Dealing With The Deed-in-Lieu Of

Recently, Bank of America sent out nearly 100,000 solicitations to distressed homeowners offering them a chance at a deed-in-lieu transaction. “Deed-in-lieu” refers to giving the deed to your home to a lender in order to circumvent the foreclosure process. You get to walk away from your home, and the lender declares the debt resolved because you returned the home, your collateral. Many lenders have announced that they will offer a variety of incentives for this type of transaction because it saves them a great deal of time and money in processing costs even though they may take a hit when they try to resell the home in today’s market.

Long Term Investing With Warren Buffett

Buffett warns against overvaluing shot-term profits as they tend to be predictable. He advises looking into businesses where you know predictability. For example, Wrigley’s Gum has been around for years. The company’s predictability comes clear: no matter what happens, people will always chew gum. Any given person’s personal preference to chew gum is unaffected by external circumstances. Therefore, there are no sharp spikes in returns, and they profitability remains consistent. As Buffett puts it, “Predictable products = predictable profits.”