Search found 899 matches

by cb474
Tue Mar 12, 2024 1:48 am
Forum: Personal Finance (Not Investing)
Topic: Form 1116: Why did CPA put "General Category Income" for mutual fund income?
Replies: 6
Views: 772

Re: Form 1116: Why did CPA put "General Category Income" for mutual fund income?

That's interesting news to me though because doing it as general income probably calculates a higher usable tax credit than passive, though I do not know this for sure. Some years I had trouble using all my credit Yeah, I think that's right. I read something in a different thread that seemed to suggest that. Maybe CPAs just always do it as general income, for this reason. I guess you could argue, if you don't know what the foreign tax rate was, on a mutual fund investment, then you may as well default to assuming it's higher than the US rate (if you're guessing, why not guess in your own favor?). Although I also read in another thread that the IRS always assumes, for this purpose, that the relevant US tax rate is the top tax braket (e.g. 3...
by cb474
Mon Mar 11, 2024 9:35 pm
Forum: Personal Finance (Not Investing)
Topic: Form 1116: Why did CPA put "General Category Income" for mutual fund income?
Replies: 6
Views: 772

Re: Form 1116: Why did CPA put "General Category Income" for mutual fund income?

I've always used passive income, but if that's what you see in the instructions, maybe I've been doing it wrong and would have been better off doing general I always use passive income for foreign income (ex-US equity ETF distributions). Thanks for the replies. @nalor511 What the instructions say that if the dividends, etc., were taxed at a higher rate in the foreign country than in the U.S. then it counts as general category income, even though it would otherwise be passive income. But, as I said, I have zero idea what the tax rate was on the distributions from Vanguard's International Growth fund. So I guess in theory it could go either way, but who knows which one is right. The taxes paid don't seem like that much relative to the amount...
by cb474
Mon Mar 11, 2024 9:03 pm
Forum: Personal Finance (Not Investing)
Topic: Form 1116: Why did CPA put "General Category Income" for mutual fund income?
Replies: 6
Views: 772

Form 1116: Why did CPA put "General Category Income" for mutual fund income?

I'm doing my mother's taxes for her, with TurboTax. She has some income, dividends and capital gains distributions, from Vanguard's International Growth fund (VWIGX). For form 1116, to take the foreign tax credit, TurboTax asks what the type of income one's foreign income is. Generally it would seem that income for a mutual fund like this would be considered "passive income," for the purposes of form 1116. But I noticed on my mother's prior year returns that her (now retired) CPA checked the box for "general category income." The only reason I can see to do this, in the form 1116 instructions, is that "high taxed income" can include passive income taxed at a higher rate than in the US and that bumps it into the...
by cb474
Tue Feb 27, 2024 8:14 pm
Forum: Personal Finance (Not Investing)
Topic: Turbotax, Sale of (sort of) inherited ETF shares, weird situation
Replies: 4
Views: 715

Re: Turbotax, Sale of (sort of) inherited ETF shares, weird situation

For inherited shares, the date acquired is ""INHERITED" on Form 8949 (See https://www.irs.gov/pub/irs-pdf/i8949.pdf page 5). The shares also get a LONG-TERM holding period. So using the Date of Death as the Date Acquired is probably going to be perceived as the shares are held short-term which might not be correct. Inherited shares get a cost basis of the average of the high and low price of the date of death, not the closing price. For mutual funds of course there is only one price per day, but not for ETFs. So I'm not sure the brokerage did what you said it did. I don't know how a "trust account" affects all this. That is, the shares may not have been community property. Thanks for the thoughts. Yes, I saw in the...
by cb474
Tue Feb 27, 2024 4:00 am
Forum: Personal Finance (Not Investing)
Topic: Turbotax, Sale of (sort of) inherited ETF shares, weird situation
Replies: 4
Views: 715

Re: Turbotax, Sale of (sort of) inherited ETF shares, weird situation

I'm not sure there is any problem. Turbotax is either going to ask for the basis of the shares, or the "DOD value of the shares". Both questions have the same answer. If the shares were sold after your father's death, you don't care how HE got them. In any case, your mother, or the trustee, sold them, not your father. Thanks for the reply. I guess that's part of my question. Does it matter how my father got the shares and the whole chain of custody, as it were, from my grandfather, to a joint account held by my parents, to a trust account, to a second trust account (same trust, new tax payer ID)? If it doesn't matter and the brokerage is reporting on the 1099-B the date acquired as my father's date of death and the cost basis as ...
by cb474
Tue Feb 27, 2024 3:11 am
Forum: Personal Finance (Not Investing)
Topic: Turbotax, Sale of (sort of) inherited ETF shares, weird situation
Replies: 4
Views: 715

Turbotax, Sale of (sort of) inherited ETF shares, weird situation

I'm helping my mother do her taxes and using TurboTax for the first time (I usually do my own taxes just filling out the forms from the IRS myself). So my question is in part about the sale of some ETF shares last year and partly about understanding why TurboTax is asking a specific question. But there are a couple twists, on what would be a totally straightforward thing on my own taxes. At the end of last year, my mother sold a small amount of shares of an ETF my parents held. A month prior my father had died. Because the ETF was held in a taxable trust account, a new account at the same brokerage had to be opened, with my mother as the sole surviving trustee, so that the tax payer ID number on the account could be changed to her (my fathe...
by cb474
Sat Sep 24, 2022 3:33 pm
Forum: Personal Consumer Issues
Topic: Vanguard website succumbs to "Fisher-Price" UI design
Replies: 843
Views: 112363

Re: Vanguard website succumbs to "Fisher-Price" UI design

I could actually live with a bad web site design. It's the loss of functionality and broken links that disturb me. What's next, incorrect balances? Since the only way we have to deal with Vanguard is via phone or electronic means, this raises the level of concern. Fidelity and TD Ameritrade both have 3 offices in my area that, if really necessary, I could walk into and get a problem solved. That's beginning to sound important to me. It wasn't important to me for the previous 31 years. Yeah, that's part of the thing for me. This update bespeaks of level of incompetence. Previous changes on the Vanguard website, in the direction of more white space, etc., I found annoying, but the website was still functional and not so substantially differe...
by cb474
Sat Sep 24, 2022 1:48 am
Forum: Personal Consumer Issues
Topic: Vanguard website succumbs to "Fisher-Price" UI design
Replies: 843
Views: 112363

Re: Vanguard website succumbs to "Fisher-Price" UI design

I could actually live with a bad web site design. It's the loss of functionality and broken links that disturb me. What's next, incorrect balances? Since the only way we have to deal with Vanguard is via phone or electronic means, this raises the level of concern. Fidelity and TD Ameritrade both have 3 offices in my area that, if really necessary, I could walk into and get a problem solved. That's beginning to sound important to me. It wasn't important to me for the previous 31 years. Yeah, that's part of the thing for me. This update bespeaks of level of incompetence. Previous changes on the Vanguard website, in the direction of more white space, etc., I found annoying, but the website was still functional and not so substantially differe...
by cb474
Fri Sep 23, 2022 5:51 pm
Forum: Personal Consumer Issues
Topic: Vanguard website succumbs to "Fisher-Price" UI design
Replies: 843
Views: 112363

Re: Vanguard website succumbs to "Fisher-Price" UI design

I have emailed twice to VG and been fobbed off and spent 45 mins on a call yesterday with someone who quite frankly didn't have the best English so it took ages to explain the problem. He opened a ticket and told me they are receiving non stop complaints and may give options to go back to old site. Then I asked if I could right now and he backtracked of course :) I felt inspired by this comment to call Vanguard myself and voice my complaint. If they really are getting non-stop complaints and really are considering an option for people to go back to the old website, then perhaps my complaint will help push things over the top, I reasoned optimistically (some might say naively). Alas. The peron I spoke with said I was the first call she has ...
by cb474
Fri Sep 23, 2022 5:43 pm
Forum: Personal Consumer Issues
Topic: Vanguard website succumbs to "Fisher-Price" UI design
Replies: 843
Views: 112363

Re: Vanguard website succumbs to "Fisher-Price" UI design

It's all a matter of degree. Yesterday I spent roughly an hour trying to resolve a (trivial) issue with our new Verizon FIOS Home Phone service, and, wow, Vanguard's website is good by comparison. One "interesting" characteristic of Verizon's "myverizon.com" website is that clicking on any link to a new page presents me the following experience: 1) A period of about five seconds with no feedback of any kind at all--not even highlighting to acknowledge that the click was noticed, sometimes leading me to click more than one... followed by... 2) A generic chasing-arrows "wait" widget... followed by... 3) A full-window chasing-arrows widget with the text "just one moment while we look up your details," w...
by cb474
Tue Sep 13, 2022 1:13 am
Forum: Personal Consumer Issues
Topic: Vanguard website succumbs to "Fisher-Price" UI design
Replies: 843
Views: 112363

Re: Vanguard website succumbs to "Fisher-Price" UI design

livesoft wrote: Mon Sep 12, 2022 10:01 pm When using vanguard.com today I was asked by a pop-up dialog to provide feedback about the website. So I answered the given questions, then clicked on the Submit button. Nothing happens. Those [Inappropriate language removed by admin LadyGeek] just like to waste my time.
I've gotten the pop-up more than once, submitted my answers, and it works fine. It indicates that my answers were received and thanks me. Whether or not anyone is paying any attention to the response is another question.
by cb474
Mon Sep 12, 2022 6:37 pm
Forum: Personal Consumer Issues
Topic: Vanguard website succumbs to "Fisher-Price" UI design
Replies: 843
Views: 112363

Re: Vanguard website succumbs to "Fisher-Price" UI design

PersonalFinanceJam wrote: Mon Sep 12, 2022 4:58 pmAssuming things basically work, I'm honestly not going to complain too much about sites becoming more mobile friendly. Even for my access to Fidelity, 90% is either through their mobile App or the website on my iPad.
But the thing is, it's not an either/or. As several people in this thread have explained, including myself, it is a very basic thing for a system like this to detect the sort of device connecting to it and serve up a different interface depending on the type of device. That's old technology. Many many websites do this with no difficulty. In order to become better for mobile, it doesn't have to become worse for the desktop (or necessarily even change at all). So, especially, Vanguard's failings are just a sign of incompetence.
by cb474
Mon Sep 12, 2022 6:29 pm
Forum: Personal Consumer Issues
Topic: Vanguard website succumbs to "Fisher-Price" UI design
Replies: 843
Views: 112363

Re: Vanguard website succumbs to "Fisher-Price" UI design

@Tubes Thanks for the screen shot. Yeah, that change seems more in line with the sort of changes in the pervious iterations of Vanguard's interface, pointless, annoying, but not totally nonfunctional. It does seem nonsensical that the "more" button appears now, instead of displaying all the options, even though there is plenty of space. A classic example of adding steps to a process, for the superficial appearance of simplicity, while actually making things more complicated. Sadly, I've seen exactly that sort of change a lot and obviously the new Vanguard interface is littered with things like that.
by cb474
Mon Sep 12, 2022 1:42 pm
Forum: Personal Consumer Issues
Topic: Vanguard website succumbs to "Fisher-Price" UI design
Replies: 843
Views: 112363

Re: Vanguard website succumbs to "Fisher-Price" UI design

I got this ominous message when I logged in to Fidelity just now: We've made some improvements Fidelity's new Portfolio Summary page makes viewing your account information easier than ever with an updated, simplified design. You can switch between the new Beta and classic views by selecting the Beta View button. Your feedback means a lot to us. Select the Feedback tab to let us know what updates you would like to see in future releases. :oops: So I tried Fidelity's beta. Bigger fonts, more whitespace. Less information. Headslap indeed. :oops: Is it as bad as Vanguard's new UI? Can you post screenshots without revealing personal information? I wonder if Fidelity will keep the option to toggle between the two UIs? I've seen websites maintain...
by cb474
Mon Sep 12, 2022 2:31 am
Forum: Personal Consumer Issues
Topic: Vanguard website succumbs to "Fisher-Price" UI design
Replies: 843
Views: 112363

Re: Vanguard website succumbs to "Fisher-Price" UI design

As many have noted, current UI's are designed for phones and tablets. Perhaps its too complicated for the software developers to recognize the type of device that is being used and tailor the display for that type of device. I know someone who was for almost two decades the manager in charge of the website design and functionality of a fairly large bank, he now does the same thing elsewhere. I've had many conversations over the years with him about things like this. It is extremely commonplace that websites are designed to detect the screen size, as a way of seeing if it's a phone, and serve up a different interface depending on that parameter. That technology has been around for years. If an organization as huge as Vanguard can't handle w...
by cb474
Mon Sep 12, 2022 2:27 am
Forum: Personal Consumer Issues
Topic: Vanguard website succumbs to "Fisher-Price" UI design
Replies: 843
Views: 112363

Re: Vanguard website succumbs to "Fisher-Price" UI design

What I do know is the Fisher-Price UI design, maybe even Playskool design, is driving me away from putting future $$ in Vanguard. I'm not bailing, but I'm not feeding something that isn't meeting my needs. Everyone has their issues, but UI design is far down my list of important matters. The new pages of importance to me (Balance/Holdings and Transaction History) give me the same info as before and are just as useful. I don't really care if they change the font and colors. I prefer the older format, but it's not that big of deal. In a world where you can buy the same funds through many different brokerage services, including Vanguard's funds, on a certain level it is the website services, UI, and other customer support that is really all t...
by cb474
Sun Sep 11, 2022 2:04 am
Forum: Personal Consumer Issues
Topic: Vanguard website succumbs to "Fisher-Price" UI design
Replies: 843
Views: 112363

Re: Vanguard website succumbs to "Fisher-Price" UI design

LadyGeek wrote: Sat Sep 10, 2022 8:50 pmThe forms are indeed on the old site.
Are you saying there still a way to see the old site? How?
by cb474
Sun Sep 11, 2022 2:02 am
Forum: Personal Consumer Issues
Topic: Vanguard website succumbs to "Fisher-Price" UI design
Replies: 843
Views: 112363

Re: Vanguard website succumbs to "Fisher-Price" UI design

As many have noted, current UI's are designed for phones and tablets. Perhaps its too complicated for the software developers to recognize the type of device that is being used and tailor the display for that type of device. I know someone who was for almost two decades the manager in charge of the website design and functionality of a fairly large bank, he now does the same thing elsewhere. I've had many conversations over the years with him about things like this. It is extremely commonplace that websites are designed to detect the screen size, as a way of seeing if it's a phone, and serve up a different interface depending on that parameter. That technology has been around for years. If an organization as huge as Vanguard can't handle w...
by cb474
Sat Sep 10, 2022 6:45 pm
Forum: Personal Consumer Issues
Topic: Vanguard website succumbs to "Fisher-Price" UI design
Replies: 843
Views: 112363

Re: Vanguard website succumbs to "Fisher-Price" UI design

The approach is to change your browser's Zoom level, not the website. That will give you some flexibility when looking at your account from different PCs / mobile devices. The annoying part of this is every website that I look at is fine but if I have to change the Zoom level for Vanguard, then Vanguard did something wrong and either is unwilling to admit or incapable of changing it back. Personally, I like the website from the late 90's early 00's and even the last 2 were not bad it just seems like Vanguard is moving to something that requires tons of scrolling i.e. as if you had a smartphone or table and could just move your fingers to scroll up/down, but what about people who use computers? What I would like to see is a preferences with...
by cb474
Thu Apr 07, 2022 2:23 am
Forum: Personal Investments
Topic: VIPSX has captial gain distribution, huh?
Replies: 13
Views: 1779

Re: VIPSX has captial gain distribution, huh?

Thanks for the replies. I guess I forgot that way back in 2016, and earlier, there were capital gain distributions in VIPSX. I sort of imagined that they just built bond ladders, held the bonds to maturity, and had some cash in the fund to deal with redemptions.

That said, it still seems a bit curious to me that they go years, e.g. 2017-2020, without any capital gain distributions and then have one. This is not really consistent with the people saying bond funds are selling bonds all the time to maintain the duration of the fund.

Anyway, I guess it's more normal than I realized. Thanks again for the replies.
by cb474
Wed Apr 06, 2022 9:00 pm
Forum: Personal Investments
Topic: VIPSX has captial gain distribution, huh?
Replies: 13
Views: 1779

VIPSX has captial gain distribution, huh?

I just noticed on my 1099-DIV that VIPSX had a tiny capital gain distribution in 2021. I've never seen this before. It seems odd. How does a TIPS fund end up with a capital gain distribution?
by cb474
Thu Feb 10, 2022 6:30 pm
Forum: Personal Finance (Not Investing)
Topic: Received WEP-GPO Notice in Error. Action Required?
Replies: 22
Views: 2013

Re: Received WEP-GPO Notice in Error. Action Required?

I just logged into my social security account the other day and saw I had one of these notices. The only thing I can think of (similar to something mentioned above) is that I was paid as a graduate student instructor in graduate school, but we were exempt from having to pay social security and medicare taxes on that. I called the national social security number and they had no explanation of why I received the letter, even though it says: "You are receiving this fact sheet because our records show you have earnings from work not covered by Social Security." If their "records" show that specifically about me, you'd think they could look up and tell you what those records are. Anyway, they suggested my local office might b...
by cb474
Sat Oct 02, 2021 7:28 pm
Forum: Investing - Theory, News & General
Topic: New Avantis ETFs
Replies: 279
Views: 54255

Re: New Avantis ETFs

I found a couple comments from Swedroe on AVRE:
Avantis announced launch of several more ETFs including...a REIT factor fund (considering leverage, a quality factor) AVRE
https://twitter.com/larryswedroe/status ... 8408136704
I think better construction that typical REIT, but I prefer private REIT to get illiquidity premium (using Blackstone BREIT)
https://twitter.com/larryswedroe/status ... 8473280514
by cb474
Sat Oct 02, 2021 2:43 am
Forum: Investing - Theory, News & General
Topic: New Avantis ETFs
Replies: 279
Views: 54255

Re: New Avantis ETFs

Does anyone have any thoughts about the new Avantis real estate fund, AVRE, as compared to Vanguard's funds VNQ and VNQI? It looks like it is a global fund, with an emphasis on filtering out REITs with a lot of leverage. The fund invests primarily in a diverse group of real estate securities globally, in particular real estate investment trusts (REITs) and REIT-like entities, across a variety of property sectors. The fund seeks securities of companies that it expects to have higher returns or better risk characteristics. For example, REITs and REIT-like entities tend to distribute a large fraction of their earnings to qualify as tax passthrough entities, so it is common for REITs to have high levels of leverage to finance their growth or ma...
by cb474
Tue Sep 28, 2021 3:04 am
Forum: Investing - Theory, News & General
Topic: Is anyone hedging against a US default?
Replies: 116
Views: 16588

Re: Is anyone hedging against a US default?

I’m glad I started this thread. Seems that responses range from “never happen” to cb astutely (yet alarmingly) explaining how even a threat of default will lead to global chaos. Seems unanimous that there’s no good way to “hedge”. Just a clarification, I'm not saying "even a threat of default will lead to global chaos," I'm saying even the credible threat of a default could lead to global chaos. It depends how credible the threat is. But it could easily take a lot less than people imagine to get there and once it happened it would probably happen breathtakingly quickly. Also, keep in mind that the people who are saying it will never happen are saying that precisely because the scenario I outline is supposed to be so terrifying th...
by cb474
Mon Sep 27, 2021 7:30 pm
Forum: Investing - Theory, News & General
Topic: Is anyone hedging against a US default?
Replies: 116
Views: 16588

Re: Is anyone hedging against a US default?

Did we have a government shutdown not too long ago? The IRS shutdown, government agencies furlough employees, etc. etc. How did the market react back then? Exactly, we don't really remember, right? That shutdown was because Congress failed to authorize the funding that the government needed to continue paying Federal workers. So workers had to be sent home. That was not about the debt ceiling. So there is zero comparison to what is on the table now. Not raising the debt ceiling would mean that the government couldn't pay it's obligations (interest and redeeming bonds that have matured) to people, businesses, other central banks all over the world who hold treasuries. Because of the central role of U.S. treasuries in global finance, that co...
by cb474
Mon Sep 27, 2021 7:24 pm
Forum: Investing - Theory, News & General
Topic: Is anyone hedging against a US default?
Replies: 116
Views: 16588

Re: Is anyone hedging against a US default?

Why didn't the 1979 US technical default on interest payments lead to a catastrophe? Why didn't the 1971 US default on gold convertibility? No serious person considers the move off of gold convertability in 1971 a default. The unique gold convertibility of the U.S. dollar had become an impendement to to global economy and itself threatened a run on the dollar. So the end of the gold regime was a boon to the global economy, not a problem for it. The technical default in 1979 happened because Congress waited too long to raise the debt limit (but they did raise it), there was more activity in the treasury market at the time than anticipated, and then there was literally a technology failure in the Treasury Dept. that got in the way of printin...
by cb474
Mon Sep 27, 2021 6:50 pm
Forum: Investing - Theory, News & General
Topic: Is anyone hedging against a US default?
Replies: 116
Views: 16588

Re: Is anyone hedging against a US default?

How about your way out of the country Because a default on U.S. debt would potentially cause a global financial crisis of immense proportions, the gold would be just as useless anywhere else. That's the point. The question of a default on U.S. debt is not about problems for the U.S., it's about problems for the whole world. * First, it's highly unlikely in a default scenario that US fails to pay its treasury debt obligations. A default means they don't have enough money to pay all obligations. They will have enough money to pay some/most. That said, trying to prioritize what gets paid and what doesn't is not a trivial task. A spending cut of 5-15% of GDP however will have a serious economic impact, if it goes on beyond days. Whether or not...
by cb474
Mon Sep 27, 2021 2:26 am
Forum: Investing - Theory, News & General
Topic: Is anyone hedging against a US default?
Replies: 116
Views: 16588

Re: Is anyone hedging against a US default?

I'm a little surprised by some comments in this thread downplaying the risks of a default on U.S. debt or comparing it to what happened in other countries, like Russia, when they defaulted. People seem to imagine that U.S. debt is simply what it sounds like, money that the U.S. has borrowed for it's own purposes and owes to other people (and in that respect, like any other debt, there's just a lot more of it). U.S. debt is not like any other debt in the world. It is quite literally the backbone of the global financial system. Because there is so much of it, because it is so liquid (the only more liquid asset in the world is cash), and because U.S. debt is viewed as safe in a way that no other asset is, U.S. debt is held as a safe store of v...
by cb474
Thu Dec 03, 2020 8:22 pm
Forum: Investing - Theory, News & General
Topic: Can anyone reach Vanguard on the phone?
Replies: 244
Views: 32353

Re: Can anyone reach Vanguard on the phone?

Most customers with Flagship status no longer have Flagship reps. A few do. If you still do may as well use it but most Flagship clients now get routed to a call center with no option of a named rep. Yeah, the flagship rep no longer appears on my homepage when I login, so I guess that's gone. It really seems like "flagship" services means nothing anymore. Vanguard allowed me to put on my phone number the other day and then they called me back when it was my turn...seemed reasonable. System does not offer me that option when I call. * Thanks for the suggestion about Etrade. I guess it seems like a hassle to change my accounts, given that I almost never need to call Vanguard. But maybe it's a sign of things to come in my future. It...
by cb474
Thu Dec 03, 2020 6:20 pm
Forum: Investing - Theory, News & General
Topic: Can anyone reach Vanguard on the phone?
Replies: 244
Views: 32353

Re: Can anyone reach Vanguard on the phone?

Thanks for the thoughts. Yes, I rarely call Vanguard. Mostly I figure out my own issues and am happy with the website. When I do call them, it's because something weird has happened. That's what makes phone menu systems that assume you could only be calling for the most obvious tasks annoying. I wouldn't call if I just wanted to do some obvious predictable task. But I guess I've never experienced hold times anything close to this before, for the last two decades. It's hard to believe that I was just getting lucky all those years. I guess that's why I'm curious if others feel like Vanguard has taken a turn for the even worse, when you thought it couldn't get worse. Anyway, it's nice to know someone got through and that it's at least theoreti...
by cb474
Thu Dec 03, 2020 6:01 pm
Forum: Investing - Theory, News & General
Topic: Can anyone reach Vanguard on the phone?
Replies: 244
Views: 32353

Can anyone reach Vanguard on the phone?

[2020 thread bumped in 2021 (Page 4) --admin LadyGeek] I have tried to call Vanguard the last three days in a row, to ask a question about my accounts. Every time I am on a hold for 30 minutes and then have to go before anyone answers. What's going on? Is this everyone's experience now? Supposedly I have Flagship services, but I guess that means nothing. Now they also have an annoying phone menu you have to slog through to say why you are calling. None of the options apply to my reason for calling, but there is no "for all other reasons" option and just hitting "0" repeatedly does not ring you through. It didn't used to be like this. For years and years. I'd call and maybe wait a minute or two at most and then get someo...
by cb474
Sun Aug 16, 2020 11:20 pm
Forum: Personal Finance (Not Investing)
Topic: Rate of return on mortgage points, calculator, please explain
Replies: 15
Views: 1557

Re: Rate of return on mortgage points, calculator, please explain

Edit: Even if you're interested in paying points, it pays to analyze the options for your unique case. Some of the lenders I've talked to have very strange point structures, for example, where 0.25 points gets 0.25% interest rate reduction, and a further 1.25 points only reduces rate by a further 0.125%. Each person's tax situation is unique, and with the current tax law, points and/or interest may be only partially deductible, or not at all. With a break-even period of 5 years or less, I'd give it some serious consideration. Yeah, the points with my lender are not linear at all. At first you pay about .333 points for a 1/8 drop in the interest rate, starting at 2.875%. But the move to 2.375% is cheaper for some reason. After that the poin...
by cb474
Sun Aug 16, 2020 4:57 pm
Forum: Personal Finance (Not Investing)
Topic: Refinance Mega Thread
Replies: 12862
Views: 1265542

Re: Refinance Mega Thread

Yes, as I stated, I think it's a recent development. When I first spoke to Watermark a couple weeks ago and mentioned Bogleheads it meant nothing to them. But a couple days ago I got a big speech about it. It may have just taken them time to put two and two together. Killed the goose that laid the golden egg... Since you don't have to tell Watermark that you heard about them through Bogleheads, how is that true? Of course, so why do people? Never reveal your sources or secret sauce unless you have to... Lesson to ne learned by other BHs applying to Watermark in the future. I think bigleheads can’t help themselves. It a badge of honor to them. But then they only use them for a good quote to leverage another lender it burns bridges. Not sure...
by cb474
Sun Aug 16, 2020 4:43 pm
Forum: Personal Finance (Not Investing)
Topic: Refinance Mega Thread
Replies: 12862
Views: 1265542

Re: Refinance Mega Thread

This whole Watermark-Bogleheads thing seems odd to me, I wonder if it depends on the loan officer. When I initially got my quote, the LO asked me where I heard about them and I mentioned Bogleheads. That didn't seem to cause any issues and I ended up applying, but perhaps this is a recent development. I do think they are extremely busy right now. I hadn't heard anything for a while so I contacted my LO this week and she said she's waiting on some title items and then will submit everything at once to the underwriters for review. I have every intention of going though with this loan. Yes, as I stated, I think it's a recent development. When I first spoke to Watermark a couple weeks ago and mentioned Bogleheads it meant nothing to them. But ...
by cb474
Sun Aug 16, 2020 4:33 pm
Forum: Personal Finance (Not Investing)
Topic: Rate of return on mortgage points, calculator, please explain
Replies: 15
Views: 1557

Re: Rate of return on mortgage points, calculator, please explain

Thanks again for all the help an explanations. If you want to modify my spreadsheet to assume the points are rolled into the loan balance, it would be straightforward - there would be a few formulas that would need to be changed. The cash flows would be accurate, but it would be difficult or impossible to calculate a rate of return. The reason is that rate of return calculation works best with a large cash investment up-front, and then streams of payments coming in later. By rolling the points into the loan, there is no initial investment, just a small savings in the payment. But after a certain point, the loan balance with points will become less than without, so the stream of cash flows will be all positive. An all-positive stream of cash...
by cb474
Sun Aug 16, 2020 12:40 am
Forum: Personal Finance (Not Investing)
Topic: Refinance Mega Thread
Replies: 12862
Views: 1265542

Re: Refinance Mega Thread

This whole Watermark-Bogleheads thing seems odd to me, I wonder if it depends on the loan officer. When I initially got my quote, the LO asked me where I heard about them and I mentioned Bogleheads. That didn't seem to cause any issues and I ended up applying, but perhaps this is a recent development. I do think they are extremely busy right now. I hadn't heard anything for a while so I contacted my LO this week and she said she's waiting on some title items and then will submit everything at once to the underwriters for review. I have every intention of going though with this loan. Yes, as I stated, I think it's a recent development. When I first spoke to Watermark a couple weeks ago and mentioned Bogleheads it meant nothing to them. But ...
by cb474
Sun Aug 16, 2020 12:25 am
Forum: Personal Finance (Not Investing)
Topic: Refinance Mega Thread
Replies: 12862
Views: 1265542

Re: Refinance Mega Thread

Are you saying you filled out the entire online application and uploaded all the documents and they never sent you a loan estimate. A friend of mine called them a couple weeks ago, got a rate quote over the phone, then filled out the online application and provided documents, and got a loan estimate with a locked rate three days later. But since then he's heard nothing. My experience with Watermark, having talked to several different loan officers, is that they are very slow to respond, beyond an initial inquiry. They seem to be extremely busy and backlogged right now. So maybe you need to bug them? Maybe just call back the 800 number and complain that they loan officer is not getting back to you? The first loan officer I spoke to at Water...
by cb474
Sat Aug 15, 2020 11:28 pm
Forum: Personal Finance (Not Investing)
Topic: Refinance Mega Thread
Replies: 12862
Views: 1265542

Re: Refinance Mega Thread

This whole Watermark-Bogleheads thing seems odd to me, I wonder if it depends on the loan officer. When I initially got my quote, the LO asked me where I heard about them and I mentioned Bogleheads. That didn't seem to cause any issues and I ended up applying, but perhaps this is a recent development. I do think they are extremely busy right now. I hadn't heard anything for a while so I contacted my LO this week and she said she's waiting on some title items and then will submit everything at once to the underwriters for review. I have every intention of going though with this loan. Yes, as I stated, I think it's a recent development. When I first spoke to Watermark a couple weeks ago and mentioned Bogleheads it meant nothing to them. But ...
by cb474
Sat Aug 15, 2020 7:11 pm
Forum: Personal Finance (Not Investing)
Topic: Rate of return on mortgage points, calculator, please explain
Replies: 15
Views: 1557

Re: Rate of return on mortgage points, calculator, please explain

Thanks to everyone for the technical explanations. I'll have to take some time to digest this, since many of these concepts are new to me. * fyre4ce, it's interesting that the loan you recently analyzed showed a breakeven point of 3 years. That's basically what I found just by comparing amortization tables for the different loans I'm considering and adding up the interest paid over different periods of time and the monthly savings on the lower mortgage payment, to figure out at what point is the remaining balance on the two loans is the same (if I get points I'm planning to roll the cost into the loan balance, so that's why I looked at it that way). I guess grabiner's rule of thumb to simply divide the points paid by the amount of reduction...
by cb474
Sat Aug 15, 2020 12:09 am
Forum: Personal Finance (Not Investing)
Topic: Refinance Mega Thread
Replies: 12862
Views: 1265542

Re: Refinance Mega Thread

I just spoke with someone at Watermark. They asked me where I heard about them and when I said Bogleheads, they told me that they've been having a lot of problems with people from the Bogleheads forum, who start loans, go through the process, and then bail at the last minute, wasting their time. So they said they would not provide a loan estimate, unless I was going ahead with the application with them and not proceeding or locked with anyone else. And that I would need to provide evidence that I had cancelled any applications with other lenders (in the form of a letter of cancellation or something--which I honestly can't imagine another lender would spend the time to send someone--"Hey, I'm cancelling, but can you do something for me...
by cb474
Fri Aug 14, 2020 11:56 pm
Forum: Personal Finance (Not Investing)
Topic: Rate of return on mortgage points, calculator, please explain
Replies: 15
Views: 1557

Re: Rate of return on mortgage points, calculator, please explain

Hi, thanks for the reply. Wouldn't the rate of return also include the lower amout of interest you are paying per month with the lower rate? And not just the lower monthly payment? It seems that if I'm paying less interest over the life of the loan and paying principal off faster, then that is also a return I'm earning from having paid the points. That's why I'm wondering what the calculator on the Mortgage Professor's website is actually including in the rate of returns it specifies of a given period of time. And if it is an annual rate of return that the calculator is producing. Or do you have a suggestion about how else to calculate the rate of return on different amounts of points? I saw your post from this thread, https://www.boglehead...
by cb474
Fri Aug 14, 2020 6:45 pm
Forum: Personal Finance (Not Investing)
Topic: Rate of return on mortgage points, calculator, please explain
Replies: 15
Views: 1557

Rate of return on mortgage points, calculator, please explain

Can anyone explain to me what this calculator is doing:

https://www.mtgprofessor.com/calculator ... or11c.html

It calculates a rate of return you get on paying points on a mortgage, compared to another mortgage with less or no points.

I don't really get what this rate or return means.
by cb474
Fri Aug 14, 2020 5:51 pm
Forum: Personal Finance (Not Investing)
Topic: Refinance Mega Thread
Replies: 12862
Views: 1265542

Re: Refinance Mega Thread

ChiKid24 wrote: Fri Aug 14, 2020 5:31 pmIt's a minor adjustment (about $50 in my case), but I do wonder if this stuff happens all the time and lenders make a mountain of nickels from volume since nobody checks the work and does the math!
Thanks for pointing this out.

I feel like I find a surprising amount of basic mistakes on loan documents and I seem to be one of the few who reads everything. I would not be surprised if differences like this are just sloppiness. As it's said, why attribute to maliciousness, what can be explained through simple incompetence?
by cb474
Fri Aug 14, 2020 4:43 pm
Forum: Personal Finance (Not Investing)
Topic: Refinance Mega Thread
Replies: 12862
Views: 1265542

Re: Refinance Mega Thread

I just spoke with someone at Watermark. They asked me where I heard about them and when I said Bogleheads, they told me that they've been having a lot of problems with people from the Bogleheads forum, who start loans, go through the process, and then bail at the last minute, wasting their time. So they said they would not provide a loan estimate, unless I was going ahead with the application with them and not proceeding or locked with anyone else. And that I would need to provide evidence that I had cancelled any applications with other lenders (in the form of a letter of cancellation or something--which I honestly can't imagine another lender would spend the time to send someone--"Hey, I'm cancelling, but can you do something for me...
by cb474
Fri Aug 14, 2020 2:51 pm
Forum: Personal Finance (Not Investing)
Topic: Refinance Mega Thread
Replies: 12862
Views: 1265542

Re: Refinance Mega Thread

I just spoke with someone at Watermark. They asked me where I heard about them and when I said Bogleheads, they told me that they've been having a lot of problems with people from the Bogleheads forum, who start loans, go through the process, and then bail at the last minute, wasting their time. So they said they would not provide a loan estimate, unless I was going ahead with the application with them and not proceeding or locked with anyone else. And that I would need to provide evidence that I had cancelled any applications with other lenders (in the form of a letter of cancellation or something--which I honestly can't imagine another lender would spend the time to send someone--"Hey, I'm cancelling, but can you do something for me?...
by cb474
Fri Aug 14, 2020 2:46 am
Forum: Personal Finance (Not Investing)
Topic: Refinance Mega Thread
Replies: 12862
Views: 1265542

Re: Refinance Mega Thread

I understand what you are saying. But the reports from people getting quotes today here and on Slickdeals is that pricing went up 0.125% or around $1,500 in costs for the same rate. Now, that market is large and there are plenty of crappy lenders, but hopefully none of us Bogleheads are working with such lenders. Btw, both my LenderFi and Better unlocked apps have 0.125% higher for $250 less in lender credits than yesterday, so about $750 in adverse pricing for me as my loans are roughly $500 for each 0.125% (rough generalization). But I’m also just a single anecdotal report from three lenders (my third was quoting on their webpage, not an app). Right, if you shop around and look for the best deals, like many people in this thread, and you...
by cb474
Thu Aug 13, 2020 9:33 pm
Forum: Personal Finance (Not Investing)
Topic: Refinance Mega Thread
Replies: 12862
Views: 1265542

Re: Refinance Mega Thread

Folks, I get the anxiety around this new fee, I really do. But keep in mind that market rates themselves could move 0.5% from week to week anyways. This is honestly no different, just that we know when and how much will change. I wouldn’t worry about this or change any plans because of it. If someone gave you a 2.5% loan at $X dollars, but you didn’t lock, it easily could be 2.5% at 1.05*$X when you go to lock. Someone on Slickdeals posted earlier this week getting offered 2.5 or 2.625% with a $6,500 lender credit, but didn’t immediately lock. When they called the lock the next morning, it was the same rate but $3,000 in lender credits. That was before all this happened. This is the same kind of impact and really nothing to fuss over. I re...
by cb474
Wed Aug 12, 2020 2:51 pm
Forum: Personal Finance (Not Investing)
Topic: Refinance: Who have you closed with? What was the experience like?
Replies: 6
Views: 847

Refinance: Who have you closed with? What was the experience like?

The refinance mega thread has a lot of discussion of the rates people are getting and how they are going about negotiating with different lenders. But not much follow up on whether people closed and what their experience with different lenders was like.

So I'd be interested to hear who people actually closed with and what their experience with that company was like through the whole process. Thanks for any replies.