Prosecution“, for Bloomberg.com this morning. It tells the story of how U.S. prosecutors used wiretaps to gather evidence in an insider trading case against the founder of the hedge fund Galleon Group.

In the first sentence, the authors report U.S. prosecutors “said they will use similar tactics to fight future crimes on Wall Street.” But the kicker is this, “He (U.S. Attorney Preet Bharara) said the prosecution is the first time wiretaps have been used to target insider trading, calling the case “unprecedented.”

Hello?

That this is the first time prosecutors have used wiretaps against insider trading begs the question, “doesn’t a wiretap seem like an obvious tool for gathering evidence in insider trading cases?”

Those who lack integrity, possess insider information and are willing to share it are certainly crafty enough to know they can’t write it on paper or send it by email. Insider information is shared mouth to ear. It’s shared in the back seats of town cars. It’s shared over dinner. It’s whispered over the phone.

Of course, with the way the Feds are making a point of their new and unprecedented use of wiretaps, the fear of having one’s whisper numbers overheard by the FBI may help eliminate the sharing of insider information by phone.

It’s sad that it has taken all the way to 2009 for the Feds to use wiretaps against insider trading. Maybe the Madoff scandal was a wakeup call. However it happened, I’m glad the Federal prosecutors who battle financial crimes have discovered wiretaps.

I imagine those who share illegal financial information will wonder about every suspicious “click” in their phone calls. It may be more than a bad connection!

A common question in discounted cash flow analysis is, “What should I use for the discount rate?”

An easy answer is, “Ask your Chief Financial Officer (CFO) for the discount rate applicable to your particular capital budgeting project.”

However, you may be with a smaller company that has no CFO. Or perhaps you just want to use Discounted Cash Flow Analysis Calculator to play with a few ideas before you share them with others.

In either case, one of the best sources of information about discount rates is the Federal Reserve Bank of St. Louis’ Economic Research web site at: http://research.stlouisfed.org/fred2/categories/116

There you’ll find the current and historical Treasury Bill Rates for 1-Year Treasuries, 3-Month Treasuries, 4-Week Treasury Bills and 6-Month Treasury Bills. For each bill, you’ll find a historical chart (with recession bars, if you wish) and the latest reported observations. You’ll also find links to the FRED graphing tool. (And you’ll probably be surprised at how low the discount rates are in our current economic environment.)

For most discounted cash flow analysis, you will not go too far astray if you use the auction discount rate on the 6-Month Treasury Bills. That discount rate should approximate the rate of return your firm will receive on short-term investments. And that’s probably why you’re doing discounted cash flow analysis — to determine if your capital budgeting project will yield a better return than what you will earn by investing in an interest-bearing instrument instead.