Delaware Mortgage Loans

The Economist is predicting annual GDP growth in 2008 of 0.8%.  For 2009, it predicts 1.1% annual growth.  T. Rowe Price economists predict GDP growth of 1.8% for 2008 and 1.5% in 2009.  It is difficult to find economists predicting a bright rest of 2008 or 2009.  (Caveat:  See many of my earlier statements on economist predictions and The Black Swan by Nassim Nicholas Taleb.)

MARKET REACTIONS:  The markets seemed suspicious of the GDP report; not willing to bet on continued strong growth without the federal stimulus payments.  The Dow Jones Industrials were down 0.72% (down 12.98% for the year) and the S & P 500 was similarly down 0.72% (down 12.64% for the year).

EMERGING MARKETS:  In 2003, the Goldman Sachs Global Economics Department predicted the economic and geopolitical influence of Brazil, Russia, India and China (the BRIC countries) would become increasingly visible in the developed world and even dominate it by 2050. These countries have averaged a total return on investment in their stock markets of 38.28% over the past five years, up 5.02% over the past year.  (Past performance is no guarantee of future results.) 

HEALTH INSURANCE:  There are two oft-forgotten numbers that you should know:  the out-of-pocket maximum and the policy limit. 

Out-of-Pocket Maximum:  Even after you pay your deductible, your insurance only pays a percentage of your bill.  (It used to be universally 80%.  Now you often see 90% for in-network coverage and 50% for out-of-network coverage.)  This is fine as long as you do not get seriously ill or have a bad accident.  If you do, even 10% of your medical care can add up.  An extended stay in the hospital–even a short stay in intensive care–can reach hundreds of thousands of dollars.  That’s what the out-of-pocket maximum is all about.  Once your share of the charges hits the maximum, the insurance should pay the rest.  The out-of-pocket maximum is the single most important number in determining if your insurance is really insurance.  One other thing to be aware of regarding the out-of-pocket maximum is that it often doesn’t apply to out-of-network coverage:  you not only have to pay 50% instead of 10%, but the amount you pay may not count toward the limit, leaving you on the hook for virtually unlimited expenses.

The Policy Limit:  Just like any insurance, medical insurance has a policy limit–the most they’ll pay.  $1 million used to be common.  Now we see a lot of policies with $3 million or $5 million limits, and some much smaller.  The policy limit doesn’t come into play very often.  Often, insurance companies will aggressively deny coverage for expensive procedures right from the start–long before they even approach the policy limit.  You can always argue about coverage for procedures that the insurance company doesn’t want to pay for–you have access to appeals, arbitration, lawsuits.  Once you hit the policy limit, the insurance company has no obligation to pay any more money.

TAX REBATE PAYMENTS:  The monthly distribution of tax rebates from the federal government was:

• April - $1.9 billion
• May - $48.1 billion
• June - $27.9 billion
• July - $13.7 billion

This is information is provided by my good friend and business associate Doug MacGray.  Doug is a certified Financial Planner, if you need to speak with Doug, give me a call at 302-368-7132 and I can forward you his information.

If you need help with a Delaware Mortgage Rate for the purchase or refinance of a home, then give me (John Thomas) a call at 302-368-7132 or send an e-mail to DelawareMortgages@yahoo.com

John R. Thomas - Certified Mortgage Planner - Primary Residential Mortgage, Inc.