Mighty Bargain Hunter

Would you out a friend’s spending patterns on Facebook?

A few weeks ago I received word of a Facebook application called Buddy Bailout.  It’s a spin on the giant corporate bailouts that have happened recently, and in part it plays on people’s thinking: “Why can’t I get a bailout, too?  I sure could use one.”

Maybe one of that person’s friends (a) knows that they could use one, too, and (b) wants to point out the main reason why they’re in the position of needing to be bailed out.

That’s where Buddy Bailout comes in.  How it works (currently):

• Choose a Facebook friend that needs to be bailed out (i.e. has a spending issue).
• Choose from one of more than two dozen common spending issues that best matches what the issue is.
• Post it to their wall, with a message saying something like “Mighty Bargain Hunter thinks YOU need a bailout!” and gives the specific reason why.

Bills.com, the designer of the application, uses this as an introduction to the website, which provides financial information and other services.  The direct, in-your-face communication style of the application reminds me of Larry Winget’s, which can be very effective and helpful at the time when it’s needed most.  Staring your problems square in the face, and accepting responsibility for them, is the first step towards working them out.

Buddy Bailout sends the message in a genuine, often lighthearted way, but the point of the message is still right there.  So for that, I applaud them. Getting people toward responsible spending habits is a fantastic endeavor.  But, as this application is now, I personally wouldn’t have the guts to use it, even if I knew it could do an incredible amount of good for the person on the other end.

These “bailout messages” are wall posts.  Users typically set permissions so that their friends can see their wall posts, so the “bailout message” would be visible not just to them, but to anyone who could view their wall.  The bailout posts are what people need to hear, but probably not what they want to hear even in private, let alone in the semi-public world of their Facebook wall.  For me, it would be a very risky move, with respect to relationships, to post a bailout message for somebody.  It could work out if that person’s friends support my observation, but the message could just as easily be ignored, or worse, attacked.  In any case, everyone knows now that I think my friend spends too much money at Starbucks, and that can’t be taken back.

I know some people aren’t bothered by confrontation, and even thrive on it.  I don’t like confrontation at all, so the thought of it affects how I behave in different circumstances.  Another thing that may come into play is the traditionally private realm of personal finance.  I’m sure open discussion of personal spending habits wouldn’t have happened in the past, but is it time now?

What do you think?  Would you broach the subject of a person’s spending patterns on Facebook?

(Note:  If you have a money question and want to ask it on your own terms, head over to Cash Commons.)

Posted in Budgeting, Personal Finance | 10 Comments »

Woe to the lender who guesses wrong

The standard Settlement Statement, the HUD-1, just got a makeover this December.  The extra page is an extra burden on lenders to get the Good Faith Estimate right the first time.

Last week at the closing for our new house, we got a small bonus courtesy of the new requirements.  The expenses are broken down into three categories based on how closely the actual charges have to agree with those on the Good Faith Estimate:

• Charges that cannot increase at all - the loan origination charge, the cost of points for the chosen interest rate, adjusted origination charges, and transfer taxes
• Charges that cannot increase by more than 10% - government recording charges, appraisal fees, cost of credit reports, cost of tax services, cost of flood certification, and cost of pest inspection
• Charges that are allowed to change – initial escrow deposit, daily interest charges, homeowner’s insurance, title services, lender’s title insurance, owner’s title insurance, and home buyer’s warranty

In our case, the lender underestimated our transfer taxes by $41.85, so we got that as a credit at closing.  What kind of sucked for the lender was that they overestimated the cost of the credit report by $26.67, and overestimated the cost of the appraisal by $50.00, but couldn’t use either of these to offset the underestimate of the transfer taxes.

The new page of the HUD-1 was the result of a November, 2008, rule change to the Real Estate Settlement Procedures Act (RESPA), and went into effect at the beginning of 2010.  Though the little bonus at closing was nice, these extra regulations just slow the whole process down and mean extra costs for everyone in the long run.  The background research to get the better estimates is an additional cost.  Filling out the third page is an additional cost all the way up the chain.  The loan still goes through, I still end up owing lots of money, and the lender still has my first-born in escrow the whole time — in essence, the same kind of lender-borrower relationship that existed before — but it’s not as efficient as it was before.

For the meantime, though, lenders now have to pay for some of their bad guesses.

Posted in Banking, Real Estate | 1 Comment »

Friday Fiscals: Late-night edition

Had to catch up a bit at work after running around Thursday to close on our new house.

So it’s Saturday morning Fiscals, but here are great links nonetheless

• A Gai Shan Life has an elaborate post on pets and preparedness.
• The Millionaire Nurse discusses life insurance needs.
• Sweating the Big Stuff talks about the best deal ever.
• The Frugal Lawyer tried out Credit Karma.
• Everybody Loves Your Money outlines someone’s big ol’ lost dream.
• Frugal Dad has 33 essentials for your bug-out bag.
• Frugal For Life is beating back the frugal fatigue.
• Money Crashers has 5 easy ways to make some extra cash.
• Mrs. Micah shows how to create a personal balance sheet.
• My Dollar Plan asks if you should use savings to pay off debt.

Special thanks to Wise Bread and The Simple Dollar for sending a whole boatload of traffic this week from the mentions in their roundups.  Also a shout-out to Get Rich Slowly for including my bank post in this week’s Carnival of Personal Finance.  Lastly, both this site and the Carnival of Debt Reduction site cracked a nice new compilation of financial resource links.

Enjoy the weekend!

Posted in Roundups | 3 Comments »

How to enlist Gmail to sell your Craigslist items for you

A friend from our previous church sent me an e-mail tonight. Because we’ve been buried in 1.2 miles of snow for the past few days, she had the opportunity to pile through some projects. She had just gotten to a pile of stuff she had been meaning to sell for quite some time, and e-mailed me to ask for help since I had offered before.

I explained how she could get an estimate of market value through eBay for the things she wanted to sell, then gave some suggestions on when to sell on eBay and when to sell on Craigslist.

Some kinds of items, especially big ones, can do better on Craigslist.  For those items, I told her how I would go about selling them there:

1. Prior to listing the item on Craigslist, I’d sign up for a Gmail account, or use one that I didn’t mind getting passed around the Internet via Craigslist.  Like MbhuntersCoolItems4Sale@gmail.com or something like that.
2. I’d write a fairly detailed description of what I was selling.
3. I’d take pictures of the item(s) and put them up on Flickr someplace that allowed me to post items for sale.  These would be linked to in my description.
4. I’d use the Vacation Responder feature in Gmail to deliver my description on demand.  To get there, go to the Settings link in the upper-right of the main Gmail screen, and go to (almost) the bottom of the General tab.
5. Then I’d put the ad up, which would be an attention-grabbing headline of some kind, plus the following:  “Send a blank e-mail to MbhuntersCoolItems4Sale@gmail.com for instant details, plus contact information.  Your e-mail address will be used only to send you this information (once) and will not be sold or rented.”

What are the advantages of doing it this way? There are several:

1. It screens out many who aren’t serious about buying the item. Providing an e-mail address is a barrier.  Not everyone will do it.  Serious buyers will.  These are the ones you want to hear from, not the tire-kickers.
2. You can answer common questions in the auto-reply. There’s a surprising amount of space available in the Vacation Responder.  If you answer questions there, they won’t call you up to ask them.  Saves time and screens out more would-be non-buyers.
3. You aren’t posting your phone number on Craigslist. You’re posting an e-mail address, but not your phone number.  Heck, you don’t even have to post your phone number in the autoresponder message:  Ask them to e-mail you with more questions.  More screening.
4. By the time people get on the phone with you, they should be pretty serious about buying the item.
5. Once the items are sold, you can delete any personal information you put in the autoresponder.  Or replace it with this message:  “Thanks for requesting information about this item, but it’s already been sold.  Have a nice day!”

Craigslist is free, but free comes at a price:  your time.  Following this kind of selling process will reduce the time you spend screening out people who aren’t really serious buyers.

Posted in Making Money | 11 Comments »