Question by Steven TJ: Are interest rates adjusted by the central bank the same as that of commercial banks?
When central banks (like the Fed) adjust interest rates, are these the same rates used by Commercial Banks? Do Commercial Banks give the same interest rates as the Central Bank?

Best answer:

Answer by mindcrime828
The rate that is adjusted by the central bank, such as the Federal Reserve, is the rate used in the transfer of money between commercial banks and that central bank. When it is adjusted, commercial banks will adjust their rates accordingly. For example, a commercial bank may lend funds at 5% over the prime rate (rate set by the central bank). If the central bank raises the prime rate from lets say 2.5% to 3%, then the commercial bank would raise its interest rate from 7.5% to 8% so that they still get the same percentage of interest on money lended to its customers. Thats how banks make profits, from fees and interest.

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Question by luke: How to report short sale stock in schedule D if it’s not closed by the end of 2006?
The 1099-B form from my brokerage firm shows a short sale as a sale proceeds amount and therefore IRS is going to treat it as a gain. But I didn’t buy to cover the short sale of stock.

Best answer:

Answer by Nusha
If you are able to defer the reporting of gain or loss until the year the short sale closes, you will need to attach a statement to your Form 1040, Schedule D explaining the details of your short sale and that it has not closed as of the end of the year.

This will allow you to reconcile your Form 1099-B to your Form 1040, Schedule D and still not recognize the gain or loss from the short sale. Include your name as it appears on the return and your social security number.

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Question by Capitalist_pig: What are some relationships between different interest rates?
Are there any well known relationships between different interest rates?

For example: The 20-year T-Bond rate is usually 2% above 3-month T-Bills.

Stuff like that. Is there a website that would have things like that? It doesn’t have to be just treasury security rates, it can be inflation rates, Federal Reserve interest rates, whatever.

Thanks

Best answer:

Answer by financegal27
Interest rates are basically a reflection of the riskiness of the investment. The reason the T-Bond is usually higher than the t-bill is due to the duration risk. Simply put if all things were equal most people would prefer to tie up their money for the least amount of time, so to encourage investors to tie up their money for 20 years as opposed to 3 months they must be compensated more for that risk.

Bond rates are traditionally ploted on a graph and called a yield curve. There are 2 main theories that address the yield curve of bonds. The first is called the liquidity preference theory, which is illustrated in the example above. The Liquidity preference theory states that investors are naturally inclined towards more liquid assets and to entice these investors into longer term, less liquid bonds you must compensate them by paying them a higher coupon payment. The second theory is called the expectation theory. According to the expectation theory investor expectations about the direction of future interest rates act as the force driving the yield curve. This is more widely accepted because it explains why the yield curve is often inverted with longer term rates lower than shorter term rates.

There is a great site that gets into some of these relationships that you’ll probably find helpful.

http://www.pathtoinvesting.org/invchoices/bonds/yieldcrv/ic_yieldcrv_011.htm

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Question by lvchic_702: How to short sale with child on title deed but not mortgage ?
My mom passed away and we are trying to short sale her home. My brother is on the title deed and second mortgage but not the first mortgage. Under the deed it says joint tenancy. We already have a realtor dealing with them but she doesn’t understand why first mortgage won’t cooperate so we will be seeking a lawyer for help. Doesn’t the deed give my brother automatic ownership since my mom passed on ? I live in Las Vegas, NV. Thanks.

Best answer:

Answer by wizjp
Problem is that as he was not in title on the original mortgage, they have the right to call the security your deceased parent pledged, and the joint tenancy is not in operation behind that first lien.

They believe you mom should not have added anyone to the title without their permission as it violates their secured interest in the property

YOu need a lawyer.

Ownership is not the issue here folks. The first lien position is being called against the owner of record who is deceased. THE ESTATE is responsible for paying off all liens secured by property owned by the deceased before ANYTHING passes. No mortgage paid=foreclosure. Joint tenancy or not. The mortgage doesn’t just go away because you put someone else on title.

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Question by Mya m: If I file Bankruptcy Pro SE to stop a foreclosure can I then hire an attorney to complete the process later on
If I file Bankruptcy Pro SE to stop a foreclosure can I then hire an attorney to complete the process later on! I just want to stop foreclosure proceedings and recieve a stay and then hire an attrorney to finish the process

Best answer:

Answer by BillRobber
I believe so.

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