Looking for a Job? Apply at small businesses.

With folks loosing their jobs everyday, the cost of living increasing, the economy trying to improve, people are looking for better jobs or even just looking for a job for their livelihood.

Traditionally, we are taught to look at big companies since they give the impression of better stability, job security and better salary. Since 2008, we have learned otherwise. In fact big business have been cutting thousands, millions job due to poor financial performance, due to mismanagement or just to generate more profits. Big companies known as too big to fail have proven not to be as reliable for those seeking jobs or even their employees, since there is always a job cut cloud looming over their head.

While big companies have been focusing on cutting jobs, small businesses have been hiring workers. According to the labor department, small businesses added 3 million new jobs in the second quarter of last year which more than half of the new jobs. Let’s mention that small businesses only accounts for just 30% of all private sector jobs.

For those looking for new jobs, perhaps it will be best to also consider small businesses in your quest.

New banks ATM Giving out $5 and $1 bill

 

If you only have $9.00 in your account, chances are that you will not be able to take out from the ATM and it is embarrassing to the teller and ask to withdraw only $9.00 from your account when it is only what you have. In hard times, every penny is important to be able to face every struggle on your way. Banks are adjusting their strategies to attract more customers.

PNC and Chase are launching new ATMs machines that will customers to take as low as $1.00 out of the ATM. Chase is even pushing the envelop to allow customers to take even pennies from the ATM machines.

 "We are always looking for ways to upgrade our ATM network with new functions that will make banking easier for our customers," PNC spokesperson Marcey Zwiebel told TODAY.

The ATMs has already been installed at multiple locations as a test to better analyse the results. Happily for the banks, customers are using the new ATMs more and fewer customers are going into the banks for check cashing and to withdraw money. PNC and Chase are planning on doubling the new ATMs location by the end of the year.

Therefore, we can see how banks will be saving a lot of money on having those ATMs handling banking transaction instead of humans. The ATMs are able to cash checks, disburse from $1.00 bill to $100.00 bill in a single transaction. No need to go in the bank just go the drive through if you are in a hurry. The new ATM machines are able to handle most of the human tellers’ transaction. Thus we can foresee a reduction in human teller and more layoff in the future unfortunately.  We all love the ease that technology provides but yet we seem to be competing with it for our jobs.

New rules to make mortgages safer for borrowers

 We are all aware of the big housing mess that happened recently. Lending institutions offered mortgages to folks who they knew were not able to afford them. Lenders had little requirements when offering a mortgage such as low credit scores were ok, no down payments, and no due diligence to ensure borrowers could make payments. This reckless behavior inevitably caused many homeowners to be foreclosed on and as results, the economy took hit and big banks suffered as well.

In an effort to prevent such reckless behavior from the lenders and also from the borrowers, federal officials enabled a law to protect both borrowers and bankers as well.

They have defined what is called a qualified mortgage. What is a qualified mortgage?. The steps are used to judge whether a loan is qualified, lenders must consider these factors:

• Income and assets must be sufficient to repay the loan;
• Borrowers must document their jobs;
• Credit scores must meet minimum standards;
• Monthly payments must be affordable;
• Borrowers must be able to afford other debts associated with the property such as home equity loans;
• Borrowers must be able to afford all home-related expenses such as property taxes; and
• Lenders must consider a borrower's other obligations like student loans, car loans and credit cards.

If a borrower meets those guidelines, the mortgage payments cannot exceed 43% of the borrower’s pre tax income.

Once a borrower’s mortgage is deemed qualified and approved, the lender cannot be sued or be liable for any complication arising with the payments or mortgage.  For folks with high income, paying up to 43% of one’s income might not be a big issue but for folks making low income ( Ex: $2500 a Month, 43%= 1075 of the Pretax pay meaning the person will be left with $1425 before paying for income taxes and others).

Some consumer advocates are arguing that the new rules are meant to protect lenders more than borrowers.

Banks see the legal protection as a big win for them. 

This week alone 10 big banks settled to pay $8.5 billion to homeowners

Consumer credit rises for 4 consecutive months.

In November, Consumer credit rose for the 4^th consecutive month.

According to the Federal Reserve, consumer credit rose from $14.08 billion in October to  $16.05 billion in November.

The rise in consumer credit beat the street estimate of $12.75 billion.

The rise put the total outstanding consumer credit jumped 7% to $1.910 trillion in November.

With strong gain in the job market with 155,000 new jobs in December and a strong demand for students loan and car loan, economist are expecting the trend to continue into the early 2013. Consumer spending accounts for 70% of the US economy. Therefore, a rise in consumer borrowing power could help expand the US economy.

The report doesn’t track debt secured by real estate, such as home equity lines of credit and home mortgages.

“We’ve seen four straight months now of very significant increases in overall consumer credit,” Thomas Simons, a money market economist at Jefferies Group Inc. in New York, said in a phone interview. “I would expect that’s going to continue.

Revolving debt, which includes credit cards, rose by $816.9 million in November, after a $3.44 billion increase the prior month.

The government provided about $4.9 billion in loan mainly in education.

“People might be caught by surprise in January, when they see how much smaller their take-home pay is, and we might see some fuel for the consumer-credit number,” Englund said in a phone interview. “The likely pattern is that we will see some run-up in consumer credit for three or four months.”

10 Big banks announce a settlement of $8.5 billion to homeowners

10 major banks including JPMorgan Chase, Bank of America and Wells Fargo, will pay billions to homeowners to end a review process of foreclosure files that was required under a 2011 enforcement action. The settlement comes after a review on Banks’ handling of foreclosure documents showed that banks did not properly followed foreclosure procedures which resulted in a lot home being foreclosed and or homeowners having to pay high fees to the banks.

The banks settled to pay $8.5 billion to homeowners. Consumer advocates argue that banks got an easy bargain; since by paying $ 8.5 billion, they are avoiding paying a substantial amount of money to homeowners who were subject to the banks negligence and mishandling of the foreclosure documents and steps.

 The banks will pay about $3.3 billion to homeowners to end the review of foreclosures. The remaining $5.2 billion will be used to reduce mortgage bills and erase principal on home sales that generated less than borrowers owed on their mortgages.

Homeowners, who were denied a loan modification as a result of the malpractice, could receive small payments, while homeowners who lost their homes unfairly and then sold by the banks would be eligible for the biggest payments.

The deal "represents a significant change in direction" that ensures "consumers are the ones who will benefit, and that they will benefit more quickly and in a more direct manner," Thomas Curry, the comptroller of the currency, said in a statement. Diane Thompson, a lawyer with the National Consumer Law Center, complained that the deal won't actually compensate homeowners for the actual harm they suffered. The deal "caps (banks') liability at a total number that's less than they thought they were going to pay going in," she said

The company subject to the action include: Citigroup, MetLife Bank, PNC Financial Services, Sovereign, SunTrust, U.S. Bank ,Aurora, GMAC Mortgage, HSBC Finance Corp., EMC Mortgage Corp, including JPMorgan Chase, Bank of America and Wells Fargo.

 The settlement is separate from a $25 billion settlement between 49 state attorneys general, federal regulators and five banks: Ally, formerly known as GMAC; Bank of America; Citigroup; JPMorgan Chase and Wells Fargo

Let’s note that the settlement comes on the same day that Bank of America agreed to pay $11.6 billion to government-backed mortgage financier Fannie Mae to settle claims related to mortgages that went bad during the housing crisis, mostly loans issued by Countrywide Financial, now a BofA subsidiary

The new tax rates

 

With the deal reached by congress on the fiscal cliff, comes a new tax bracket. We do not have to worry ourselves with any sudden changes when filling our 2012 tax returns, but we might be noticing a slight change in our paychecks. In fact, the new changes will take effect on the income earn in 2013. The Bush-era tax cuts have been made permanent for individuals earning $400,000 or less and $450,000 or less for married people. Those making above 400,000 for individual and 450,000 for married, will be facing a slight increase in their taxes.

Below is a table highlighting the rates:

Rate	Single Filers	Married Joint Filers	Head of Household Filers
10%	$0 to $8,925	$0 to $17,850	$0 to $12,750
15%	$8,925 to $36,250	$17,850 to $72,500	$12,750 to $48,600
25%	$36,250 to $87,850	$72,500 to $146,400	$48,600 to $125,450
28%	$87,850 to $183,250	$146,400 to $223,050	$125,450 to $203,150
33%	$183,250 to $398,350	$223,050 to $398,350	$203,150 to $398,350
39.6%	$400,000 and up	$450,000 and up	$425,000 and up

The numbers are for marginal rates, it is always better to contact your tax advisor for your specific case.