INDIANAPOLIS – A woman who has a glass of wine at dinner trips and falls outside the restaurant.

The hospital emergency room treats her broken ankle, but although she is insured, her health-insurance company won’t pay the claim. The reason: A blood test showed she had alcohol in her system, even though she wasn’t legally intoxicated. And that denial is perfectly legal.

Indiana lawmakers heard that Portland, Ore., example Thursday as they considered a proposal to change the law, so insurers cannot deny claims solely because patients test positive for alcohol or drugs.

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Question: I’ve recently completed a disturbing loan and I was wondering if you could be so kind as to answer a question I have. I refinanced a condo which was purchased for income property and used excess cash from a new home-equity line of credit (also done with the same lender a few months earlier) on my home to eliminate a second mortgage on the condo and get the mortgage at an 80% loan-to-value ratio for the lowest interest rate.

I was shocked when the lender’s handpicked appraiser valued the property at $468,000, which was less than what I purchased the condo for and, as I later found out, was far less than identical units had sold for in the very recent past. I brought this to the lender’s attention. I demanded another appraisal with an appraiser of my choosing. And as I suspected, the valuation came back at an appraised value of $625,000.

Instead of using the $625,000, the lender’s underwriter used the median of the two appraisals for the refinance, knowing full well the funds to make it an 80% LTV loan value were coming out of a line of credit advanced by the same lender. Not knowing how underwriting works and pressured by a closing date which was only a day or two away, I foolishly signed the closing docs.

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Monday’s New York Times highlighted one of the many ways that existing models of medical insurance are beginning to come undone. In this case the subject was long-term-care insurance, which is supposed to help cover the exceedingly high cost of intense chronic care required by some elderly Americans—especially those with Alzheimer’s disease and dementia. As policy-makers have looked at the economic forecasts for old-age health care in the past few decades, they have increasingly used tax incentives and other spurs to encourage middle-aged and older Americans to buy such insurance.

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March 27 (Bloomberg) — Congress should pass legislation setting a national anti-predatory lending standard that would apply to all mortgage lenders, a top U.S. bank regulator said.

A national standard would create a “more level competitive playing field” between federally regulated lenders and state- regulated mortgage brokers and lenders, Federal Deposit Insurance Corp. Chairman Sheila Bair said today at House Financial Services subcommittee hearing in Washington.

The legislation “should raise the bar by strengthening protections available to borrowers” and draw from existing federal mortgage guidelines, Bair said in testimony on predatory lending practices in the subprime mortgage market.

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Editor’s Note: Many people have financed their house with an adjustable rate mortgage (ARM). Is it a good time to refinance, and will interest rates go higher. There are a lot of factors at play here. Here is an article on the subject:

When rates are rising should you consider refinancing your mortgage loan? When rates are falling this is a moot question. Of course you should consider doing a refinance whether it be a fixed loan or home equity loan. When rates are rising you should, in my opinion, only consider refinancing if you want to take cash out of the equity in your home or if you feel now is the time to lock in a fixed rate.

If the market appears to be on a longer rise, locking in a fixed rate now can save you money in the future. Homeowners with adjustable rate mortgages can rise at the end of the initial low rate ARMs charge for the first twelve months. This currently means your rate can rise 2.75 points or so based on your original agreement. This translates to much higher payments than you currently are paying.

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Norfolk, Nebraska’s “Big, Bang, Boom” celebration has gone “bust.” Organizers of the annual fireworks show say they’ll cancel the event because they can’t afford to pay higher liability insurance costs, which the city has now mandated.

A large crowd gathered at the city council chambers Monday night to respond to a ruling from city officials that due to the current Liability and Recreation Act of Nebraska, each organization that uses city property must increase their liability insurance coverage from $1-million to $5-million for their events.

That’s leaving local non-profit organizations like Big Bang Boom, who present the annual fireworks show, with a tough decision. “We said ‘no, we can’t cover the event… can’t take something away,’” said Don Wisnieski, Big Bang Boom Inc. “We are just simply going to have to cancel at this time until either some details can be worked out.”

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Dear Bruce: I am 75, and my husband is 76. Like many, we are house-rich but cash-poor. We are in good health, and we have a lot of fun traveling. After moving to Florida, we had expenses we never expected. Is a reverse mortgage a good option for us? We have in excess of $250,000 in our home. — D.B., via e-mail

Dear D.B.: A reverse mortgage for many people is a viable way to extract cash from their home and still live in it. Simply put, the mortgage company will send you an agreed upon sum every month until yet another agreed upon number is reached. Once you have exhausted that number, you will no longer receive a check and you may live there for the balance of your life and your husband’s. At the time both of you have passed on, the home will be sold and the mortgage company will recover its advances, plus interest. The older you are, the more viable a reverse mortgage becomes. Often, I receive inquiries from people in their 50s. First of all, it’s unlikely a reverse mortgage would be issued to them, but, even if it were, it would be a very small number since that person’s life expectancy could be as much as 30 years. The older the applicant, the more favorable the terms.

Found here.

Question: I am a 74-year-old widow. About six years ago, I added my daughter’s name to my home’s title in joint tenancy with right of survivorship so she wouldn’t have to worry about probate costs when I pass on. I’m doing pretty well, health-wise, but I am running low on income since my airline pension income was cut about two years ago. However, I am told I can’t qualify for a senior-citizen reverse mortgage because my daughter is on the title. Is this true? I asked her to quitclaim her interest back to me, but she is reluctant.

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To protect tribal law enforcement organizations and officers, Governor Kathleen Sebelius signed a bill requiring insurance carriers providing liability insurance coverage to tribal law enforcement officers to certify with the Attorney General that the tribal officers have the appropriate insurance coverage.
The bill, SB 13, also requires the insurance carrier to notify the Attorney General if the insurance coverage is terminated or no longer complies with the insurance requirements. Finally, it requires the insurance policy to be at least $2,000,000 in aggregate loss limit. The bill will take effect after its publication in the statute book.

Governor Sebelius also signed three additional bills into law, bringing the total number of bills signed during the 2007 Legislative Session to 12.

Found here.

Less than credit-worthy mortgage loans are falling apart in record numbers and loan defaults are causing a downward spiral in the housing market.It’s also having an effect on the economy overall.

It means getting credit could be more difficult, making it tougher for more first time buyers to open the door to home sweet home

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