Archive for July, 2009

Mortgage giant Fannie Mae issued new lending rules earlier this month that will make it harder for workers facing job-related transfers.

Job-related transfers typically involve one spouse who’s moving to stay with the company while the other spouse has to give up their current job and find a new one, often only after the move takes place. Under Fannie Mae’s new rules, the income potential of the “trailing” spouse will no longer be considered in the mortgage application, even if the second spouse is a high wage-earner. The result? Families transferring with their employers may have to trade down to less house than they were accustomed to based on two salaries, or they may end up having to rent.

In the past, lenders usually counted at least a portion of the trailing spouse’s income when processing the mortgage application, but they’ll do so no more, given the state of the economy and particularly the unemployment picture, the Washington Post reports.

More than 800,000 relocating families could be affected each year, according to Worldwide ERC.

Freddie Mac still factors in the trailing spouse’s income, but with strict limits; self-employment income can’t be included, and the trailing spouse’s income can’t represent more than 33% of the total qualifying income.

In addition to ending consideration of a trailing spouse’s income, Fannie Mae will also start relying less on the value of stocks, bonds and mutual fund investments as part of a mortgage applicant’s financial reserves, something that lenders routinely look at as part of the mortgage application review process.

Due to stock market volatility, the value of stocks, bonds and mutual funds that’s counted as part of the applicant’s financial reserves will now be discounted by 30%, while only 60% of the value of retirement accounts will be considered as part of the applicant’s financial reserves.

Do you think tighter lending standards could cause some couples to change their minds about a job-related relocation?

TJX Companies, parent company of clothing retailers T.J. Maxx and Marshall’s, will pay $9.75 million to 41 states to settle a case involving a huge data breach in 2005 and 2006 after computer hackers gained access to the credit and debit card account numbers of 50 million store customers.

The settlement comes just as most states are grappling with escalating budget deficits. You might think that this little windfall could be used to help save the job of a firefighter or two, or maybe get the potholes filled in your hometown. Alas, after deducting roughly $1.75 million for expenses incurred by the investigations of the 41 attorney generals and $2.5 million, which will go toward creating a data security fund for states, the actual settlement money heading toward the states is just $5.5 million, or about $134,000 per state, if the money were evenly divided. (It’s not.)

Oh, and the bad guys? Of the 11 people indicted, two pled guilty to the original charges, and two others have pled guilty to related charges. I guess that seems like a partial victory, but there are far too many scammers ready to take their place.

In April, I shared with you my ambitious plans for a vegetable garden and promised to keep you updated on how my own personal recession-buster project was progressing.

Thanks to an incredibly cool and rainy spring, we got off to a slow start, with practically every seed-sown crop failing to germinate. A five-foot row of snap peas produced maybe three plants that grudgingly emerged from the soil. The easy-as-can-be, cool-weather radishes seemed to flourish, judging by their leafy green tops. They’re quick growers, maturing in about 25 days, but when I pulled one after 30 days, there was no bulb, just a long, stringy-looking root. Week after week, I’d pull another “test” radish and get the same disappointing results. How embarrassing for a lifelong gardener. This past weekend, I saw the radishes were starting to go to seed, signaling the end of their lifespan. So I decided to rip them all up to make room for something else, and lo and behold, I got about a half-dozen radish bulbs!

I picked some red and green lettuce, along with baby spinach leaves (another very slow starter), and together with the radish tops, I marched into the house to make a salad on the spot. Those little radishes had none of the bitterness of store-bought varieties. They were quite mild and crunchy, not unlike a water chestnut.

So, back to the garden. The red potatoes are doing quite well, and I’ve already hilled them over (to prevent the tubers growing below from turning green) several times with pine mulch. Still, I have these nasty cutworms that mow down entire stems of potato plants overnight. I painstakingly covered the base of every stem with tinfoil, but still, those little suckers managed to get around it. That’s it. I’m getting diatomaceous earth, a natural dust made of crushed-up seashells. You spread it around your plants like a protective moat, and it’ll kill slugs and any other soft-bodies creatures that attempt a crossing.

I also see cucumber beetles are gnawing numerous tiny holes on the potato plant leaves, but I have plans for them, too. I’ve mixed a blend of onion, garlic, cayenne pepper and dish soap in water, and the pungent brown concoction, sprayed on my veggie plants, should act as a natural bug repellent. That is, if our torrential rains ever stop.

Yellow wax beans and string beans have emerged, but they, too, have been cruelly mauled by slugs, which I pick up and fling away when I find them. The garlic is growing like gangbusters, as are the tomatoes, which are sporting a few small blossoms. The bell peppers have been ravaged by what I suspect are slugs. Inexplicably, the zucchini, acorn squash and spaghetti squash seed I planted ages ago never germinated, so I replanted again yesterday, hoping there would still be enough time for the plants to mature.

I’m guessing the cold start to the growing season has also stymied other gardeners here in the Northeast. According to a Washington Post story, the demand for vegetable seed has skyrocketed this year, up 75% compared to last year at one longtime seed grower.  Contributing to the gardening mania are fears about salmonella outbreaks, rising food prices and concerns about pesticide use.

Some seed growers have even reported runs on certain staples, like beans, potatoes and lettuces, while certain varieties of other vegetables, like carrots, beets, onions and spinach, remain in short supply. Plants like melons, which require a lot of water and space, are not selling well.

My harvest to date? About three servings of lettuce greens with baby spinach and radishes. A paltry output, but hope springs eternal.

It’s a familiar scenario — a diligent, even workaholic, career-bent employee unexpectedly gets laid off from his job. Pity the poor jobless person who suddenly has nowhere to go and countless hours to scour want ads in her pajamas … right?

Wrong!

Get that image of a depressed and downhearted job seeker out of your mind.  Think about replacing it with a 30-something young woman relishing the ocean breezes while sipping a margarita.

Some laid-off employees, particularly those in their 20s and 30s, are quickly transforming sudden unemployment into “funemployment,” according to a June 4 Los Angeles Times story.  Others arrive at that happy state by voluntarily quitting their jobs.

While the “funemployed” may have outwardly appeared to adopt the work ethos of older generations who accepted the bonds and limitations of traditional employment, more young people today are skipping what they believe will be a fruitless job search and heading straight for the beach, golf course or travel abroad.

One young person interviewed by the Los Angeles Times put it this way:  “The rat race puts blinders on you and makes time fly, and then the next thing you know, you’ve missed the chance to be your more exciting self, or to push yourself in a gutsier direction.”

Instead of slinking away to a hole somewhere and expecting everyone to forget them, today’s unemployed often blog or twitter about their new lives of unemployment quite happily.  And instead of taking a temporary sabbatical from work, some people are opting out of the system entirely, with no desire to return to corporate America. (Of course, it helps if you have substantial savings or generous parents.)

Everyone deals with a crisis in their own way, and it seems to me that if you’re forced to deal with a layoff, it’s better to make the most of your newfound time instead of wallowing in self-pity. Still, if you’d prefer to return to the workforce as hastily as possible, we’ve got a 16-step guide to help you get back on course.