How Businesses Can Give Back

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It’s always important for me to give back to my community I serve as a business leader.  However, losing sight of that goal is surprisingly easy.  Not every business can afford to incorporate social “good” into their model, yet there are still ways you can use your business to give back.  I recently read an article that interviewed members of the Young Entrepreneurs Council, an invitation-only organization made up of promising young entrepreneurs, to ask their opinion on the matter.  Of course, some of these are more specific to startups, but nonetheless offer some interesting insights:

Lead by example: If you want your employees to give back to the community, then get involved yourself.  Share your stories, and if you’re going to an event, encourage your team to join you.  Likewise, make a point to support coworkers at their own events.  

Give back at what you’re good at: Have people give back with something that they can do well; for example, as a basketball enthusiast, I volunteer on a local kid’s basketball team.

Sponsor a local charity event: Get your entire company involved with supporting a local charity event.  This is a good way to generate value for the charity organizations, but also to get your own business some positive exposure.

Make social good a part of company culture: Companies can find great ways to make social good a part of their culture.  For example, giving them a day off once a month to volunteer for an organization of their choice, or maybe creating partnerships with local nonprofits.

Give bonuses to charities: By offering employees a bonus to give to the charity of their choice, employees are given a chance to creatively give back for the social good.

Align interests: The company ContextMedia supports initiatives to give back, and encourages their team members to share their personal causes, supporting through attendance and tickets.  Choose areas that align with what you do and support an organization.  

Provide incentives: If you provide incentives, then people will be more likely to give back.  The article talks about one hedge fund that selects a new charity to support every quarter, and every employee who donated $15 or more gets to enjoy business casual for the quarter.

Go pro bono: Nonprofits are always in need of talent, although they can’t always afford it.  If for-profit employees are looking for a way to give back, then working pro bono is a great way.

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What You Need to Know About FHA Loans

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For those who aren’t familiar, an FHA loan is a mortgage insured by the Federal Housing Administration. Borrowers with FHA loans pay for mortgage insurance, which protects the lender from a loss if the borrower defaults. Since they lending standards surrounding them aren’t as rigorous, and the down-payment requirements are lower, FHA loans are popular with borrowers. However, there are things that borrowers need to know before they dive into an FHA. Here are some facts, taken from an article I recently read on bankrate.com:

You don’t need perfect credit: The minimum credit scores for FHA loans depend on the type of loan. As a general rule of thumb, people with credit scores under 500 are ineligible. However, the FHA will make exceptions for certain cases if they think the applicant meets certain requirements.

Minimum down payment is 3.5 percent: For most borrowers, the FHA requires a down payment of just 3.5 percent of the purchase price, which is what makes them so attractive in the first place. While Fannie Mae and Freddie Mac reduced minimum down payments to 3 percent back in 2014, these have limited availability.

Closing costs may be covered: The FHA lets home sellers, builders and lenders pay some of the borrower’s closing costs as an incentive to get the buyer to get a new home. If lenders agree to pay closing costs, they’ll typically charge a higher interest rate on the loan.

Lenders need to be FHA-approved: The FHA is only an insurer, so borrowers need to get their loan through an FHA-approved lender. These lenders offer varying interest rates and costs, so you’ll want to shop around.

Two-part mortgage insurance is required: Two mortgage insurance premiums are required on all FHA loans: the upfront premium (1.75 percent of the loan amount), which is paid when the borrower gets the loan, and then the annual premium, which is paid monthly and varies based on the length of the loan.

You can borrow cash for repairs: The FHA has a special loan product for borrowers that require extra cash to make repairs called a 203k. The loan amount isn’t based on the current appraised value of the home, but rather on the projected value after repairs are completed.

Financial hardship relief allowed: FHA insurance isn’t meant to be a get-out-of-jail-free card for borrowers that are unhappy about their mortgage payments. However, loan servicers can offer some relief to borrowers with an FHA-insured loan that are having trouble meeting payments by offering temporary periods of forbearance or modifying the loan.

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