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Most of you reading this would answer the above question quickly and label your mortgage as a liability. After all, it is a debt, isn't it? But if there was more to it than that, or even if your mortgage could become one of your greatest assets. You may think I am crazy, but think about the concept for a while, then read on.

Traditional thinking places the mortgage clearly as a liability, a debt that should be paid off. Some even think that financial freedom cannot occur with a mortgage looming overhead, possibly because of the monthly payment required to maintain it. Money Merge Account and other mortgage acceleration advocates, especially the agents that sell these products, will encourage this thought process. In fact, they will entice you to join their clan even though their product only works as advertised if you use all of your discretionary income to pay off your mortgage as fast as possible, a belief that could actually do the opposite of what is intended, potentially sending you into foreclosure or bankruptcy, even both.

I am not going to give you the rundown as to why what I just mentioned is accurate, but you can click on MMA in the sidebar and review my posts on the subject and read where I have explained it before. I want you to focus more on the reality of the benefits derived from using your mortgage as a financial tool, an asset that can prove extremely helpful in obtaining financial freedom even faster than any mortgage acceleration program can accomplish.

Read more at Florida Mortgage Report

I have seen this repeatedly in marketing materials from United First Financial (UFirst Financial/UFF) and their agents, another example of the misleading material provided to sell their product, the Money Merge account (MMA). Throughout the history of this company, they have provided nothing but false and/or misleading statements into their advertisements, many of which I have already exposed here and in my previous ActiveRain blogging.

Now, let's look at another one, this time using a quote by one of the foremost figures of intelligence in history, Albert Einstein. The quote that they use is:

"Insanity means doing the same thing over and over again and expecting different result" (Albert Einstein(?) - It is believed that this quote was actually misattributed to Einstein and is actually a quote of Rita Mae Brown)

The truth is, by adding this quote to their advertising, they are even telling you that there product sucks in reality. While they will misuse the quote to bring justification to their product, by saying that carrying a mortgage is insane (in essence), reality is completely different. One could argue that the true insanity is believing that paying off your mortgage in the first place since that is what has been done over and over again and rarely brought wealth to those whom have done so.

In fact, now that boomers are hitting retirement, we can see the gruesome reality that many are failing to be in a position to retire since they had focused a lot on paying off their mortgages and pensions of old are no longer to be found, which is what our forefathers relied upon. So, the argument that paying off your mortgage, especially through mortgage acceleration programs is the really insane choice.

Now, since they are bringing Albert Einstein's quotes into their advertising, let's look at another applicable quote Mr. Einstein did as it explains why the Money Merge Account is still being sold, and the agents are making money selling a scam product...

“Only two things are infinite, the universe and human stupidity, and I’m not sure about the former.” (Albert Einstein)

If they doesn't explain it, the latter may certainly be applicable, sorry.

This can be a confusing time right now when it comes to determining whether to lock or float your mortgage rate to get the best deal. As I write this, there are many originators talking about both sides of the spectrum as to where mortgage rates are headed. While there is no real "crystal ball", there are many ways to forecast mortgage rates with a high degree of accuracy.

You have likely heard the phrase, a picture is worth a thousand words. Well, when it comes to investing, a picture is worth a thousand (or more) dollars, and that holds true to forecasting the direction of mortgage rates. Charts present a picture of prices over a given time from one day to many years. Add other indicators, such as stochastics, fibonnacci numbers, and moving averages, and, with practice, you can get a very clear "snapshot" of what lies ahead. The fact is that you can even predict what some economic reports outcome will be simply looking at a securities chart.

Now, why do I talk about charting as it applies to investing in a security, whether a stock, mutual fund, index, or even a commodity or currency? Quite simply, mortgage rates are based on mortgage backed securities (MBS), mortgage bonds if you will. Once you know what securities to watch and chart, you can learn the skills it takes to accurately forecast the direction of mortgage rates, which I am nearing completion of a book on how to do just that.

No one can be 100% accurate in this game, however. That is because at any given moment, news or some other event can swing the market sentiment and break through the barriers presented by charts. That is how many trend reversals take place, and one thing we cannot gaurantee at this exact moment, is the level of participation the Fed is playing in the markets. We can only find out each Thursday, when they announce how much they bought that week, and that throws some uncertainty into the mix.

Now, some of you already know I operate a blog called Florida Mortgage Daily which posts daily mortgage market updates, sometimes several times per day, and even shows my current locking stance. It can be very technical for those that are interested or you can simply get my curent locking stance or scroll down and get the summary of what I expect. Another place you can read what I feel the markets are doing is over at Lenderama, where I do a weekly mortgage market update. In that post, I recap the prior week's events and market reactions and forecast what lies ahead for the coming week, not to mention list most, if not all, of the major economic events that could affect mortgage rates that week.

I know there are several real estate agents that are using this information to pass on to their clients. There are even a fair number of mortgage professionals doing the same thing. The material is copyrighted, so you must have permission from em should you want to use it, by I am fairly open with whomever cares to do so, just let me know ahead of time. I will be starting up a new service very soon, so keep your eyes open for that as it will be like no other you have seen so far and will be 100% borrower focused.

Apparently, the IRS isn't always the "bad guy", and you may want to take their advice if you owe taxes right now. The IRS Commissioner, Doug Shulman, encouraged taxpayers to take advantage of several new tax credits and deductions this filing season along with announcing a major enhancement to the Free File program that will allow nearly all taxpayers to e-file for free and and get their refunds faster.

“With so many people facing financial difficulties, we want taxpayers to get all the tax credits they’re entitled to as quickly as they can,” Shulman said. “In addition, we are creating new protections to help people trying to meet their tax obligations. The IRS will do everything it can to help during these tough times.”

“We need to ensure that we balance our responsibility to enforce the law with the economic realities facing many American citizens today,” Shulman said. “We want to go the extra mile to help taxpayers, especially those who’ve done the right thing in the past and are facing unusual hardships.”

That's sounds like a far cry from what most people have pictured the IRS to be like. I, for one, am glad to see the IRS taking the intitiative to help those whom have fallen behind, though they also walk a fine line between doing what is right and creating moral hazard, a subject the Fed and Tresaury have brought to light with their disregard for it.

Among the areas where the IRS can provide assistance:

• Postponement of Collection Actions: IRS employees will have greater authority to suspend collection actions in certain hardship cases where taxpayers are unable to pay. This includes instances when the taxpayer has recently lost a job, is relying solely on Social Security or welfare income or is facing devastating illness or significant medical bills. If an individual has recently encountered this type of financial problem, IRS assistors may be able to suspend collection without documentation to minimize burden on the taxpayer.
  
• Added Flexibility for Missed Payments: The IRS is allowing more flexibility for previously compliant individuals in existing Installment Agreements who have difficulty making payments because of a job loss or other financial hardship. The IRS may allow a skipped payment or a reduced monthly payment amount without automatically suspending the Installment Agreement. Taxpayers in a difficult financial situation should contact the IRS.
  
• Additional Review for Offers in Compromise on Home Values: An Offer in Compromise (OIC), an agreement between a taxpayer and the IRS that settles the taxpayer’s tax debt for less than the full amount owed, may be a viable option for taxpayers experiencing economic difficulties. However, the equity taxpayers have in real property can be a barrier to an OIC being accepted. With the uncertainty in the housing market, the IRS recognizes that the real-estate valuations used to assess ability to pay may not be accurate. So in instances where the accuracy of local real-estate valuations is in question or other unusual hardships exist, the IRS is creating a new second review of the information to determine if accepting an offer is appropriate.
  
• Prevention of Offer in Compromise Defaults: Taxpayers who are unable to meet the periodic payment terms of an accepted OIC will be able to contact the IRS office handling the offer for available options to help them avoid default.
  
• Expedited Levy Releases: The IRS will speed the delivery of levy releases by easing requirements on taxpayers who request expedited levy releases for hardship reasons. Taxpayers seeking expedited releases for levies to an employer or bank should contact the IRS number shown on the notice of levy to discuss available options. When calling, taxpayers requesting a levy release due to hardship should be prepared to provide the IRS with the fax number of the bank or employer processing the levy.

So, those of you in dire straits may have some options. Keep in mind that if you had been foreclosed upon, or even sold your property in a short sale, there may be a huge tax burden awaiting you. Typically, as in the past (waived for 2007), the difference in what youe owed and what the home transferred for was considered imputed income and taxable as income. I may have overlooked it (or simply forgot), but I have not seen where the IRS has waived that type of taxable income for 2008. Visit www.irs.gov for more information.

Update: I did some more research and I apparently missed this somewhere. Eligible homeowners can exclude debt forgiven on their principal residence if the balance of the loan was less than $2 million. The limit is $1 million for a married person filing a separate return. Not sure about short sales, but I imagine they fall under this ruling.

Lately, my posts have become more about the warnings of government actions and their longer term effects on mortgage rates. Ultimately, I have been talking about increased inflation, the mortgage rate bubble, and mortgage rates breaking into double digits, all of which could very well happen in the not-so-distant future as a result of Paulson and Bernanke's actions, along with continued "economic stimulus" packages.

Many have questioned why I am talking about rampant inflation when the chief concern right now is deflation? I have eluded to the answers in my posts, however I have not been able to come up with a great analogy. Well, as much as I would like to say I came up with this one, I didn't and actually found it in a place most of you have not even heard of, the Taipan Publishing Group.

Yes, the best analogy I have seen to date was presented by Justice Little, where he used rabbits running around a tree to describe monetary velocity, which is quite stagnant right now and the reason the Treasury and Fed are printing money left and right. here is how he describes it...

To read more, head on over to Florida Mortgage Report...