Refinancing accounted for roughly 66 percent of mortgage applications in early October, according to the Mortgage Bankers Association, no doubt driven by homeowners’ urge to nab those historic lows on rates and lower their bills.

That said, refinancing costs you time and money. You’ll most likely benefit from it if:

1. You can lower your rate by half a point or more

It’s worth looking into refinancing if the going rate is 0.50 percent lower than your current mortgage if you plan to stay in your home, said Timothy McFarlin, a real estate lawyer based in Irvine, Calif.

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The Massachusetts housing market may be facing a new challenge next year: higher mortgage rates that could hobble the fragile housing recovery now under way.

Morgan Stanley and Freddie Mac have issued warnings about rising mortgage interest rates, which are now hovering in the 5 percent range for 30-year fixed-rate loans.

Freddie Mac, the government-controlled mortgage giant, recently warned that rates could hit 6 percent in 2010, while a fixed-income economist at Morgan Stanley said rates could spike as high as 8 percent, thanks to heavy government borrowing that could drive up rates for Treasuries.

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Two bodies charged with reviewing U.K. law on Tuesday recommended changes to insurance law to reduce the responsibility of insurance buyers to volunteer information on risks to insurers.

The recommendations of the Law Commission, which reviews the laws of England and Wales, and the Scottish Law Commission were welcomed by the London-based Assn. of Insurance and Risk Managers.

Although the initial recommendations relate to consumer insurance contract law, a similar review of commercial insurance contract law is expected next year, AIRMIC said.

After three years of review and consultation, the Law Commission and the Scottish Law Commission recommended reforms to the more than 100-year old Marine Insurance Act, which was intended to govern shipping insurance contracts but has been applied to a wide variety of insurance contracts.

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Trying to prevent foreclosure while waiting for a permanent loan modification

Question: I have also made trial payments under the Making Home Affordable program. But my house truly was in foreclosure and I spoke with an attorney. Your advice in your column is wrong. They can foreclose, they will foreclose, and they are foreclosing on thousands of people who have made their trial payments every month!

There is nothing written into this program that provides any penalty for lenders if they do not modify a loan. They very clearly state that you are not actually approved for the program, and stipulate that the magical approval (or denial) will happen at some unspecified future time.

My story is not unique. I was able to stop foreclosure (only days before the trustee sale) temporarily by filing a complaint with my state attorney general. However, I still have not received a permanent modification and my lender continues to claim paperwork that I have provided is missing.

The bottom line is that paying trial payments in anticipation of a modification does not guarantee anything and foreclosure is the most likely outcome.

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Congress, under pressure to provide additional help for people who have lost their jobs and health benefits, passed legislation to extend federal subsidies to help people pay for their former employer’s health insurance. Lawmakers also agreed to extend the eligibility period to sign up for assistance.

As part of the stimulus bill passed in February, the federal government subsidized 65 percent of the cost for unemployed people who opted to continue their employer’s health insurance coverage. A person can pay to stay on his or her former employer’s group policy – generally for a maximum of 18 months – through the Consolidated Omnibus Budget Reconciliation Act, a federal law better known as Cobra.

But the assistance program was open only to people who lost their jobs through the end of this year, and the subsidy lasted only nine months, so starting Dec. 1 many people were faced with ending their insurance coverage or paying the full amount.

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The sector has enjoyed a big run, but select public REITs still offer opportunities

Don’t make the mistake of letting this year’s powerful rally by real estate investment trusts deter you from considering an allocation to real estate at this point in the cycle.

Shunning REITs right now, even after a 110% gain from the March low, means ignoring both the unfolding opportunities in commercial real estate and the growing use of real estate as a portfolio diversification tool.

Instead of pulling back, investors might even want to consider increasing their allocation to select REITs.

To put recent performance (a 24% gain year-to-date through Dec. 15) in perspective, it is important to remember that REITs, as measured by the FTSE Nareit U.S. Real Estate Index, declined by 37% last year and 18% in 2007.

Popular thinking among analysts is that the recovery has lifted the REIT market to a level of fair value, limiting the near-term upside.

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Taiwan may allow reverse mortgages to support the island’s aging population, Ministry of Interior Chief Secretary Weng Wen-te said, following similar plans in the U.S., Australia and Singapore.

One in 10 people in Taiwan were 65 and older in 2008, and that may rise to 14.7 percent in 10 years, according to a report by Taiwan’s Council for Economic Planning and Development. By 2056, they will make up 37.5 percent of the population, it added. The mortgages allow homeowners, usually retirees, to borrow money in the form of annual payments that are charged against the equity of the properties.

“Taiwan’s population is aging too quickly,” Weng said today in a phone interview in Taipei. “Some of them may not have any savings other than their property, so we are considering this policy.”

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COLLINSVILLE — Communities that fail to live up to strict, new floodplain management standards face financial penalties or possible loss of insurance eligibility, federal officials are telling community leaders.

Federal agency representatives flooded elected officials with information about insurance issues in a meeting Tuesday night, one of a series of gatherings taking place this week.

The Federal Emergency Management Agency and the National Flood Insurance Program reviewed flood insurance, with a special emphasis on communities that have never been required to purchase policies in the past.

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One in four borrowers is underwater on a mortgage in the U.S.

Count me among them.

My family’s modest, suburban New Jersey house is now worth about $30,000 less than our current balance. We never dreamed of walking away, but the idea of “strategically defaulting,” is something we had to at least consider. Many others have, too, as my colleague Mark Whitehouse reported in Thursday’s Journal (See American Dream 2: Default, Then Rent.)

We’re not home flippers or boom-era borrowers who opted for an exotic loan with no documentation. In buying our house, we believed we were making a life decision.

We started thinking about buying in 2004, when my wife and I found out that we were having a baby. We were thrilled. Shortly after that, we learned we were having multiple babies, we were equally thrilled–and terrified. We’re going to need a bigger place, we thought.

We probably could have held out a few years in our sizable apartment in Metuchen, N.J., a bedroom community about 35 miles outside of New York City. But we knew interest rates were hovering at historic lows. It was impossible, working at The Wall Street Journal, to not read those headlines every day. At the same time, people all around me were buying homes and refinancing their mortgages to capture these relatively inexpensive home loans. It was like a race, and everyone else was crossing the finish line while I was still putting on my sneakers.

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Time could be called on a 103-year-old insurance law which campaigners say has led to thousands of insurance claims being unfairly rejected each year.

Claims made on all types of insurance have been turned down by some insurance firms under the law, which puts a duty of disclosure on the policyholder.

Consumers are expected to tell an insurer about issues which might subsequently be important.

The Law Commission said the rules put too much pressure on the consumer.

Current rules

Consumers are not only expected to tell the insurer things they have been asked about, such as known medical conditions, but also things they have not been asked about and which could later turn out to be important.

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