Choose Your Monthly Mortgage Payments

Choose Your Monthly Mortgage Payments

Have you decided on a new home that you're going to make an offer on? Or maybe you are planning on refinancing an existing mortgage, and are deciding what you want your monthly mortgage payment to be. Choosing how much to pay each month is a good place to start. It's one of the first questions a car salesman will ask when you walk on to his lot, and with all the new types of mortgages, it's now a question that can be asked by many mortgage lenders.

Innovative mortgage products, sometimes called exotic mortgages, have features that allow borrowers to minimize their monthly payments early in the life of the mortgage in exchange for higher payments down the road. Most borrowers believe they will refinance their mortgage or move before those higher payments set in. However, a misunderstanding of the risks associated with these mortgages can lead to financial stress - or even disaster. (To read more about shopping for a house, see Understanding the Mortgage Payment Structure,Shopping For A Mortgage and Make A Risk-Based Mortgage Decision.)

Great Company Or Growing Industry?

Great Company Or Growing Industry?

It is no accident that companies within a particular industry move in lock-step with one another. Companies in a single industry are forever bound by the type of product or service that they provide, and they are constantly competing with one another for market share, consumer acceptance and technological leadership in their particular sub-sectors. These competitive and consumer forces shape an industry's corporations and determine the status of the industry as a whole. These forces have followed roughly the same patterns over time. Here we take a look at these stages and how they affect the companies that follow them.

Term of the Day... Risk

Risk

What Does Risk Mean?
The chance that an investment's actual return will be different than expected. This includes the possibility of losing some or all of the original investment. Risk is usually measured by calculating the standard deviation of the historical returns or average returns of a specific investment.

Many companies now allocate large amounts of money and time in developing risk management strategies to help manage risks associated with their business and investment dealings. A key component of the risk mangement process is risk assessment, which involves the determination of the risks surrounding a business or investment. 

Investopedia explains Risk
A fundamental idea in finance is the relationship between risk and return. The greater the amount of risk that an investor is willing to take on, the greater the potential return. The reason for this is that investors need to be compensated for taking on additional risk.

For example, a U.S. Treasury bond is considered to be one of the safest investments and, when compared to a corporate bond, provides a lower rate of return. The reason for this is that a corporation is much more likely to go bankrupt than the U.S. government. Because the risk of investing in a corporate bond is higher, investors are offered a higher rate of return.

Get a Tax-Smart Plan for In-Retirement Withdrawals

Get a Tax-Smart Plan for In-Retirement Withdrawals

Cramer's 'Mad Money' Recap: A Playbook for Market Insanity

Cramer's 'Mad Money' Recap: A Playbook for Market Insanity

NEW YORK (TheStreet) -- "We need a new playbook to deal with this roller coaster of a market," Jim Cramer told the viewers of his "Mad Money" TV show Wednesday.

He said investors can't afford to get caught up in the day-to-day gyrations of markets, they need to stick with stocks with great long-term secular growth stories.

According to Cramer, the markets have just gotten too hard for anyone other than the nimblest of day traders to tackle on a daily basis. He said that his viewers need to stick with stocks that are working, and that means stocks that are uniquely domestic, have strong growth, or do well when the rest of the market panics.

For example, Cramer said the generic drug makers, stocks like Teva Pharmaceuticals (TEVA), a stock which he owns for his charitable trust, Action Alerts PLUS, will do well in this market since governments are still trying to save on health care costs.

Term of the Day... Callable Security

Callable Security

What Does Callable Security Mean?
A security with an embedded call provision that allows the issuer to repurchase or redeem the security by a specified date. Since the holder of a callable security is exposed to the risk of the security being repurchased, the callable security is generally less expensive than comparable securities that do not have a call provision.

Investopedia explains Callable Security
The conditions of the call provision are established at the time the security is issued. Callable securities are commonly found in the fixed-income markets and allow the issuer to protect itself from overpaying for debt.

For example, a bond issuer may choose to redeem a certain issue when the current market rate falls below the coupon rate of the bond by a set amount. This allows the issuer to reissue the bonds at a lower rate and avoid paying a higher interest rate.

Vary Your Options With Variable Insurance

Vary Your Options With Variable Insurance

Traditional insurance and annuity products are rapidly becoming a thing of the past. While many traditional products still have their uses, a relatively new breed of insurance products in the marketplace contain features and riders that make even their recent counterparts look like ideas from the dark ages. In other words, say goodbye to limited choices, market risk, inflexible payout options and separate policies for each kind of risk.