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Fed keeps rate unchanged

Posted on August 3, 2018 at 4:40 PM Comments comments (0)

by Martin Crutsinger

Associated Press

WASHINGTON - The Federal Reserve on Wednesday left its benchmark interest rate unchanged while signaling further gradual rate hikes in the months ahead as long as the economy stays healthy. 

The Fed's widely expected decision kept the central bank's key short-term rate at 1.75 percent to 2 percent - the level hit in June when the Fed boosted the rate for a second time this year. 

The Fed projected in June four rate hikes this year, up from three in 2017. Private economists expect the next hike to occur at the September meeting with a fourth rate hike in December.

The Fed's statement was upbeat on the economy, pointing to a strengthening labor makret, economic activity growing at "a strong rate, and inflation that's reached the central bank's target of 2 percent annual gains.

Analysts saw all the comments about economic strength as a clear signal that the Fed remains on track to raise rates two more times this year.

All signs still point to a September rate hike," said Greg McBride, chief financial analyst at Bankrate.com. He said that consumers should continue to pay down their home equity, credit card and other loans with variable rates that will rise further as the Fed keeps hiking rates. 

"Refinance adjustable rate debt into fixed rates to insulate yourself from further rate hikes," McBride recommended. 

There was no mention in the statement of what many economists see as one of the biggest risks at the moment; rising tariffs on billions of dollars of U.S. exports and imports that have been imposed as a result of President Donald Trump's new get-tough approach on trade. 

The Fed statement also made no reference to criticism Trump has lodged recently agains the Fed's continued rate hikes. 

The Fed's decision was approved on a unanimous 8-0 vote. The action was not surprising, given that this meeting followed a June session where the Fed took a number of steps including raising rates by another quarter-point and changing its projection for hikes this year from three to four. 

Lincoln Journal Star 

Thursday, August 2, 2018                       

Report: Hiring issues increasing in Lincoln

Posted on August 3, 2018 at 3:55 PM Comments comments (0)

Companies having trouble filling jobs

by Matt Olberding

Companies in the Lincoln area are having more trouble filling jobs than they were just a few years ago, despite the fact that a perceived "skills gap" has improved. 

Those are two of the key findings of the "Lincoln Area Skills Gap Report" prepared by the Bureau of Business Research at the Univeristy of Nebraska-Lincoln. 

The report, written by Bureau Director Eric Thompson and released last month, found that more than 70 percent of employers in the Lincoln metro area reported having trouble hiring in the past year, up from 62.5 percent three years ago. 

That was despite a large decline in the percentage of companies that said they couldn't find candidates with the right skills. 

Nearly 42 percent of companies said their hiring troubles were due mainly to applicants lacking the right skills, which was down from 55 percent three years ago. 

The three other main hiring factors measured in the report all increased, however,. 

Nearly 30 percent of companies said applicant wage demands were too high, up from 26 percent in the previous report. 

Pat Haverty, vice president of the Lincoln Partnership for Economic Development, said he constantly hears from companies that competition for employees is fierce, and "that's driving up wages in the community." 

The number of companies citing poor work history among applicants rose from just more than 41 percent to nearly 45 percent, while those that reported applicants failed a background check rose slightly, from 22.5 percent to 23.3 percent. 

Thompson said in an email that he found it "notable that employer concerns with workforce quality such as work history and background checks are often as prominent as concerns about skill level." 

Most occupations, especially "white collar" ones, do not have a shortage of workers, according to the report. For example, just counting new college graduates, there are nearly twice as many candidates as there are jobs for business and financial services and nearly five times as many graduates as there are jobs in architecture and engineering. 

In fact, the report found that annually, there are about 9,320 job applicants in the Lincoln area and 7,260 open jobs. 

However, in blue-collar fields such as manufacturing, transportation and construction, there are fewer workers than there are jobs even when counting all available candidates, including people moving into the area from somewhere else.  

The report also shows worker deficits in fields such as food service and personal care. 

"It was notable that Lincoln appears to have enough new college graduates to meet entry-level job openings but a deficit of workers in many blue-collar and service occupations," Thompson said in an email. "In particular, there is a deficit in many skilled blue-collar accupations such as carpenters, mancinists and welders." 

It's not just companies having trouble finding workers.The report found that workers say they are having difficulties finding a job. 

Nearly 67 percent of local job seekers cited a lack of adequate opportunities, up from less that 62 percent, three years ago. Nearly 67 percent also cited inadequate pay, which was up from 64.4 percent. 

The job hurdle that saw the biggest jump was a lack of training, with 37 percent of job seekers citing it as an issue, up from 30.5 percent three years ago. 

When it comes to training, a large number of employers said they are training existing employees to fill highly skilled roles that will become vacant because of retirements, with 47 percent of companies reporting they are doing this versus only 14.5 percent reporting they are hiring new employees with the needed skills. 

"It was noteworthy that the vast majority of employers address skills lost due to impending retirements through retraining existing workers rather than hiring new workers," Thompson said. 

Lincoln Journal Star

Thursday, August 2, 2018

Health plans cheaper under administration rule

Posted on August 3, 2018 at 3:35 PM Comments comments (0)

However, the options could cover less, not provide some benefits. 

Ricardo Alonso-Zaldivar

Associated Press

WASHINGTON - Consumers will have more options to buy cheaper, short-term health insurance under a new Trump administration rule, but there's no guarantee the plans will cover pre-existing conditions or provide benefits like coverage of prescription drugs. 

Administration officials said Wednesday the short-term plans will last up to 12 months and can be renewed for up to 36 months. With premiums about one-third the cost of comprehensive coverage, the options is geared to people who want an individual health insurance policy but make too much money to qualify for subsidies under the Affordable Care Act. 

"We see that it's just unaffordable for so many people who are not getting subsidies and we're trying to make additional options available," said Health and Human Services Secretary Alex Azar. "These may be a good choice for individuals, but they may also not be the right choice for everybody."

Buyers take note: Plans will carry a disclaimer that they don't meet the ACA's requirements and safeguards. And there's no federal guarantee short-term coverage can be renewed. 

Democrats immediately branded Trump's approach as "junk insurance," and a major insurer group warned that consumers could potentially be harmed. Other insurers were more neutral, and companies marketing the plans hailed the development. 

It's unclear how much mass-market appeal such limited plans will ultimately have. 

Unable to repeal much of "Obamacare," the Trump administration has tried to undercut how it's supposed to work and to create options for people who don't qualify for financial assistance with premiums. 

Officials are hoping short-term plans will fit the bill. Next year, there will be no tax penalty for someone who opts for short-term coverage versus a comprehensive plan, so more people might consider the option. More short-term plans will be available this fall. 

Lincoln Journal Star 

Thursday, August 2, 2018

Goss: Recession is likely

Posted on August 2, 2018 at 11:55 AM Comments comments (0)

Creighton economist thinks it could happen by 2020

by Matt Olberding

A Creighton University economist is bringing up the dreaded "R" word. 

Ernie Goss, who is well known for his monthly surveys that measure economic conditions in the Midwest and Plains, said Tuesday that signs are starting to point to a possible economic downturn as early as late 2019 or eary 2020. 

"As the last recession showed us, it's very hard to predict the timing, but the U.S. economy is definitely headed toward higher rise," Goss said in a news release. 

He pointed to a number of troubling signs, including rising interest rates, trade tensions, rising inflation and the rising federal deficit as potential signs of a recession on the horizon. 

Trade tensions have been particularly concerning for Nebraskans, as China has raised tariffs on pork and soybeans in response to the U.S. imposing tariffs on $34 billion in Chinese goods earlier this month. 

"Those are two agriculture commodities where we've seen some significant declines in prices tied to trade tensions or tariffs,"  said Goss, who called the trade war a "clear and present danger to the overall U.S. economy."

Another potential economic warning sign is continually rising home prices, Goss said, although he noted that the price increases are becasue of constrained supply rather than out-of-control demand, which helped contribute to the housing bust that was a big contributor to the recession of 2007-2009. 

The Federal Reserve in June reported that home prices in Nebraska have risen 26 percent since 2008, which is more than the increase in all but four states and the District of Columbia during the same time period. 

In Lincoln, the median price of an existing home in the fist quarter was 36 percent higher than just five years ago, according to the Realtors Association of Lincoln. 

Goss said he expects "some of the air to come out of the bubble" in the housing market by late next year or early in 2020.  

Goss is joining a growing chorus of economists warning about a coming economic downturn. 

A May survey of economists done by the Wall Street Journal found that 81 percent expect a recession by 2021. 

Lincoln Journal Star

Wednesday, August 1, 2018

Top 10 Credit Score Myths - Busted!

Posted on July 31, 2018 at 3:55 PM Comments comments (0)

by Eagle Mortgage, Inc

Your credit score is one of your most powerful tools for planning your financial future - mostly because it determines the terms of loans like mortgages. 

Unfortunately, there's a lot of misunderstandings about FICO scores, and it can lead you to miss out on the benefits of your credit. 

Don't miss out! Read on to find out the truth about what affects your credit score, and to start reaping the benefits of your credit.

Myth #1 Checking Your Credit Lowers Your Score

There's a difference between you checking your credit and a creditor checking your credit. When you apply for credit, the creditor conducts a "hard inquiry" to review your rating. Only hard inquiries affect your score. Inquiries stay on your report for 24 months, but only the ones from the past 12 months affect your score. 

The good news is that one or two inquiries a year are nothing to worry about. But if you have been applying for credit or loans more than three times a year, it may start lowering your score. 

Myth #2 Your Debt-to-Income Ratio Affects Your Score

Debt-to-income ratio is the amount of monthly debt obligations, like car payments, compared to your monthly gross income. Credit bureaus don't have access to your income so there's no way for them to factor it into your score. DTI ratios are most ofen used to determine how much home you can afford. Considering this, it's a good idea to lower your debt to get a larger loan. However, when it comes to your credit score, your debt-to-income doesn't affect it. 

Myth #3 The Higher the Debt, The Lower the Score

Not all debt is the same! Debt from a mortgage, even a $300,000 mortgage loan, is considered "good debt" becasue a home is a financial investment. $15,000 credit card debt, on the other hand, is bad debt. 

Keep your credit balances low, preferably below 15% of the credit limits, and you'll be on your way to maintaining your FICO high. 

Myth #4 Paying Off Collections Raises Your Score

This one is surprising. Once a collection agency is involved, your score is going to take a major hit. Even after you pay off or settle the debt, the delinquency will still show on your report. The only way to remove it is by disputing it with all three major credit bureaus. It's not easy but worth the effort!

Myth #5 Your Credit Becomes Joint with Your Spouse When You Get Married

Getting married doesn't automatically include your spouse on your credit nor does it add you on theirs. If you want to be added to their account and possibly reap the benefits of their credit score, your spouse needs to call creditors to have them add you. 

Myth #6 A Better Job Means You'll Have a Better Score

Despite credit bureaus having your employers information, they don't have access to your salary or yearly income. So a better paying job won't affect your credit score. On the other hand, higher income could mean you can now pay down debt - and that definitely increases your credit score!

Myth #7 If You Don't Use a Credit Card, You Should Close It 

The longer yoru credit's open, the better it is for your score, so you never want to close credit cards. However, creditors may end up closing it if there's no activity so try to use it (and pay it off) every month to keep it open. 

Myth #8 Opening a Credit Card will Hurt Your Score

This myth is a little tricky. While opening a new credit account will make your score drop initially, it's only temporary. After a few cycles of payments, your credit will start to rise again and even improve from where it was in the first place. 

Myth #9 One Late Payment Won't Lower Your Score Much

Payment history is the most significant factor in your FICO score. Even just one payment that's late by 30 days lowers your score by 50 points or more. 

Don't let this happen to you! Set up a reminder or automatic payment schedule and avoid making this costly mistake. 

Eagle Mortgage

July 2018

Bankruptcy exemptions increased

Posted on July 31, 2018 at 3:50 PM Comments comments (0)

Sen. Lydia Brasch, LB105

Senators passed a bill Feb. 8 that expands bankruptcy exemption provisions that were last modified 20 years ago. 

LB105, introduced by Bancroft Sen. Lydia Brasch, increases the personal property exemption from $2,500 to $5,000 when filing for bankruptcy or resolving a creditor judgment. 

The bill additionally increases an exemption for household items from $1,500 to $3,000 and an exemption for business tools and equipment from $2,400 to $5,000. The bill also provides an exemption for a debtor's interest in a motor vehicle for up to $5,000.

The exemption limits will be adjusted for inflation every five years, beginning in 2023. 

The bill passed on a 47-0 vote. 

Unicameral update 

February 8, 2018

New TV Commercial on Channel 8

Posted on July 26, 2018 at 2:15 PM Comments comments (0)

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Traditional Credit Scores Still Matter

Posted on July 25, 2018 at 12:55 AM Comments comments (0)

By Liz Weston 


(AP) - Researchers and startups say all kinds of weird data can predict your creditworthiness. What kind of smartphone you have, who your friends are and how you answer survey questions may foretell how likely you are to pay back a loan. 

Don't expect this alternative data to displace the three-digit number most lenders use, however. Credit scores still matter - a lot. 

Lenders use credit scores to decide whether you get loans and credit cards, plus the rates you pay. Scores are also used to determine which apartments you can rent, which cell phone plans you can get and, in most states, how much you pay for auto and homeowners insurance. 

The central problem with credit scores is that they can't be generated unless people actively use credit accounts. Millions of people don't, but they still may be creditworthy. Alternative data is being used to sniff them out. 

What May Predict Your Risk of Default

Some U.S. lenders, for example, factor in how often people change addresses, how they pay noncredit bills such as rent or cell phone plans and how they handle their bank accounts. FICO, the leading credit scoring company, has found that people who have savings, maintain higher balances in their checking accounts and don't overdraft may be good credit risks. The company has created a new "opt in" score that would allow lenders with consumers' permission, to factor in bank account behavior when evaluating loan applications. 

In Russia, applicants can get loans based on answers to "psychometric" surveys that evaluate their verbal and arithmetical skills. Meanwhile, a study of a German e-commerce company's transactions found people's "digital footprints" - whether they use iPhones, have numbers in their email addresses or shop at night - can predict their risk of default. (if you're curious, iPhone users are less likely to default than Android users, while those who have email numbers or shop late are more likely to default, according to the study.)

Alternative Data Hasn't Displaced Credit Scores

Not all alternative methods will pass muster with regulators and gain widespread acceptance with lenders. Social media feeds, for example, showed some early promise, but enthusiasm for that idea waned once lenders considered the regulatory hurdles. 

"No bank wants to be tagged with 'they denied me because of my Twitter feed' regardless of how predictive it may be," says cred expert John Ulzheimer. 

Simlilarly, the credit scores of people in your household and in your social circle may predict how creditworthy you are, but mainstream lenders aren't likely to embrace scores based on other people's behavior. 

"Factors should be palatable and fair in addition to beiong predictive and compliant," says Ethan Dornhelm, FICO's vice president for scores and predictive analytics. "Saying 'You've got the wrong friends' - it doesn't sit well."

For Now, and The Foreseeable Future, Focus on Your Scores

Much of the research has found that alternative data works best when used in conjunction with, rather than as a replacement for, tradtional credit scores. So the best way to keep your financial options open remains the same: keeping your credit scores strong. That means you should: 

-Have Credit. If you're trying to build or rebuild your scores, consider a secured card that gives you a line of credit equal to the deposit you make with the issuing bank. Other options include a credit-builder loan from a credit union or online lender or being added as an authorized user to a creditworthy person's account. 

-Actively Use Credit. You don't need to carry a balance on your credit cards, which is fortunate: credit card debt is usually expensive and almost always unwise. But regularly using credit cards halps maintain your scores. So can paying installment loans, such as student loans, car loans and mortgages. 

-Avoid Using Too Much Credit. Maxing out your credit cards or applying for too many cards in a short period can ding your scores. The less of your credit limits you use, the better, even when you pay in full every month. 

The Daily Record

July 18, 2018 

ACLU starts bail fund for low-income inmates

Posted on July 16, 2018 at 4:25 PM Comments comments (0)

Program will help people who can't afford to bond out. 

by Lori Pilger 

The ACLU of Nebraska on Thursday formally launched a first-of-its-kind, six-month pilot project in Lancaster Coutny meant to help bond out low-income people siting in jail because they can't afford bail. 

  The Lancaster County Bail Fund is being funded by an anonymous local donor and will operate as a revolving fund that will post bail for individuals held pretrial in the county jail, the ACLU communications director Heidi Uhing said. 

She said when people who benefit from the bail fund appear for trial, the money is returned to the fund and recycled to help others. 

Danielle Conrad, executive director of ACLU of Nebraska, said the organization is following in the footsteps of successful, grass-roots activists who, with the support of local donors, are bringing attention to the "persistent and unfair modern-day debtors prison practices plaguing the capital city." 

Last year, Black Lives Matter groups raised more than $500,000 to bail out mothers in 20 cities on Mother's Day. Similar bail funds have been established in Brooklyn, Chicago, Nashville and Seattle. 

Said Conrad: "Far too many of our neighbors are languishing in county jails presumed innocent yet unable to afford to pay bail causing significant harm to their families, employment and our community at taxpayer expense with little to no benefit to our shared public safety goals." 

Lancaster County Attorney Pat Condon, whose deputies make requests about bond amounts to judges, said Thursday he isn't part of the program and doesn't tknow how the ACLU determines candidates for the money. 

"If we can ensure that these people come back to court, that's what we want," he said. 

Condon said so far most have been in misdemeanor county and city cases for things like property crimes or disturbing the peace. 

But, he said, he is a little concerned some chosen to get the money have a history of failing to appear for court and thinks they may not be motivated to show up because they, or a family member, aren't putting up their own money. Then, a warrant goes out, potentially taking up additional police resources to find them. 

"The reason we ask for these bonds is the history of their failures to appear, not because they're poor," Condon said. 

On the other side of court cases, Lancaster County Public Defender Joe Nigro said he supports a move to end the money bond system, which he says criminalizes poverty. He'd like to see a move to a system that relies on evidence-based risk assessments. 

"Whether or not someone has $500 does not make them more likely to come back to court, or less of a risk in the community. It just means they have $500," he said. "Our current system punishes the poor."

Nigro said one night in jail can mean the loss of a job, housing and custody of children. 

Larry Wayne of the Re-entery Alliance of Nebraska said when people are locked up with criminals, they learn more about criminal behavior. 

He said some people's crimes are just stupid mistakes, and they need a chance to turn their lives around instead of being dragged into a system thet causes themand their families financial hardship. 

"Instead of having people sit out their lives because they can't afford a few hundred dollars for bail, we should be reinvesting in programs to help those who need it and keep them out of criminal behavior," Wayne said. 

Taxpayers are needlessly paying up to $100 per day to jail people still presumed innocent, he said. 

"Ideally, judges would not be charging bail of those who cannot afford it. Until then, this bail fund will get people the resources they need so they can get back to their lives and be productive memers of society," Wayne said. 

Katrina Thomas, a community organizer at ACLU of Nebraska, said eveyone who they helped Thursday was grateful. 

One man asked whether this could really be happening, she said. Another teared up when Thomas told him he would be released. 

"He shook my hand, thanked me several times and told me I had no idea how much this means to him," Thomas said. 

He'd been sitting in jail for over a week becasus he didn't have $150 for bail, she said.

"As a formerly incarcerated individual, I know all too well the havoc and stress that being in jail can cause on a family and in one's life. Being able to bail people out thfrough the bail fund today was such a wonderful experience," Thomas said. 

In 2016, the ACLU published Unequal Justice, which reviewed current practices in Douglas, Lancaster, Sarpy and Hall counties, which they said illustrated racial disparities and a modern-day debtors' prison. 

Last year, state lawmakers passed debtors prison reform legislation, LB259, which directed courts to consider all methos of bond and conditions of release to avoid pretrial incarceration. But, the ACLU says, the form measures have not been implemented in daily practice. 

Lincoln Journal Star

July 13, 2018

Types of Debt

Posted on July 16, 2018 at 4:25 PM Comments comments (0)

There are several types of debt. A debt is just something that is owed or due, typically money.

The most common type of debts are either secured or unsecured. A secured debt is a debt that is secured or guaranteed by the lender taking an interest in an item of property, whether real or personal. Personal property is anything that is not real property. Real property is real estate. There are some ways personal property can become real property, but we’ll skip that for now. A secured debt means that if you default on payments, the lender can (and will) repossess, or foreclose on the collateral. Most commonly, these are home loans, car loans and furniture loans. Collateral is the item the debt is secured by. This means if you fail to pay the mortgage on your house, the lender-subject to state law procedures, can foreclose, or hold a trustee sale on the property, which entitles the lender to take the home from you. Similarly, if you default on a car loan, the lender can repossess the car-again, subject to state law procedures.

An unsecured loan is one that does not have a security interest in the collateral/thing. Commonly, unsecured debts would be credit cards, student loans and medical bills. Lenders who hold unsecured debts cannot immediately take any of your property, though they can (and will) file a complaint against you and obtain an order that gives them the ability to garnish your wages, or take your personal and real property to satisfy the debt.

John A. Lentz

July 16, 2018